Results Briefs November 11, 2019

Strengthening Budgeting and Monitoring to Improve the Lives of Seychellois

To improve public sector performance, the Government of Seychelles has reformed its budget and performance monitoring process by fully adopting Programme Performance Based Budgeting (PPBB) and Performance Monitoring and Evaluation (PM&E). The reforms have improved budget allocation to priority areas and monitoring for the benefit of the citizens of Seychelles. The World Bank Group provided technical support to the government to develop appropriate infrastructure – policies, processes, tools - and human capacity to implement these two reforms. PPBB has been rolled out in all Ministries, Departments and Agencies (MDAs) while PM&E is being piloted in seven MDAs.

Challenge

Seychelles, an island state with a population of 95,000, has developed at a remarkable pace, making it the only high-income country in Sub-Saharan Africa. Since a macro fiscal crisis in 2008/2009, Seychelles has managed an outstanding turnaround in restoring fiscal sustainability and improving public sector governance. However, despite the progress, public sector performance challenges remained. There were inefficiencies in public resources allocation (budgeting) and in monitoring and evaluating the implementation of government policies, programs and projects that negatively impacted service delivery to Seychellois. More specifically, budget allocations made by Ministries, Departments and Agencies (MDAs) were based mainly on funding the institutions and their inputs rather than policy priority areas. Furthermore, these institutions failed to provide systematic information on results achieved using the budgeted resources which weakened the government’s ability to monitor and evaluate policy implementation and outcomes. In addition, limited budget documentation was provided to Cabinet and the National Assembly for budget approval and monitoring, reducing transparency and accountability.

Approach

To address these challenges, a Results-Based Management (RBM) reform was initiated in 2013 to bring about more efficiency, effectiveness and accountability within the public service. The reform comprised four pillars: (i) planning, (ii) programme-performance based budgeting (PPBB), (iii) performance monitoring & evaluation (PM&E) and (iv) public service and performance management (PSM). The government adopted a sequential approach of implementing the pillars starting with PPBB from 2013 and PM&E in 2016.

The implementation of PPBB, introduced in 2013,  involved each MDA (a) designing program budget structures that focused on services the MDA delivers as an additional dimension in budget classification as opposed to the previous administrative classification, for example, the Ministry of Health shifted from previous administrative budget classifications that included Hospitals, Community Health, Central Drug stores etc. to designing budget programs like Primary Health Care, Hospital services, to mention a few. (b); introduction of a medium-term strategic planning phase to ensure resources are allocated to government priority areas; (c) introduction of the targets (performance indicators) to measure results against priority objectives and (d) strengthening in-year budget monitoring at all levels against the stated expenditure priorities and priority results. The reform was implemented on a pilot approach: starting with 2 MDAs in the 2015 budget, 3 more MDAs in the 2016 budgets, introduction of PPBB presentational format in all other MDAs in 2017 and 2018 budgets, and full adoption by all MDAs from 2019 budget.

PM&E was introduced in late 2016 to complement PPBB and improve tracking and delivery of government plans, programs and projects to achieve more efficient and effective service-delivery. The implementation approach involved designing of an M&E policy framework and designing the performance M&E tools that started being piloted in the Ministry of Education and Ministry of Fisheries and Agriculture in 2016. The pilot process was extended to other 5 MDAs and the reform is being integrated with other RBM pillars.

Results

The government has successfully developed guidelines, tools, systems and capacities that has enabled full roll out of PPBB in all MDAs by the 2019 budget

The government has already recorded early wins by implementing PPBB that provide evidence of improved budget process aimed at achieving results for Seychellois. The Cabinet and National Assembly (NA) now appreciate the comprehensiveness of the budget information submitted for approval. Previously they only received quantitative information with no qualitative information. The budgeting behaviors amongst the MDA staff has improved. They now plan properly to facilitate prioritization of the allocation of the budget envelop, they determine and include performance indicators in their budgets, and monitor achieving these targets regularly which has increased their focus on results. Senior management and programme managers in all MDAs have developed their budgeting skills and are now involved in budget planning, implementation and monitoring. Previously, the role was only fulfilled by the financial controller.

PM&E is now gradually being rolled out to seven pilot sectors across government using the developed detailed implementation guideline. The designed high-level PM&E tool, that is linked with the PPBB is being used by the pilot sectors, enables the tracking of progress on key outcome and supporting outputs against national and sector priorities across the sector.

The World Bank Group (WBG) Contribution

The WBG supported the government to implement the two aforementioned reforms, funded through three Reimbursable Advisory Service Agreements (RAS). The support involved assisting the Ministry of Finance, Trade, Investment and Economic Planning and the Department of Public Administration to conduct diagnostics, develop policies, implementation guidelines, tools and human capacity for the two reforms, and assisting the two institutions to roll out the reforms to the MDAs.

Human capacity development involved hosting many initiatives with all MDAs to develop sustainable national capacity and embedding new behaviors and practices. The initiatives included: on-the-job training; practical workshops; knowledge exchanges with practitioners from other countries; and designing a PPBB course at the Guy Morel Institute that has and will continue to be delivered to MDA staff.

The support was inclusive and transparent as it involved systematic and regular engagement with different stakeholders: Cabinet, National Assembly (NA) members, MDA senior leadership and staff, and civil society.

Partners

There were no other development partners involved in supporting the government to implement the reform. However, the WBG regularly update the development partners involved in the country on the progress of the reform, especially the European Union, IMF and African Development Bank. The achievements of implementation of the two reforms was mainly attributed to close cooperation between the Government of Seychelles and the WBG.

Moving forward

The government acknowledges effective PPBB implementation is about progressively strengthening capacities and infrastructure, and inculcating practice changes over the long-term. Therefore, the government is committed to continuing to strengthen the quality of planning, improving the quality and use of performance information, and building staff capacity. In addition, the government plans to introduce an audit of performance information by the Auditor General starting with the 2022 budget to provide credibility on the information.

In respect to PM&E, the government will further roll-out the reforms across all MDAs. This requires (i) incorporating performance targets in the national and sector development strategy once developed, (ii) linking the institutional to the individual accountability mechanisms in the PSM pillar, (iii) converting the PM&E tool into an electronic dashboard that integrates all RBM information as a management tool for decision makers, and (iv) gradually incorporating the evaluation function.

Beneficiaries

“We have a comprehensive budget with clear performance indicators for all ministries, department and agencies,” said Maurice Loustau-Lalanne, Seychelles’ Minister of Finance, when presenting the 2019 budget to the National Assembly.  

“This has been the best technical support that we have ever received. There has been an extensive and practical transfer of knowledge and experiences which resulted in developing capacity in the budget office and in the MDAs that is needed to sustain the implementation of the reform,” said Damien Thesee, Principal Secretary at the Ministry of Finance.

“The Government of Seychelles has made a lot of progress on budget management as a result of the work conducted through the Results Based Management. Today our citizens get more value for the money that the government spends. We are also making progress on our ability to measure and evaluate our performance in a more structured manner,” said President Danny Faure during his 2019 State of the Nation Address.