A Comparative Study of Public Expenditure Management in Tigray Regional State: Cases From Bureau of Agrculture and Rural Development and Bureau of Education
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Date
2010-01
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Addis Ababa University
Abstract
One of the principal objectives of the developing countries is to accelerate the pace of social and
economic development. However, the over all effort to achieve this development objective has
remained an elusive and difficult task. This is so partly due to lack of financial resources,
problems of resource allocation and inefficient utilization of the resources in the public sector.
Effective and efficient public e:o.:penditure management has remained to be one of the serious
problems often encountered by the sector bureaus of Tigray regional government. The core
essence of the problem lies in the way the strategic and annual plans are formulated, the different
components of budgets are allocated and utilized, physical and financial pelformances are
evaluated and reported as well as inefficiencies related to systems of monitoring and control.
This study attempts to analyze the case by considering the performance of the Tigray Region
Agriculture and Rural Development Bureau and Education Bureau based on Modified Cash
Based Accounting System introduced since 2003. Accordingly, the analysis in this study
covered, among others, resource allocation between recurrent and capital budget by source of
finance, the pattern of expenditure in relation to the priorities expressed in the 3-5 years strategic
plan of the sector spanning the period 2003-2006 as well as the effectiveness and efficiency of
auditing and procurement procedures and systems in place.
The study revealed that the execution capacity of capital budget for both sector bureaus has been
low during the period under review. Moreover, in both sector bureaus, the financial management
system especially with respect to off setting budget allocated from loan and assistance and
regional and federal governments lacked clear and transparent reporting system. As a result, the
report on budget utilization does not reflect the actual budget utilized during a fiscal year, as it
does not capture the expenditure components related to loan and assistance provided in cash or
in kind or by way of technical assistance from donors.
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Information gap on the budget approved at the federal level, lack of qualified human resource and
the absence of effective intemal audit function are among the factors for the constraints in the
execution of capital budget and prevalence of weak financial management.
Strengthening the management information system, arrangement of local and foreign training
for building the capacittJ of staff, ensuring participatory approach during the preparation of
annual plans and working with higher government officials for possible arrangement on
information flow with respect to approved and released budget are the major recommendations of
the study.
Key te1'11ts: Strategic Planning, Source of Finance, Medium Te1'1n Expenditure
Management, off Budget Fund, Cost Center
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Keywords
Strategic Planning, Source of Finance, Medium Te1'1n Expenditure Management, off Budget Fund, Cost Center