240 Structure and functions of Reserve Bank of Zimbabwe (1) An Act of Parliament must provide for the structure and organisation of the Reserve Bank of Zimbabwe 3 Parliament must provide for the functions of the Reserve Bank of Zimbabwe, in particular the following– (a) the regulation of the monetary system; (b) the formulation and execution of monetary policy; and (c) any other function that is customarily exercised by a central bank; and may confer or impose additional functions on the Reserve Bank, including the registration and supervision of financial institutions. (3) In the exercise of its functions, the Reserve Bank of Zimbabwe is not subject to the direction or control of anyone, except as otherwise provided in an Act of Parliament, and must exercise its functions independently and without fear, favour or prejudice. CHAPTER XVI LOCAL GOVERNMENT PART I PRELIMINARY 241 Tiers of government The tiers of government in Zimbabwe are– (a) the national Government; (b) provincial councils to represent people in the provinces into which Zimbabwe is divided; and (c) local authorities, that is to say– (i) councils, by whatever name called, to represent and manage the affairs of people in urban areas; and (ii) councils, by whatever name called, to represent and manage the affairs of people in rural areas within the districts into which the provinces are divided. 242 Principles of local government The following principles apply to the local government system of Zimbabwe– (a) local authorities must be democratically elected; (b) provincial councils and local authorities must be given as much autonomy as is compatible with good governance; (c) functions and responsibilities must be decentralised and transferred from the central Government to provincial councils and local authorities in a co-ordinated manner; (d) decentralisation must be a principle applying to all levels of local government so that there is participation by the people and democratic control in decision-making; (e) each provincial council and local authority should have a sound financial base with reliable sources of revenue; - 87 -