Insight: Peru provinces sit on cash from mines; discontent growsPeru's provincial governments are sitting on billions of dollars in mining tax revenue earmarked for new roads, schools and water projects - an institutional failure contributing to anti-mining protests nationwide.
Regional and local governments had 9.5 billion soles ($3.5 billion) from natural resources taxes collected over the last decade lying dormant in bank accounts as of December, according to a Reuters analysis of finance ministry data. The swollen coffers represent a fortune in poor provinces where the poverty rate is around 60 percent despite Peru's decade-long boom fueled by minerals exports to a rising China.
Most of the receipts come from mining, though a fraction come from energy or commercial fishing companies.
The central government blames a lack of administrative capacity in the provinces - a polite way of saying incompetence - for the spending shortfalls that contribute to a cauldron of discontent in the hinterlands and feed anti-mining sentiment continues here
This is a good note from Reuters which explains a little about how a substantial percentage of the mining royalty revenues received by local governments in Peru is either spent on silly projects or not spent at all. Here's how it starts: