Africa Region Working Paper Series No. 45

Public Expenditure Performance in Rwanda: Evidence from a Public Expenditure Tracking Study in the Health and Education Sectors

Abstract

This report is the result of a public expenditure tracking survey (PETS) of the flows of resources to and from the providers of public services in the health and education sectors (health and education administrators) in Rwanda. The PETS traced the flow of budgetary resources form the ministry of finance to primary health centers and a sample of primary schools by quarter for 1998 and 1999 and collected information on sources of income for the facilities, expenditures on basic services, and the practices of accountability at various levels. It also surveyed the administrators and facility heads on the problems on the problems they face, how these problems could be resolved, and the quality and impact of the delivery of public services. A parallel Core Welfare Indicators Questionnaire (CWIQ) survey collected information for the beneficiary assessment of public social and other services.

The study found substantial delays in the process of transfers of public resources from the central administration to primary beneficiaries, and possible leakages of funds at regional and district health and education offices. The discrepancy between the amounts transferred by the treasury through the banking system to regional health and education offices for local administration of facilities, and the corresponding amounts from the records of these offices tended to be significant and variable across regions. The study found rampant lack of accountability in these offices, with poor bookkeeping and lack of internal financial controls and auditing requirements. Thus, the discrepancies could be due to leakages in the system or the unreliable bookkeeping. In any case, the lack of accountability created an atmosphere for leakages and mismanagement of funds.

In both the primary education and health, the budgetary allocations of the central government only paid the salaries of teachers and health workers, hence the facilities relied on household contributions and fees, and sporadic contributions from donors and NGOs. In the context of widespread poverty, the contributions from households were inadequate to meet the minimum operational requirements of the primary education system. This lack of operational inputs compounded the challenges of a system with a relatively high pupil-to-teachers ratio (58) and even higher pupil-to-qualified teachers (larger than 100), with adverse implications on education outcomes. The CWIQ survey results found that the lack of textbooks was seen as a major constraint to improving the quality of education. The cost of health services to households was also a major deterrent to using them. The CWIQ survey also found that 95 percent of respondents who needed to see a health provider but did not do so cited the high costs, and among those that consulted a health provider, 80 percent were dissatisfied with the costs.

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