MTEF BUDGET PROCESS A TOOL FOR MAINSTREAMING MDGS

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MTEF BUDGET PROCESS A TOOL FOR MAINSTREAMING
MDGS

• Presented by
• Ms. Monica Aoko Ministry of Finance

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Introduction

• A credible budget system requires, an effective
  and politically anchored mechanism to decide on
  and fund priorities. i.e having to use the budget
  as a tool to deliver the national agenda.
• Strengthening the link between Governments policy
  priorities and public expenditure is one of the
  key objectives of MTEF budgeting

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MTEF Process 2006/07

• Comprehensiveness of the Budget
• This will involve shifting the focus from line
  item level to comprehensive analysis of policy
  priorities. This will be done through the
  Ministerial Public Expenditure Reviews (MPERs)
  which will be the key input to the sectoral
  reports.

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MTEF Process continued

• Deepening the participation of the stakeholders
  in the key decision making stages of the budget.
  This will be achieved through the Sector Working
  Groups and the Public Sector Hearings.
• Strengthening continuity between overlapping
  years ( the budget year and the two forward
  years) by ensuring that projects/activities that
  are ongoing are considered while projecting the
  outer years.

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MTEF Process Continued

• Political Buy in the budget
• Putting in place a clear mechanism for political
  engagement in the budget process especially
  parliament
• As many times as will be praticable the cabinet
  and parliament will be consulted as they are key
  to creating a credible budget.

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MTEF process continued

• Improving the classification system During the
  last MTEF Budget Treasury rolled out a new
  Economic classification and will continue to
  develop it further to achieve a consistent
  classification of the budget.
• Increasing the Budget time table a revised
  annual calendar that allows an early start of the
  MTEF hence the reason for todays launch of the
  SWGs

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Institutional Arrangement

• There are nine sector Working Groups Namely
• Agriculture and rural Development, Physical
  Infrastructure, General Economic Services, Public
  Safety law and Order, Health, Education, Public
  Administration Information communication and
  Technology and National Security
• The distribution of Ministries into sectors has
  closely followed the type of activities and
  functions the Ministries do.

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Institutional arrangements . contd

• Composition of Sector Working Group
• Chairperson - Permanent Secretary
• Convenor - Ministry of Finance
• Co-convenor - Ministry of Planning
• Representatives from line Ministries making up
  a sector
• Private sector, Civil Society, and Development
  Partners
• Each sector will have a secretariat formed from
  Finance, Planning and the sector Ministries

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Terms of reference for Sector Working Groups

• Review sector objectives and strategies in
  relation to the overall National Goals as stated
  in the ERS.
• Coordinate all activities leading to the
  development of of MPERs and finalization of
  Sector report.
• Identify sector priorities and rank them
  accordingly
• Identify inter and intra Sectoral linkages

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Terms of reference for SWG..Contd

• Analyse cost implications of policies and
  strategies in the sector and identification of
  sector wide resource needs, including potential
  sources of funds
• Improve communication and build partnership with
  other stake holders ( private sector, development
  partners and civil society)
• Develop criteria for additional resources if any
  to Ministries/Departments within the sector in
  accordance with an agreed criteria.

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Budget Steering Committee

• A budget steering Committee has been formed in
  the Ministry of Finance. Its main objective will
  be to co-ordinate and monitor the overall budget
  estimates for consideration at policy level.
• Review expenditure proposals in the budget
• Review the overall projections of revenues,
  domestic borrowing and external resource flows
• Coordinate the preparation of the Budget Outlook
  Paper and the Budget Strategy paper
• Review and monitor budget execution

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Budget Secretariat

• The budget Secretariat Based at the Budgetary
  supply Department will provide the linkage
  between the sectors, line Ministries Its role
  will include the following
• Assist the director in the overall coordination
  of the MTEF process
• Technical Analysis of policy and budgetary issues
• Preparation of technical briefs for budget
  steering Committee ( Including Agenda)
• Secretariat to the budget steering Committee

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Macro Working Group

• This will be coordinated by the Director Economic
  Affairs Department and have membership from
  KIPPRA, EAD, Macro DEPT, Central Bank, ERD, KRA,
  BSD and other agencies to be co-opted as need
  arises

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Schedule of events leading to the Finalization of
the 2006/07 Budget

• August 2005 Review of Strategic Plans
• September 2005- Launch of Sector Working Groups
• Sept-Nov. 2005, - Development and Finalization of
  MPERs
• Oct- Nov. 2005 Development of Budget Outlook
  Paper
• December 2005 Issuance of MTEF guidelines

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Schedule of events leading to the Finalization of
the 2006/07 Budget

• January 2006 - Finalize Sector Reports
• February 2006 Sector Hearings
• March 2006- Develop Budget Strategy Paper
• April 2006 Finalize Itemized Budget
• May 2006- Approval of estimates by Cabinet
• Early June 2006 Presentation of Budget to
  Parliament.

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THANK YOU