中期支出框架
Medium term expenditure framework

本文研究了（中期支出框架）在孟加拉國的改革。介紹了包括年度教育部4部委命名為MTBF（中期預算框架）。在接下來的一年里，它包括一部教育部、教育部、衛(wèi)生部和家庭福利部。在不久的將來，所有其他部委將在這一框架下進行。這項研究的重點是探索教育和醫(yī)療預算介紹或解釋的影響，或制定和執(zhí)行傳統(tǒng)的預算制度的差異，分析其有效性和預算支出效率由于在教育和衛(wèi)生部門考慮三種結果（采用或維持財政紀律，促進資源配置效率和運營效率的提升）的公共支出管理（PEM）最后評論是否進行改進或不采用。本章概述了本研究的關聯(lián)性，在隨后的章節(jié)要回答研究問題，方法和分析框架，研究的局限性，以及最后的演示結構。

MTEF下制定預算的主要目的是預算分配與政府的政策的優(yōu)先級。這是為了確保高效利用有限的公共資源,這將增強貧困人口的減貧增長。其中的“政策優(yōu)先三角形”的國家的減貧戰(zhàn)略文件(扼要介紹,2005)關乎人類發(fā)展。因此,教育和醫(yī)療領域一直是政府投資的首要任務。

1根據(jù)MTBF(2005 - 06,p-01)‘中期預算框架(MTBF)是通常稱為中期支出框架(MTEF)的新的預算方法’。

Chapter 1: Introduction——第一章:介紹

1.1 Background——背景

This dissertation studies the MTEF (Medium Term Expenditure Framework) reform in Bangladesh. The MTEF was introduced in 4 ministries including Ministry of Education from 2005-06, named as MTBF

(Medium Term Budgetary Framework). In the following year it included Ministry of Primary and Mass Education and Ministry of Health and Family Welfare. All other ministries will be brought under this framework in near future. The focus of this study is to explore the effect of introducing the MTEF in education and health budgets, explain the difference between the MTEF and traditional budgetary system in the formulation and execution of budget, analyze the effectiveness and efficiency of budgetary spending due to adopting the MTEF in the education and health sectors considering the three outcomes (maintaining fiscal discipline, promoting allocative Efficiency and enhancing operational efficiency) of public expenditure management (PEM) and finally to comment on whether improvements were achieved or not due to adopting the MTEF. This chapter outlines the relevancy of the study, the research questions to be answered in the subsequent chapters, methodology and analytical framework, limitations of the study and finally the presentation structure.

1.2 Rationale of the Study——研究的理論基礎

The main objective of formulating a budget under the MTEF is to link the budgetary allocations with government's policies, priorities. This is for ensuring efficient utilisation of limited public resources, which will enhance pro-poor growth and poverty reduction. One of the ‘policy priority triangles' set out in country's Poverty Reduction Strategy Paper (PRSP, 2005) is human development. So, Education and health sectors have been attached to top priority on investment by the Government.#p#分頁標題#e#

1 According to MTBF (2005-06, p-01), ‘The Medium Term Budgetary Framework (MTBF) is a new budgeting approach generally known as the Medium Term Expenditure Framework (MTEF)'. Here, no basic difference between MTEF and MTBF has been stated. So, the term ‘MTEF' will be used ubiquitously in this dissertation except quoting the references where relevant.

These two sectors account for almost 20% of the total government expenditure each year in Bangladesh. The MTEF has been implemented in these two sectors since 2006 and many of the government policy objectives are linked with them. It is necessary to review the performance of the MTEF so that the output could be infused into ongoing works and corrective actions can be taken to planned activities accordingly. Thus, it seeks to investigate the impact of the MTEF on budgetary system of these two sectors.

1.3 Research Questions——研究問題

For this paper, the research questions are:

1. To what extent MTEF led to changesa in the formulation and execution of education and health budgets?

2. Has MTEF improved the effectivenessb and efficiencyc of budgetary expenditure on education and health?

a. Mainly three types of changes- institutional, process (procedure) and technical (technological).

b. Effectiveness is about how far does the activity (here MTEF) achieve its objective- and the objective itself is greater allocative efficiency.

c. Efficiency here means at what cost was that result achieved, i.e. how many additional resources were used up in adopting MTEF (Here it means operational efficiency).

1.4 Broad Methodological Approach——廣泛的方法論的方法

The analysis is purely desk- based. Secondary information sourced from review of literatures on the MTEF of different countries and other related articles of OECD, IMF, World Bank. UNICEF, PEFA, ADB, UNDP comprising as assessment and analysis of available documents on the MTEF and related processes. To answer the research questions data of national budget from 2001t o 2010, documents on the MTEF from 2006 to 2010, monthly fiscal report from 2004 to 2008- Finance Division, Ministry of Finance (MoF), Bangladesh Economic Review 2003-2008, IRBD by CPD (Centre for Policy Dialogue) from 2004- 2010, Public Expenditure Review on health- 2007, Bangladesh Bureau of Statistics, Sector wise budgets from Ministry of Education, Ministry of Primary and Mass Education, Ministry of Health and Family Welfare are used. Data from national budgets, BER, MTBF and PER played the key role to answer the research questions. Information was collected from interviewing few relevant staff of the MoF and consulting published documents and databases available in the Internet. The analysis is both qualitative and quantitative depending on the availability of the relevant data.

1.4.1 Analytical Framework——分析框架#p#分頁標題#e#

1) To answer the first question regarding changes due to adopting MTEF in Bangladesh, three elements will be analyzed - institutional change, procedural change and technical change and this analysis will try to differentiate the qualitative changes took place due to adopting MTEF over the traditional budgeting system in relation to those three elements.

2) The MTEF budgets of education and health will be assessed taking into account the three basic elements of PEM (Public Expenditure Management) - maintaining fiscal discipline, promoting allocative efficiency and enhancing operational efficiency (Schick, A, 1998) to get the answer of the second question concerning improvement in effectiveness and efficiency of budgetary spending after MTEF.

Fiscal discipline, allocative efficiency and operational efficiency are interdependent (DFID, 2001). Allen Schick (1998, p. 2) argued that the lack of fiscal discipline leads to improper resource allocation and operates inefficiency. So, fiscal discipline promotes allocative and operational efficiency. MTEF sought to strengthen those three outcomes. Therefore, the effectiveness and efficiency of budgetary spending is improved when those three basic elements are achieved.

The following criteria/ principles will be analysed to reveal the experiences of attaining those three basic elements

Basic Indicators of PEM
Criteria/ Principles that influence PEM indicators
Fiscal discipline- ‘
keeping government spending within sustainable limits over the medium- term and beyond' (Schick , A. 1998).
Conformity with the spending limit
- whether the actual spending exceeds the original budget
Consistency in the trend of sectoral expenditure-
increasing trend in the sectoral allocation having uniformity with the increase in total public expenditure
Allocative Efficiency-
means that the allocation is better targeted shifting spending from lower priority to higher priority linked to policy objectives (ibid).
Change in sectoral allocation-
whether allocation is increased in real term
Strategic resource allocation linked to policy, planning -
ensure allocating resources to the strategic objectives of MTEF that reflects the policy priority
Spending in priority areas/ programmes-
ensure better targeting means lower to higher priority
Devolution of allocative responsibilities to line ministries-
ensuring more empowerment in preparing budget
Operational efficiency-
quality of the public services should be reasonable and it should be given at the lowest possible cost (ADB, 2001)
Convergence between Expenditure estimates and outturn-
to see the deviation, over- spending and under- spending
Greater predictability of public funds
Progress in achieving output targets-
analysing progress against agreed milestones (performance targets) set by the MTEF ministries.#p#分頁標題#e#
Source: The above criteria in the table are generated on the basis of the literature of Schick, A (1998), World Bank (1998), DFID guidelines (2001)

1.4.1.1 Criteria setting——標準設置

The aim is to find out some criteria that influences the three objectives of PEM as well as matches with the ‘MTEF objectives of Bangladesh' (discussed in chapter- 3..) so that the impact of the MTEF can be assessed. The analytical framework is adapted and it is mainly based on the literature of ‘Schick, A (1998), A Contemporary Approach to Public Expenditure Management', ‘World Bank (1998), Public Expenditure Management Handbook', DFID guidelines (2001) and some other empirical evidences (discussed in chapter- 2).

Some other relevant criteria are not examined mainly due to data non- availability of appropriate data. For example, improvement in accountability and transparency relates to operational efficiency is not analysed due to data limitation and relevant information unavailability.

A simple cross- section data is presented in tabular form where it is relevant in addressing the research questions.

1.6 Limitations——局限性

The MTEF is now at its earlier stage in Bangladesh and no formal review or comprehensive assessment has been made on this new budgetary process. Sufficient information is not available and current and reliable data are also unobtainable. So, there is much reliance on government budgetary documents that cannot always be testified by evidences from other sources.

1.7 Presentation Structure——演講結構

Chapter 2 provides literature review on theoretical concept of MTEF, budgetary reforms followed both in developed and developing countries and assessments of the impact of the MTEF in those countries using the analytical framework specified for answering question two.

Chapter 3 illustrates MTEF reform in Bangladesh and analysis of the traditional budgetary process and MTEF in view of the changes took place due to adopting MTEF to get the answer of question 1.

Chapter 4 focuses on the assessment of impact of MTEF on education budget to get the answer to question-2

Chapter 5 focuses on the assessment of impact of MTEF on health budget to get the answer to question-2

Chapter 6 presents the conclusion where all the research questions are summarized.

Chapter 2: Literature Review文獻綜述

This chapter aims to explore various criteria/ principles that will be used to judge the performance of the MTEF in line with the three basic indicators of the public expenditure management (PEM). With this end in view, it provides literature review on theoretical concept of the MTEF, the theoretical explanation regarding the relationship between the MTEF and the public expenditure management (PEM). It also examines the empirical studies on the MTEF of different countries to reveal the different criteria/ conditions that were set to assess the role of the MTEF in promoting the efficiency and effectiveness of public expenditure. Finally it brings together some criteria that will be used to develop the analytical framework to assess the impact of the MTEF on education and health budget (the title of the dissertation) in Bangladesh.#p#分頁標題#e#

2.1 The Theoretical Background——理論背景

2.1.1 Concept of the MTEF——MTEF的概念

The MTEF (Medium Term Expenditure Framework) is defined as an approach ‘designed specially to link planning, which has a medium term outlook, with the annual budget, and, as a consequence, to link budgetary expenditure more systematically with socially desired outcomes', (ADB, 2002, p-1). On the whole, MTEF integrated policy, planning and budgeting and allows expenditure to be ‘driven by policy priorities and disciplined by budget realities' (World Bank, 1998). So, MTEF is a multiyear rolling expenditure under which a realistic projection of revenue receipts and expenditure is prepared over a three to five year period and spending priorities are set with reference to the Government's policy objectives and thus it provides a clear foundation for the annual budget. Under the MTEF, over a three year period, first year estimate is considered as budget, two outer year's estimates as indicative figures. In the following year, the MTEF rolls forward and a new forward estimate for another year is added. After necessary adjustment, the second year forward estimate is considered as budget as it becomes first year for the next MTEF.

Figure 2.1: Rolling Principle of the MTEF (Source: ODI, 2002, p- 5)
In many countries, the MTEF is implemented at two key levels, at the central government level which is referred to as the ‘top- down approach' and at the spending agencies level, referred to as the ‘bottom- up approach' (World Bank, 1998, p-40). In the ‘top- down approach', Ministry of Finance identified the ‘resource envelops' (which is referred to as the indicative expenditure ceiling) and allocate those to the line ministries in view of their relative need. In the ‘bottom- up approach, line ministries or sectoral agencies formulates and estimates the actual and projected costs of the spending programmes within the spending limit for the medium term by examining the sectoral objectives and activities (Houerou and Taliercio, 2002, p-2).

Table 2.1 Seven Stages of the MTEF
Stage
Characteristics
I. Developing a Macroeconomic/Fiscal

Framework

A model that makes the multi- year projection of revenues and expenditure

II. Developing Sectoral Programs

* Reviewing of policy objectives, outputs, and activities

* Agreement on programs and sub-programs, developing performance indicators and prioritizing spending

* Costing of programmes

III. Hearing on Sectoral Programme

Analysing the sector reviews carried out in stage- 2

IV. Developing Sectoral Expenditure Framework

Consensus-building among the key players on strategic resource allocation

V. Defining Sector Resource Allocations

Determining Medium term sectoral allocation based on budget ceilings#p#分頁標題#e#

VI. Preparing Sectoral Budgets

Preparing of budget estimates by ministries within cabinet approved

VII. Final Approval

Reviewing sectoral budget estimates again and placing before cabinet and parliament for approval

Source: Adapted;[PEM Handbook (World Bank, 1998a: 47-51) cited in N.Oyugi. L, (2008, p-3, 4)

and Houerou and Taliercio, (2002, p-3)]

Annexure- 2

2.2 A General Overview of the Empirical Literature——一般的實證文獻的概述

Many developed countries like UK, Australia, New Zealand, Austria, Sweden, Germany, USA are practising multi- year budgeting. The MTEF of UK maintains a firm consistency in controlling public expenditure having ‘focused on outcomes and efficient service delivery' (HM Treasury, 2007).

World Bank, DFID and other Aid agencies influenced many developing and transitional countries to initiate series of reforms (Wyane, 2005). The MTEF is introduced in more than 25 countries in Asia, Africa (e.g., Benin, Cameroon, Burkina Faso, Ghana, Malawi, Rwanda, South Africa, Tanzania, Uganda, Namibia, Kenya, Zambia) Latin America and Eastern Europe. In Asia, MTEF has already been introduced in Nepal, Pakistan and Bangladesh. Almost all the developing countries have 3 years MTEFs except Mozambique (6 years) and South Africa (4 years) (Houerou and Taliercio, 2002). Most of the countries integrated development and non- development expenditure in the MTEF except Guinea and Rwanda (only recurrent budget). In Kenya, Tanzania, South Africa, Uganda, civil society representatives participate in Sector Expenditure Frameworks (SEFs) preparing process (Houerou and Taliercio, 2002). Suriyaarachchi (2004) argued that Nepal has improved in development budget formulation and execution after introducing MTEF in Fiscal Year 2002-03. Assessments on the MTEF in many African countries are carried out considering the organizational change and procedural change rather than assessing the progress achieved through implementing the MTEF (Bird, A, 2003; Holmes and Evans, 2003; Jennes. G, 2003; Carlier. K, 2003; Short. J, 2003)

2.3 The MTEF and the public expenditure management (PEM)——MTEF和公共支出管理(PEM)

ADB (2001) suggested that ‘Public expenditure management (PEM) is the latest approach that emphasizes on achieving the desired policy outcomes through public sector budgeting. PEM considered expenditure as an instrument to produce optimal output whereas conventional budgetary process sets focus on spending as an input'.

PEM emphasizes on three main outcomes in budgetary system. The objectives of PEM are to maintain fiscal discipline, to promote allocative efficiency and to enhance operational efficiency (World Bank, 1998a cited in DFID, 2001, p-8). Allen Schick (1998, p-2) describes three basic elements of PEM as follows:

1.

Aggregate fiscal discipline
, which usually means that the public spending limit should not exceed the total revenue (spending in accordance with the affordability) and should be ‘sustainable over the medium-term and beyond' (ibid, p-2).#p#分頁標題#e#
2.

Allocative efficiency
, which refers to the condition that public spending, should be prudent. ‘Expenditure should be based on government priorities' and it should be directed to the most beneficial programmes and activities that ultimately increase the effectiveness of the budgetary spending. It means that the allocation is better targeted shifting from ‘lesser to higher priorities and from less to more effective programs' (ibid-2).
3. Operational efficiency
means getting the best value of public money. Quality of the public services should be reasonable and it should be given at the lowest possible cost (ADB, 2001, p-1).
According to Fjeldstad et al. (2004 p.2) cited in N.Oyugi. L, (2008, p- 2),

The objectives of MTEF are
:
to maintain ‘aggregate fiscal discipline'
to promote ‘resource allocation to strategic priorities' (allocative efficiency)
to enhance ‘efficient and effective use of resources' (operational efficiency)
It suggests that there is a close connection between MTEF and PEM objectives.

2.3.1The MTEF and improvement in effectiveness and efficiency of——MTEF和改善的有效性和效率

budgetary expenditure
ADB suggested that ‘the MTEF is one mechanism through which a PEM system can be operationalzed' (2001- issue- 2, p-4). So, the improvement in effectiveness and efficiency of budgetary expenditure depends on to what extent the MTEF is sought to strengthen the PEM objectives.

Fiscal discipline, allocative efficiency and operational efficiency are ‘interdependent' (DFID, 2001). Allen Schick (1998, p. 2) argued that the lack of fiscal discipline leads to improper resource allocation and operational inefficiency. So, fiscal discipline can promote both allocative and operational efficiency.

Fiscal discipline is maintained when implementation of budget ensures that actual expenditure does not exceed the spending limit and even when the increase in spending (% as a share of GDP) is consistent with the increase in revenue each year (Schick, A, 1998, p. 12, 67). So, two criteria- conformity with the spending limit and consistency in the trend of sectoral expenditure influence fiscal discipline.

Allocative efficiency means the ability of the government to distribute resources considering the effectiveness of public programmes in accordance with its strategic objectives or policy planning. It is the capacity to reallocate resources from old to new priorities and from less to more effective programmes. Delegation of major allocative responsibility to sectoral ministries also promotes allocative efficiency (ibid, p. 17, 90). So, four criteria- change in sectoral allocation, strategic resource allocationlinked to policy planning, spending in priority areas/ programmes anddevolution of allocative responsibilities to line ministries influence allocative efficiency.#p#分頁標題#e#

MTEF offers greater predictability of fund since it establishes ‘baseline budgets for the upcoming years' (while one year budget cannot) and thus improves operational efficiency (ADB, 2001- issue- 2, p-4). World Bank (1998) argues that predictability of funds (assurance to spending agencies as to when and where the resources will be available) is one of the major factors that influence operational efficiency (p- 28). Operational efficiency put emphasis on output and outcomes rather than input (Schick, A, 1998, p. 21). So, two criteria- greater predictability of public funds and progress in achieving output targets influence operational efficiency.

2.3.2 Evidence from Cross-country Studies——全國的數(shù)據(jù)研究

This is to explore what criteria/ characteristics are set out by different countries to assess the impact of MTEF with respect to three levels of PEM outcomes. However, most of the studies are found to use one or more of the following criteria.

Reducing fiscal deficit——減少財政赤字

Since the adoption of the MTEF, Malawi reduced its fiscal deficit from 15% of GDP to 5% in the 1998/ 1999 budgetary- year and a further reduction to 4% in 1999/ 2000. So, it achieved some progress in reducing fiscal deficit (Anipe et al., 1999, p. 15).

Adequate information availability——足夠的信息的可用性

In Cambodia, the MTEF was introduced in two ministries (education and health) and while preparing the sectoral expenditure for 2003-2005, health ministry had inadequate information regarding user fees and other payments, which in turn prevented from making a realistic estimation (Dom et al., 2003, p. 30).

Above two criteria are concerned with aggregate fiscal discipline.

Strategic resource allocation linked to policy, planning——戰(zhàn)略資源分配與政策,規(guī)劃

In case of Ghana, the MTEF was adopted in 1999; the resources were allocated in line with government development policy documents, e.g. ‘Ghana Vision 2020' (Anipa et al., 1999, p-21). The MTEF in Uganda achieved a considerable success in integrating the PEAP (‘Poverty Eradication Action Plan') within the Budgetary process and expenditure planning is carried out considering PEAP at the central and local government levels (Bird A, 2003).

Change in sectoral allocation——部門分配的變化

In Uganda, actual spending increased from 19.8% of total expenditure to 26.9% in 1998/99 (Bevan and Palomba, 2000, p. 18). In Benin, budgetary allocations had increased significantly to the ‘priority sector' since 1998. Recurrent budget for education was 27.4% of the total expenditure in 1998 and it increased to 39.5% in 2001 and capital budget was 4.5% of the total expenditure in 1998 and that increased enormously to 40.7%. Allocations towards the health budget have increased from 1.4 percent of GDP in 1998 to 2.3 percent of GDP in 2001 (Carlier K, 2003, p. 23-24).#p#分頁標題#e#

Greater responsibility to line ministries——更大的責任部門

The MTEF in Ghana promoted allocative efficiency as line ministries enjoying ‘greater responsibility for allocating resources to priority activities' which ensures effective and efficient use of limited resources (Anipa et al., 1999, p- 7).

Improvement in budgetary classification——改善預算分類

The MTEF in Malawi promotes allocative efficiency as it improved in budgetary classification by adopting activity- based budgeting that reviews the on- going programmes and creates sub- programmes to specify the activities (ibid, p. 12-25).

From the above analysis it is evident that three criteria- strategic resource allocation linked to policy planning, change in sectoral allocation, improvement in budgetary classification are relevant to allocative efficiency and greater responsibility to line ministries is concerned with both allocative and operational efficiency (discussed in section 2.1.3).

Fund predictability——基金可預測性

In Malawi, the allocation for health sector was 20.7% of the total development budget for the 1996/1997 fiscal year, but the actual release was only 3.6% of the development expenditure (Oxford Policy Management, 2000, p. 4).

Reducing the deviation between budget and actual spending——減少預算和實際支出之間的偏差

In case of Tanzania, from 1995 to 1998, the average BDI (Budget Deviation Index) was equal to 33% before introducing the MTEF and after the MTEF since 1999, it was reduced to 25% (Houerou and Taliercio, 2002, p. 21).

Improvement in accountability and transparency——改善問責制和透明度

In Namibia, MTEF has improved transparency as the framework explains inputs required for all programmes and expected outcomes. It also increased accountability because public has the access to the information regarding government priorities set in the medium term framework (N Oyugi L, 2008, p-12).

The above two criteria are relevant to operational efficiency as discussed earlier.

2.4 Findings——調查結果

The country assessments of the MTEF indicate that all types of criteria/ conditions were not used by any single country to assess the impact of the MTEF. From the above analysis, the following key criteria/ principles can be brought together which appear to be important to examine the MTEF outcomes at three levels- fiscal discipline, allocative and operational efficiency.

Basic Indicators of PEM
Criteria/ Principles that influence those indicators
Description
Fiscal discipline

Reducing fiscal deficit

Fiscal deficit means total public spending exceeds total revenue (earning)

Conformity with the spending limit

Spending limit means spending within the budgetary allocation#p#分頁標題#e#

Consistency in the trend of sectoral expenditure

Consistency means increasing trend in the sectoral expenditure keeping pace with the increase in total spending

Allocative efficiency

Change in sectoral allocation

Change means increasing or decreasing in allocation

Improvement in budgetary classification

Budgetary classification means budgets are classified in different categories to introduce some order from diversity such as functional classification (e.g. education, health, defence), economic classification (e.g. pay and allowances, goods and services) (ADBI, 2005)

Strategic resource allocation linked to policy planning

Resources are allocated in accordance with the policy objectives

Spending in priority areas/ programmes

Spending to the most beneficial programme

Devolution of allocative responsibilities to line ministries

More authority and responsibility to line ministries to allocate and utilize resources according with their priority needs

Operational efficiency

Fund predictability

Predictability means assurance to spending agencies as to when and where the resources will be available (DFID, 2001)

Improvement in accountability and transparency

Accountability means that budget officials and line ministries will be held responsible ‘for the exercise of authority vested in them' (DFID, 2001, p-12, 13)

Transparency means the ‘availability of budgetary information to the public' so that they can challenge the Government to promote the efficiency of expenditure (ibid, p-25-26)

Reducing the deviation between budget and actual spending

Reducing the gap between budgetary allocation and actual spending as well as over- spending and under- spending

Progress in achieving output targets

analysing progress against agreed milestones (performance targets) set by the MTEF ministries

In the next chapter, the changes due to adopting the MTEF in the education and health budget will be examined.

Asian development bank institute, 2005

Chapter 3: Changes due to the MTEF in Bangladesh由于MTEF孟加拉國變化

This chapter addresses the first research question of Chapter- 1 which refers to the changes took place because of the MTEF introduced in the education and health budget. For this, it focuses on the budgetary reforms in Bangladesh. Experiences with the introduction of the MTEF are discussed and finally the changes due to adopting the MTEF (the traditional versus the MTEF) have been analysed.

3.1 Why the MTEF in Bangladesh——為什么MTEF在孟加拉國

Before the MTEF, budgets were prepared by making arbitrary incremental changes to the preceding year's allocation. No strategic planning was present in budgetary process, non- development and development budgets were prepared separately and emphasis was laid on input rather than output (BCAS-2006/09, p. 53). Therefore, to enhance the credibility of the budget, to face the strategies set out in the PRSP with the macroeconomic framework and to ‘create a more disciplined, dynamic, efficient and modern public financial management system' (MTBF-05/06, p. i), the MTEF was introduced.#p#分頁標題#e#

3.2 Budgetary reforms and the MTEF in Bangladesh——預算改革和MTEF在孟加拉國

Bangladesh is a densely populated developing country which has a less public spending as a share of GDP (Socio- economic indicators are shown in

Appendix- 1
). For the effective and efficient use of scant resources, important reforms have been carried out in public financial management since 1990s. According to World Bank, ‘Bangladesh re-emerged as a democracy, successfully restarted reforms on critical fronts while ensuring sound macroeconomic and fiscal management' (BCAS, 2006/09, p-9). A committee on Reforms in budgeting and Expenditure Control (CORBEC) was formed in March 1990 and this committee identified a number of problems including budgeting procedure, budget classification, budget presentation, separate non- development (recurrent) and development (investment) budgets preparation, emphasis laid on the inputs rather than outputs, etc. It was also difficult to identify the flow of funds as non- development and development budgets used separate classification systems and that was not computerized. To implement the recommendation of CORBEC, RIBEC (Reform in Budgeting and Expenditure Control) was formed with the financial support from the DFID (Department for International Development). A detailed operational unit wise and economic code wise classification chart was prepared and published, financial rules and reporting systems were upgraded and large number of Government officials were trained through the RIBEC from Phase- 1 (1993-1996), Phase -2 (1996-1997), Phase- 3 (1997-1999). (FIMA, 2007).
Public Expenditure Review Commission was formed in June 2002 and according to their recommendation (December, 2003) the existing budget preparation system was replaced by the MTEF (MTBF, 2005-06). A new budget guideline was incorporated in the MTEF in view of strategic budgeting and better management of development and non- development budgets (BCAS, 2006-09, p-20).

3.2.1 Introduction of MTEF——引入MTEF

Multiyear budgeting links between aggregate medium term plans and annual budgets (OECD, 1995). In most countries traditional budgeting system allocate resources on a historical incremental basis and MoF (Ministry of Finance) exercises its last minute discretionary cut in expenditure. In Bangladesh, the MTEF was first introduced in fiscal year 2005/06 in four ministries including Ministry of Education (MoE). In the following year, MTEF was introduced in Ministry of Primary and Mass Education (MoPME) and Ministry of Health and Family Welfare (MoHFW). Budget is prepared for

03 years (three)
under the MTEF system and it consists of
top- down process
as resource ceiling is given by MoF to line ministries before preparing the budget and
bottom- up process
as estimation of costs of current and medium term activities are prepared by the line ministries keeping conformity with the line ministries policies to go with the available resources (MTBF, 2005/06). In FY (Fiscal Year) 2009/10, a total of twenty ministries which spend almost 63% of total budgetary spending, prepared their budgets under the MTEF (MTBF, 2009/10).#p#分頁標題#e#

3.2.2The MTEF objectives in Bangladesh——在孟加拉MTEF目標

The existing budgetary system is replaced by the MTEF in view of some specific objectives. According to the MTBF (2005/06, p. 3), the objectives are:

a) ‘keeping the public expenditure within a sustainable limit in the medium and

long term';

b) ‘enhancing the participation and role of the line ministries in formulating

policy planning and allocating resources accordingly'

c) ‘improving predictability of fund with a medium term view to ensure realistic

plan for forward estimates';

d) ‘ensuring efficient and effective use of resources, a more explicit linkage

between the PRSP (Poverty Reduction Strategy Paper) and other policies for

strategic resource allocation by line ministries';

e) ‘establishing performance indicators for the ministries, so that a clear

indication of the desired output from the inputs provided through the budget

can be shown'.

3.2.3 Experiences with introducing the MTEF in Bangladesh——經(jīng)驗介紹MTEF在孟加拉國

The MTEF introduced a systematic procedure for preparation of budget. It entails a coordinated system with many interrelated phases (MTBF, 2005/06). BC (Budget Circular) - 1 issued to the MTEF ministries to formulate their budget framework in 2005. One of the important phases is strategic phase which was completely absent in preceding budgetary system. The strategic phase of budget preparation under the MTEF in Bangladesh is as below:

Stage II. Strategic phase
Developing Sectoral Programs

* Reviewing the Ministry Budget Framework (MBF) by the Finance Division (FD) and Planning Commission (PC) together

* Finalizing the indicative expenditure ceiling (for both non - development and development) and revenue target for line ministries by FD and PC together

* Preparing the MBF by line ministries in order to submit a single budget estimate as well as the forward budget estimates for both non- development and development spending considering medium term strategic objectives, priority programmes, performance indicator, etc and sending it to MoF and PC after the approval of Budget Management Committee (BMC)

Source: Adapted; (MTBF-2005/06 and BC-1, 2008) -

Annex- 3
The Finance Division, Planning Commission and the concerned ministries hold meetings jointly to examine the planned expenditure estimates and projections prepared by the MTEF ministries considering the expenditure ceiling and in some cases; adjustments are suggested (MTBF-2006/07, p-2).
After the MTEF, substantial progress has been made in gender budgeting as the MTEF ministries have to consider the gender- related impacts (who will get the benefit- male or female) on their strategic objectives while preparing budget proposals. Education and health sectors are getting continuous priority in case of budgetary allocation after the MTEF. Poverty reduction initiatives are also considered as priority objectives (MTBF, 2007/08, p-3).#p#分頁標題#e#

3.2 Changes due to the MTEF in the Education and Health——改變由于MTEF在教育和健康

The following study identifies a series of changes occurred after implementing the MTEF, are grouped in three categories.

* Institutional

* Process

* Technical

3.2.1 Institutional Change——制度變遷

Here institutional change implies the changes in role played by the line ministries after the MTEF, the dominant role of the Ministry of Finance and Ministry of planning is decreased as more authority is delegated to line ministries.

3.2.2.1 Changes in role played by Ministry of Finance and the MTEF ministries——財政部所扮演的角色的變化和MTEF部門

In the old budgetary system, FD (Finance Division) controlled all budgetary managements. Increased allocation depends on bargaining and persuasion. The officials of Ministry of Education (MoE) and Ministry of Health and Family Welfare (MoHFW) have to convince the FD and PC (Planning Commission) for higher allocation. But under the MTEF, MoE and MoHFW are enjoying more authority and responsibility for budget preparation and expenditure allocation. Ministries have the flexibility to allocate and use the fund according to their particular needs and priorities (MTBF, 2005/06). In MoE and MoHFW, Budget Working Groups (BWG) and Budget Management Committee (BMC) are formed under the MTEF process. The development and non- development budget preparation cells are merged together in MoF (MTBF, 2006/07, p-3).

3.2.2 Process Change——工藝變化

The analysis is to see how the budget estimation and preparation procedures under the MTEF are changed comparing to the old system.

3.2.2.1 Multi- year projections and Roll-Forward——多歲的預測和前滾

In the old budgetary system, the budget was prepared for only one year. The MTEFs of MoE and MoHFW include a three year period - estimated budget for the first year and projections for the following two years. Under Article 87 of the Constitution of Bangladesh, only the first year estimated budgets are submitted to the parliament. The two outer year's projections are treated as indicative figures. In the second year, the MTEFs roll forward to maintain three year forward planning perspective and after necessary review the second year projected estimates are considered as budget (MTBF, 2007/08, p-2).The table below shows the first year budgets and next two years projections.

The below shows an example of forward budget estimates of MoE and MoHFW (In crore Taka, 1Crore =10 Million)

Ministry
Budget 2007-08
Projection 2008-09
Projection 2009-10
MoE
Non- Development

5,190

5,687

6,325

Development

1,315

2,158

2,508

Total#p#分頁標題#e#
6,506
7,846
8,833
MoHFW
Non- Development

2,876

3,307

3,636

Development

2,606

2,875

3,032

Total
5,482
6,182
6,669
Source: MTBF-2007-08, Finance Division, MoF

3.2.2.2 Integration of development and non- development budget——集成開發(fā)和非開發(fā)預算

In the old budgetary system, development and non- development budgets were prepared separately by FD (Finance Division) and PD (Planning Division) respectively. Under the MTEF, a single indicative resource ceiling is given by FD in consultation with PD for Development and Non- development expenditure to MoE and MoHFW (MTBF, 2006/07, p-2).

3.2.2.3 Introduction of different budget preparation phases under the MTEF——引入MTEF下不同預算的準備階段

Under the MTEF, budget preparation process consists of three phases- strategic phase (discussed in 3.2.3), estimation phase and budget approval phase. Under the strategic phase a prescribed budget format known as Ministry Budget Framework (MBF) is to be filled- up by MoE, MoPME and MoHFW in accordance with the guideline framed by Ministry of Finance (BC-1, 2008). In the old budgetary system, no strategic phase in the budget preparation process was present and no prescribed format like MBF was available.

3.2.2.4Participation of high officials in the budget formulation process——高級官員參與預算制定過程

In the past, bottom level officials formulated budget considering it as a routine work. However, under the MTEF the Minister and high officials including the Secretary of MoE and MoHFW are involved in the process of formulation of the budget (MTBF, 2006/07, p-5). MoE, MoPME, FD, PD are working with close coordination to develop the MTEF and to upgrade the Ministry Budget Framework (MBF).

3.2.2.5 Establishing linkage between policies, strategic objectives and budget that
helps to prepare a realistic expenditure plan
In the preceding budgetary system, budgets were prepared on incremental basis without considering strategic objectives, policy priorities. After introducing the MTEF, MoE and MoPME and MoHFW submit a ‘concise justification of the ministry's budget in the narrative section of the MBF' which was absolutely absent from the earlier budgeting system. This MBF includes medium term strategic objectives (e.g. Increased primary enrolment for education, Improve mother and child health status for Health), priority programmes, programme spending strategies, projected ministry expenditures, revenue receipts, etc (MTBF, 2006/07, p-4). So, the expenditure plan is more realistic under the MTEF than that of old budgetary system.

3.2.2.6 Change in evaluation procedure through establishing performance indicators——通過建立績效指標評價的變化過程#p#分頁標題#e#

In the old budgetary system, there was no such performance indicator to measure the efficiency in public spending. Performance indicators are developed to assess the output achieved from public spending. MoE, MoPME and MoHFW identify the key performance indicators (outcome or higher level output) against which the progress towards attainment of the strategic objectives can be measured. The MTEF ministries then specify the related strategic objectives and fix the targets for the budget year and for the medium term (at the time of budget preparation, the MTEF ministries fill- up the form set out in the MBF every year) (BC-1, 2008, p-10) The Budget Monitoring and Resource Committee (BMRC) has been formed to monitor the implementation of the MTEF (MTBF, 2006/07, p-2).

The following table shows the Key Performance Indicator (Partial) of the Ministry of Health and Family Welfare

Performance
Indicators
Actual
2005-06
Target
2006-07
Actual
2006-07
Target
2007-08
Actual
2007-08
Post- MTBF
1. Neonatal mortality rate decreased/ 1000 live births

32
30
32
27
32
2. Infant mortality rate decreased /1000 live births

48
45.5
48
43
52
3. Under five child mortality rate decreased /1000 live births

70
65.5
65
60
N/A
4. Maternal mortality rate decreased /1000 live births

2.75
2.64
2.75
2.56
2.90
5. Antenatal care increased /100

50
63.75
51.7
67.25
50
Source: MTBF, 2008-09, Finance Division, MoF

3.2.3 Technical Change:——技術變革

3.2.3.1 The development of new instruments——新儀器的發(fā)展

- The MTEF and MTEF frameworks, MBF, resource models, standard budget formulation, implementation and evaluation formats, investment appraisal techniques, etc.

3.2.3.2 Integrated Budgeting and Accounting System (IBAS)——綜合預算和會計制度(遷徙水鳥)

After the MTEF, a web based ‘integrated budgeting and accounting system' (IBAS) is introduced in MoE, MoPME and MoHFW (MTBF, 2007/08, p-14). Recently a wide area network (WAN) is established to connect district accounts offices including the divisional accounts offices (BS- 2009/10, p-58) All these will ensure availability of timely and accurate financial information and thus it will improve the formulation and execution of budget.

3.3 Findings——調查結果

The following table- 3.1 summarize the changes occurred after implementing the MTEF in the education and health budget and the impact (what is actually happening) of the MTEF

Table 3.1 The old budgetary system versus the MTEF
Elements of change#p#分頁標題#e#
Previous budgetary system
Changes due to adopting the MTEF
Impact of the MTEF
Process
1. Multi year- budgeting and rolling forward

Budget was prepared for one year

Now 3 years estimates are prepared, first year estimate is considered as budget and rolled forward each year. So, first year's estimate becomes the annual budget

After the MTEF, Resources are not cut back as the unspent balances are carried forward. Therefore, it reduces wastage of public money

2. Linking policy, planning and budgeting

Policy planning was seen as a political process. The budget was incremental just adding a margin on the top of the previous year's budget, little thoughts were given to the strategic priorities

Now budget is linked with the policy objectives as strategic objectives, priority programmes are set out in the MTEF in line with the policy, planning

There is a positive change in the pattern of resource allocation pattern as strategic priorities are taken into consideration. It helps to prepare more realistic budget than before

3. Integrating development and non- development budget

Development and non- development budget were prepared separately. It caused duplication and overlapping in budgetary process

Budget is now prepared in a single ceiling for development and non- development budget

Now coordination is improved, lack of duplication and demarcation between development and non- development budget is removed

4. Establishing performance indicators

Emphasis was laid on budgetary input rather than output. So, there was no output target for the ministries.

Now output targets for specific ministries are fixed in the budget

Although output targets are not achieved by the ministries but it makes easier for them to know how far they are from the agreed target.

5. Involving high officials in budget formulating process

Lower officers carried out that

Now high officials are involved

It ensures better coordination and team work.

6. Introducing Ministry Budget Framework (MBF)

It was absent before

Now a prescribed format named MBF is distributed between the MTEF ministries where they have to put their objectives, priority programmes, output targets, etc.

It introduces more organized and systemic approach in budgetary process.

Technical
7. Introducing a web based ‘Integrated Budgeting and Accounting System' (IBAS)

IBAS was not present before

After the MTEF, it was introduced

It ensures the availability of necessary financial information quickly

Institutional
8. More authority and responsibility to line ministries

MoF and MoP plays the major role in budget preparation and resource allocation

Now the line ministries are given more authority and responsibility to allocate and use fund in line with their priority needs#p#分頁標題#e#

It enhances the efficient and effective use of limited resources

The above indicates that a number of significant changes have been occurred due to adopting the MTEF in the formulation and execution of the education and health budgets. And it is evident that these changes clearly distinguish the new budgetary system (MTEF) from the old.

In the next chapter, the impact of the MTEF on the education and health budget in view of three elements of PEM will be examined.
 

Chapter- 4: Impact of the MTEF on the Education and Health budget中期支出框架對教育和衛(wèi)生預算的影響

This chapter will address the second research question in relation to the education and health budget in view of three basic elements of Public Expenditure Management (PEM) - fiscal discipline; allocative efficiency and operational efficiency as the MTEF sought to strengthen those three outcomes. The effectiveness and efficiency of budgetary spending is improved when those three basic elements are achieved. For this reason, the impact of the MTEF on the education and health sector expenditure in Bangladesh will be analysed and the experiences in attaining those objectives of PEM will be assessed.

The chapter is mainly consists of two parts-

Part A
and
Part B
. Part A will assess the impact of the MTEF on the education sector and Part B will assess the impact on the health sector.

4.1 Data, methodology and analytical framework——數(shù)據(jù)、方法和分析框架

The analysis is both qualitative and quantitative and it fully depends upon the availability of data from secondary sources. The analysis is also very simplistic in nature as it does not take into account some other factors like unexpected macroeconomic shocks, adjustments in debt payments that might have destabilized the MTEF. The scope for the analysis is also very limited due to data unavailability. The emphasis was laid on the pre and post MTEF period and data were collected mostly from annual financial statements, Bangladesh from FY01 to FY10, monthly fiscal reports from FY05 to FY09, public expenditure review especially 2006/07, Bangladesh economic review from FY04 to FY08, documents on the MTEF from FY06 to FY10 and also from other sources and then those were assembled in different tables in order to relate them with different criteria.

In order to assess the impact of the MTEF, the criteria that influence the three objectives of PEM are identified (discussed in chapter- 2). The analytical framework is adapted and it is mainly based on the literature of Schick, A (1998), World Bank (1998), DFID (2001) and some other empirical evidences (also discussed in chapter- 2). The assessment will consider the following criteria:

Basic Indicators of PEM
Criteria/ Principles that influence those indicators
Fiscal discipline

Conformity with the spending limit

Consistency in the trend of sectoral expenditure

Allocative Efficiency#p#分頁標題#e#

Change in sectoral allocation

Strategic resource allocation linked to policy, planning

Spending in priority areas/ programmes

Devolution of allocative responsibilities to line ministries

Operational efficiency

Convergence between Expenditure estimates and out- turn

Greater predictability of funds

Progress in achieving output targets

One of the reasons for selecting those criteria is that most of them go with the ‘MTEF objectives' in Bangladesh (discussed in chapter- 3). Some other relevant criteria (discussed in chapter- 2) are not examined mainly due to data unavailability. For example, fiscal deficit relates with aggregate fiscal discipline is not considered here as it is not relevant to sectoral impact analysis (health and education). Improvement in budgetary classification relates to allocative efficiency and improvement in accountability and transparency relates to operational efficiency are not examined due to data and relevant information non-availability.

4.2 Part A- Assessing the impact of the MTEF on the education budget——一個部分——評估MTEF教育預算的影響

4.2.1 Fiscal discipline——財政紀律

MTEF helps to prepare a consistent and realistic estimate that is allocated between public sectors in line with the spending priorities through annual budgeting process. It keeps government spending within sustainable limit and thus promotes fiscal discipline. Wheather education budget achieved the fiscal discipline after introducing the MTEF, will be analysed considering two criteria- conformity with the spending limit and consistency in the trend of sectoral expenditure.

4.2.1.1 Conformity with the spending limit——符合支出限制

The analysis is carried out to see whether the actual spending exceeded the allocation specified in the original budget for education. If it exceeds, it will contribute to the

Table 4.1: Education budget1 and actual spending during 2002-03 to 2008-09
Education Sector
Crore Taka (1 Crore= 10 Million)
Result
(OS= Over- spent)
Original Budget
Actual spending
Non- Development
Pre- MTEF

2002/03

3,875

4,021*
OS

2003/04

4,187

4,418
OS

2004/05

4,706

4,989
OS

Post- MTEF

2005/06
6,374

6,220

2006/07
7,215

7,524

2007/08
8,659

8,143

2008/09
9,603

9,327*

Development
Pre- MTEF

2002/03

2,994

2,319

2003/04

2,709

2,100

2004/05

3,153

1,978

Post- MTEF

2005/06
3,315

#p#分頁標題#e#

2,584

2006/07
3,878

2,513

2007/08
3,710

2,747

2008/09
3,496

3,205*

Sources: Adapted; calculated from the data in Annual Financial Statements (AFS) (FY03 to FY10), Monthly fiscal reports (FY05 to FY 09), Finance Division,Ministry of Finance(MoF), Bangladesh-

Appendix-4

1 Education sector consists of three ministries MoE, MoPME and MoSIC (Ministry of Science, Information and

Communication. So, education budget is the sum of those ministries's budget.

2 & 3 FY03 means Fiscal Year 2002/03 and FY05 means Fiscal Year 2004/05. In Bangladesh, Fiscal Year starts

from July of the current year to June of the next year.

* Revised budget for FY03 and FY09, figures in F03 and FY09 are calculated based on AFS- FY03 and FY09.

overall fiscal deficit. So, keeping conformity with the spending limit is very important to maintain aggregate fiscal discipline.

The Table-4.1 shows that in Pre- MTEF period, actual spending went beyond the budget allocation in case of non- development expenditure from FY032 to FY053. After adopting the MTEF, the actual spending did not cross the budget allocation in case of both development and non- development expenditure.

4.2.1.2 Consistency in the trend of sectoral expenditure——部門支出的趨勢的一致性

Here the analysis is to see whether there are is an increasing trend in the education budget keeping pace with the increase in total public spending. The Table-4.2 shows that after the MTEF, the education sector is manifesting some consistency since the allocation is 2.1 percent of GDP from FY05 to FY08. Allocation dropped a little in FY09 and total expenditure decreased as well.

Table 4.2: Distribution of public expenditure in Education sector from FY 2005
to 2009 (% of GDP)
Source: Adapted; (MTBF-2009/10, p-36), Figures for FY09 is calculated based on (MTBF-2009/10 annex-1, p-64

and AFS 2009-10) at a glance, Finance Division, MoF-

Appendix-5

4.2.2 Allocative efficiency——配置效率

The effectiveness of the budget increases when most beneficial areas/ programmes get the priority and resources are allocated to those. It means shifting spending from lower priority to higher priority to ensure better outcomes. So, where and how the resources are allocated, is very important to get the fruitful results and the MTEF helps to promote this allocative efficiency. After introducing the MTEF, to what extent education budget achieved the allocative efficiency, it will be analysed in view of four criteria- change in sectoral allocation; strategic resource allocation linked to policy, planning; priority spending; and devolution of allocative responsibilities to line ministries.

4.2.2.1 Change in sectoral allocation——部門分配的變化#p#分頁標題#e#

The analysis is to see whether allocation to the education budget increased and to what range after adopting the MTEF. Table- 4.3 shows that highest priority has been accorded to education sector in terms of allocation as before and average share of total expenditure was 17% from FY06 to FY09 comparing to average 15% in pre- MTEF period (FY04 to FY05). Figure- 4.1 indicates that allocation is improved (in current Taka) for education after the MTEF.

Source: Adapted;AFS (FY03 to FY10), Finance Division, MoF

Table 4.3: Sectoral Distribution of Total Programme Spending 4 FY04 to FY08
(percent of total programme expenditure as per the Revised Budget)

Sources: Adapted; MTBF 2008-09, p-301 MTBF-2009-10(Annex-A, p-64), Finance Division, MoF, Figures for FY09 is calculated based on MTBF-2009/10 annex-1, p-64-

Appendix-5

4Total Programme Spending = Total Spending less Interest Charges less Other Non-Assigned Expenditure

Table 4.4: Original Budgetary allocation for Education sector by year (both
development and non- development) Taka in crore (1 Crore= 10 million)
Education Sector
01-02
02-03
03-04
04-05
05-06
06-07
07-08
08-09
09-10
Pre- MTEF
Post- MTEF
Current Crore Taka
6,166

6,869

6,896

7,859

9,689
11,093
12,369
13,099
14,387
Constant Crore Taka5
(1995/96=100)

4,733

5,052

4,792

5,129

5,840
6,238
6,327
6,285
6,451
Yearly change as %
(In constant price term)
-

6.73%

- 5.14%

7.03%

13.87%
6.80%
1.42%
- 0.65%
2.65%
Source: Adapted;all figures are calculated from AFS (FY03 to FY10) Finance Division, MoF-

Appendix-4
Table- 4.4 shows that allocation increased by 13.9% and 6.8% in FY06 and FY07 respectively in real terms after the MTEF although allocation increasing trend is not significant in real terms in the following years. But in FY10 the allocation is increased by 26% (5 year period) in constant price comparing to the allocation of FY05. In FY07, the allocation for Annual Development Programme (ADP) in education was highest comparing to pre- MTEF years allocation (Table- 4.1). The above analysis reflects that education sector is attached to top most priority after the MTEF and some progress has been achieved in sectoral allocation.

4.2.2.1.1 Sub- sectoral allocation——子部門分配

Investment in primary education is considered as one of the major strategies to reduce poverty. To this view, the Government of Bangladesh has targeted to ensure ‘universal primary education in the country by 2015' (BER-2007/08, p-155).

Table 4.5: Budgetary allocation to primary and mass education(both#p#分頁標題#e#
development and non- development) (Taka in crore, 1 crore =Million)
Sub- sector
FY04
FY05
FY06
FY07
FY08
FY09
FY10
Post- MTEF for MoPME
Primary and Mass education
2,799

(40.5%)

3,291

(41.9%)

3,827

(39.4%)

4,722
(42.6%)
5,652
(45.7%)
5,700
(43.5%)
6,616
(45.9%)
Total allocation in education sector
6,896

7,859

9,689

11,093

12,369

13,099

14,387

Source: All figures are calculated from AFS (FY03 to FY10), Finance Division, MoF-

Appendix-4

5 Calculated from the inflation rate stated in Bangladesh Bank, July 2009, tentative inflation for 2009-10 is assumed 7.0,measured by CPI (Consumer Price Index)

From the above table (Table- 4.5), it can be seen that some progress has been achieved in this regard after the MTEF since sub- sectoral allocation to the primary and mass education has been increased. Before the MTEF, the highest allocation was 42% of the total allocation for education sector in FY05 but after the MTEF, the highest allocation was 46% in FY10 which clearly indicates a better targeted allocation to the primary education.

4.2.2.2 Strategic resource allocation linked to national policy, planning——戰(zhàn)略資源分配與國家政策、規(guī)劃

One of the major objectives of the MTEF is to link policy, planning with the budgetary system. In the MTEF, strategic objectives are specified in line with the policies with a medium term perspective to ensure appropriate allocation of limited resources to those programmes which will eventually benefit the maximum number of people and thus it promotes allocative efficiency.
The analysis tries to reveal whether the MTEF in the education sector establishes any linkage between policy, planning and how it translates it in budgeting. If resources are directed to achieve strategic objectives, it will ensure the proper allocation of scarce resources.
PRSP( Poverty Reduction Strategy Paper) and the MTEF
Before the MTEF, the budgets of MoE and MoPME have no linkage between the policy priorities and resource allocation decisions. But after The MTEF the budgets of MoE and MoPME reflect the priorities identified in the ‘National Strategy for Accelerated Poverty Reduction' (NSAPR6). The introduction of the MTEF, a link between NSAPR and the ministry budget is, more or less, established. Within the strategic framework, ‘public resources are allocated through a more policy-led budget planning process towards priority programmes identified in the PRSP' (MTBF- 2006/07, p-8).

6 Bangladesh - Unlocking the potential - National Strategy for Accelerated Poverty Reduction ‘(NSAPR) is the poverty reduction strategy paper (PRSP) for Bangladesh introduced in 2005#p#分頁標題#e#

Table 4.6: Policy objectives, MTEF and budgetary allocation for the education
sector
Strategic Goal stated in national policy (NSAPR)
Strategic objective incorporated in the MTEF of MoE and MoPME in line with the national policy
Programmes/ activities are carried out to implement the strategic objectives of MTEF
Activities are translated into budget (resource allocation)
1. Improve quality and equity and increase access to all types of primary education

a) Improve quality of education at primary level

b) Ensure equality and equity in education at the primary level

a) ‘Second Primary Education Development Programme' was implemented (PEDP-II) (BER-06/07, p-156)

b) ‘Primary Education Stipend Project' was implemented aiming to cover 40% of the students from poor family(CPD-07/08, p-48)

a) Total allocation is Taka 4,933 crore for six year period. (BER-06/07, p-156)

b) Monthly stipend was introduced for 5.5 million primary students (Total allocation was 55 crore Taka in FY08) (CPD-07/08, p-48)

2. Ensure gender parity in secondary school

Gender priority in

secondary education

Tuition fees are waived and stipends are awarded up to 12th grade (BER-06/07, p-158)

Taka 200 crore was allocated for 2.5 million girls in FY06 (BER-06/07, p-158)

Source:Adapted; PRSP-2005 p-226, 227, (MTBF- 2006/07, MoPME, p-34 MoE-47-

Appendix-6
Table-4.6 shows two policy objectives set out in PRSP for education sector, strategic objectives identified in the MTEF in line with policy objectives, activities are carried out to implement those objectives and budgetary allocations were approved to materialize those.

Budgetary spending described in the above matrix are carried out after introducing the MTEF and the above shows a clear link between policy planning, strategic objectives

of the MTEF and budgetary allocation. It means that allocations are directed more systematically to the appropriate programmes considering the policy objectives and thus it indicates some progress in resource allocation pattern after introducing the MTEF.

5.2.2.4 Spending in priority areas/ programmes——支出優(yōu)先領域/項目

The MTEF helps to identify the priority needs and limited resources are directed to those which ensure the efficient use of budgetary fund. The analysis is to see whether resources are allocated in the budget according to the priority needs set out in the MTEF of MoE.

Table 4.7 Priority spending areas/ programmes and budgetary allocation for the education sector
Priority Spending Areas/Programmes for the education sector
Related Strategic Objectives stated in the MTEF
Activities
Activities are translated into budget (resource allocation)
For FY09, one of the priority areas for MoE was development and expansion of tertiary level education#p#分頁標題#e#

‘Improve the balance in the enrolment of

students for professional degrees in the humanities/soci

al faculties, general and applied science,

technical and business

education'

Building new universities and upgrading existing infrastructure (BS-09/10, p-60)

Taka 1,915 crore was approved in FY09 for 09 new projects to carry out those activities (BS-09/10, p-60)

For FY10, one of the priority programmes for MoE was expansion of vocational and technical courses

‘Increase the scope of technical

and vocational education for

adolescents, youths, men and women'

Vocational and technical courses are included in secondary and higher secondary level from FY10 (BS-09/10, p-60)

Taka 320 crore was allocated in FY10 which was 56.3% higher over the previous year

(BS-09/10, p-60)

Sources: Adapted; (MTBF-2008/09, MoE, p-95, 103) and (MTBF-09/10, MoE, p-93), Finance Division, MoF-

Appendix- 7
In previous budgetary system, no sectoral expenditure review process was available and little thoughts were given to set out the exact priorities. But now in each year, MoE reviews their priority spending areas/ programmes set out in the MTEF, then finalizes priority spending areas and seeks for budgetary allocation. The Table- 4.7 shows two different priority spending areas of MoE for two different years and budgetary allocations were approved to carry out specific activities that facilitated the implementation of those programmes. It indicates that after introducing the MTEF, resources are allocated in accordance with priority needs. It shows that progress is achieved in case of resource allocation to the priority programmes.

4.2.2.5 Devolution of allocative responsibilities to line ministries——權力下放的分配責任部門

It seems that Bangladesh has shown some progress in achieving the objectives of allocative efficiency due to adopting the MTEF. The fact is that line ministries are enjoying more freedom and responsibility and they allocate resources to priority activities independently which eventually ensures effective use of limited resources that was completely absent before the MTEF. After adopting the MTEF, a Budget Management Committee (BMC) and a Budget Working Group (BWG) are formed in MoE and MoPME who are working as a budget and planning cell (MTBF, 2008/09). MoE, MoPME and their divisions prepare budgets independently considering their four major functions- ‘medium term strategic objectives'; ‘key activities'; ‘poverty and gender reporting'; and ‘priority spending areas' on the basis of the revenue target and expenditure ceiling given for the Ministry with the call circular from the MoF (BC-1, 2008).

4.2.3 Operational efficiency——經(jīng)營效率

World Bank (1998) refers operational efficiency as the ‘efficient and effective use of resources in the implementation of strategic priorities' (p-2). According to ADB (2001, p-1), public services should be provided at reasonable quality and at the lowest possible cost to achieve operational efficiency. In other words, operational efficiency means ‘getting the best value for money' (DFID, 2001, p-8).#p#分頁標題#e#

In case of education budget execution whether the MTEF enhanced operational efficiency, this is analysed considering three criteria- convergence between expenditure estimates and out- turn, greater predictability of public funds and progress in achieving output targets

4.2.3.1 Convergence between expenditure estimates and out- turn——融合支出估計——轉

Budget expenditure is compared here with out- turn to find out whether the deviation is least after MTEF in view of over- spending or under- spending.

Table 4.8: Budget and Actual Spending ofEducation Sectors from FY 2003-2009(Taka
in Crore)
Pre- MTEF- Education Sector
FY 03

FY 04

FY 05

Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Non- development
3,875

4,021d

3.76
4,187

4,418

5.5
4,706

4,989

6.0
Development
2,994

2,319

-22.54
2,709

2,100

-22.4
3,153

1,978

-37.26
Post- MTEF- Education Sector
FY 06
FY 07
FY 08
FY 09
Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Non- development
6,374

6,220

-2.41
7,215

7,524

4.28
8,659

8,143

-5.95
9,603

9,327d

-2.87
Development
3,315

2,584

-22.05
3,878

2,513

-35.19
3,710

2,747

-52.19
3,496

3,205d

-8.32
Source: Adapted; AFS from FY03- FY09, MFR from FY05 to FY09, Finance Division, MoF-

Appendix-4,
Table- 4.8 shows that, before the MTEF the highest deviation was 6% but the trend tended to be overspending in case of non- development budgetary out- turn (FY 03 to 05). And after the MTEF (FY07 to FY09), the deviation was not increased but the trend tended to be under- spending except FY07. The deviation is very high in case of development budget in case of both before and after the MTEF. So, huge inconsistency in budgetary outturn (either over- spent or under- spent) shows the divergence between budgetary estimates and out- turn which indicates that operational efficiency has not yet achieved.

 

d
Revised budget for FY03 and FY10 are calculated from AFS-2003/04 and 2008/09#p#分頁標題#e#
4.2.3.2 Greater predictability of public funds
World Bank (1998) argued that predictability of funds (assurance to spending agencies as to when and where the resources will be available) is one of the major factors that influence operational efficiency (p- 28). Here predictability is measured by reviewing the quarterly pattern of expenditure (suggested by DFID, 2001, p-25) to see whether resources are utilized from the beginning of the year or the spending is rushed at the year end.

Table 4.9: Quarterly pattern of non- development expenditure as percentage of total non- development budgetary allocation
Source: calculated using the data in MFR from FY05 to FY08, Finance Division, MoF-

Appendix-8
The Table-4.9 shows that before and after MTEF, the quarterly patterns of expenditure are almost same. If 3rd quarters are considered, it indicates that the resources were utilized more or less in an even way (75%, 69%, 77% and 70% respectively). It implies that some funding predictability is there in case of revenue budget but it is not showing a significant change in the funding predictability pattern.

Table 4.10: Quarterly pattern of development expenditure as percentage of total development budgetary allocation
Source: calculated using the data in MFR from FY05 to FY08, Finance Division, MoF

- Appendix-9
The above Table-4.10 shows that in case of development expenditure pattern, no progress achieved in quarterly pattern of expenditure due to the introduction of MTEF. The development expenditure for all the years implied underutilization. The worst thing is that up to 3rd quarter, only one- third of the total allocation was utilized over all the fiscal years. CPD- IRDB (2009) stated that average development expenditure utilization rate (48.44 %) by MTEF ministries was almost identical to the average utilization rate (48.13%) by all ministries in FY09. So, greater fund predictability due to adopting the MTEF is not achieved in case of development budget. But MTEF is not to be blamed as some specific reasons are strongly linked to poor predictability of funds.

According to the IMED, implementation of the ADP was hampered due to delays in tender processing, delays in land procurement, delays caused by project amendment and low disbursement of project aid (CPD- IRDB, 2009).

After the MTEF, the 4th quarters show that resource utilizations were increased by almost 50% over the 3rd quarters of all the fiscal years. It seems that the MTEF ministries are following the same historical trend, making rush to spend respective allocations in the last two months of the fiscal year. Although the MTEF addresses that by allowing resources to be carried forward to the next years but problems lie in some where else. If planned activities are delayed in implementation, the total expenditure could be raised as well as services would not be delivered efficiently.

4.2.3.3 Progress in achieving output targets Table 4.11: Medium Term Output——實現(xiàn)產量目標的進展表4.11:中期輸出#p#分頁標題#e#

Targets of the MoE and MoPME in the MTEF
Source: Adapted; figures in MTBF,2005-09, Finance Division, MoF, Bangladesh-

Appendix-10
Now in each year after the MTEF, department or agencies of MoE and MoPME set their output indicators in the prescribed form of Budget Circular-1 on a medium term basis and the first year target is fixed for budget. MoE and MoPME prepared their key performance indicators accordingly (BC-1, 2008).

The above table shows that net enrolment rate, learning aptitude of the student and attendance in primary education are increased and agreed target by the ministries were achieved after introducing the MTEF. Implementation of two programmes ‘Second Primary Education Development Programme' (PEDP-II) (BER-06/07, p-156) and ‘Primary Education Stipend Project' aiming to cover 40% of the students from poor family (CPD-07/08, p-48) may justify the above achievement. Regarding technical and vocational education, there is an evidence of substantial achievement in all targets like student enrolment, enrolment of female student. It is not obvious that the achievement is only due to adopting the MTEF (other factors are also involved) but the MTEF has a significant role as it facilitated pinpointing the problems (e.g. what indicators are below the satisfactory level in education), including them in the strategic objectives and priorities (MTBF, 2007) and translating them into budget (as discussed in Table- 4.6).

4.3 Findings——調查結果

The following template tries to show, what is supposed to be happened in education sector and what is actually happening due to adopting the MTEF in view of the above analysis.

Table: 4.12 Present Scenario of the MTEF in the education sector
Basic Indicators of PEM
Criteria/ Principles
What is supposed to be happened after MTEF
What is actually happening after MTEF
Achievement
over Pre- MTEF
Fiscal Discipline
Conformity with the spending limit

Complied with the spending limit of budget as well as the projection

There is progress but not fully complied

Progress is achieved

Consistency in the trend of sectoral expenditure

Consistent with the increasing trend of overall public expenditure

There is an increasing trend but not consistent

No progress as increasing trend existed before MTEF

Allocative Efficiency
Change in sectoral allocation

Allocation should be increased in real terms and should achieve the medium term projections

Allocation has been increased in real terms but failed to achieve the medium term projections

Some progress is achieved

Strategic resource allocation

Resource allocation will be mainly consider the strategic objectives

Strategic objectives are specified and there is an improvement in strategic resource allocation#p#分頁標題#e#

Progress is achieved

Linkage between policy, planning and budgeting

Strong linkage between policy, planning and budgeting

Linkage is established as the MTEF is linked to the objectives of PRSP and is translated in budget accordingly

Significant progress is achieved as it was lacking before

Spending in priority areas/ programmes

More spending in priority areas for the maximum utilization of

Scant resources

There is a progress in fixing priority areas and resource allocation is increased consequently

Progress is achieved

Devolution of allocative responsibilities to line ministries

Line ministries are empowered to take decisions in fixing priorities, resource allocation and spending

MO is enjoying more autonomy and responsibility in fixing priorities, resource allocation and spending

Significant progress is achieved as it was lacking before

Operational Efficiency
Convergence between expenditure estimates and outturn

Least deviation between expenditure and outturn

It tended to be under- spending, large deviation is there and also very inconsistent

No Progress is achieved

Competency in resource utilization

Optimal resource utilization

No progress in resource utilization in case of development expenditure.

No Progress is achieved

Progress in achieving output targets

Complied with the target

Targets are not achieved, target projection seems to be unrealistic

No Progress is achieved

4.4 Part- B: Impact of the MTEF on the Health budget

The impact of the MTEF in the health sector is analysed below in view of the same criteria used for the education sector earlier.

4.4.1 Fiscal discipline——財政紀律

4.4.1.1 Conformity with the spending limit——符合支出限制

The Table-4.13 shows that in pre- MTBF period, actual spending went beyond the budget allocation in case of non- development expenditure from FY03 to FY05. After adopting MTEF, the actual spending did not cross the budget allocation in case of both development and non- development expenditure in FY06 and FY07 but in FY09, revised budget was higher than the original budget and the projection in the MTEF for non- development expenditure.

Table 4.13: Health budget and actual spending during 2002-03 to 2008-09
Health Sector
Crore Taka (1 Crore= 10 Million)
Result
(OS= Over- spent)
Original Budget
Projection
Actual spending
Non- Development
Pre- MTEF

2002/03

1.325

-
1,334
OS

2003/04

1,410

-
1,448
OS

2004/05

1,652

-
1,704
OS

2005/06#p#分頁標題#e#

2,063

-

1,936

Post- MTEF

2006/07

2,409

-

2,241

2007/08

2,863

2,723

2,586

2008/09

3,435

3,307

3,593e

OS

Development
Pre- MTEF

2002/03

1,702

-

1,463

2003/04

1,512

-

1,338

2004/05

2,080

-

1,136

2005/06

2,177

-

1,768

Post- MTEF

2006/07

2,375

-

1,701

2007/08

2,606

2,606g

1,586f

2008/09

2,439

2,875g

2,615e

Sources: Adapted; Annual Financial Statements (AFS) (FY03 to FY10), Monthly fiscal reports (FY05 to FY 09),Finance Division,MoF, PER-2006/07of MoHFW.-

Appendix-4

e Revised budget for FY09

f figure in FY08 for development is taken from MFR- FY08

g figures taken from MTBF-2006/07, MoHFW, p-61 and MTBF-2007/08, MoHFW, p- 143 respectively

4.4.1.2 Consistency in the trend of sectoral expenditure——部門支出的趨勢的一致性

The Table-4.14 shows that after the MTEF, the health sector exhibited some consistency in the increasing trend as it increased from 0.7% in FY06 to 0.9% in FY07 and FY09, although the total expenditure is not increased considerably as percent of GDP after the MTEF.

Table 4.14: Distribution of public expenditure in the health sector from FY 2005 to 2009
(% of GDP)
Sector
2003-04
Actual
2004-05
Actual
2005-06
Actual
2006-07
Actual
2007-08
Actual
2008-09
Actual
Pre- MTBF
Post- MTBF
Total Programme Expenditure
11.7

12.3

11.3

11.4

11.5

12.3

Health
0.7

0.5

0.7

0.9
0.8
0.9
Source: Adapted; (MTBF-2009/10, p-36), Figures for FY09 is calculated based on MTBF-2009/10 annex-1, p-64 and AFS 2009-10 at a glance, Finance Division, MoF-

Appendix-5

4.4.2 Allocative efficiency——配置效率

4.4.2.1 Change in sectoral allocation——部門分配的變化

Table-4.15 shows that the allocation for the health sector increased from 7.7% in FY05 to 8.4% but after that allocation is dropped as % of total expenditure. Figure- 4.2 indicates that after the MTEF, there is a significant increase in the health budget in FY10 in current price. Table- shows that the allocation for the health sector in FY10 also increased considerably at constant Taka.

Figure- 4.2
Source: Adapted; AFS (FY03 to FY10), Finance Division, MoF#p#分頁標題#e#

Table 4.15: Sectoral Distribution of Total Programme Spending 4 FY04 to FY09
(% of total programme expenditure as per the Revised Budget)

Year
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
Revised budget
Pre- MTEF for Health
Post- MTEF for Health
Sectors
Public Services

12.6

14.1

11.8

12.3

13.2

12.2

Local Government and Rural Development

10.9

11.4

12.2

12.5

10.0

9.6

Defence Services

8.9

8.3

8.4

9.2

8.6

8.9

Public Order and Safety

5.6

6.1

6.5

7.5

7.4

7.9

Education and Technology

16.1

14.6

17.4

18.6

16.8

15.8

Health
7.8

6.4

7.7

8.4
7.6
7.8
Social Security and Welfare

4.8

4.0

4.9

4.0

6.7

8.0

Fuel and Energy

9.3

8.6

7.1

5.2

5.2

3.7

Agriculture (incl. Subsidy)

6.6

9.0

8.5

9.1

12.5

13.5

Transport and Communication

13.3

13.6

11.5

10.1

8.7

6.8

Sources: Adapted; MTBF 2008-09, p-30,calculated from MTBF-2009-10(Annex-A, p-64), Finance Division, MoF-

Appendix-5
Before the MTEF from FY03 to FY06 (4 years period) the allocation increased by 15% in real terms whereas after the MTEF from FY07 to FY10 (4 years period) it increased by 22% in real terms. Even expenditure in development programmes (Table- 4.18) also increased gradually during FY07 to FY09. The above analysis reflects that priority has been attached to health expenditure after introducing the MTEF and some progress is achieved.

Table 4.16: Budgetary allocation by year (both development and non- development)
Taka in crore (1 Crore= 10 million)
Health Sector
00-01
01-02
02-03
03-04
04-05
05-06
06-07
07-08
08-09
09-10
Pre- MTEF
Post- MTEF
Current Crore Taka
2,727

2,873

3,027

2,921

3,732

4,240

4,785
5,470
5,874
7,000
Constant Crore Taka5
(1995/96=100)

2,152

2,206

2,226

2,030

2,435

2,556

2,719
2,827
2,819
3,139
Yearly change as %
(In constant price term)
-

2.49%

0.94%

-8.81%

19.9%

4.93%#p#分頁標題#e#

5.27%
3.97%
0.78%
11.3%
Source: Adapted; AFS (FY03 to FY10) Finance Division, MoF-

Appendix- 4
Table 4.17: ADP (Annual Development Programme)expenditure by year (% share of
total allocation)
Health Sector
Year
% share of total allocation
Pre- MTEF
2000/01

7.3

2001/02

7.9

2002/03

6.72

2003/04

8.27

2004/05

8.17

2005/06

9.59

Post- MTEF
2006/07

10.4
2007/08

10.5
2008/09

11.4 h
Source:Adapted;BER-2007/08, p-46,ADP utilization-Adp_june_09.pdf. Finance Division, MoF-

Appendix- 11

4.4.2.2 Intra- sectoral allocation——不可多得的部門分配

The total allocation for the health sector is distributed between the line directorates of different districts according to their needs. The following analysis is to see the impact of the MTEF on the distribution of development spending for health across districts by poverty status.

Table 4.18: Distribution of development expenditures (% share of Total allocation)
reported by Line Directors of the districts by poverty status from FY03 to FY08
Health Sector
2003/04
2004/05
2005/06
2006/07
2007/08
Share in Population
HDI 2001 Quartile7
Pre-MTBF

Post-MTBF

Richest 25% districts

55%

66%

74%

61%

34%
33%

2nd quartile

24%

15%

14%

19%

22%
24%

3rd quartile

12%

11%

7%

12%

26%
23%

Poorest 25% districts

9%

8%

5%

9%

18%
20%

Poverty status
Non poor

57%

65%

73%

62%

33%
34%

Less poor

15%

14%

12%

14%

29%
25%

Poor

17%

11%

6%

13%

21%
14%

Very poor

12%

9%

9%

11%

16%
26%

Source: Data Annex, Table A12, of PER-2006/07for health sector-

Appendix- 11

7
Districts were ranked according to HDI (2001) score in ascending order and then divided into four equal groups. Each group has 16 districts.
h Figures in FY09 is from Adp_june_09.pdf

Comparing distribution of development expenditure by poverty status across districts in terms of the HDI (Human Development Index) ranking quartile (Table- 4.18), it is evident that the allocation is improved from 2006-07 for the poor districts and in 2007-08, allocation decreased from 61% to 34% for the richest 24 districts and the bottom two quartiles got the benefit for the change in allocation (PER, 2007)#p#分頁標題#e#

Distribution of development expenditure by poverty status across districts based on the World Bank 2005 study - (Targeting resources for the poor in Bangladesh) is also compared. It shows that allocation for the non poor dropped from 62% to 33% in 2007-08 while the change in allocation benefited the bottom three quartiles (ibid) which complied with the government policy to ‘allocate more resources to the poorer areas' (PER, 2007, p-11).

4.4.2.3 Strategic resource allocation linked to national policy, planning——戰(zhàn)略資源分配與國家政策、規(guī)劃

The analysis tries to reveal whether the MTEF in the health sector establishes any linkage between policy, planning and how it is translated in budgeting. If resources are directed to achieve strategic objectives, it will ensure the proper allocation of scarce resources.
PRSP( Poverty Reduction Strategy Paper) and MTEF
Before the MTEF, the budget of MOHFW (Ministry of Health and Family Welfare) was incremental like other ministries as it considered the actual of the previous year and by adding a margin on top of it (MTBF, 2005). The linkage between the policy priorities and resource allocation decisions was not clearly expressed. But under MTEF, various issues like policies (NSAPR6), priorities of MOHFW, fund requirement for implementing existing and prioritised programmes are considered (ibid).

Two examples are set in Table-4.19 to show the linkage between national policy objectives and strategic objectives for the health sector in the MTEF it also points out how those are translated into budget to ensure their implementation.

Table 4.19: Policy objectives, MTEF and budgetary allocation for the health
sector
Strategic Goal stated in national policy (NSAPR)
Strategic objective incorporated in MTEF of MoHFW in line with the national policy
Programmes/ activities are carried out to implement the strategic objectives of MTEF
Activities are translated into budget (resource allocation)
1. ‘Improve child and mother health'

1. ‘Improvement of child and mother health'

HNPSP (Health, Nutrition and Population Sector Programme) was implemented to provide primary health services to all especially to women and child in rural areas and the programme will be continued up to2011(BER-06/07, p-160)

a) Total allocation for this programme is Taka 37,384 Crore (BER-06/07, p-160) and Taka 2,363 for FY08 was allocated to implement this programme in total 205 Upazilas (Sub- urban and rural areas) (BER-07/08, P-159)

2. ‘Improve child and mother nutrition'

2. ‘Ensure mother and child nutrition'

NNP (National Nutrition Programme) was implemented to ensure food and micro- nutrients (Vit- A, iron, folate) supplementation in rural areas (BER-06/07, p-160)

Taka 641 crore was allocated to cover 28.6 million population through 23,244 community nutrition centre in 105 Upazilas (BER-06/07, p-160)#p#分頁標題#e#

Source:Adapted; PRSP-2005 p- 227, 228 (MTBF- 2006/07, MoPME, p-34) MoE-47-

Appendix- 12
The above shows that some progress is achieved in resource allocation pattern of the health sector after introducing the MTEF as resources are allocated in accordance with the strategic objectives linked to policy that improves the effectiveness of the budgetary expenditure.

4.4.2.4 Spending in priority areas/ programmes——支出優(yōu)先領域/項目

The MTEF helps to identify the priority needs and limited resources are directed to those which ensures the efficient use of budgetary fund.The analysis is to see whether resources are allocated in the budget according to the priority needs set out in the MTEF of MoHFW.

Table 4.20: Priority spending areas/ programmes and budgetary allocation for
the health sector
Priority Spending Areas/Programmes for the health sector
Related Strategic Objectives stated in the MTEF of MoHFW
Activities are carried out
Activities are translated into budget (resource allocation)
For FY09, one of the priority programmes for MoHFW was ‘construction/expansion of different health and family planning infrastructures'

‘Provision of general health care services'

8,464 community clinics and union health and family welfare centres across the country were revitalized (CPD-IRBD-08/09, p-34)

Taka 230 crore was allocated in FY09 to ensure proper functioning of those centres (CPD-IRBD-08/09, p-34)

For FY10, one of the priority programmes for MoHFW is ‘to improve the reproductive health'

‘Improvement of child and mother health'

a) ‘Allowance for poor lactating mother' was introduced (BS-09/10, p-61-63)

b) ‘Maternity health voucher scheme' was introduced (ibid)

a)Taka 33.6 crore was allocated in FY10 (BS-09/10, p-61-63)

b) Taka 70 crore was allocated in FY10 (ibid)

Sources: Adapted; (MTBF-2008/09, MoHFW, p-173) and (MTBF-09/10, MoHFW, p-152-153), Finance Division, MoF-

Appendix- 12
Two examples of priority programmes for MoHFW are described in the above matrix (Table- 4.20). It indicates that after introducing MTEF, resources are allocated in accordance with priority needs. It shows that progress is achieved in case of resource allocation to the priority programmes.

4.4.2.5 Devolution of allocative responsibilities to line ministries——權力下放的分配責任部門

The fact is that MoHFW has been given greater freedom and responsibility for allocating resources to priority activities. After introducing the MTEF, MOHFW and its divisions prepare their budget independently considering their four major functions- medium term strategic objectives, key activities, poverty and gender reporting and priority spending areas on the basis of the revenue target and expenditure ceiling set out for MoHFW (BC-1, 2008).#p#分頁標題#e#

4.4.3 Operational efficiency——經(jīng)營效率

4.4.3.1 Convergence between Expenditure estimates and outturn——收斂性支出估計和產量之間的關系

Crore)
Pre- MTEF- Health Sector
FY 03

FY 04

FY 05

FY 06

Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Non- development
1,325

1,334

0.67
1,410

1,448

2.69
1,652

1,704

3.14
2,063

1,936

-6.16
Development
1,702

1,463

-14
1,512

1,338

-11.5
2,080

1,136

-45.3
2,177

1,768

-23
Post- MTEF- Health Sector
FY 07
FY 08
FY 09
Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Budget

Out- turn

Variation % of budget

(%)

Non- development
2,409

2,241

-6.97
2,863

2,586

-9.67
3,653

3,593 i

-1.66
Development
2,375

1,701

-28.3
2,606

1,586

-39
2,439

2,615 i

7.21
Source: AFS from FY03- FY09, MFR from FY05 to FY09, Finance Division, MoF-

Appendix- 4
Table- 4.21 shows that, In case of non- development budgetary outturn before the MTEF (FY 03 to 05) the deviation was less than 5% but the trend tended to be overspending and after the MTEF (FY07 to FY09), the deviation raised up to 10% but the trend tended to be under- spending and deviation is fluctuated each year. The deviation is very high in case of development budget before and after the MTEF although the revised budget is 7% higher than the original budget in FY09. So, huge inconsistency in budgetary outturn (either over- spent or under- spent) shows the convergence between budgetary estimates and outturn is far away and it demonstrates operational efficiency has not yet achieved.

4.4.3.2 Greater predictability of public fund——更大的可預測性的公共基金

Source: all figures are calculated from MFR- FY05 to FY08, Finance Division, MoF-

Appendix-8
The above table-4.22 shows that after introduction of MTBF (FY06 to FY07), there is an improvement in resource utilization in revenue expenditure pattern in different quarters.

Table 4.23:
Quarterly pattern of development expenditure as percentage of total non- development budgetary allocation from FY 05 to FY08#p#分頁標題#e#
Source: all figures are calculated MFR- FY05 to FY08, Finance Division, MoF-

Appendix-9
The table-4.23 shows that in case of development expenditure pattern, no progress achieved in quarterly resource utilization due to adopting the MTEF. The development budget for all the fiscal years implied underutilization although total resource utilization is increased in FY07 to FY08 comparing to FY05 to FY06.

.3.3 Progress in achieving output target
Source: MTBF, 2008-09, MoHFW, Finance Division, MoF- -

Appendix-10
After introducing the MTEF, Each year department or agencies of MOHFW set their output indicators in the prescribed form of Budget Circular-1 on a medium term basis and first year target is fixed for budget. Accordingly MOHFW prepared their key performance indicators (BC-1, 2008).

The above table shows that in most cases progress seems to be stagnant. Even in some cases targets are not achieved. It is assumed that the indicator targets are not realistically set. Another reason may be the inaccessibility to reliable data. But indicators targeting should be well researched and more efforts should be put in this issue by MOHFW.

4.5Findings——調查結果

The following template tries to show, what is supposed to be happened in health sector and what is actually happening due to adopting MTEF in view of the above analysis.

Table 4.25: The present scenario of the MTEF in the health sector
Basic Indicators of PEM
Criteria/ Principles
What is supposed to be happened after MTEF
What is actually happening after MTEF
Achievement
over Pre- MTEF
Fiscal Discipline
Conformity with the spending limit

Complied with the spending limit of budget as well as the projection

There is progress but not fully complied

Progress is achieved

Consistency in the trend of sectoral expenditure

Consistent with the increasing trend of overall public expenditure

There is an increasing trend but not consistent

No progress as increasing trend existed before MTEF

Allocative Efficiency
Change in sectoral allocation

Allocation should be increased in real terms and should achieve the medium term projections

Allocation has been increased in real terms but failed to achieve the medium term projections

Some progress is achieved

Strategic resource allocation

Resource allocation will be mainly consider the strategic objectives

Strategic objectives are specified and there is an improvement in strategic resource allocation

Progress is achieved

Linkage between policy, planning and budgeting

Strong linkage between policy, planning and budgeting

Linkage is established as the MTEF is linked to the objectives of PRSP and is translated in budget accordingly

Significant progress is achieved as it was lacking before#p#分頁標題#e#

Spending in priority areas/ programmes

More spending in priority areas for the maximum utilization of

Scant resources

There is a progress in fixing priority areas and resource allocation is increased consequently

Progress is achieved

Devolution of allocative responsibilities to line ministries

Line ministries are empowered to take decisions in fixing priorities, resource allocation and spending

MO is enjoying more autonomy and responsibility in fixing priorities, resource allocation and spending

Significant progress is achieved as it was lacking before

Operational Efficiency
Convergence between expenditure estimates and outturn

Least deviation between expenditure and outturn

It tended to be under- spending, large deviation is there and also very inconsistent

No Progress is achieved

Competency in resource utilization

Optimal resource utilization

No progress in resource utilization in case of development expenditure.

No Progress is achieved

Progress in achieving output targets

Complied with the target

Targets are not achieved, target projection seems to be unrealistic

No Progress is achieved