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Public Expenditure Tracking in Uganda (and elsewhere)

Public Expenditure Tracking in Uganda (and elsewhere). Budget Management and Financial Accountability Washington, DC March 2004 Magnus Lindelow (mlindelow@worldbank.org) The World Bank. The Ugandan experience. Many improvements since 1992 macroeconomic stability and growth

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Public Expenditure Tracking in Uganda (and elsewhere)

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  1. Public Expenditure Tracking in Uganda (and elsewhere) Budget Management and Financial Accountability Washington, DC March 2004 Magnus Lindelow (mlindelow@worldbank.org) The World Bank

  2. The Ugandan experience • Many improvements since 1992 • macroeconomic stability and growth • shift of public resources from defense to roads and social sectors • decentralization • Poverty Eradication Action Plan (PEAP) • Poverty reduced from 56% in 1992/93 to 35 % in 2000 • Strong budget management • MTEF, Poverty Action Fund (PAF) • Sector level performance did not keep up

  3. Uganda Education PETS (1995) • Data collected from different levels of administration, including 250 schools • Only 13 percent of intended capitation grant actually reached schools (1991-95). • Large schools with wealthier parents and qualified teachers were able to obtain more of their budget allocation. • Other findings • Enrollment trends differed from published data. • Importance of parental contributions.

  4. Impact and follow-up • Mass information campaign by Ministry of Finance (the press, posters) • A signal to local governments • Lower the cost of information to parents • Follow-up PETS in education in 2001 • Ministry of Education initiative and local implementation • shows a major improvement (18% leakage) • Broadening agenda: other sectors and broader focus (service delivery, integrity, etc.)

  5. Why new tools to analyze public spending and service delivery? • Uganda survey stimulated similar surveys in other countries • Limited impact of public spending and external aid on growth and human development (WDR 2004) • Inappropriate allocation of resources • Resources do not reach service delivery units • Poor quality of service delivery • Services are not used by the population • New approaches to aid delivery (budget support, PRSCs, etc) • fiduciary and accountability concerns • Lack of reliable data in many developing countries

  6. PETS and Service Delivery Surveys • Diagnostic tool for understanding problems in budget execution • Data collected from different levels of government, including service delivery units • Reliance on record reviews, but also interviews • Variation in design depending on perceived problems, country, and sector • Growing focus on service delivery and use of “hybrid” survey approaches

  7. But tracking is often difficult… • Data availability • E.g. tracking not possible in health sector in Uganda 1995 • Data quality • Reliance on records, but books may be “cooked” • Multiple flows and different levels of execution • Schools and health facilities receive many resources in-kind • Undefined or changing allocations/norms • Often much discretion over resource allocation in budget process • Different focus in some surveys • Timing of transfers, bottlenecks in budget execution, the use of discretion in resource allocation, etc.

  8. An illustration from Mozambique • Context and issues • National Health System: health sector dominated by public providers • Providers receive budgets and in-kind transfers • Vague allocation criteria and guidelines • Fragmented and unreliable reporting • Diagnostic survey • 90 health facilities, 35 districts offices • Record reviews and staff interviews • Exit poll to capture user perceptions Central Resource allocation Vague guidelines Province ? ? District ? ? Facility

  9. Delays and bottlenecks • Delays in budget transfers to districts • Budget norm: January • Delays => low levels of budget execution (32%) and service delivery problems • Other systems weaknesses • Up to 90 day delays for re-stocking of drugs • Stock-out of drugs or material in 60% of facilities

  10. Equity in resource allocation Number of tablets distributed to facilities per outpatient • Push-based system of drug distribution • Based on outpatient numbers • In practice, very different… • Also “irrational” or inequitable allocation of other resources

  11. Strengths and weaknesses of approach • Useful tool for diagnosing and understanding problems in budget execution and service delivery, and monitoring changes over time • Validation of administrative data (financial and output) • Process of designing and implementing survey is useful for understanding PEM and service delivery system • But… • surveys only provide part of the answer (intra-sectoral allocations, link with outcomes, etc.) • Surveys should supplement rather than supplant routine information, control, and integrity systems • Surveys are not audits • Surveys provide information but don’t necessarily result in change

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