public financial management reform programme strategy phase iv
THE UNITED REPUBLIC OF TANZANIA
MINISTRY OF FINANCE
PUBLIC FINANCIAL MANAGEMENT REFORM
PROGRAMME STRATEGY PHASE IV
2012/13 - 2016/17
VOLUME I
JUNE, 2012
Table of Contents
...............................................................................................2
.................................................................4
......................................................................................8
........................................................................................ 13
...................................................................................16
.......................................................................................17
.............................................................................17
..................................................................... 18
....................................................................................18
Revenue Management and Tax Administration
.............................................. 19
...................................................................................... 20
Budget Execution, Accountability and Transparency
..................................... 21
........................................................................... 23
Change Management, Programme Monitoring and Communication
Other Core Reforms in Tanzania
.......................................................................25
Strengths identified in the Tanzania PFM systems
.........................................27
Challenges identified in the Tanzania PFM systems
.......................................28
.............................................................................................. 30
.............................................................. 30
The PFM reform Key Result Areas
....................................................................30
...........................................................................................33
Enabling Realisation of Tanzania Development Vision 2025
Facilitating Implementation of the Five Years National
................................. 34
Facilitating Implementation of MKUKUTA/MKUZA II
..................................... 35
Taxpayers Demands for Better Services
.......................................................... 35
............................................................................. 35
Effective and Efficient PFM System
................................................................... 36
............................................................................... 36
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...............................................................................37
................................................................................................. 37
................................................................................. 37
Effective Communication, Coordination and Dissemination
Commitment of Top Leadership and Key Stakeholders
................................. 38
Effective and Functional M&E System
.............................................................. 38
.................................................................................38
........................................................................... 38
........................................................................ 39
KRA 3: Budget execution, accountability and transparency
KRA 4: Budget control and oversight
............................................................... 41
KRA 5: Change Management, Programme Monitoring and Communication
................................................................................................ 46
..................................................... 46
Internal Programme Implementation Arrangements
.....................................46
Programme Governance Arrangements
...........................................................46
Joint Steering Committee (JSC)
........................................................................49
Programme Management Committee (PMC)
...................................................49
......................................................................49
...................................................................................49
..........................................................................50
..................................................................................... 51
....................................................................................51
5.3 Link between PFMRP IV with other National Frameworks
.................................51
............................................................................52
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GDP
GFS
GoT
HIPCs
ICT
IDA
IEC
IFMS
IMF
IMTC
ABBREVIATIONS AND ACRONYMS
ACGEN Accountant General
AFROSAI
AMP
African Organization of Supreme Audit Institutions
Aid Management Platform
BoT
CAG
CB
COA
CoFoG
Bank of Tanzania
Controller and Auditor General
Commissioner for Budget
Chart of Accounts
Classification of Functions of Government
CPAD
CS
CS-DRMS
DAC
DFID
DFMIS
Commissioner for Policy Analysis Department
Chief Secretary
Commonwealth Secretariat-Debt Recording Management System
Development Assistance Committee
Department for International Development
Director of Financial Management Information Systems
DIA
DPs
Department of Internal Audit
Development Partners
DPD Director of Planning Division
East-AFRITAC Eastern Africa Technical Assistance Centre
EFT
EU
FEC
GBS
Electronic Funds Transfer
European Union
Finance and Economic Committee
General Budget Support
Gross Domestic Product
Government Financial Statistics
Government of Tanzania
Highly Indebted Poor Countries
Information and Communications Technology
International Development Association
Information, Education and Communication
Integrated Financial Management System
International Monetary Fund
Inter-Ministerial Technical Committee
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MTEF
MTFF
MTSPBM
NAO
OECD
PAC
PAOB
PC
PBB
PEFA
PFM
PFMRP
PEs
PER
PLANREP
PMIS
PMO-RALG
IMF/FAD
IPSAS
IRBM
JAST
JSC
JSM
KRA
LGAs
LAAC
LGRP
LSRP
MACMOD
MDAs
MDGs
M&E
MoF
International Monetary Fund/Fiscal Affairs Department
International Public Sector Accounting Standards
Integrated Results Based Management
Joint Assistance Strategy for Tanzania
Joint Steering Committee
Joint Supervision Mission
Key Results Areas
Local Government Authorities
Local Authorities Accounts Committee
Local Government Reform Programme
Legal Sector Reform Programme
Macroeconomic Modelling Tool
Ministries, Departments and Agencies
Millennium Development Goals
Monitoring and Evaluation
Ministry of Finance
Medium Term Expenditure Framework
Medium Term Fiscal Framework
Medium Term Strategic Planning and Budgeting Manual
National Audit Office
Organization for Economic Cooperation and Development
Public Accounts Committee
Public Authorities and Other Bodies
Planning Commission
Program-Based Budgeting
Public Expenditure and Financial Accountability
Public Financial Management
Public Financial Management Reform Program
Procuring Entities
Public Expenditure Review
Planning and Reporting system
Procurement Management Information System
Prime Minister’s Office, Regional Administration and Local
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RCU
RSs
SAI
SBAS
SP
TA
TISS
TR
PO-PSM
PPAA
PPP
PPRA
PPD
PSPTB
RBBS
TRA
TRIMS
WB
Government
President Office -Public Service Management
Public Procurement Appeal Authority
Public Private Partnership
Public Procurement Regulatory Agency
Procurement Policy Division
Procurement and Supplies Professionals and Technicians Board
Results-Based Budgeting System
Reform Coordination Unit
Regional Secretariats
Supreme Audit Institution
Strategic Budget Allocation System
Strategic Plan
Technical Assistance
Tanzania Inter-Bank Settlement System
Treasury Registrar
Tanzania Revenue Authority
Treasury Registrar Investment Management System
World Bank
6
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EXECUTIVE SUMMARY
The Strategic Plan for reform of Public Financial Management, Phase IV, is the result of a period of diagnostic analysis and consultations within Government and Development
Partners. The need for deepening reforms of the public finance management is emphasized in MKUKUTA/MKUZA II and Vision 2025, as key elements for PFMRP to achieve:
Fiscal sustainability and balance in the public economy;
Restructuring and reallocations for growth and poverty alleviation; and
Improved public sector performance, efficiency and effectiveness in public administration leading to improved service delivery and development results for
Tanzanians.
A number of underlying reforms have been initiated, for example, those related to an improved budget process along with simplified procedures, automated spending commitment controls, financial reporting and other finance systems, legal reforms of financial management, ethics, procurement, introduction of modern audit methods and techniques. Some institutional reforms have been undertaken to promote good governance and fight against corruption. These initiatives have resulted in some improvements, as measured by international benchmarks and diagnostic reviews.
However, there are indications that the reforms undertaken had not fully reached the desired end results. External diagnosis coupled with the problem analysis carried out through specific audits, reviews, workshops and consultations to design Phase IV indicate that many challenges still remain. In essence, the PFM system is still inadequate; a number of improvements are needed before it becomes an effective and efficient management tool for improved public service delivery.
Efforts to mobilize public financial resources have encountered challenges relating to tax collection; accounting and reporting of non-tax revenues. There are still challenges to comprehend fully the costing of priorities into the Government budget allocations and the implementation and credibility of the recurrent and development budgets across key sectors.
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The quality, accuracy and timeliness of financial reports and accounting are generally good, but require improvement. As EPICOR was rolled out to Ministries, Departments and Agencies (MDAs) and are being rolled out to all Local Government Authorities
(LGAs) it faces serious challenges related to ICT infrastructure and interfacing with other systems.
Efforts have been made to improve cash management. The present cash based commitment system, which ensures commitment control on macro level, puts some challenges to cash management as its side effect can distort execution of the budget especially when cash is not available on a timely manner. Over the coming reform period the Government will start the migration from Cash basis of accounting to Accrual accounting. This will further improve the integrity and content of the Governments financial statements. The migration towards program based budgeting will increase the credibility of the budget to ensure that priorities are properly costed and attained. In addition, a centralization of the management of public debt will reduce the borrowing costs. Reforms in procurement are well underway and compliance rates have gone up and efforts will continue to ensure improvement and sustainability. In addition, support will be given to the Procurement Policy Division with the aim of ensuring value for money in public procurement. There is opportunity to further enhance the quality of financial internal controls following the establishment of Internal Audit Department in the MoF, to further improve the timeliness and quality of audit reports and to ensure that audit recommendations are implemented.
The Government is determined to step up reforms of the Public Finance Management system. The analysis of the current needs and lessons learned has led to the conclusion that the PFM reform shall be:
Comprehensive, including all those various key reforms and activities in the PFM system as well as the cross-cutting issues related to capacity building, service conditions, and the institutional policy legal and regulatory frameworks;
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Captured in a well defined Monitoring and Evaluation framework Sequenced, to manage priorities to ensure a more accurate cash forecasting and achievement of results;
Linked and inter-dependent with clear demarcation of responsibilities and accountability
Better standardized and automated systems to ensure attainment of desired results in financial recording and reporting;
Well managed, with effective institutional arrangement to support implementation of the programme
Focused, aiming at supporting agencies and initiatives which are likely to have a great cross cutting impact on the PFM system.
This strategy is in line with the Five Year Development Plan (FYDP 2011/12-2015/16),
MKUKUTA/MKUZA II and the Vision 2025 and aims for achieving the following:
Economic growth and poverty reduction achieved through policy-based budget management and resource mobilization and allocation, improved fiscal discipline and sustainable budget balance;
Service delivery improvement through the introduction of results-based management, program based budgets, accountability and performance audits;
Good governance through improved transparency, accountability and efficient controls.
The new phase is an enabler towards enhancing revenue mobilization, planning and budgeting, transparency, accountability, efficiency and effectiveness in the use of resources and implementation will be through 5 Key Result Areas (KRAs) of the PFM system; 1) Revenue management, 2) Budget and Planning, 3) Budget execution,
Transparency and Accountability, 4) Budget control and Oversight, 5) Change management, Programme monitoring and Communication.
The identified KRA structure shall ensure that all the different aspects and dependencies of PFM reform are contained and managed during the program implementation. In
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essence, it concurs with the best model for the Public Financial Management system, which is also reflected in the common assessment framework for PFM-PEFA. In addition, it includes cross-cutting institutional issues such as IFMS, Information,
Education and Communication (IEC), Change management, Information Communication
Technology (ICT) and capacity building and training.
The reform program is led by a PFM Joint Steering Committee chaired by Permanent
Secretary – Treasury, MoF with members from wider PFM stakeholder group and with representatives from the development partners.
The estimated total cost of PFMRP Phase IV amounts to Tshs 175 billion 1 over a five year period for the direct development activities including funds to allow the
Government of Zanzibar to conduct the necessary studies that could lead to the preparation of a full-fledged Zanzibar Public Financial Management Reform project
(ZPFMRP), through Basket, Project and Government funds. This translates into roughly
Tshs. 35 billions per annum. The Government will commit the equivalent of Tshs 75 billion 2 within the MTEF for the next five-year period.
This strategic plan will be accompanied by the following documents that serve to facilitate the program implementation:
Results Performance Monitoring Framework, which specify Outputs, Performance indicators, baselines, targets and milestones.
The PFM Reform Program Five Year Work Plan and Budget (2011/12-2015/16) that details activities planned against the milestones. The plan contains the total estimated budget for implementation of the program and an annual work plan will be prepared (Volume II)
An Operations Manuals, that lead component leaders and provide a description of the main policy and rules, specific roles and responsibilities, institutional arrangements, and procedures and formats for procurement and financial
1
Subject to review depending on availability of funds and pace of implementation
2
Subject to review depending on availability of funds, exchange rate and pace of implementation
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management and monitoring and evaluation for program implementation (Volume
III)
A Memorandum of Understanding (MOU) between GoT and Development Partners which is a signed document outlining shared commitment in implementation of the programme.
Flexibility and keeping the PFM program relevancy while maintaining a strategic focus at all times is a challenge that continuously need to be kept on the dialogue agenda. It is also expected that Development Partners will continue to play a constructive role in the engagement with the Government. A mid-term review will evaluate progress and challenges.
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CHAPTER ONE
1.0 INTRODUCTION
1.1
Background
Tanzania has established a solid macroeconomic record over the past decade, with key macroeconomic indicators improving further particularly between 2006 and 2010 amid the global downturn. Real GDP growth averaged 7 percent, attributed mainly to impressive performance in agriculture, transportation, infrastructure, communications, manufacturing and real estate sectors. Among others, inflation lowered to single digits, revenue mobilization increased markedly, and overall fiscal deficits and public debt levels were kept at sustainable levels. In spite of an overly stable macroeconomic framework, the Government of the United Republic of Tanzania (GoT) has gone through economic and financial challenges which necessitated structural reform interventions including strengthening public financial management.
Despite the aforesaid development, challenges remain and these include the need to expand economic infrastructure and create a more enabling and competitive environment for achieving sustained and broad based growth. A more efficient allocation of resources is crucial for the Government of Tanzania. In this context, reforms in public finance management are intended to contribute more meaningfully and geared towards better coordination of reforms that will improve public financial management and hence a high level public service delivery. PFMRP IV strategic plan represents a paradigm shift from previous plans in that it is driven by an integrated results based management and monitoring framework. More efficient and effective budget management is recognized as one of the best ways in which the Government can contribute to realization of broad-based economic growth and development of a vibrant private sector.
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Government has implemented PFM reforms over the past two decades with significant successes. Commendable are the enactment of Public Audit Act No. 11 of 2008 to enhance operational independence of the National Audit Office; the enactment of Public
Finance Act No. 6 of 2001 and its amendment in 2010 and Public Procurement Act
No.21 of 2004 as amended in 2011 to enhance transparency and accountability; timely submission of CAG annual audit reports; establishment of the independent Department of Internal Auditor General; adoption of the Government Financial Statistics (GFS) codes
2001 and Classification of Functions of Government (CoFoG); introduction and expansion of financial management systems to automate various key PFM processes including IFMS, LAWSON, CS-DRMS, SBAS; use of EPICOR by all sub-treasuries MDAs and 86 LGAs; strengthening the capacity of Parliamentary Accounts Committees to execute the oversight function; identifying and closing down dormant bank accounts to improve cash management; and provision of capacity building to staff involved in public financial management.
In spite of the contribution of these reforms to improved PFM, a number of challenges and concerns were observed during the implementation of PFMRP III that contributed to programme underperformance. In fact, PFMRP in itself has evolved in different phases as presented in Box 1 below. PFMRP IV is meant to sustain achievements made and address the observed challenges in the previous phases and further strengthen the public financial management systems and facilitate provision of high level of public service delivery.
The need to strengthen and re-organize Tanzania’s PFM systems has been echoed in a variety of documents and has attracted support from various stakeholders. The documents include, among others: i) the 2009 Tanzania Public Expenditure and Financial Accountability (PEFA) review identified certain areas of weakness, including credibility and classification of the budget; multi-year perspective in fiscal planning, expenditure policy, and budgeting;
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transparency of inter-governmental fiscal relations; consolidation of fiscal position and the medium term debt management strategy, and oversight over local governments. Other areas are; procurement and contract management; in-year fiscal reporting; and the internal audit function and follow up of audit recommendations. ii) The Public Expenditure Reviews (PERs) and a Public Investment Management
(PIM) diagnosis report by the World
Bank point to the need to re-evaluate public expenditure management institutions to enable the Government to fulfill a changing role, one more focused
Box 1: Evolving of PFMRP
Tanzania’s PFMRP evolved in the following phases:
PFMRP I: 1998 - 2004
This Phase implemented from 1998-2004 had an objective of controlling expenditure, introducing aggregate fiscal discipline and contributing to stable macro-economic growth. PFMRP I focused on minimizing resource leakage, strengthening financial control and enhancing accountability by reforming budget process and introducing an
Integrated Financial Management System
(IFMS).
PFMRP II: 2004- 2008
The objective of Phase II was to progressively modernize the processes, procedures and systems involved in PFM through the implementation and use of ‘best practice’ tools, techniques and methodologies to improve revenue forecasting and resource allocation for strategic priorities . with efficiency and effectiveness in service delivery and supporting an engaging competitive private sector.
These reports also highlight that budget reform needs to be developed in tandem with other public sector reforms.
PFMRP III: 2008- 2011
The objective of Phase III was to ensure greater predictability and availability of medium term resources to executing agencies. The thrust was about getting the tools, techniques, methodologies and systems that were introduced in the previous phase to work efficiently and effectively in an integrated manner. iii) The IFMS/EPICOR Audit Report commissioned by the office of the Controller and
Auditor General (CAG) recommends critical areas for strengthening the institutional capabilities and harmonization of IFMS systems and tools across MDAs and LGAs. iv) A recent IMF review of Tanzania’s Public Financial Management underlines that
MDAs strategic plans are not always framed within an assessment of the likely available medium – term financing. It is acknowledged that considerable emphasis is put on aligning expenditure allocations with government’s strategic policies and priorities focusing on activity –based budgeting process. Addressing these issues will
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require that greater emphasis is given to the initial strategic phase of budget preparation with a stronger program level focus thereby enhancing the effectiveness of the overall expenditure and having positive impacting on service delivery. The
Government has embarked on program based strategic planning and budgeting processes which will facilitate linkage to MKUKUTA/MKUZA and the Five Year
Development Planning.
Following recommendations from the above reports, the Government has embarked on a comprehensive and integrated PFM reform program to address major challenges by developing PFMRP IV strategy.
1.2
Purpose of the PFMRP IV
The PFMRP IV aims at strengthening and improving public financial management systems in a more coordinated manner in order to meet the current fiscal policy challenges. Formulation and implementation of Phase IV will enable reforms in the areas of revenue management, planning and budget management, budget execution transparency and accountability, budget control and oversight and program management, monitoring and communication including change management. Hence, the reform agenda is programmed so as to attain a more effective and efficient budget formulation, implementation and control in order to contribute to broad-based economic growth as well as a vibrant private sector development in a sequenced manner.
1.3
Main actors
The Ministry of Finance (MoF), is responsible for public financial management within the
Government thus it has the overall role and mandate of coordinating implementation of the PFM reform program. The Government intends to implement PFMRP IV focusing on five Key Result Areas namely: Revenue Management; Planning and Budgeting; Budget
Execution, Transparency and Accountability; Budget Control and Oversight; and Change
Management and Program Monitoring and Communications including supporting development of a comprehensive Public Financial Management Reform Program strategy for Zanzibar (ZPFMRP). Thus the main actors will be all MDAs specifically including TR, NAO, TRA, BoT, PPRA, PAC, LGAs, and Zanzibar.
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1.4
Implementation Period
It is planned that the implementation cycle of Phase IV will be for five financial year from July 2012 to June 2017. This period is intended to achieve both short term and medium term results, recognising that short-term wins can be attained, while ensuring that synergies and sequencing are maintained to ensure realistic results in the medium and long term.
1.5
Financing of the Programme
PFMRP Phase IV is estimated to cost a total amount equivalent of Tsh 118 billion to finance the five Key Result Areas. The Government and Development Partners are committed to financing implementation of PFMRP IV. The five year work plan is found in volume II.
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CHAPTER TWO
2.0
SITUATIONAL ANALYSIS
2.1
Overview of current PFM
The Vision 2025 and MKUKUTA/MKUZA II affirm that new challenges are emerging including the need for a greater focus on value for money and effectiveness in order to maintain prudent management of public resources. Tanzania has maintained a strong record of fiscal prudence including tax revenue collection performance which has in turn firmed up the basis to furthering macroeconomic stability and sustained expansionary economic policy. Literature recognizes that reforms in PFM has contributed to preserve fiscal discipline and achieve poverty reduction and improved local governance in
Tanzania over the past decade 3 . Instruments such as the Public Expenditure Review
(PER) and the Medium Term Expenditure Framework (MTEF) and strategic plans have been introduced as part of the enhanced Highly Indebted Poor Countries (HIPC) initiatives since 2001 and implemented successfully in all Ministries, Departments and
Agencies (MDAs), with the purpose of maintaining spending under the prescribed limits and linking policy objectives to multi-year budgets. Despite various reforms in PFM the
Government has nonetheless come to a point of realizing the importance of pursuing a more inclusive, coordinated and integrated approach to implementation of PFMRP in order to achieve greater gains in tax administration, make a more efficient use of public resources, set a more appropriate fiscal policy framework and achieve greater development results. This becomes more necessary as GoT continues to support stimulus measures aiming at rapid public investment growth and less fiscal risks and seeks to better respond against global shocks through improved fiscal adjustment and developing other suitable fiscal policy and plans.
3
Andy Wynne (2005), “Public Financial Management Reforms in Developing Countries: Lessons from Ghana,
Tanzania and Uganda”; and De Renzio and Dorotinsky (2007), “Tracking Progress in the Quality of PFM Systems in HIPCs”.
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2.2
PFM Reforms
The Ministry of Finance has been steadfast and instrumental in spearheading past and ongoing PFM reforms. Gaps in revenue administration, planning, budget preparation and execution, backlogs in cash and debt management, reporting, procurement, payment processes, and oversight have been the basis for initiating various PFM reform interventions.
2.2.1
Revenue Management and Tax Administration
Domestic Revenue Collection
Tanzania faced fiscal challenges arising from the gap between low pace of domestic revenues and large public expenditures. Low Tax compliance was endemic as a result of weaknesses in the revenue collection system, poor infrastructure, and antiquated business processes.
In tackling the challenges in revenue administration, the Government established
Tanzania Revenue Authority (TRA) in 1996, which has markedly improved tax administration as evidenced by significant increase in revenue collection. Moreover, TRA has demonstrated effectiveness in revenue administration by introducing Tax payers
Identification Number (TIN), e-filing, and diversifying modes of payment, and effecting reforms in tax administration, it has however, not been able to resolve key issues including strengthening of linkages between domestic taxes and customs databases and other major central database e.g National Civil Registry, social security thus enabling to improve tax registration and monitoring of medium- and small-size taxpayers brewing tax evasion and avoidance. The Government continue to provide guidance on how to better overcome long-pervading deficiencies in non tax revenue collection by MDAs, RSs and LGAs. The structure of levies and user fees as well as institutional capacities within MDAs, RSs and LGAs remain complex and deters achievement of effective, efficient and transparent collection of non tax revenues. In
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line with this, the productive capacities and corporate earnings within parastatal companies and public corporations need to be strengthened.
External Resources Mobilization
In order to reduce transaction cost in mobilization of foreign resources, the GoT and the
Development Partners jointly developed the Joint Assistance Strategy for Tanzania
(JAST) in 2006. The JAST, as a medium term strategy, has put in place a framework for dialogue between the GoT and DPs. The Aid Management Platform (AMP) System was developed to enhance transparency on issues pertaining to disbursing and reporting of foreign resources and projections in a more timely and regular basis and in concordance with to the budget calendar.
2.2.2
Planning and Budgeting
The government has developed a Medium Term Strategic Planning and Budgeting
Manual (MTSPBM) that guides MDAs, RSs and LGAs in planning, budgeting, monitoring, evaluation and reporting. The key documents include the Planning and Budgeting
Guideline (PBG), the budget speech; the estimate books and the background to the budget and medium-term framework (BBMTF). The Government has also updated its financial statistics by upgrading GFS codes from 1986 to 2001 series. Furthermore, since 2010/11 the Government budget system has been upgraded so as to enable reporting according to Classification of Functions of Government (CoFoG). A salient feature in reforms of budget preparation is the stepped up commitment towards transitioning to program-based budgeting, whose implementation is expected to start in the financial year 2012/13.
The Government improved the Medium Term Expenditure Framework (MTEF) by updating theMacroeconomic Modelling Tool (MACMOD) tool for projection of macroeconomic variables and building capacity on financial programming and projections; the tool for resource allocation - Strategic Budget Allocation System (SBAS) and the
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Planning and Reporting (PLANREP) system for LGAs. Expenditure tracking and performance monitoring mechanisms have been instituted and institutional arrangements are in place to conduct periodic follow-up of funds disbursed for budget execution including inspection of projects.
2.2.3
Budget Execution, Accountability and Transparency
Procurement
The Government enacted the Public Procurement Act 2004 (PPA, 2004) along with its
2005 regulations which resulted into inter alia the establishment of the Public
Procurement Regulatory Authority (PPRA) and the Public Procurement Appeals Authority
(PPAA). In addition, the MoF established the Public Procurement division with a mandate to oversee the development of public procurement policy and procurement cadre. In 2007 the Government amended the Local Government Procurement
Regulations to enable LGAs use the PPA, CAP 410.
Procurement audits have been conducted in 219 entities, and these have confirmed that the average level of compliance with the Act (PPA) increased from 39% in 2006/07 to 65% in 2009/10, to 68% in 2010/11 while follow up audits showed that compliance level has improved from 71% in 2008/09 to 73% in 2009/10 and 75% in 2010/11.
A web-based Procurement Management Information System (PMIS) was developed in
2008 and 243 PEs have been registered as of June 2011. The system facilitates PEs to submit procurement plans and implementation reports to PPRA. In addition, there has been increased transparency, awareness and access to procurement information published through the weekly Tanzania Procurement Journal and the PPRA website
( www.ppra.go.tz
).
The Government has introduced a system for procurement of common use items and services, by establishing the Government Procurement Services Agency (GPSA) which arranges for Framework agreements with suppliers and services providers operating
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under such system. The System has simplified procurement of common items, and
Procuring Entities (PEs) are now saving both time and transaction costs, normally associated with carrying out tendering proceedings. The public Procurement Policy Unit
(PPU) was established under the Ministry of Finance to formulate and oversee implementation of procurement policy. The Unit is also mandated to ensure that a professional public procurement cadre is developed, coordinated and properly supervised.
Debt Management
In the year 2004, the Government amended the Government Loans Guarantees and
Grants Act No. 30 of 1974 to empower the MoF to borrow and receive grants. This aimed at curbing haphazard borrowing which landed the Government into the debt crisis in the 1980s. The Act established among other things the Technical and National
Debt Management Committees (TDMC and NDMC); the latter acting as a technical arm to the NDMC and the former taking an advisory function to the MoF on borrowing and grant seeking matters.
Cash Management
Cash Management in the context of the Government entails an effective and efficient management of the Government resources in the way and manner stipulated in the
Finance Act, Regulations and International Public Sector Accounting Standard (IPSAS).
During the financial year ended 30th June 2008 the Government adopted the
International Public Sector Accounting Standard (IPSAS) – Cash basis of accounting.
This has improved the content, credibility and quality of cash flow plans for revenues and expenditures, good banking arrangement system and effective utilization, and reporting of public funds. The Government aims to have right amount of cash and on time for the service delivery units.
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The Government has been implementing IFMS/EPICOR in the MDAs since the year
2000. Currently all MDAs and several LGAs use the IFMS/EPICOR to process the financial transactions and provide input for the preparation of financial statements.
Implementation of the recommendations of a system audit carried out by NAO has enhanced efficiency and effective use of the system.
Public Access to Fiscal Information (Accounting and Reporting)
The Government continues to facilitate improved public access to fiscal information through website, local newspapers, Government gazette, notice boards, radio and television. The information include planning and budget guidelines, financial legislations, annual budgets, budget execution reports, financial statements, audit reports and contract awards, and allocation of budget resources. In general, access to fiscal information has improved in recent years, notwithstanding a few key missing elements and quality controls which undermine integrity and accuracy of financial reporting. A “Citizen Guide to the Budget” is published by a non-governmental organization to enhance public awareness to fiscal information.
2.2.4
Budget Control and Oversight
Internal Control and auditing
In recent years, the importance of the internal audit profession has gained significantly within the country. The Institute of Internal Audit (IIA) was established in 2006 to promote greater awareness and facilitate accredited training to Internal Auditors.
Another salient feature in PFM reforms is the creation of a centralized internal audit function within the MoF Department of Internal Auditor General established in 2010.
This is sought to strengthen the PFM mandate and capacity of the MoF so as to provide technical guidance for internal auditors across MDAs and LGAs and be the only responsible agent on behalf of Government suiting and channeling of new international
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standards and unifying of national procedures and controls in accordance with best practices.
External Audit and Oversight
The Government strengthened audit and oversight functions through enactment of the
Public Audit Act No.11 of 2008 which empowered and enhanced operational independence of the Controller and Auditor General (CAG) and the functions of the
Parliamentary Accounts Committees in order to ensure accountability in PFM. The CAG capacity was strengthened through recruitment, training and provision of tools, equipment and office accommodation. Moreover, the CAG has taken measures to improve external audit performance through the introduction of a risk-based audit methodology and recently has embarked on the automation of the audit process as a remedial measure and further training in other audit activities. As a result, there has been increased compliance with financial legislation and regulations as evidenced by
CAG audit reports. The reports show that unqualified audit opinion for Central
Government (MDAs and RSs) increased from 70 percent in 2007/08 to 77 percent in
2009/10.
2.2.5
Change Management, Programme Monitoring and Communication
Program Administration and Management
The mainstreaming of PFMRP into MoF structures has been generally effective. The capacity of the Government structures to design and implement reform activities outside the enclave of Reform Secretariat has improved significantly. Furthermore, there is improved coordination and dialogue between and among the various stakeholders of the programme. Some of these initiatives include the Lushoto 4 retreat which intended for team building and introspection; joint sessions for development of
MTSPB Manual, MKUKUTA/MKUZA, strategic planning and MTEF; and other meetings.
4
Objective of Lushoto retreat was to build improved dialogue and trust between the various PFMRP stakeholders and improve networking.
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Despite some of the noted achievement regarding mainstreaming of PFMRP into government structure, the design of previous phase posed a challenge in integrating
PFMRP into the existing institutional structure. Most of PFMRP III components were designed according to functions and not necessarily matching with the program expected results and apart from components that are within the Ministry of Finance, the rest are seemingly projects in respective MDAs.
Communication
The Government established Information, Education and Communication units in all
MDAs with a view to improving public access to information. The capacity of the MoF unit needs to be strengthened for smooth communication and improve timely dissemination and sharing of information among all stakeholders.
Support to Zanzibar
Under the previous phases funds had been allocated to strengthen capacity building in public financial management to the Zanzibar Accountant General and the Controller and
Auditor General. These efforts have resulted in installation of IFMS, improved budget management and auditing in Zanzibar. Under PFMRP IV it is intended to support the development of a strategy for a full fledged reform program designed for Zanzibar. The proposed reforms are expected to include revenue management and strengthening capacity in financial management.
2.3
Other Core Reforms in Tanzania
Apart from the Public Financial Management Reform Program the other core reforms being undertaken in Tanzania are Local Government Reform Programme (LGRP), Public
Service Reform Programme (PSRP), Second Generation Financial Sector Reform
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Program, Business Environment Strengthening for Tanzania (BEST), and Legal Sector
Reform Programme (LSRP ).
The essence of the Local Government Reform Programme (LGRP) is to devolve functions and responsibilities, political powers and authority, human and financial resources from the central to the local government authorities levels and thus enhancing accountability under the auspices of Government’s policy on Decentralization by Devolution (D by D). The extent, to which these reform programs results into improved service provision depends on the quality of local governance as well as status of financial management in the public sector.
The public service reform program aims at enhancing capacity, performance and accountability of MDAs and LGAs in the use of public resources and improves service delivery to levels consistent with timely and effective implementation of strategies and priorities. Enhanced performance could as well be evidenced by improvement in policy making, improvement in the use of performance management systems by MDAs and
LGAs, improvement in the management of public servants, and greater access to information and responsiveness to the demands of stakeholders.
The Second Generation Financial Sector Reform Program intend to improve the management structure and financial growth of the financial sector and also to stop further mismanagement in the financial sector which was experienced in the 1990s.
The Government of Tanzania with the support of donors is implementing the Program for Business Environment Strengthening for Tanzania (BEST) whose objective is to deliver a more conducive environment for doing business in Tanzania. The BEST
Program addresses key constraints in the legal and regulatory environment for business and outlines the most effective measures to resolve them.
The Legal Sector Reform Program has the objective of ensuring speedy dispensation of justice, affordability and access to justice for all social groups, integrity and
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professionalism of legal officers, enhanced independence of the judiciary, and ensuring high standards of legal and regulatory framework.
2.4
Strengths identified in the Tanzania PFM systems
The Government has implemented a number of PFM interventions which ultimately led to gains in credibility of the budget, financial recording and reporting, and fiscal oversight. Sound macroeconomic policies and a prudent fiscal management strategy have underpinned Tanzania’s position as one of the best performing public financial management system in Sub Saharan Africa (PEFA Report, 2006). As a result of the impact of the global financial crisis and the stimulus recovery, policies are being appropriately redirected away from short term demand management and expanding resources towards medium term considerations and achieving higher quality standards as a result of improved service delivery.
Significant reforms are still required to build on the strengths gained over time which include the following: i) Strong commitment by the Government of Tanzania to undertake PFM reforms to a new stage; ii) Strengthened MoF, macro-fiscal policy role and the introduction of a Medium-Term
Expenditure Framework so as to enable a more effective formulation and disciplined use of the budget according to revenue and development targets on the aggregate; iii) Aligning planning timeframe with MKUKUTA/MKUZA II and by a global performance framework for all public agencies and executing units including the development of the five year development plan- ongoing review of the Public
Finance Act, the Public Procurement Act, Public Audit Act and other relevant legislation concurrently with the formulation of a new phase of the PFMRP and ensure a wide coverage and coordination of the newly revised components in the reform agenda;
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iv) Successful rollout of the IFMS/EPICOR to all MDAs, RSs and 86 LGAs with simplified and automated means to ease financial recording and reporting and the
MOF to exert a major successful role in implementing commitment controls throughout the payment system in a centralized manner. This will continue to improve the quality of planning and budgeting controls as the new phase enter into operation; v) Adoption and use of International Public Sector Accounting Standards (IPSAS),
International Standards on Auditing (ISA), and International Professional Practices
Framework (IPPF) for Internal Auditors; vi) Introduction of Electronic Fund Transfer (EFT) and Tanzania Interbank Settlement
System (TISS); vii) Ongoing reforms to foster effective management of both external and domestic debt; viii) Ongoing reforms in payroll controls, procurement, and tax regimes; ix) Strengthened oversight functions committees to enforce implementation of CAG recommendations; x) Revision of Legal and Regulatory Frameworks to enhance control and accountability; and xi) Continued strengthening of NAO and PPRA to carry out control and oversight functions over the procuring entities.
2.5
Challenges identified in the Tanzania PFM systems
While the traditional budget system and the new features introduced in recent years have enabled Tanzania to observe fiscal discipline and stability, the system’s continued effectiveness and the management of public resources are being challenged. The main challenges of the current PFM system can be summarized as follows: i) Macroeconomic and fiscal forecasting; ii) Linkages between development spending and the recurrent cost of the development budget;
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iii) Predictability of the budget execution; iv) Harmonization of external and domestic debt systems; v) Project and contract management; and vi) Timely responding to audit recommendations.
To address these PFM challenges, the Government has embarked in the staging of a comprehensive and integrated PFM reform program based on the PEFA analysis and the other reports mentioned in the first Chapter. Five Key Result Areas have been identified which are: Revenue Management; Planning and Budgeting; Budget Execution,
Transparency and Accountability; Budget Control and Oversight; and Change
Management and Programme Monitoring and Communications.
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CHAPTER THREE
3.0
PERSPECTIVES OF PFMRP IV
3.2
Goal
The overarching goal of Tanzania’s PFMRP is to attain a Sound financial management and discipline in public service delivery for sustainable development. Compared to previous phases, the PFMRP IV will strategically focus on critical PFM actions which aim at improving coordination primarily between revenue management, fiscal policy and planning while prioritising those agencies and actions that will have cross cutting effect on the full PFM system. Further, the programme will focus on improving MTEF credibility, budget control and oversight, and deepening into better linking planning and budgeting, cash and debt management, while migrating towards accrual accounting, financial accountability and transparency.
3.3
Main Objectives
The main objective of the PFMRP IV is to support the National Strategy for Growth and
Reduction of Poverty – MKUKUTA/MKUZA II through implementation of the five year
National Development Plan to attain the objectives of Vision 2025.
3.4
The PFM reform Key Result Areas
The Government is defining its PFM reform priorities, subsequent reform activities and sequencing of the implementation process according to MKUKUTA/MKUZA II. Further, the PFM reform agenda will serve as a useful tool for dialogue between Government and development partners about the provision of harmonized support to the
Government’s PFM reform efforts. PFMRP Phase IV is intended to address the identified
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critical limitations in the public financial management systems based on five Key Result
Areas (KRAs): Revenue Management; Planning and Budgeting; Budget Execution,
Accountability and Transparency; Budget control and Oversight; Change Management and Programme Monitoring and Communications as well as strengthening
Government’s capacity to improve service delivery.
Considering the need for attaining a comprehensive approach, the reform will address the following Key Result Areas (KRAs) with Senior leads indicated in : 1) Revenue
Management (Commissioner Policy Analysis), Planning and Budgeting (Commissioner for Budget), Budget execution, transparency and Accountability (Accountant General),
Budget control and oversight (Internal Audit General), Crosscutting issues (including change management and Program management) (Director for Planning Division).
The identified KRA structure concurs with MoF structure PFM implementation stakeholders and is reflected in the common assessment framework for PFM-PEFA. In addition, it specifically focuses on cross-cutting institutional issues, such as training, ICT systems, change management and communication etc.
The M and E details Outcomes, Outputs, Performance indicators, Baselines, Targets and
Milestones. Based on the M and E framework the work plan, details outputs, milestones, timing, resources and responsible person.
The particular choice and inclusion of components in the PFMRP Phase IV was informed by two main factors; i) functional considerations within the MoF and ii) the organizational structures pertaining within the Government of Tanzania.
Accountability for performance and sustainability considerations also justify an emphasis on reflecting the organizational structure in the particular breakdown of PFM reform components. Hence most components have a departmental “home” and are linked to a
“KRA lead”, see Table 1 .
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Table 1: KRA and components overview
KRA
1. KRA 1: Revenue Management,
Leader: CPAD
2. KRA 2: Planning and Budgeting,
Leader: BC
3. KRA 3: Budget Execution,
Transparency and Accountability,
Leader: AccGen
Major Component, Department and KRA-TWG
Commissioner for Policy Analysis Department
(CPAD) – MoF
Treasury Registrar (TR) - MoF
Prime Minister’s Office – Regional Administration and Local Government (PMO-RALG)
Commissioner External Finance - MoF
MDAs
Commissioner for Budget (CB) – MoF
CPAD – MoF
PMO-RALG
Public Procurement Regulatory Authority (PPRA)
Public Procurement Policy Unit
Accountant General (ACCGEN) - MoF
CPAD - MoF
Government Asset Management - MoF
Internal Auditor Department - MoF
National Audit Office (and Parliament PACs)
TR
4. KRA 4: Budget Control and
Oversight,
Leader: IAG
5. KRA 5: Change Management
Programme Monitoring and
Communication,
Leader: DPD
Department for Financial Management
Information System (DFMIS) - MoF
Government Communication Unit - MoF
Department for Planning Division – MoF
Support to Zanzibar
PMO – RALG
ACGEN - MoF
DAHRM - MoF
As the table indicates most KRAs have many actors/stakeholders contribution to the
Outcomes. It is evident that linkages between and across most components will need close collaboration in order to achieve the intended outcome. As such, IAG, NAO and
PPRA as well as the TR and the Parliament (PACs) need to converge efforts, liaise and collaborate to contribute to improvement in budget control and oversight functions.
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3.5
Intermediate Results
The intermediate results of PFMRP IV, to be achieved by fiscal year 2015/2016 are: i) Coordinated, comprehensive PFMRP effectively sequenced and supported by a consistent and harmonised legal and institutional framework; ii) Utilisation of sound and comprehensive macroeconomic analysis, macro fiscal forecasting for a credible and transparent budget process and utilisation of MTFF. iii) Realistic revenue forecasting, collection and management; iv) Enhanced accuracy in forecasting and reporting of domestic and external cash resources; v) Improved reporting and corrective action to enhance quality and completeness of report on financial statements and audits; cash and debt management; vi) Establishment of a clear sequenced and coordinated roadmap for support and implementation of “high impact” implementing agencies and initiatives such as program-based budgeting, Internal Audit, DFMIS, Treasury Registers, AcGEN,
PMORALG and Revenue management; vii) A global performance and monitoring framework and establishing of strong linkages between policy objectives and public expenditure by means of sector-led
MTEF and costed strategic plans; and viii) Institutional and Standardized training modules established where relevant.
Therefore, Implementation of PFMRP IV will pursue achievement of the hierarchy of results at Outputs, Outcomes and Impact level as indicated in M&E Result matrix.
PFMRP IV result chains follow the logical sequence of cause-effect relationships between Impact, Outcomes, Outputs, Activities and Inputs which are monitored by the
M and E framework. PFMRP Stakeholders did a thorough problem analysis through a logical framework approach to identify what the Programme is accountable for in contributing to the Impact and Outcomes and what it is accountable for delivering outputs. For each output, several milestones were identified as a means to achieve
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short term results. The use of Results-Based Management from the design stage of
PFMRP IV is expected to improve program and management effectiveness and accountability by orienting all the implementation cycle towards achieving the desired results.
3.6
Key Drivers
The main drivers for PFMRP IV include the need to: enable realisation of Vision 2025; develop an effective and efficient PFM system in the country; facilitate implementation of MKUKUTA/MKUZA II; address taxpayers’ demands for better services; enhance good governance; and address emerging PFM challenges associated with the changing needs in a dynamic and evolving global economic environment.
3.6.1
Enabling Realisation of Tanzania Development Vision 2025
Realisation and operationalisation of Tanzania Development Vision 2025 (TDV 2025) depends on a good public financial management system. The vision envisages Tanzania to become a middle income country characterised by: high quality livelihood; peace, stability and unity; good governance; well educated and learning society as well as strong and competitive economy. These aspirations, in particular good governance require transparency and accountability in public financial management. Similarly, a strong and competitive economy is to be underpinned by robust planning, sound resource prioritisation, financial discipline and ability to generate sufficient revenue. This provides the first rationale for developing PFMRP IV.
3.6.2
Facilitating Implementation of the Five Years National
Development Plan
The Government has prepared the first Five Year Development Plan (FYDP 2011/12 –
2015/16) with the goal of unleashing the country’s resource potentials in order to fast
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track the provision of the basic conditions for broad-based and pro-poor growth. PFMRP
IV is embracing all three salient features of FYDP which are : a shift from need based planning to opportunity-based planning; strong emphasis on growth while focusing on human resource skill development and high drive and scaling up on the role and participation of private sector in economic growth. In order to attain the main goal of
FYDP, it is necessary to implement PFM interventions which will assure a sound PFM system to enable effective and optimal resource utilization.
3.6.3
Facilitating Implementation of MKUKUTA/MKUZA II
MKUKUTA/MKUZA II translates Vision 2025 aspirations and MDGs into measurable broad outcomes organised in three clusters. Cluster I: Growth for reduction of income poverty; Cluster II: Improvement of quality of life and Social well being; and Cluster III:
Governance and accountability. Moreover, MKUKUTA/MKUZA II is linked to sector policies and strategies through the operational targets. For effective implementation, sectors align their strategic plans with MKUKUTA/MKUZA II. Therefore, in order to attain MKUKUTA/MKUZA II goals, a sound PFM system is essential across the
MKUKUTA/MKUZA clusters.
3.6.4
Taxpayers Demands for Better Services
In the recent years there has been an increase in demand by taxpayers for better services. The better services are manifested by enhanced transparency and accountability, value for money on public expenditure and responding to amongst others requirements of the Parliament regarding public resource management.
3.6.5
Enhancing Good Governance
Good governance has been emphasized in Tanzania Development Vision 2025 and
MKUKUTA/MKUZA II and is a fundamental component in shaping a favourable environment for economic growth and poverty reduction. It is given the central role in
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reaching national goals and objectives. These include ensuring systems and structures of governance support and upholding the rule of law.
3.6.6
Effective and Efficient PFM System
The ability to generate sufficient revenue and external resource mobilisation still remains a challenge in the country. PFMRP IV will assist in addressing the challenge through articulating enforcement of tax laws, rules, laws and regulation, widening the tax base, better management and control of retention and roll over funds, proper channelling of revenue from collection points to the treasury and the management of non tax revenue. Moreover, systems and procedures for optimal mobilisation, allocation, funds flows, spending of and accounting for public resources are still required.
3.6.7
Addressing PFM Challenges
As PFM challenges are still in existence, there is a need to continue formulating strategic interventions for addressing them. PFMRP IV strategy builds on internal and external reviews in the last seven years which, besides the above mentioned reports
(primarily PEFA and CAG reports), include the Campo Review (2005), the Paul review
(2007), Hawkins report (2009), the Lushoto retreat report and the supervision mission reports of 2010 and 2011. The reviews have acknowledged significant PFM achievements in the country and remain challenges to be addressed. The government has decided to develop this strategy which will address the observed PFM challenges in the next five years (2011 – 2016). The strategy will consolidate achievement and deepen reforms to take into account noted challenges and emerging development issues. It is noteworthy appreciated that there will always be some PFM challenges as the economy is dynamic and hence the need to keep PFM systems current and in robust.
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3.7
Anticipated Success Factors
The success of this strategy will depend on a number of strategic imperatives which include: capacity building; enabling legal framework and supportive institutional setting; effective communication, coordination and dialogue; commitment of top leadership and key stakeholders; as well as an effective and functional M&E system.
3.7.1
Capacity Building
In the earlier phases focus was on implementing PFM capacity building initiatives in the areas of human resources development, retooling and improving working environment.
However, inefficiency in the programme design resulted into failure in reporting on training impacts. It is envisaged in the short term, mapping exercise for capacity building and draw on identified institutions that will develop and deliver PFM specific modules. In the long term, it is expected that local training institutions to pick up the opportunity and offer public finance, accounting and procurement certificates/courses.
Hence, this will enable the training institutions to sustainably provide short and long term PFM training.
3.7.2
Enabling Legal Framework
In cases where the existing laws, rules and regulations are not harmonised or do not support public financial management, at the Central and Local Government, they will be reviewed, amended and their enforcement will be pursued in earnest.
3.7.3
Effective Communication, Coordination and Dissemination
Effective communication, coordination, dissemination and sharing of information among all stakeholders are vital towards the success of the programme. Further, dialogue among key players is necessary for transparency and accountability of public finance management.
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3.7.4
Commitment of Top Leadership and Key Stakeholders
Commitment of the top leadership and implementing agencies is vital for the success of the programme; this will also ensure ownership and commitment among technical staff who will be implementing the programme. PFMRP IV intends to carry out change management programme that will create change champions and also develop comprehensive communication strategy.
3.7.5
Effective and Functional M&E System
An effective and functional program monitoring and evaluation system (M and E
Framework) has been developed. It has been based on the PFMRP IV strategy focus and influenced by the PEFA framework. This will assess whether or not the Programme objectives are being realized and thus will be the basis for decision making.
3.8
Interventions of PFMRP IV
The MoF will be the main actor of the PFM reform agenda in collaboration with the
Planning Commission, PMO-RALG, PO-PSM, the Tanzania Revenue Authority, and other key stakeholders. The Programme should clearly bring out the enhanced role of the
MoF as the custodian of Government resources in respect of planning and recommending sound revenue and financing policies, allocating resources judiciously and carrying out the required monitoring and oversight functions. Phase IV reforms will be implemented across the following Five Key Result Areas:
3.8.1
KRA 1: Revenue Management
Improved revenue forecasting and mobilization is critical to support a credible and sound budgetary process. Realistic revenue and cash flow forecasting, as well as opportunities for cost recovery and cost-benefit sharing is a key aspect of reforms in revenue management. The need to streamline the existing revenue policy function
38
within MoF has been identified in the action plan, as adequate tax statistics needed to perform tax policy and other fiscal policy analysis are facilitated also with a view to supporting more realistic revenue and cash flow forecasts. MoF will review the existing legal and institutional arrangements for revenue collection. This will enable development of a more appropriate model for revenue forecasts.
The Government will continue collaborating with development partners to improve external resources management, integration with budget preparation and implementation, to enhance predictability, accounting for and reporting on of public resources. Furthermore, PFMRP IV will implement specific activities aimed at improving retention scheme arrangements.
3.8.2
KRA 2: Planning and Budgeting
Despite the achievements made in planning and budgeting at central and local levels, challenges still remain. PFMRP IV deems necessary to prioritize basic actions targeting on macro-fiscal policy, planning, improved MTEF credibility, and extend the course of adopting GFS2001 and CoFoG standards to facilitate program-based budgeting and thus broaden the scope of the chart of accounts for enabling improved budget planning, monitoring, recording, reporting, and accountability.
Medium-term expenditure framework
MTEFs exist for most MDAs and LGAs operating though with weak linkages between recurrent and development estimates and between administrative and executing units.
One enduring limitation of MTEFs relates to the recurrent budget format, which is mainly administrative (i.e., not program based) hence, it fails to capture the recurrent costs that arise from development expenditure. In response to this, PFMRP aims at establishing a policy-driven system that adheres to major upstream programmatic goals which integrates recurrent and development spending into central operations of priority programs and activities that bear results.
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Linking national development and institutional plans to budgeting
Concurrently, a methodology will be developed as part of the Medium Term Strategic
Planning and Budgeting Manual (MTSPBM) so as to enable the national development planning and the budgeting system to articulate national targets and institutional plans across public organizations. A global performance framework will also be formulated for planning and linking the programmatic goals to the desired sector and institutional results and measuring performance against national priorities at the various lines and levels of accountability.
Results-based Budgeting System
All the above interventions will lay the ground for enabling the Government to gradually transitioning to a Results-Based Budgeting System (RBBS) through a detailed action plan. The objective of these activities are to make PFM systems more results-oriented as well as to increase accountability and transparency; to provide and use information on performance for policy planning and management in order to enhance efficiency and effectiveness in budget preparation, execution and oversight. Introduction of RBBS will ensure that financial resources are allocated on the basis of outcomes to be achieved, by matching program costs with program results, and by comparative assessments of program efficiencies, effectiveness and relative worth in producing the desired results.
3.8.3
KRA 3: Budget execution, accountability and transparency
This KRA aims at achieving greater predictability for spending units, increased efficiency throughout the public sector and maintaining sustainable debt levels. Key activities will address deficiencies in procurement processes, cash and debt management and accounting and reporting.
Procurement
Most of MDAs and LGAs face capacity constraints in procurement and contract management in implementing programs and ensuring achievement of value for money.
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PFMRP IV will focus on building capacity in the Procurement Policy Unit and in preparation of procurement plans, bidding /tendering documents, evaluation of bids/proposals negotiation skills and contracts management as well as asset management. The capacity for PPRA will also be enhanced to carry out procurement compliance audit and facilitate infrastructure for e-procurement. The policy and legal framework for public procurement will also be instituted.
Cash and debt management
PFMRP IV has set out critical activities that will gear towards improving consolidation and reporting of Government cash balances by closing numerous bank accounts held by spending units; devising a Treasury Single Account (TSA) structure inclusive of revenue and expenditure sub-accounts managed and maintained through the Bank of Tanzania; allowing overnight sweeping and clearance of tax collections on a daily basis; and building capacity of MDAs, RSs, LGAs and PAOBs in the development of accurate and realistic revenues and expenditures projections. PFMRP will facilitate establishment of a debt management office, consolidation and reporting of public debts by establishing a single unified data base.
Accounting and reporting
PFMRP IV will implement activities aimed at improving the scope and quality of financial recording and reporting. Moreover, the PFMRP will support harmonization of existing accounting and reporting systems, review the legal and regulatory framework, and build capacity of accounting cadre and the migration towards accrual accounting. Other activities will target financial reporting and presentation of key budget execution reports as well as other review and fiscal reports.
3.8.4
KRA 4: Budget control and oversight
PFRMP IV will act promptly to strengthen Internal Audit Department, oversight function of the National Audit Office and TR capabilities to oversee the public finances of Public
Enterprises.
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Internal control and internal audit
The programme will strengthen the Internal Auditor General’s Department within MoF that will provide technical guidance to internal auditors within MDAs, RSs, PAOBs and
LGAs. Other activities include capacity building to internal auditors so as to conduct audits in a wide range of PFM areas and enhance governance.
External audit
The main intervention of National Audit Office (NAO) in PFM reforms is to conduct a timely independent examination of the financial performance and report to the public to ensure accountability and compliance with financial regulations. These reforms will support NAO to become a well performing Supreme Audit Institution (SAI) in Africa espousing the principles of good governance and accountability, implementation of value for money, performance auditing and other modern methods of managing and operating an audit institution.
Capacity to oversee Public Enterprises and Government Institutions
The Treasury Registrar (TR) is responsible for overseeing management and financial accountability of the Government’s interests as a shareholder in public enterprises and
Government institutions. It advises the Government on all issues pertaining to those investments. PFRMP IV will continue supporting TR in order to perform its core functions effectively and efficiently. The support will include: developing Public
Investment Management Database; management of Public Enterprise; Reviewing and harmonizing public investments Acts; implementing M&E system for Public investments; and building the capacity of public enterprises and Government Institutions.
Parliamentary oversight
The Public Audit Act stipulates that CAG reports shall be followed up by the
Parliamentary Accounts Committees (PAC, POAC and LAAC). The enforcement of CAG reports are facilitated by Parliamentary Accounts Committees during execution of their duties. Parliamentary accounts Committees constitute new members after every three
42
years and after General election. These members are required to be trained in understanding financial statements, CAG reports and on interrogation skills in order to enable them execute their functions effectively. The main intervention in respect of
Parliamentary Oversight Committees in PFM reforms is to build capacity and also by conducting training to their members and facilitating them to conduct physical visiting to the projects implemented by the Central and Local Government as well as the
Parliament Secretariat.
3.8.5
KRA 5: Change Management, Programme Monitoring and
Communication
The programme will review key financial management information systems to increase the efficiency by interfacing, co-ordinate and integrate for improved service delivery.
Also, it will Improve communication and public access to key fiscal information to stakeholders while instituting change management and leadership.
IFMS and electronic services delivery
IFMS/EPICOR is recognized as an effective tool in financial management and reporting.
In general, there is inadequate coordination to deal with ICT management at the
Ministry of Finance leading into financial systems and tools that are not properly integrated and harmonized. PFMRP IV will facilitate harmonization of systems and tools like SBAS (Access), IFMS/EPICOR (SQL), RIMKU (Access), Plan Rep (Access), HCIMS
(Oracle), CS-DRMS (Oracle) and AMP (Oracle) including compatibility for effective planning, budget management, accounting and reporting. Further, the Government will continue to implement the recommendations specified in the CAG’s IFMS Review Report of 2010.
Also, under the programme, some of the existing IFMS/EPICOR modules and computerisation will be upgraded. IFMS/EPICOR will also be provided with the opportunity to further developing and interfacing other systems such as aid management, procurement and supply chain management, and fixed assets.
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The Government has rolled out EPICOR to all Ministries, Regions and 86 LGAs. The
Government will roll-out EPICOR to the remaining MDAs and LGAs, ensure effective utilization of EPICOR and conduct training to staff. In contrast with previous PFMRP efforts, the focus of IT-related activities will lie mostly on quality aspects, harmonization of technological capabilities and technical resources, and other basic precepts before
EPICOR can be rolled out further within MDAs and LGAs.
Access to Key fiscal information
The GoT already makes available key fiscal information but there is a need to communicate more and better to the targeted audiences. To achieve this, a communication strategy will be developed as well as enhancing capacity.
Co-ordination and standardization of PFM training initiatives
One of the major components in the Phase IV program is PFM training. Inorder to lift the whole system standardised and repetitive training against modules of PFM training is needed across the system. This intervention is foreseen to lead to quality and effectiveness gains with a cross cutting impact on the PFM system.
Change management and program monitoring
Success of the program depends much on the change management of the stakeholders under which all program implementers will have to embrace. In order to succeed continuous learning is crucial for component managers who are expected to be instrumental as change agents for the change management process. Development of work plans will be done to ensure that all are informed, that activities are planned in line with the strategy and that activities are efficiently and effectively co-ordinated to ensure that results are achieved. Internal monitoring and evaluation will be a key element of the successful implementation of the reform programme.
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Communication
Communication plays an important role in any change management. In respect of interventions proposed herein, there is need for an effective communication that will improve interaction between and among PFM stakeholders. The activities to be implemented will include, developing communication Strategy, raising awareness of
PFM issues among stakeholders, developing and disseminating IEC materials and reviewing communication structure between central Ministries and LGAs.
National systems and processes for intra-governmental transfers to LGAs
Intra-governmental transfers of funds are cross-cutting in nature and delays have been experienced at different levels. The delays cause inefficiencies in the public service delivery. In order to address the key challenges in the transfer system a mapping exercise will recommend measures to streamline and rationalise the processes.
Support to Zanzibar
Mainland and Zanzibar have many interlinked PFM systems and are interdependent on functional systems. The PFMRP IV will support the development of a comprehensive strategy for PFM reforms in Zanzibar.
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CHAPTER FOUR
4.0 INSTITUTIONAL ARRANGEMENTS
Successful implementation of a PFMRP requires the establishment of a robust institutional framework. The institutions within the programme should work in a more harmonised framework to support and coordinate the PFM reform process. Although
PFMRP implementation has been mainstreamed in the Government structure there is still more need for change management and mindset to view it as part of normal
Government core functions. In addition, there is still low knowledge base on resultbased monitoring and evaluation among key stakeholders especially in MDAs and LGAs.
As a result there is incomplete, inconsistent and inadequate data, presentation of process oriented reports and duplication of efforts. The success of the programme will depend much on organizational arrangement which includes clear linkages and collaboration among the various stakeholders and other reforms initiative and coordination of components implementing the programme.
4.1
Internal Programme Implementation Arrangements
In terms of organization for managing PFMRP IV activities within MoF and other beneficiaries of the programme, an Operational Manual has been developed. The manual describes roles, responsibilities and processes and procedures to be followed in implementation of the programme. The Manual will be amended from time to time as required (see Volume II).
4.2
Programme Governance Arrangements
The programme Governance arrangements under PFMRPIII were well documented however a number of challenges were experienced. There were a number of shortcomings which need to be addressed during this phase. Some of the problems that were encountered during Phase III governance arrangements included: irregular meetings; inadequate separation of strategic and operational meetings; inconsistent dialogue mechanism between GoT and DPs; and inadequate representation of key
46
stakeholders in the programme meetings. Issues that are addressed in the institutional arrangements for Phase IV, include: frequency and sequencing of meetings; better linkage of the meetings with the Government’s planning; budgeting and reporting instruments and timeframe; separation of strategic issues from operational issues; and linking PFMRP governance arrangements with those relating to other reforms, representation of other key stakeholders and in close collaboration with RCU.
The PFMRP governance arrangements are intended to provide strategic guidance to the programme through approving the plans and budgets of the programme; ensuring that the programme management is meeting the needs of its clients; and monitoring the implementation of PFMRP. The institutional arrangement of PFMRP IV comprises three levels namely: Joint Steering Committee (JSC); Programme Management Committee
(PMC), Technical Working Groups (TWGs).
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PFMRP IV ORGANOGRAM
FMRP IV INSTITUTIONAL ARRANGEMENT AND DIALOGUE
KRA 1
CPAD
-CPAD
-TR
-PMO-RALG
-CEF
-MDAs
PFM
ADVISOR
SECRETARIAT
KRA 2
CB
CB
CPAD
-PMO-RALG
KRA 3
ACGEN
PPRA
-PPP
-ACGEN
-CPAD
-GAMD
PST
DPSPFM
PROGRAM
MANAGER
KRA 4
IAG
IAG
-NAO
-TR
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KRA 5
DPD
DFMIS
-PMO-RALG
-GCU
-DPD
-ZNZ
- DAHRM
-ACGEN
JSC
PMC
TWG
DP LEAD
CHAIRMAN
AND
MEMBERS
CO-CHAIR
AND
MEMBERS
4.3
Joint Steering Committee (JSC)
The role of the JSC will be to provide overall strategic guidance as well as review and monitor the performance of the PFMRP. Being the highest level authority, JSC will review the proposals from PMC, approve the budgets, action plans progress reports and makes policy decisions. The JSC will be chaired by the Permanent Secretary MoF.
4.4
Programme Management Committee (PMC)
The PMC is the second level authority in the management of the programme. The role of this group will be to scrutinize plans and budgets, progress reports that have been prepared, reviewed and agreed at the Technical Working Group (TWG) level. The PMC draws conclusions and present agreed recommendations for consideration by the JSC.
The PMC will be Co-chaired by the Deputy Permanent Secretary – PFM at the Ministry of Finance and the designated chair of the PFM Development Partners Group (PFM
DPG).
4.5
Technical Working Group (TWG)
This level focuses on the implementation of the programme. The TWG consists of designated component managers and DP counterparts. The role of the TWG will be a forum for detailed interactive technical discussions in order to build consensus and propose interventions for the way forward. TWG will thus review progress of implementation of the programme. Meetings are held on a needs basis on consultation throughout the implementation of the programme. The TWG forwards proposals for
PMC deliberations and approval.
4.6
Programme Management
The overall responsibility for the programme management rests with the Permanent
Secretary Treasury. The Deputy Permanent Secretary PFM will be responsible to manage the programme on behalf of the Permanent secretary. The Director of
Planning Division is a designated Program Manager who is responsible for ensuring smooth implementation of the programme on the daily basis. The PFMRP Secretariat, headed by the Programme Coordinator, will support the Programme Manager in coordination of PFMRP IV implementation. The Secretariat, among others will providing
49
technical support, quality assurance, ensuring linkages between PFMRP and other reform programmes; liaising and sharing information with various stakeholders; supporting monitoring and evaluation activities. The Secretariat will offer support and facilitate meetings including logistics, reviews, coordinate preparation and execution of strategic and annual work plans and program implementation.
4.7
PFMRP and other core reforms
The Reform Coordination Unit
PFMRP is among the public sector core reforms. The GoT has put in place a clear role and mandate for the coordination of core reforms. These arrangements involve (1) the
Committee of the IMTC on cross-cutting reforms (2) The Technical Committee to
Reform Programme Coordinators (3) Public Expenditure Review (4) and the Cluster
Working Groups.
The Government has established the Reform Coordination Unit (RCU) under the Chief
Secretary’s Office. The unit advises and assists the Chief Secretary on the coordination and leadership of core reforms for better achievements of results. RCU serves as the
Secretariat to the Committee of the IMTC on cross cutting reforms and chair the
Technical Committee of Reform Programme Coordinators.
As part of the design of PFMRP IV, programme will collaborate with the RCU through seeking technical advice, participating in all scheduled meetings organized by both parties and submission of plans, budget and reports.
50
CHAPTER FIVE
RESULT FRAMEWORK
5.1 INTRODUCTION
This Chapter shows how the results envisaged in this Strategic Plan will be measured as well as the benefits that will accrue to its clients and other stakeholders. Furthermore, the chapter shows how the various interventions to be undertaken during the five years of the strategic planning cycle will achieve the overarching goal of attaining a Sound financial management and discipline in public service delivery for sustainable development. With the vision of becoming a centre of excellence for enabling sound financial management, fiscal control and accountability
The chapter also show how the interventions will be monitored, the reviews that will be carried out over the period and what type of evidence based evaluation studies and analytical work to be undertaken.
5.2 The Development Objective
The paramount objective of PFMRP IV is to ensure improved public service delivery by enhancing public financial management in the areas of Revenue Management, Planning and Budgeting; Budget Execution, Accountability and Transparency; Budget control and
Oversight; Change Management and Programme Monitoring and Communications. This development objective represents the highest level of results envisioned by the programme. The achievement of this development objective, among others, will be influenced by the availability of financial resources, competent staff, top management commitment, and the demand for accountability on the part of citizens.
5.3 Link between PFMRP IV with other National Frameworks
This strategic plan is designed to address issues in Five Key result Areas (KRAs) which contribute directly to attainment of Vision 2025. With regards to MKUKUTA II, PFMRP IV
Strategic Plan contributes directly to MKUKUTA II Clusters and MKUZA II.
51
5.4
Result Chain
PFMRP IV result chain consists of outputs, objectives, strategies, targets, activities and inputs which broadly contribute to Vision 2025. Realization of PFMRP IV overarching objective in the medium term will contribute to the achievement of MKUKUTA, Five
Years development Plan’s goals and other vices target as stipulated in Vision 2025. This results chain will justify PFMRP use of the tax payer’s money into the various interventions and thus contribute to the improvement of service delivery in the country through sound public financial management.
5.5
The Result Framework Matrix
This matrix contains PFMRP IV impact, outputs, performance indicators, indicator baseline, indicator target and milestone for the implementation period. The matrix envisages how the development objective will be achieved and how the results will be measured. The indicators in the matrix will be used to track progress towards achievement of planned outcomes and objectives. The result framework matrix is detailed below.
PFMRP IV MONITORING AND EVALUATION RESULT FRAMEWORK 2012-2017
Impact
Sound financial management and discipline in public service attained by
June 2017
Outcomes
KRA 1 Revenue Management:
Strengthened systems, processes and procedures for improving the operational capability of the revenue collection by June 2017
KRA 2 Budgeting and planning:
Strengthened capacity of planning and budget management, including results and program based budgeting, within MOF, MDAs and LGAs by June 2017.
KRA 3 Budget Execution, Transparency and Accountability:
Improved utilization of public resources in a more effective, efficient and transparent manner by June 2017
KRA 4 Budget Control and Oversight:
Improved adherence and enforcing of MDAs and LGAs to financial internal controls,
52
rules, laws, regulations and audit recommendations by June 2017
KRA5 Change Management, Program Management and Communication:
Improved management practices with increased accountability and leadership to better manage performance of PFMRP by June 2017
Outputs Performance
Indicators
Indicator
Baseline 2011
Indicator
Target 2017
Milestones
KRA 1 Revenue Management: Strengthened systems, processes and procedures for improving the operational capability of the revenue collection by June 2017
Output 1.1
:
Improved quality of forecasting of fiscal aggregates for three years on a rolling basis
Aggregate revenue outturn compared to original approved budget (PEFA:
PI-3)
Increase in number and quality of participating
MDAs and
LGAS with staff capable providing accurate, realistic revenue projections
Actual domestic revenue collection was below 92% of budgeted domestic revenue estimated in no more than one of the last three years.
(PEFA: C)
Less than 5% of participating MDAs and LGAS providing accurate, realistic revenue projections in
2010/11
Actual domestic revenue collection is below 94% of budgeted domestic revenue in no more than one of the last three years. (PEFA: B)
50% of participating
MDAs and LGAS providing accurate, realistic revenue projections by
2017
Output 1.2: The
Government improves efficiency in domestic revenue mobilization both at the policy and the administration levels by updating
Increase in collection of
Total and nontax revenues as percentage of GDP
Total revenue collection was 16.5 % of GDP in 2010/11
Non-tax revenue was
1.2% of GDP in
2010/11
Total revenue collection will be at least 17.8% of GDP by
2013/14-
Non-tax revenue will be at least 1.9% of
Study on forecasting targets and actual revenue collection by June
2013
Recommendations from study on forecasting targets and actual revenue collection informs budget preparations for budget 2014/15.
A team of trainers in forecasting revenue developed by June
2014 (milestone to be reviewed in line with recommendations from the study)
The study on Non
Tax Revenue
(NTR)-“Integration and Harmonization of Revenue
Collection Systems” completed by
November 2013.
Submission of a bill to Parliament to enact Tax
53
Outputs legal instruments towards international best practices
Performance
Indicators
Indicator
Baseline 2011
Increase in
Revenue from
Parastatals as
Revenue from
Parastatals was 0.55
% of total approved
Indicator
Target 2017
Milestones
GDP by 2013/14 Administration Act for the purpose of establishing a common tax procedure among different collected taxes by
Tanzania revenue authority (TRA) by
November 2013
Review Laws, rules and Regulations for
Local Government revenue system to improve LGA’s own sources in line with best practices by
June, 2016.
Revenue from
Parastatals will be 4% of total
Take policy action to improve revenue mobilisation from natural
2014 resource sectors by June
The action plan to implement the recommendations from review of non tax
2016 collection developed and implemented by
Computerised revenue collection to at least 50% of participating MDAs and LGAs by 2016
New TR's Bill presented to the
Parliament by June
2013
54
Outputs Performance
Indicators
Indicator
Baseline 2011
Indicator
Target 2017
Milestones percentage of
Approved domestic revenue collection domestic revenue collection in 2010/11 approved domestic revenue collection by
June 2014
150 Parastatals’
Acts Reviewed to be in line with the
New TR Act by
June 2014
TR’s Office
Capacities enhanced by June
2014
M& E system for
Parastatals reviewed and implemented by
June 2015
Tax exemptions as a percentage of GDP
2.2% Target :
2012 ; 1.9%
2013; 1.6%
2014: 1.2%
Output 1.3
:
Strengthened capacity of local government authorities to collect revenue by 2015
Local
Government
Own source revenue to
GDP
Actual revenue collection by LGAs
2010/11: Tsh 158,280 million and 0.46 % of
GDP
Local
Government
Own source revenue will be
1.5% of GDP
Review the current system of tax exemptions with the value-added Tax
(VAT) regime and amend the VAT Act with a view to be in line with international best practices by
November 2014
Completed assessment and evaluation of revenue potential for all major own sources of revenue to all LGAs by June
2013
PMO - RALG staff and Finance
Management
Officers at RS to be trained in tax revenue plans and budgets to spearhead LGAs tax reviews and reforms. June
2013
Local Authorities
Tax administration teaching and practice modules established and
55
Outputs Performance
Indicators
Indicator
Baseline 2011
Indicator
Target 2017
Milestones
Local
Government legislation reviewed by
2016 (Act No.
7, 8 and 9)
The last amendment of the Local
Government Finances
Act No.9 of 1982 was done in year 2002.
The act does not adequately address issues of equity, change of technology and other administrative issues to enhance local revenue mobilization considering the present and future
LGAs circumstances.
Local
Government
Finances Act
No. 9 reviewed by 2014
TOT completed for all finance management staff at the regional level. June 2013.
Four (4) Revenue
Accountants, 3
Council management team members and 1 FMO from each LGA and RS are trained on own revenue source management by
June 2014.
Establishment of known and clear revenue data base by each source of revenue, presence of trained personnel and a clear follow up arrangement at PMORALG and
RS levels by June,
2014.
Completed study on effectiveness, the relevancy and sufficiency of the provisions of the
Local Government
Finances Act No.
9 by June, 2013.
A bill for an act to amend the Local
Government
Finances Act No.9 of 1982 finalized is and submitted to the
Cabinet
February, 2014 by
56
Outputs
Output 1.4
:
Increase of donor funding that flows through the exchequer system by 2016
Percentage of disbursement of direct project fund portfolio via the exchequer
20%
Performance
Indicators
Indicator
Baseline 2011
Indicator
Target 2017
50%
Milestones
National framework for managing development cooperation (JAST) reviewed and put in operation by
December 2012
Revised JAST and AMP user guideline clearly communicated to both parties by
December 2012
Analysis of trends of the direct fund project portfolio disbursed via the exchequer system published and shared annually by June 2015
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator
Target 2017
Milestones
KRA 2 Budgeting and planning : Strengthened capacity of planning and budget management, including results and program based budgeting, within MOF, MDAs and LGAs by June 2016.
57
Outputs
Output 2.1:
Strengthened capacity of MDAs,
RSs and LGAs in implementing program based budgeting by
June 2016.
Performance
Indicator
Presence of
Programsbased budget classification
(PI-5)
Indicator Baseline
2011
Indicator
Target 2017
Milestones
The 2008/09 budget formulation and execution is based on administrative and
GFS –compatible economic classification. There is no CoFoG-based functional classification and budget documentation and reporting system (PI-
5C)
The budget formulation and execution will be based on administrative , economic and functional classification
(Using at least the 10 main
CoFoG functions), using
GFS/CoFoG standards or a standard data can produce consistent documentation according to those standards
All sub programs, objectives and performance indicators defined by Dec 2012
Chart of accounts to Modified accommodate program budgeting
August
(ACCGen) based by
2013
MTEF reviewed to make based compatible program budget by
September 2014
Progress on the PB
Action Plan implementation
(PI-5B)
Increase in number of
MDAs and RSs with skilled staff for implementing a based program budgeting
In 2011, there are no staff in MDAs and RSs with necessary skills to implement program based budgeting
95 % of MDAs and RSs have staff with necessary skills to implement program based budgeting
Completed phased training for all
MDAs and RSs by
2014
Completed phased training for all LGAs by 2014
Output
Increased
2.2: effective utilization of
Planning and budgeting tools by 2016
Percentage increase number in of
MTEF budgets meeting the
MTSPBM requirements by 2016
In 2011, less than
75% of MTEF budgets are meeting the standards of MTSPBM
98% of MTEF budgets are meeting
MTSPBM the standards
MTSPBM reviewed by June 2013
Sixty MDAs, 21 RSs and 133 LGA trained in MTSPBM by June 2014
Reviewed MTSPBM to be applied during
FY 2013/14
Annexes to budget book volume II for
58
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator
Target 2017
Milestones
Orderliness and participation in the annual budget process by
2016 (PI-11) i) A comprehensive budget calendar exists but delays sometimes are experienced. MDAs have 6 – 8 weeks to submit their budget ii) A comprehensive budget circular and budget preparation guidelines are issued but the MDAs ceilings are not always approved by cabinet before issue (B) i)A clear annual budget calendar exists, generally is adhered to and allows MDAs enough time (at least six weeks from receipt of budget circular) to meaningfully completes their detailed estimates time on
Executive Agencies completed by June
2014
Action plan on implementation of recommendations on budget legal framework completed by June
2013
At least 10 PER
Main Dialogue meetings held by
June 2016 ii) comprehensive
A and clear budget circular is issued to MDAs which reflect ceilings approved by cabinet or equivalent prior to the circular distribution to
MDAs(A)
Percentage reduction in deviation of actual expenditure from approved budget
In 2011, percentage the of deviation of actual recurrent expenditure
MDAs budget at vote level compared to approved budget but excluding salary adjustments, contingency and debt
Actual expenditure deviated from budgeted expenditure by an amount equivalent to not more than
10%
Phased training to
MDAs, RSs and LGAs
Budget Committees on resource prioritization and planning
59
Outputs Performance
Indicator
Indicator Baseline
2011 service was at 13.7%
Indicator
Target 2017
Milestones
Quality and timeliness of in-year budget report (P-24) by 2016
Comparison to budget is possible only for main administrative headings. Expenditure is captured either at commitment or at payment stage (not both)
Reports are prepared quarterly( excluding first quarter), and issued within 8 weeks of end of quarter
Possibly
Classification allows comparison to budget but only with some aggregation.
Expenditure is covered at both commitment and payment stages.
Mechanism for quality assurance of Quarterly
Budget Performance
Reports (level of detail, timeliness, accuracy, consistency and usefulness to decision makers, as well as for budget transparency
June 2013 to citizens) established by
Reports prepared are quarterly and issued within 6 weeks of end of quarter
There are some concerns about the accuracy information, of which may not always be highlighted in the reports, but this does not fundamentally undermine their basic usefulness (C+)
There are some concerns about the accuracy, but data issues are generally highlighted in the reports and do not compromise overall consistency/usef ulness (B)
Output
Strengthened
2.3: capacity of LGAs for MTEF preparation by
2015
Comprehensiv eness of information included in budget documentation
(PI-6)
Currently there no sufficient information on LGAs revenue planning and budgeting which is included in the budget documentation.
Supportive and verifiable revenue data and information to be included in the LGAs budget documentation.
Proposal budget for information to be included in the
Budget guideline to be submitted to National
Budget Guideline committee by
October annually.
Recommendation s of various studies on LGAs budget allocation
60
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator
Target 2017
Milestones
Various studies in fiscal transfers and decentralizatio n process in
Tanzania indicates that
Budget allocation to
LGAs reflects a more inequitable distribution of resources to
LGA, and that
Currently budget allocation formula follow, population, land area and poverty level,
Budget allocation formula reflects resource needs, distances from service facilities, special area diseases, number of projects to be implemented, number of orphans etc. formulas reviewed by
December, 2012 which will include recommendations to be made by the fiscal decentralization taskforce in
LGRPII by June
2014. The M&E framework under
LGRPII included performance indicator measure application transfers.
Agreement to of formulae based allocations actual to fund on improvement of
LGAs budget allocation formulas among the Sector
Ministries (PMO-
RALG, MOF, PO-
PSM and Sectors) completed by
June,2013
All LGAs budget allocation formulae reviewed by June,
2014
All reviewed LGA budget allocation formulae applied in the budget preparation during
2014/15 for the FY
15/16 budget.
Monitoring arrangements in place for measuring deviations in actual releases against all formula-based allocations to LGAs for FY 15/16.
61
Outputs Performance
Indicator
Indicator Baseline
2011 the allocation formulae are not fully applied. There is a need to revisit all the existing budget allocation formulae to clearly reflect equitable allocation of financial resources by
June 2016.
Indicator
Target 2017
Milestones
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 3.1:
Improved public procurement performance by PEs by
2015
Average level of compliance of i) all procuring entities (for follow-up audits) and ii) the top 20 procuring entities with the (revised)
Procurement
Act 2011
Competition,
Old target
(63%+75%)/2=68%
Target will be based on new set of indicators
+20% of baseline
(new BL by
October 2012) i) 66 % of tenders under open tendering process were advertised in fiscal year 2006/2007 (B) ii) Using less competitive procurement methods is allowed with justification.
PPRA audits in
2008/09 show that i) Accurate data on the method used to award public contracts exists and shows that more than 75% of contracts above the threshold are awarded on the
Annual audit
PPRA results confirm positive trend on a yearly basis
Revised procurement implementation and monitoring tools issued by
December 2013
New Public
Procurement Act,
62
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016 value for money and controls in procurement
(PI – 19)
Increase in number of PEs using eprocurement system (PMIS) the great majority of contracts now use the correct methods
(B) iii) A comprehensive complaints mechanism operates, but for unknown reasons the number of complaints has declined (B) basis of open competition(A) ii) Other competitive less methods when used are justified in accordance with clear regulatory requirements (A) iv) A process (defined by legislation) for submission and timely resolution of procurement process complaints is operative and subject to oversight of an external body with data on resolution of complaints accessible to public scrutiny (A)
Currently, 203 PEs are using PMIS
(Procurement
Management Information
System)
393 PEs will have a functional PMIS and pilot e-procurement system will start functioning by Nov
2016.
2011,
Regulations and
Tools disseminated to major PEs and other key stakeholders by
December 2015
Procurement plans aligned with MDAs, LGAs and parastatal
Institution
Strategic plans by June 2015
Value for money procurement enhanced through
Framework contract in procurement of common items
2017 use and services by June
PPRA operational and outreach capacity strengthened by
June 2014
All (393) PEs will have a fully functional PMIS as a reporting tool for procuring entities to report back to PPRA by Nov 2014 e-procurement will start functioning as pilot stage by Nov
2016
63
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Increase in number of PEs reached for procurement audit
Currently 330 PEs have already been audited.
Output 3.2:
Strengthened public sector procurement by June 2015
Number of
Public procurement regulations issued
Number
Skilled procurement staff of
None( to be established after baseline study)
None( to be established after baseline study)
In June 2012 all 393
PE’s will be audited, then beyond F/Y
2012/2013 will be “
Follow-up Audits
(should be repeatedly process especially on
Top 20 PE’s
% increase in number of Public procurement regulations issued
% increase in number of skilled Procurement personnel in PEs
393 PEs audited by
June 2012
Follow up audit of 100
PEs to be done annually by 2016
Annual Procurement
Performance
Evaluation Report prepared published Annually and
Action plan for implementing PPA is developed
December by
2012
(Milestones to be revised after finalization of the action plan)
New procurement public regulations prepared and issued by June
2013
Procurement training needs assessment exercise completed by June,
2013
[300] procurement staff trained on public procurement by June, 2017 as per TNA
Strategy on public procurement human resource developed and disseminated by
June, 2015
Procurement and
64
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Presence of procurement policy draft by
June, 2013
PPDs’ capacity enhanced by
June, 2013
National procurement policy and procurement law synchronised
None
None
None
None
National procurement policy developed and disseminated stakeholders to i) Motor vehicle and office ii) equipment acquired
Short training for 20 members of PPD staff conducted
Public Procurement Act
2011 reviewed supplies database maintained updated staff
December, 2015 and by
National procurement policy draft finalized by June,
2013
Stakeholders’ comments incorporated by
June, 2013
PPDs’ capacity enhanced by
June, 2013
20 members of
PPD staff equipped with skills on public policy formulation, implementation and evaluation by June, 2014
National procurement policy developed and shared by
December, 2014
65
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Stakeholders acquainted with
National the procurement policy
National procurement policy strategy in place by
December,
2013
None
None
800 Stakeholders acquainted with the
National procurement policy
National procurement policy strategy implemented
National procurement policy strategy developed and implemented by
June 2015
Printing and uploading the
NPP on the website by June,
2015
National procurement policy and procurement law synchronised by
June, 2015
Monitoring the implementation of the National procurement policy by June,
2015
Evaluation and feedback of the implementation of the National procurement policy by June,
2016
1000
Stakeholders acquainted with the National procurement
Policy by June,
2016
Output 3.3
:
Strengthened
Increase in number of
10 staff with cash management skills
610 staff with cash management skill
600 staff of MDAs and
LGAs Trained on cash
Management using
66
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016 capacity of
MDAs, RSs and LGAs in
Cash management by 2015 staff with adequate skills on cash management
Decrease in the aggregate number of bank accounts operated by
LGAs by 2015.
The aggregate number of bank accounts operated by LGA are 4,736 in 2011
3938 bank accounts will be closed by
December 2013 standardized materials by June 30 2014(
Milestones to be reviewed and aligned the East after
AFRITAC recommendations on
Cash and Banking
Arrangement Mission)
Six bank accounts operated by each
LGAs by December
2013
67
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 3.4:
Strengthened public debt management capacity by
2015
Recording and management of each cash balance, debt and debt guarantees
(P1-17) by
2016 i) The various databases containing debt data are currently in the process of being merged. Data quality is considered fair and minor reconciliation problems occur. For the data entered in CS DRMS, statistical reports are regularly produced (B) i) Domestic and foreign debt records are complete, updated and reconciled on a monthly basis with data considered of high integrity.
Comprehensive management statistical and reports
(cover debt service, stock and operations) are produced at least quarterly (A). ii) The balances of several government bank accounts in commercial banks are not consolidated, though there is a plan to do so
(D). ii) Calculations and consolidation of most government cash balances take place at least monthly, but the system used does not allow consolidation of bank balances (C). iii) Contracting of loans and issuing guarantees is approved by Minister of
MOF in line with rules, but there are no ceilings
(C) iii)
Government’s
Central contracting of loans and issuance of guarantees are made within limits for total debt and total guarantees (B).
The agreed actions arising from the Feb.
2012 World Bank debt management report with shared key stakeholders by
July 31, 2012
(Milestones to be reviewed)
Debt management policy developed and shared by
June 2013
Capacity of 50
Public Debt staffs enhanced by
June 2014
Review
Government
Loans, of
Guarantees and
Grants Act by
June 2014
Debt
Management department established by
June 2016
68
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 3.5:
Improved integrity and content of government financial statements and the migration from IPSAS cash to IPSAS accrual accounting for all government accounts is progressing in accordance with plans.
Quality and timeliness of annual financial statements (PI-
25) i) Central
Government final accounts include revenue, expenditure and bank balances, and since 2007/08 data on most financial assets and liabilities are disclosed with few exceptions. (B) ii) Financial
Statement are submitted for external audit within 6 months of the end of fiscal year. (A) iii) Cash basis IPSAS has been applied since 2007/08. (B i) Central
Government final accounts disclose full information on revenue, expenditure and bank balances, financial assets and liabilities
(A) ii) Target for 2013
-125 staff and
2014-125 iii) (ii)Financial
Statements are submitted for external audit within 6 months of the end of fiscal year. (A) iv) IPSAS applicable to all financial statement
Completed review of the IPSAS guideline issued by PMORALG in 2008/09 to accommodate the recent IPSAS updates by June
2013
Training to the
MDAs, RSs and
LGAs accounting officers to develop awareness on
IPSAS Accrual by
2013
Capacity building to 250 staffs from
MDAS and RSs and
Embassies to enhance skills in
IPSAS accrual by
2014
Public Finance Act
No.2001 and
Regulations reviewed to address migration to IPSAS accrual by June 2016
Consolidated template financial statements of to include MDAs, Rs,
LGAs, Controlled entities &GBEs developed by 2016
250 government accountants in MDAs
/LGAs trained in
IPSAS accrual and
69
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Stage of the transition confirmed against approved action plan.
The decision to transition all government accounts to full accrual accounting has been made but detailed action plan has not been finalized or approved.
Reports of the
Auditor General confirm improvement
2009-10 Government accounts received an adverse opinion.
Central Government final accounts include revenue, expenditure and bank balances, and since
2007/08 data on most financial assets and liabilities are disclosed with few exceptions. (B)
Financial Statement are submitted for external audit within 6 months of the end of fiscal year. (A)
Cash basis IPSAS has been applied since 2007/08. (B)
IPSAS Accrual migration action plan has been completed approved and is in process of execution.
Implementing migration targeted.
Quality and integrity of government financial statements is improved as evidenced by the reports of the Auditor
General plan as
Financial Statements are submitted for external audit within 6 months of the end of fiscal year. (A) accrual modules for
Epicor by September
2013
Plan for migration towards IPSAS Accrual accounting is completed by
December 2013.
Plan is approved for execution and stakeholder information sessions have been completed by January 2014
All legislative and policy supports decisions have been identified by
December 2014
Milestones for the transition have been identified and approved Eg Public
Finance Act No.2001 and Regulations amendments
October 2014 by
Plan to integrate all
RSs and LGAs operations into the centralized IPSAS accrual architecture is completed and PMO
RALG is fully engaged as a stakeholder by
December 2014
70
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 3.6:
Improved accountability in management of
Government
Assets for supporting migration to
IPSAS Accrual
Number of
MDAs which are now reporting their financial position through IPSAS
Accrual
Number of
MDAs which have been valued and uploaded in the
EPICOR
None
20 MDAs( 28%) have been valued and uploaded in
EPICOR
% increase of MDAs reporting their financial position through EPICOR asset management module by 2016 (Targets to be set after migration action plan towards
IPSAS Accrual
Accounting is completed)
% increase of MDAs valued and uploaded in
EPICOR by June 2016
(Targets to be set after migration plan towards
IPSAS Accrual
Accounting is completed)
Uploading of 16 MDAs in EPICOR by
December 2012
Asset
Management(tracking
) software acquired by
March 2013
40 staff(25 regional heads(RSVs) and 15 from HQ) trained on asset management by
December 2013
Asset Management
Policy prepared and submitted by June
2015
Valuation of
Government assets in
34 MDAs and RSs completed by June
2016
Progress target against reported annually.
KRA: 4 Budget Control and Oversight: Improved adherence and enforcing of MDAs and LGAs to financial internal controls, rules, laws, regulations and audit recommendations by June 2016
Performance
Indicator
Indicator Baseline 2011 Indicator Target 2017 Milestones
Output 4.1
:
Increased coverage and quality of the internal audit functions by
2016
Percentage increase in unqualified opinion in the external audit report for MDAs and LGAs
54% of MDAs and 65% LGAs obtained unqualified opinion in 2009/2010
65% MDAs and 75% LGAs will get unqualified opinion in 2015/2016
Operational developed plan and approved by June,
2013
Internal audit manual/guidelines, standards and quality assurance improvement
71
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Effectiveness of internal audit (PI-
21) i) Internal audit function exists in most MDAs, and it is estimated that 20 percent of staff time is allocated to system based reviews and high risk areas (C) ii) Reports are issued for Most MDAs but these are not copied to NAO (C) iii) To some degree actions are taken by management on major issues but often with delays (C) programme, complies which with international standards and best practices, will be in place by June
2013 i) Internal audit is operational for all
Central and Local government entities, and generally meet professional standards .
At least 50% of staff time is allocated to system based reviews and high risk areas. ii) Reports adhere to a fixed schedule and are distributed to the audited entity,
Ministry of
Finance and NAO
(B) ii) Action by management on internal audit findings will be taken within one month after issuing a report and should be comprehensive across Central and Local government entities (B)
Effective internal audit units and audit committees established to all MDAs and LGAs by June 2016
The Pilot stage of
Computerised Audit will be finalized by
June 2014.
Computerised Audit in place by June 2016.
550 internal auditors and other stakeholders trained in risk management process and risk based audit by
June, 2016
72
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Number of staff equipped with skills on riskbased audit
100 staff trained in risk based internal audit
550 internal audit staff are trained in risk based audit
Technical Audits conducted for
20 Projects in 2011 70 Technical Audit conducted by 2016
Technical Audits are conducted for 70
Projects by June, 2014
Output 4.2:
Strengthened
External audit functions by
2016
NAO reaches
AFROSAI-E
Level 3
Level 2
NAO did not reach at level 3 in
2010 as planned because of lacking two criteria. Out of 10 criteria, NAO cleared 8criteria.
Other 2 criteria are (1) NAO staff should not be Civil
Servants, and (2) Appointment of CAG by the Parliament.
A committee was formed to conduct legal review and will submit a report on needs of legal amendments to reach at level 3.
The committee members visited South Africa, Kenya and
Uganda.
Most Auditors are accommodated in Auditees premises
NAO to reach Level 3 by
2016
Capacity of NAO audit service strengthened by
2016
100 Auditors trained on Risk
Based Audit
Increase in number of NAO staff capable of issuing audit reports as per international technical and professional
One VFM report is produced by NAO staff each year without technical assistance by
80% of Auditors to have be accommodated in own offices
The committee report on needs of legal amendments (existing laws) to contribute towards reaching level
3 submitted to the attorney General and awareness by
December 2012
50% of Auditors to be accommodated in
NAO own offices by
2014
300 Auditors trained on Risk Based Audit and 200 in IT audit by
2014
2 Value for Money audit reports to be produced each year by
NAO staff without technical assistance
73
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016 practices
Value for Money
Audits to be conducted by
NAO staff with minimum technical support by external
Consultant
Adoption and application of
International auditing
Standards in all audit assignments external Consultant
200 auditors trained on
International standards on auditing (ISSAI,
IPSAS.ISSAI,IFRS,ISA)
800 Auditors trained on
Risk Based Audit and 400 in
IT audit
Five value for money audit reports to be produced each year by NAO staff without technical assistance from external consultant
800 auditors trained on
International standards of auditing and Full adoption of International audit standards from external consultant by 2014
300 Auditors trained on international standards of auditing and full adoption of
International Audit
Standards by 2014
Number of MDAs.
LGAs and
Parastatals reached financial audit for
All 86 MDA, 134 LGAs and about 122 Parastatals were covered by Financial Audits.
Scope, nature and follow-up of external audit (PI-
26) by 2016 i) In the last three years, the audit report, including consolidated financial statements of government, was presented to the legislature six months after the receipt of financial statements (B)
All MDA, LGAs and
Parastatals are covered by
Financial Audits by 2016 i) Audit reports are submitted to the
President within
9 months (per the
Public Audit Act) of after the end of the financial year. ii) Fully operational and accessible easily database support to
Closing of books of accounts for
Parastatals harmonized and audit modalities agreed by 2014.
Audit methodology in line with ISSAIs guidelines adopted by
June 2013
Scoping ascertain parameters study to of the outstanding matters
Database is completed by November 2012 the
74
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016 ii) No electronic system currently exists to consolidate and easily access data regarding outstanding audit findings and recommendations, including their age.
Government’s efforts to reduce outstanding matter(findings and recommendation s) .
Establish a database that will separate findings (monetary and non monetary) and recommendations including by age, and record follow up actions (i,e matters closing) by December
2013.
Increased application of ICT in auditing and connectivity (by
Wide Area
Network ) of NAO offices
20 staff trained on ICT application in auditing
NAO offices are not connected
600 Auditors trained on
Audit Commanding
Language (ACL) and other audit based software
One TeamMate module
(Electronic working papers) is applied in auditing
NAO Headquarters is connected by all 21 regional offices using WAN by 2016
All five Teammate modules applied in auditing by 2016
Output 4.3:
Improved transparency on audit reports
(central, local and parastatal levels) to strengthen
“Citizen Audit
Report”(simplified audit reports accessible by the general public) are published
4 Consolidated audit reports
(central, local, POABs and
VfM/Performance) are publicly available on the NAO website after tabling.
All General audit reports are accompanied by a
‘citizens audit report’ (short summary of the key audit findings and recommendations, in both
Swahili and English) and are available in a timely
200 Auditors trained on audit commanding language (ACL) and other audit based software by 2014
NAO Headquarter is connected to 10
Regional offices using
WAN by 2014
Two of five Team Mate modules applied in auditing by October
2014
Citizen audit reports available for the 4
General audit reports by June 2013 and onwards on annual basis.
75
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016 scrutiny and accountability .
Output 4.5: capacity of oversight
Strengthened functions of
Parliamentary
Accounts
Committee in
Tanzania
NAO set up a booth at Trade
Fair (Saba Saba) and Public service week where general audit reports are distributed to visitors. manner (within 4 weeks after tabling) on the NAO website and at NAO offices all over the country by
2016.
Output 4.4:
Improved performance of parastatals by
June 2016.
Increase in number of
Parastatals implementing performance contracts by June
2016
2 Parastatals (TRL & TPA) were implementing Performance contract in 2009
All Parastatals will be implementing Performance
Contracts by June 2016
Oversight of aggregate fiscal risk from other public sector entities (PI-9) by
2016
There is weak Monitoring of
Parastatals as their final number is still to be established and their consolidated overview is missing (PI-9: D)
All Parastatals will submit fiscal reports including audited account to TR and consolidates overall fiscal risk issues into an Annual
TR Financial Statements (B)
Increase compliance rate on TR’s Act by
Parastatals by
June 2016
Number of PAC members trained
Compliance rate on TR’s Act by
Parastatals is below 70% in
2010/11
Compliance rate on TR’s
Act will be 100% by June
2016
Evidence of PAC members making follow-up on financial audit recommendations in the respective MDAs and LGA
Ten Pilot Parastatals
Signed Performance contracts with TR by
June 2014
Database on Parastatals set up and functioning by
December 2014
Monitoring framework for Parastatals set up by
June 2014
Mechanism for measuring Parastatals’ compliance rate developed by June
2014
Capacity building interventions to PAcs conducted
76
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Mainland
KRA:5 Change Management and Programme Management: Improved management practices with increased accountability and leadership to better manage performance of PFMRP:
Outputs P-Indicator Indicator Baseline 2011 Indicator –Target
2017
Milestone
Output 5.1:
Coordinate
Integration, interfacing and rationalization of
Government financial systems.
Interface central and local
Government financial management system and tools
MDA /LGA IFMIS systems are not harmonized and or integrated and are not being centrally managed.
Stand alone software continues to be acquired and implemented.
DFISM with overarching technical control for all government IFMIS systems is fully staffed and operational.
ICT Infrastructure capable of supporting approved systems architecture is in place
All Government financial systems ( SBAS, PlanRep,
RIMKU, IFMS) have been integrated and interfaced and financial data is smooth exchanged between systems.
162 LGAs, 25 RSs and 3 institutions under PMO
RALG connected with
ICT mapping exercise showing location and owners of all and perifinancial software commenced with inception published report
December 2012. (refer
PAF 2012) by
Stakeholder coordination meetings held to gather input and agree on cross functional responsibilities for financial systems
Planning held on by
December, 2012
Sequenced, prioritized and costed action plan to bring all GoT financial and perifinancial software under one common
Government financial systems architecture with supporting technical, infrastructure management and
77
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 5.2
:
Utilization of
IFMIS by Dec.2015
133 LGAs are connected to the IFMS
167 LGAs, 25 RSs and 3 institutions will be connected to the IFMS
Evidence analytical reports of generated from the system available at
MDAs and LGAs level
133 LGAs, 21 RSs and 3
PMORALG institutions could produce.
Operation Reports, and
Management Reports
162 LGAs, 25 RSs and 3
Institutions will be able to produce;
Operation Reports
Management
Reports
Final account reports (Financial
Statements), and
Other reports like
Council financial and development report s (CFR &
CDR), Mkukuta strategies implementation report by target, etc.
Upgraded version of
EPICOR module are not Upgraded EPICOR with structures completed and approved by the
GoT by June, 2013
Integration/Interfacing plan is engaged and series of planned actions are being executed and completed by October,
2015
IFMS infrastructure installed to new 34 LGAs,
RSs and PMORALG institutions and connected to central server at Dodoma and
MoF by June 2013
MoF IFMS linked to
PMO-RALG IFMS to the immediate capture of the Approved Budget and all Exchequer transfers to RSs and
LGAs respectively by
June 2013.
Completed capacity building to key users of
IFMS from all LGAs, RS and PMORALG institutions by June
2013.
Audit of IFMIs in LGAs conducted by June 2015
EPICOR system upgrade completed by
78
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
EPICOR modules
Increased from seven to ten
EPICOR with ten modules inplace. The new modules are:
Multi –
Site
Manag ement.
Replica tion
Server
License
.
Advanc ed
Financi al
Report
Design er fully utilized ten modules in-place
Output 5.3
:
All software development and module upgrades are coordinated with the overarching plans for ICT integration.
Number of systems that are linked into an IFMIS platform and available for common use
ICT Planning is single purpose and not coordinated with other harmonization activities
All software development is integrated within a fully rationalized ICT architecture.
Output 5.4
:
Improved communicatio
Public access to key fiscal
The government makes available to the public 5 out of 6 types of information,
The government makes available to the public 5 out of 6
December 2014
ACGEN staff capacity enhanced by
December 2014
Training for IFMS end users on the upgraded modules conducted by
December 2014.
EPICOR is able to provide real-time information to all LGAs on flow of funds by July
2015
DFISM is operationalized and controls are put in place to manage software acquisition and development by
December, 2012.
DFISM staff capacity enhanced by June,
2015.
The Approved National
Budget is published on
Ministry of Finance
79
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016 n and public access to key fiscal information to stakeholders information:
1. Annual budget documentation, but two of them are not complete: in-year budget execution reports and contract awards. Resources available to primary service providers are not published
(A)
2. In-year budget execution reports,
3. Year-end financial statements,
4. External audit reports,
Special surveys were undertaken within the last three years, but their results and methodologies used have not been seen
(D) types of information-
(A)
Special surveys undertaken within the last 3 years have demonstrated the level of resources received in cash and in kind by either primary schools or primary health clinics covering a significant part of the country OR by primary service delivery units at local community level in several other sectors (C)
5. Contract awards,
6. Resources available to primary service delivery units
(PI-10) website by September each year.
Publish Citizens Budget by November each year.
A Year-End Report
(budget out turn) comparing the actual budget execution to the enacted budget is published on Ministry of Finance website by
October each year.
MoF Communication
Strategy developed and implemented by
June 2013
Fiscal Information and
Budget Transparency
Publication developed
Cycle and implemented by June
2013
MoF website timely updated by June 2017
80
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 5.5:
Coordination and
Standardizatio n of PFM
Training
Achieved.
Number of trained staff in
PFM
Quality of service delivery from trained staff.
None
None
Output 5.6:
PFMRP component
Managers are being guided by detailed multi-year operating plans.
Program components are completed in sequence based on priority and the reform is keeping pace with the agreed milestones
PFMRP component activities are not always derived from and/or described within the context of detailed component operating plan
Relevance, sequence and costs are difficult to assess
........... of staff trained Training mapping exercise completed by
December 2012
Presence of trained staff providing quality service. Capacity building Plan developed and result measurement framework shared with key Stakeholders by
June 2013
Two tracer studies conducted to measure impact of training and documented by June
2014 and June 2016
PFM activities are governed by multi-year component operating plans that provide context for relevance, sequence and cost..
All activities presented for inclusion in PFMRP annual work plan are presented within the context of a detailed, multi year operating plans by June 2013
81
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 5.7:
PFM activities are effectively planned and implemented
Component managers have capacity to develop and manage strategic operational plans.
Component managers have developed capacity in the use RBM methodology
Output 5.8:
Effective coordination of activities and support provided to the program implementers
Secretariat support is facilitating program performance.
Component managers have not had the necessary level of capacity development in strategic planning and results based management
.
150 staff from KRAs trained on change management and strategic planning
60 staff trained on RBM methods
Under resourced secretariat with short term contract
Functional secretariat providing a range of needs based program supports
Capacity building Plan developed and shared with key Stakeholders by December by 2012
Training on Change
Management and
Strategic Planning completed by
December by 2013
Results Based
Management training has been delivered to
60 PFM RP Component managers by June 2013
Secretariat procurement process completed by July 2012
Secretariat work plan is completed and approved by JSC by
December 2012.
PFMRP coordination secretariat facilitated annually.
Output 5.9
:
PFM Program oversight and review is being guided by clearly defined
Milestones derived from
Performance expectations for each component are clearly defined and understood by all
Performance expectations are not clear and the absence of context makes qualitative aspects of program oversight difficult.
Approved M&E framework sets out clear and relevant performance expectations
Annual review and amendment of the
M&E framework to ensure ongoing congruence and relevance annually starting November
2012.
82
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016 an agreed
M&E framework, stakeholders.
Output 5.10
:
All major PFM reforms have been coordinated with and informed by the relevant government and DP stakeholder groups
Stakeholders have knowledge of reforms and change initiatives that will impact on them or their units and are collaborating or supporting implementation
.
Coordination of major reforms with stakeholder groups is not prioritized.
Significant information and capacity gaps exist.
Major PFM reforms are all supported by a communication / collaboration strategy which ensures that all stakeholders have the opportunity to provide input and to receive necessary information in time to adapt to the change.
Stakeholders have adequate time to develop the necessary adaptive capacity.
Change resistance is minimized
PFM information session completed to disseminated results of: ICT mapping exercise, ICT
Harmonization
Integration Plan by
March 2013
IAG action plan,
AcGEN’s Plan to transition to Accrual
Accounting
Dec.31st each year
Minimum of one PFM reform information day conducted for CSOs ,
DPs and GoT during
Public Service day annually
83
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 5.11
:
PFMRP implemented efficiently and effectively through result based management approach.
Comprehensive annual work plan and budget
Approved by August annually
Progress report on place on
15th day after end of quarter
Progress report in place
Strong and effective dialogue structure
Weak dialogue structure
Number of coordinated dialogue meeting
6 meeting
Work plans and budgets are approve by June annually
Funds are released by
July 1/annually
PFMRP implemented according to annual work plan and milestones are being met
Periodic report prepared quarterly
Presence of strong and effective dialogue structure as per MoU.
Working Group and Joint
Steering Committee meetings are attended by KRAs decision makers
KRA teams are meeting monthly schedule.
Annual supervision mission are conducted by Sept 30 of each year commencing 2012.
Independent program evaluations are completed in 2014
Dialogue structures are working as evidenced by combined DP/GoT
Survey results (Survey
1-March 2013/ survey
2 – March 2015for
Effective program implementation
Improved.
Surveys to ensure that teams (KRA Teams and
JSC members)are actually working completed, March
2013, March 2015 and results informed to JSC for action
Donor representatives are well informed on reform initiatives.
84
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Output 5.12:
National systems and processes for intergovernme ntal transfers to LGAs
Streamlined and rationalized
System and processes are documented with target timelines for each process step.
No overall view of systems and processes for intergovernmental transfers. Flow of funds and information on the same is not in parallel and tied to one system.
Effectiveness and efficiency of the system has increased
X XX Number of key actions implemented
(Target to be set after mapping exercise)
In 2010 it took 7days for funds to reach MDAs and
RSs (after receipt of complete set of fund request).
Share of Nonsalary (OC+DEV) funds released to RSs and LGAs by end Q3, as percentage of the Resources budgeted and available
(OC+DEV) for the year
42.1% of resources available to RSs and LGAs at
Q3
Decreased number of days of fund transfer time to RSs LGAs and
MDAs
70% of resources available to RSs and
LGAs at Q3by 2014
TORs completed by
July 2012.
Mapping commences
September 2012.
Review and mapping of the systems and processes intergovernmental for transfers initiated with inception report finalised by October
2012
Comprehensive and sequenced action plan on a recommendation of the mapping exercises on the intergovernmental transfers finalized by
June 2013.
Reports to be produced annually by end September.
Output 5.15
:
Strengthened
Public
Financial
Management
Reforms in
Milestones developed and agreed after discussion with
Zanzibar and thereafter decide on the support by
85
Outputs Performance
Indicator
Indicator Baseline
2011
Indicator Target
2017
Milestones
KRA:3 Budget Execution, Accountability and Transparency : Improved utilization of public resources in a more effective, efficient and transparent manner by June 2016
Zanzibar by
2016
September 2012
Zanzibar PFMRP
Strategy developed by June
2014
86
