programme based budgeting in ghana 8th annual cabri seminar … · 2016. 6. 1. · programme based...
TRANSCRIPT
-
\PROGRAMME BASED BUDGETING
IN GHANA
8th Annual CABRI Seminar on 8th Annual CABRI Seminar on
Budgeting for Results: Moving Towards
Performance Budgeting, Johannesburg,
South Africa, 9-11 May, 2012
PRESENTATION BY GHANA
-
Outline� Introduction
� Strengths and weaknesses of Activity Based Budgeting (ABB)
� What is Programme Based Budget ?
� Why Programme Based Budgeting(PBB) in Ghana?
� How different will it be from The current Activity Based Budget?How different will it be from The current Activity Based Budget?
� What is the Implementation Plan?
� Status of Implementation
� Lessons Learnt
� What is the Way Forward
� Conclusion
-
Introduction� The Activity Based Budgeting (ABB)approach has been in use in Ghana since1998.
� ABB was introduced under the PublicFinancial Management Reform ProgramFinancial Management Reform Program(PUFMARP)
� It was intended to bring a strongerperformance focus to MDAs budgets bylinking strategic objectives to budgetoutputs and activities.
� Various findings from the reviewsundertaken of the ABB process in Ghana.
-
Strengths of ABB
� Budget coverage increased from GoG to include donor and
IGF budget.
� MDAs prepare management information such as Mission
Statement and Costing of the Activities required to meet the
MDAs objectives MDAs objectives
� Increased Ownership by MDAs of their budget and reduced
the involvement of MoFEP in the details of MDAs budget.
� Improved capacity of MDAs to plan and budget more
strategically for the medium term.
� Helped integrate recurrent and development expenditure
-
Weakness – Budget Preparation� Determining the exact commitment made by MDAs in the
previous years
� Matching fund requirements for donor funded project and
agreement spanning more than the MTEF
� MDAs spread scope of work and objectives too wide instead
of concentrating on core mission and as such request for
resources over the ceiling provided by MoFEPresources over the ceiling provided by MoFEP
� The MTEF in Ghana uses three year planning horizon, effort
are usually placed on the preparation of the current year
budget with the remaining years being merely indicative
ceiling.
� lack of comprehensiveness in the MTEF. Currently, the MTEF
budgeting is limited only to service and investment expenses
whilst the personnel emoluments and administration expenses
are on line item budgeting.
-
Weakness – Budget Preparation
Cont’d � The budget process remains incremental and input focused;
� The budget structure does not allow for monitoring budget
implementation against set objectives or performance
indicators.
� There exists limited capacity to cost strategies and lack of� There exists limited capacity to cost strategies and lack of
comprehensive information on budget parameters during
budget formulation
� Weak revenue forecasting and macroeconomic planning
affecting the MTEF process.
� The inability of MOFEP to meet the resource requirement of
MDAs usually affects the implementation of planned activities
and projects.
-
What is PBB?
� It is a way of preparing the budget
which directly links the planned
expenditures to clearly determinedexpenditures to clearly determined
results and improved service delivery
within the mandate of the
organisation.
-
Objectives
� To enhance Government's ability to allocate
available resources in accordance with its policy
priorities
� To better demonstrate the strategic intent of the � To better demonstrate the strategic intent of the
Budget
-
Why PBB in Ghana?
� To respond to challenges with the current Activity Based
Budget system and other emerging issues (oil find etc)
� Improve budget management
� Introduce performance management in the current
budget system
� Improve service delivery
� Improve the medium term expenditure framework
-
How different will PBB be from The
current ABB
� To respond to challenges with the current ABB system
� Clearer linkage between priorities and planned expenditures of
MDAS
� Less detail (sub-program level appropriation)
� Less emphasis on input and activity in budget documents
� Shift from managing budget inputs and activities and focusing
on results through output and performance indicators
� Flexibility in budget execution
� Making the MDAs more accountable
� More focus on monitoring and evaluation
-
Benefits of PBB�More clearly document how resource allocation
decisions affect services to the public.
� Facilitates benchmarking for the assessment of
performance (both effectiveness and efficiency)
� Clearer, regarding what Public Servants are
11
� Clearer, regarding what Public Servants are
expected to achieve and what resources available
� Clearer and more succinct reporting of the Budget
(to Parliament and to citizens)
-
Benefits of PBB Cont’d� Facilitates a closer alignment between planning
and allocation of resources.
� Allows Government to better explain the Budget
to Parliament and ordinary citizens.
12
� Allows measurement of performance against
targets.
� Empowers Public Service managers to manage
flexibly and innovatively in order to efficiently and
effectively meet client needs.
-
A Program Hierarchy13
Budget
Program 1
Budget
Program 2
Budget
Program 3
MDA
Budget
Budget
Program 4
Budget
Program 5
Core
Operations
3.2.1
Budget Sub -
Program
3.1
Budget Sub -
Program
3.2
Budget Sub -
Program
3.3
Budget Sub -
Program
3.4
on-going
3.2.2
Initiative
3.2.3
Project
3.2.6
Project
3.2.5
Project
3.2.4
Project
3.2.7
-
What is the implementation plan
� Phase One – Initial pilot for testing of the new
Guidelines
� Phase two- Pilot Budget preparation for 7 MDAs.
� Phase three- Pilot Budget preparation for all
MDAs
� Phase four- Roll out to all MDAs by 2014 and
MMDAs by 2015.
-
Status of implementation� Project Secretariat for Budget reforms has been set up at
MoFEP
� Orientation for all MDAs on PBB completed
� Initial pilot involving two MDAs for testing of the new
Guidelines completed.
� Identification and selection of additional five (5) MDAs� Identification and selection of additional five (5) MDAs
for piloting completed. These are: Ministries of Education,
Health, Food and Agriculture, Roads and Highways and
Commission on Human Rights and Administrative Justice.
� Completed training to build capacity of staff of the
seven (7) pilot MDAs
� Production Workshop for the seven PBB pilot MDAs to
prepare their PBB using the ABB has been completed
-
Lessons learnt� The Ghana Shared Growth and Development Agenda( GSGDA)
provided a sound basis for the development of program outcomes
and therefore for guiding the development of a program Structure.
� MDA medium term strategic plans exist for each of the pilot Ministries
and provide valuable information to assist the development of
program structure and adoption of output indicators.
� The Institutional Structures of Government and Programs are� The Institutional Structures of Government and Programs are
inconsistent with the PBB approach
� Allocation of Compensation of Employees ( Wages and Salaries) to
programs and sub-programs poses a challenge since it is currently
centrally managed. This is not consistent with the PBB principles.
� Appropriation and Budget Execution concepts, methods and
processes need to be critically reviewed before full introduction of
PBB.
� Significant capacity will need to be developed in MOFEP and MDAs.
-
What is the way forward for
2012� Review the 2012 Programme Based Budgeting of the
seven (7) pilot MDAs.
� Review the PBB guidelines and Training Manual
� Train all the (35) MDAs in PBB to:� Train all the (35) MDAs in PBB to:
• Determine their programme structure.
• Write narrative statement.
• Develop performance indicators
• Cost their programmes for the full roll out in 2014
-
Conclusion� The budget process in Ghana is still ‘work in
progress’. Major PFM reforms continue to take
place.
� Introduction of PBB is part of the overall
ongoing PFM reforms.
Expectation is that it will lead to incremental � Expectation is that it will lead to incremental
improvements in our budget management
and improve on service delivery
�Will require commitment and collaboration of
all stakeholders to ensure success.
-
THANK YOU