Public Expenditure Management Research Articles

Good Governance and Regulatory Reform, Need Public Participation in all Development Stages in Albania

This article sets out to examine World Bank's efforts at strengthening good in Albania case study, in developing countries and improving effectiveness of aid. It focuses on relationship between good and aid effectiveness in providing a critical assessment of Bank's approach to reform in developing countries. This paper scrutinizes shifts in policies and strategies of Bank during 1990s as well as research it generated to support them. The wide array of issues under governance occupies center stage in debate and agenda of international financial institutions (IFIs). The concept of captures the manner in which power is exercised in management of a country's economic and social resources for development (World Bank 1992, 1). Dervish Kaptur and Richard Webb attest: For IFIs, new mandate is a boost to their importance, but one fraught with peril. The new mission arrived at a moment when growing doubts regarding purpose and effectiveness of IFIs. On matters of public administration, Government's strategy focused on addressing two inter-related sets of interventions: (a) strengthening public financial management, including management of both public expenditures and revenues; and (b) strengthening human resource management. On matters relating to public sector human resource management, reform strategy envisaged addressing this issue in two major stages: civil service reform and broader public sector human resource management reform. During first stage, reforms aimed to create managerial and professional nucleus required to lead any serious efforts to improve accountability and performance of public institutions. Subsequently, in a second stage, reform would address larger body of public employees to improve productivity and accountability for their work and ensure that public policies, programs and services are delivered reliably and cost-effectively. DOI: 10.5901/ajis.2014.v3n3p117

Does public expenditure management matter for education outcomes?

This paper examines the significance of public expenditure management for primary education outcomes in public schools in two South African provinces (Gauteng and North West). Using cross-sectional data from 175 public primary schools and 13 local education offices, the analysis finds that while misappropriation of education funds (leakages) is not strongly associated with poor education outcomes, delays on the part of the government in disbursing funds to schools are correlated with Grade 5 dropout rates. The paper finds no evidence that public expenditure and total resource wealth (including public and private contributions) are significantly associated with education outcomes. Increased spending on learning and teaching support materials is associated strongly with lower Grade 1 and Grade 7 repetition rates. The paper also finds that repetition rates are driven strongly by poverty indicators at the district level, while dropout rates are driven strongly by district and school inefficiency.

The Global Financial Crisis And India’s Policy Development For Public Expenditure Management

The global financial crisis started in the USA and then gradually affected the entire world with a major effect on the Euro zone economies. The Asian economies also came under the influence of the global financial crisis. The Indian economy, considered the fastest growing economy of the world was not severely affected by the global financial crisis. The Government of India and various State governments came up with austerity measures in order to manage and curb public expenditure. A new policy initiative and push was witnessed in India with regard to the public expenditure management. But the policy initiatives for public expenditure management would be successful only when these are properly and effectively managed and implemented by the government organizations. In this paper, ten questions/ areas contributing towards public expenditure management are identified. Than the responses of the Financial Advisors & Chief Accounting Officers (FA&CAO) of different organizations of Government of India and nine State governments are collected. The responses of FA&CAO are than analyzed and concluded. It is found that the various orders and circulars of the Government advocated for measures which would bring efficiency and prudence in public expenditure management. But the ground reality of their implementation is still far behind than designed and anticipated.Â

English

  This study examined whether the Eastern Cape province’s district municipalities are on course to achieve local and regional goals of improving agricultural production and reducing poverty. Results show significant strides towards locally set targets and high uncertainty in meeting the regional targets. Out of seven district municipalities, five municipalities are still about 5% points below the designated 10% of the annual budget to agriculture, and only three district municipalities scored more that the set 6% agricultural growth rate. All the seven district municipalities are not in a position to meet the target of 7% economic growth rate. Econometric simulations using the Hodrick-Prescott filter on data dating from 1995 to 2010 shows that all the seven district municipalities are off-track the set millennium development Goal 1 target with one even retrogressing from that goal. Failure to significantly reduce poverty is largely attributed to the province’s failure to boost agricultural production which is an outcome of low and inefficient public expenditure management, inconsistent and misaligned policies. Regional policies should be built on local policies to bring in the desired impact on local development. This study made a strong case for frequent independent evaluation of set goals.   Key words: Agricultural productivity, growth, poverty. &nbsp

English

The article examines Obasanjo’s public expenditure management reforms in Nigeria from 1999 to 2007. Anecdotal evidence indicated that public expenditure management (PEM) projects of the various regimes in Nigeria had been at best non-facilitator in fostering Nigeria’s Development. However, an evaluation of PEM during Obasanjo’s regime from 1999 to 2007, offers a heuristic insight into the political doldrums that not only undermine Nigeria’s development initia but also deconstruct Nigeria’s economic and political quantum. The implications of the study were explored in relation to due process in PEM and forensic accounting management in a third world country, Nigeria.   Key words: Budgeting, public expenditure management, reforms, development.

Medium Term Expenditure and Fiscal Management in Nigeria: A Review of the (2005-2008) Framework

The Medium Term Expenditure Framework (MTEF) provides the link between policy priorities and the budget. Given that in developing countries in general, and in Nigeria in particular, there is a disconnection between planning, policy and the budget, the MTEF has increasingly been regarded as central to public expenditure reforms. The objectives of this paper are to review the MTEF and budget performance in Nigeria for the period 2005-2008, and identify the challenges undermining the effective operation of the budgetary processes. The paper gathered that the MTEF is the bridge between the national development plan, its underlying policies and the annual budget. Analysis of available data on budget performance during the review period shows that public finance in Nigeria have not been operated within the specifications of the MTEF and the budget, and the priorities expressed in the budget are not always in sync with national objective plans. Some of the identified challenges to effective public expenditure management in Nigeria include lack of citizen’s participation in the process, the bureaucratic and inefficient nature of the civil service, large scale corruption, lack of proper coordination between the national development plan and budget, lack of adequate reforms in other key budget areas, such as execution, monitoring and reporting, lack of political commitment, and lack of adequate coordination between the national and sub-national governments.

Innovations in Public Expenditure Management: Country Cases from the CommonwealthEdited byAndrewGraham. London, U.K.: Commonwealth Secretariat and Institute of Public Administration of Canada, 2011. Pp. vii, 108.

Innovations in Public Expenditure Management: Country Cases from the Commonwealth<i>Edited by</i>AndrewGraham. London, U.K.: Commonwealth Secretariat and Institute of Public Administration of Canada, 2011. <i>Pp</i>. vii, 108.

An index to quantify street cleanliness: The case of Granada (Spain)

Urban surfaces receive waste deposits from natural and human sources, which create a negative visual impact and are identified as potentially significant contributors to water and air pollution. Local councils are usually responsible for the sweep of roads and footpaths to keep the environment clean and free of litter. Quality controls are useful in order to check whether the services are being executed according to the quantity, quality and performance standards that are provided. In this sense, several factors might affect the efficiency of the management of cleaning and waste collection services; however, only a few contributions are available in the literature on the various aspects associated with the level of street cleanliness. In this paper, the suitability of a Cleanliness Index has been checked, for the case of Granada (South of Spain), in order to contribute to the proper management of public expenditure, improving the quality and cost of an essential service for any municipality. Results have concluded that the city exhibits a good level of cleanliness, although the standard of cleaning varied from one area of the city to another. The Cleaning Index fits well to the general situation of the different districts of Granada and thus, it could be considered a useful tool for measuring the level of cleanliness of the streets of the city and for evaluating the organization of the cleaning service, such that an outsourced company would not be responsible for controlling all the cleaning services.

Back under the Microscope: Insights from Evidence on Budget Support

This article analyses evidence for each of the expected benefits of budget support in turn, and finds the biggest improvements in the pro‐poor nature of public expenditure and public financial management. More modest improvements are noted in the predictability of aid and the burden of transaction costs, while less is known about the real effects on domestic accountability. Underlying them all is an assessment that programmes are incapable of ‘buying’ reforms. Drawing on the analysis, seven areas are highlighted where budget support design can be strengthened vis‐à‐vis its original rationale.

Book Review: Innovations in Public Expenditure Management: Country Cases from the Commonwealth, by A. Graham

Book Review: <i>Innovations in Public Expenditure Management: Country Cases from the Commonwealth</i>, by A. Graham

Three Decades of Public Expenditure Management in Zimbabwe

Sound public expenditure management forms the bedrock of public administration. It facilitates producence, efficiency, transparency and accountability in expenditure processes at various levels of government. This serves as a long term barricade aginst debt trap. This article responds to these fundamental concerns by examining the nature, processes and challenges of public expenditure management in Zimbabwe. Reviews of expenditure management systems in Zimbabwe show general consistence with those in Anglophone Africa. Ministries of finance, working closely with spending ministries, Accounting Officers, Public Accounts Committees of Parliament, Auditor Generals and internal auditors-constitute key players in the public expenditure management process. Notwithstanding this, overall expenditure over the decades remained sticky downwards due to inflationary pressures, unbudgeted expenditures and weak expenditure management systems. Robust mesaures should be put in place to institutionalise a culture of compliance with extant expenditure management frameworks at both the macro and micro levels of government.

The Reform of Public Expenditure Management Systems in OECD Countries

Blőndal examines the key institutional features in the reform of public expenditure management systems in OECD countries. He notes that the countries which are experiencing the best fiscal outcomes are generally those that have more successfully modernized their budget processes. The paper identifies the most relevant aspects for the control of public expenditure: the use of medium-term frameworks, prudent economic assumptions and top-down budgeting techniques; the relaxation of central input controls; the focus on results; the emphasis on budgetary transparency and the introduction of modern financial management practices concerning, inter alia, accruals, capital charges, carry-overs of unused appropriations and interest-bearing accounts. The paper examines the benefits and the problematic aspects of each of these factors and stresses that they must be taken as a package.

Philippine Public Environmental Expenditure Review at National and Local Levels

This study is a component of the Philippine Poverty Environment Initiative (PPEI), a project that links environmental management to poverty alleviation. The PPEI supports the target of both the United Nations Development Program (UNDP) and the United Nations Environment Program to integrate pro-poor climate and environmental concerns into development planning and economic-decision making. In pursuing such target, this study sought to analyze the allocation and management of public expenditures in the Philippines to provide key guidance to strategic planning and budget preparation and to identify ways in which to improve the efficiency and effectiveness of resource allocations. The study seeks to review the public environmental expenditures at national and local levels and analyze how they contribute to environmental and poverty outcomes. It also aims to explore the manner by which the level of environmental expenditure data could be incorporated in the Medium Term Expenditure Framework (MTDF).

Non-profit organisations and government’s pro-poor spending: the case of health and development in Gauteng

Globally, there is growing recognition of participatory public expenditure management (PPEM). PPEM is seen as the process whereby citizens and civil society organisations participate in the management of public expenditures. The adoption of PPEM is aimed at ensuring greater transparency, better targeting and tracking of resources, and increased overall responsiveness. The Gauteng Department of Health and Social Development (GDHSD) is committed to co-operative governance; this includes working with different spheres of government and civil society or non-profit organisations (NPOs).NPOs are required to have a governing committee to manage funds allocated by GDHSD. The committee has the capacity to hold the NPO management accountable for the resources (financial and material) entrusted to it by the GDHSD. The effectiveness of NPOs is challenged by poor attendance of board members at meetings, poor understanding of the board’s mandate and responsibilities and lack of experience amongst members.The paradigm of PPEM is still faced with challenges to ensure that significant flows of revenue are accounted for and used effectively for growth and poverty reduction. This study is divided into three components. The first section focuses on the background, the introduction and the conceptual framework. The second part focuses on the empirical study for deriving a benchmark for the South African NPO sector. The third section highlights good practices as well as governance-related challenges. Finally, for further consideration by the GDHSD, a series of recommendations is provided, focusing on how key domestic stakeholders can better contribute to successful participatory budgeting programmes.Keywords: Participatory public expenditure management, non-profit organisations, pro-poor spending, public finance, public financial management, early childhood development. Disciplines: Public Management and Administration, Public Financial Management

"More money for health - more health for the money": a human resources for health perspective.

BackgroundAt the MDG Summit in September 2010, the UN Secretary-General launched the Global Strategy for Women's and Children's Health. Central within the Global Strategy are the ambitions of "more money for health" and "more health for the money". These aim to leverage more resources for health financing whilst simultaneously generating more results from existing resources - core tenets of public expenditure management and governance. This paper considers these ambitions from a human resources for health (HRH) perspective.MethodsUsing data from the UK Department for International Development (DFID) we set out to quantify and qualify the British government's contributions on HRH in developing countries and to establish a baseline.. To determine whether activities and financing could be included in the categorisation of 'HRH strengthening' we adopted the Agenda for Global Action on HRH and a WHO approach to the 'working lifespan' of health workers as our guiding frameworks. To establish a baseline we reviewed available data on Official Development Assistance (ODA) and country reports, undertook a new survey of HRH programming and sought information from multilateral partners.ResultsIn financial year 2008/9 DFID spent £901 million on direct 'aid to health'. Due to the nature of the Creditor Reporting System (CRS) of the Organisation for Economic Co-operation and Development (OECD) it is not feasible to directly report on HRH spending. We therefore employed a process of imputed percentages supported by detailed assessment in twelve countries. This followed the model adopted by the G8 to estimate ODA on maternal, newborn and child health. Using the G8's model, and cognisant of its limitations, we concluded that UK 'aid to health' on HRH strengthening is approximately 25%.ConclusionsIn quantifying DFID's disbursements on HRH we encountered the constraints of the current CRS framework. This limits standardised measurement of ODA on HRH. This is a governance issue that will benefit from further analysis within more comprehensive programmes of workforce science, surveillance and strategic intelligence. The Commission on Information and Accountability for Women's and Children's Health may present an opportunity to partially address the limitations in reporting on ODA for HRH and present solutions to establish a global baseline.

M&amp;E and Budget Program Performance Measurement in Ukraine: Current State and Needs for Improvement

The key elements of a performance-based budgeting methodology have already become a part of the mechanism for public expenditure management in Ukraine. At the same time, there still remains the issue of linking budget expenditures to specific results achieved by specific budget programs which defines the necessity of applying modern approaches to carrying out M&E. This study presents an analysis of the current state of M&E in Ukrainian public expenditure program management and offers some solutions which could improve its functioning. The analysis has revealed the absence of rigorous selection of performance indicators to evaluate budget program implementation, a need to better institutionalize the monitoring and evaluation activities through functional differentiation of budget programs and changes in approaches to their assessment.

The Next Generation of Poverty Reduction Strategy Papers in Africa: What is the Role for Capacity Buiding?

AbstractIn the late 1990s and at the early path of this century, most African economies embraced poverty reduction strategy papers (PRSPs) as a policy prescription out of the poverty abyss into which their economies had sunk since the early 1970s. The results from the first generation of PRSP processes have been encouraging and have acted as a stimulus for the second generation PRSPs. However, capacity constraints have tended to create difficulties for many of these countries, slowdown the pace of implementation of the PRSP, as well as undermine the achievement of objectives. This study, focusing on a sample of countries in Africa, attempts to identify and characterise the nature of capacity building constraints in the formulation and implementation of PRSPs and suggests capacity building efforts for dealing with these constraints. Four major areas of capacity constraints were identified: capacity for poverty and social impact analysis, monitoring and evaluation, absorptive capacity, public expenditure management, and constraints on prioritisation. Given funding constraints, the paper concludes by prioritising areas of capacity building interventions by capacity building institutions and donors in a bid to strengthen capacity building in Africa.

Public Expenditure Management Reform in India via Intergovernmental Transfers

This paper explores the possibility of using the channel of intergovernmental transfers for Public Expenditure Management reform in India. It seeks to introduce a quantifiable measure of expenditure quality which would influence intergovernmental transfers. The central message of this study is that a Quality Control Fund should be created by the Finance Commission. Inter-se distribution from this would be in the nature of a reward to the states for their performance in the context of expenditure quality. The funds received from this incentive fund could be tied to spending on education and health. It would be a major change of approach if the Finance Commission mandated the States to set out some realistic output targets which could be monitored (would be reviewed by the next Finance Commission). This would be a big stride toward results-based output-oriented transfers and could herald a sea change in the very approach of budgeting and intergovernmental relations in India!

Challenges and Trajectories of Fiscal Policy and PFM Reform in CEE/CIS

The purpose of this study is to provide an overview of fiscal policies and PFM reforms in 7 countries in the Western Balkans and 12 countries in the CIS, including major macroeconomic and poverty trends, fiscal policy, the size and role of the public sector, public expenditure management and its linkage to policy development, the organization of budget processes on the central and local levels, the role of various actors and tools in PFM, including civil society and the international donor community. The period of 2003-2007 was characterized by an extraordinary high rate of economic growth, both worldwide and in the CEE/CIS region. This created macroeconomic room for meeting numerous development challenges: reducing poverty and inequality, improving the quality and coverage of public services, upgrading infrastructure, and advancing various reforms, including those related to PFM. However, the economic situation deteriorated dramatically in 2008 as a result of the global financial crisis, with deep recession hitting most of the countries in 2009 and bleak perspectives for subsequent years.It remains to be seen whether the crisis situation will force governments to speed up necessary reforms. In the PFM area major tasks concern lengthening fiscal planning horizon and gradual movement toward performance oriented budgeting (the measure which can allow better expenditure targeting and decrease volatility in expenditure allocation), increasing budget transparency and creating real room for civil society involvement into a budget process. However, the reforms must also involve a broadly defined governance sphere, i.e. improving transparency and accountability of government, modernization of civil service, decentralization, including building a genuine system of local and regional self-government, and other similar measures to improve quality of public services and social policy interventions.

Fiscal Transparency and Accountability in Governance: The Role of Local Government Audit

Local governance is all about service delivery at the grass roots. Achieving service delivery at that level requires an effective internal audit to establish integrity in the management of public expenditure. Once integrity is achieved fiscal transparency ushers in fiscal accountability. The objective of this study is to examine the extent to which local government internal audit achieved fiscal transparency and accountability in local governance since its inception.In line with this objective, interview was conducted on key employees operating the internal audit units of local governments and the oversight employees from the ministry and parastatals in Kaduna state. The paired sample t-test was used to analyze data collected and this aided the study to conclude, there is a significant relationship though not very strong, that exist between the internal audit unit and fiscal transparency and accountability in local governance. In order to achieve integrity in public expenditure management there by establishing fiscal transparency and accountability in local governance, there is the need for adherence to the code of transparency by the local councils if really the internal audit is to be effective for all intent and purposes.