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More Than Numbers: Open Budgets and the Data Revolution

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This post was written by Jamison Crowell and Ryan Flynn, International Budget Partnership

Last week hundreds of representatives from governments, CSOs, and academia met up at the Cartagena Data Festival to discuss ways to implement a “data revolution.” The Overseas Development Institute (ODI), which jointly hosted the event, also published a new report which takes a comprehensive look at what the data revolution means for sustainable development.

ODI’s report has a welcome emphasis on the imperative of data serving the needs of citizens. Drawing on IBP research, the report also recognizes that without access to information on both development finance and government budgets it “will be impossible for stakeholders to hold governments and other actors accountable for funding delivery of the SDGs [Sustainable Development Goals].”

The data revolution has generated a great deal of momentum around the idea that open, accessible, and better quality information is needed to improve development outcomes. And the promise the movement holds – a better understanding of the world we live in, and of the needs of the poorest amongst us – is tantalizing.

But when it comes to public finance, “data revolutionaries” sometimes overlook two important points: governments already produce a great deal of budget information, they just don’t make it available to the public; and the narratives contained in official budget documents are crucial for gaining a better understanding of how public finances are being managed.

More than Numbers

Open data activists have tended to emphasize the need for budget data to be published in machine readable formats. While this is an important innovation that can enhance the ability of actors outside government to do independent analysis, it can sometimes overshadow the need for narratives to accompany the numbers.

US 201516 budget dataAs development economist Morten Jerven has pointed out, “data is not the same as numbers.” Indeed, when it comes to understanding how public money is being used, numerical data is rarely sufficient. Numbers can give us the “what,” but to piece together the story of the budget we also need the “why.” The best place to get this is from the narratives contained in the budget documents governments produce and use themselves.

Without these narratives, determining justifications for expenses, linking policies and budget allocations, and understanding differences between actual and estimated expenditures is essentially reduced to guesswork. Each key budget document is a part of this story, and the gritty details contained in their narratives are imperative for budget information to be meaningful.

The good news is that improving the availability of fiscal data doesn’t always require deep investments in National Statistics Offices. The even better news is that if official budget documents are published, civil society can help scrutinize and improve the information contained within. This will not only improve accountability and foster greater trust, but also stands to improve government’s own picture of how public finances are being managed.

Budget Information is Low-Hanging Fruit

The data revolution has been successful at capturing the imaginations of governments around the world. In March, finance ministers from all across Africa released a joint statement (PDF) embracing an, “African data revolution […] built on the principles of openness across the data value chain and a vibrant data ecosystem driven by national priorities and inclusive national statistical systems.”

Yet, as pointed out by Mo Ibrahim in an article for the Financial Times, “Only 3 per cent of African citizens live in countries where governmental budgets and expenditures are made open, according to the Open Budget Index.”

Why is this the case? One big reason for the paucity of budget data is so much simply goes unpublished. This is by no means a problem confined to Africa: of the hundreds of budget documents found by the 2012 Open Budget Survey to be unavailable, 40 percent were produced by governments but remained off limits to citizens. This fact is reinforced by data collected by the IBP in its monthly Open Budget Survey Tracker.

There are clearly issues of capacity (many important budget documents are not produced at all). But governments that wish to drive the data revolution forward can do so remarkably quickly and at very little cost: publish the budget documents that are being produced.

So You Want to be a Revolutionary?

The ambitions of the data revolution stretch well beyond public finance. Data hold the promise of improving our collective understanding of our world. Our ability to marshal this this understanding to improve the lives of poor people is a crucial test of the age we live in.

But as governments contemplate how to build the capacity to better understand the needs of their citizens, there is a simple, timely, and revolutionary act they can make. Commit to open budgets as a part of the post-2015 agreement, and encourage other governments to do the same.

Developing Social Audit and Citizen Monitoring Practices in South Africa

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This article was written by Keren Ben-Zeev, Heinrich Böll Stiftung Southern Africa.

The South African government spends almost half of its budget each year on education, health, and welfare services. A further 20 percent of the budget goes to the provision of housing, water, electricity and sanitation. By some measures, though not all, these levels of expenditure compare favorably to similar economies and should be sufficient to provide quality public services to the majority of the population.

Despite these significant investments, however, public education and healthcare are both in crisis, and last year public outcry over failing services reached fever pitch: a record 185 “service delivery” protests took place in 2014, with residents demanding improvements to basic services such as water, sanitation, housing, roads and electricity. Whether public services can be significantly improved, however, largely depends on fixing accountability and transparency deficits inSouth Africa’s political system.

In response, South African civil society has been increasingly exploring participatory methods to enable citizens to hold the government to account for how it is using public money to deliver services. One powerful participatory tool that is emerging in South Africa is social audits.

south africa social audits photoSocial audits enable citizens to interrogate the state on specific budget and expenditure choices, as well as their outcomes. In South Africa, where state driven participation has failed to challenge vested interests, social audits provide platforms for citizens to hold the government to account on their own terms.

In an effort to develop and expand the use of social audits in South Africa, the Heinrich Böll Foundation, the Social Justice Coalition (SJC), Ndifuna Ukwazi (NU), and IBP organized a study visit to India for South African activists. Among the delegates were those who already use social audits in their work, such as those from SJC, NU and Equal Education, as well as delegates involved in monitoring the extractive industry and urban development for whom social audits are new, such as PlanAct and Afesis Corplan.

Learning from the “Pioneers”

Social audits have long been an important part of the accountability “ecosystem” in India. Indian civil society organizations (CSOs), such as Support for Advocacy and Training Health Initiatives (SATHI), Samarthan, and the Society for Social Audits, Accountability, and Transparency (SSAAT), have pioneered different ways of using social audits to improve service delivery outcomes.

For SATHI, social audit work has evolved into the Community Based Monitoring and Planning (CBMP) approach. CBMP involves establishing regular forums for citizens to engage with the government on service delivery problems that have been identified through citizen monitoring. SSAAT, a politically independent but state funded agency, organizes social audits government programs on a mass scale. Samarthan works in one of India’s poorest states to enable communities to take charge of the state’s social audit platforms.

Delegates from South Africa were directly linked with experienced social auditors from these organizations. They accompanied youths to audit infrastructure projects and employment programs; attended CBMP forums aimed at improving health clinics; and observed public hearings to report on audit findings. Delegates were also able to directly engage with villagers, civic leaders and government officials involved in auditing practices.

What we Learnt

A number of lessons emerged from the delegates’ own reflections on their experience.

Social audits can drive systemic change as well as deliver immediate justice.
Including political leaders alongside the officials directly responsible for resolving specific issues enabled solutions to be found and immediate justice to be won for communities. In one public meeting, an official who mishandled scholarship funds paid back the money. In a CBMP forum, identifying alternative accommodation for doctors helped to increase the length of medical consultations.

In contrast, social audits in South Africa have tackled systemic problems and targeted high profile office bearers. This is essential and must continue. But it leads to long term campaigns that don’t immediately improve people’s lives, and leaves communities to deal with “basics” like broken toilets outside of the audit.  CSOs should consider an approach that combines regular forums with local officials to address specific problems, and special public hearings to address systemic issues with higher level representatives.

Communities need to be in the driving seat.
While the monitoring forums and social audits we observed were supported by CSOs or the Indian government, residents in the community took the lead.

In South Africa, social audits have been largely associated with the CSOs who led them. Structuring audits so that so that they are led by communities could strengthen the legitimacy of audit findings and the government’s response.

Combining social audits with community based monitoring should be explored.
Holding regular forums for the community to monitor services allows individual problems to be tracked until they are solved, facilitates collective action, and provides space for the community to take the lead.

Establishing resident committees to monitor the implementation of commitments won through social audits is one way this can be achieved. In time, these could also become inclusive and community based forums for planning and leading social audits.

Social audit findings should be integrated into official planning, oversight, and budgeting processes.
This could help to strengthen the state’s own planning and oversight processes, as well as the institutions themselves. This is particularly relevant in South Africa, where oversight institutions have largely failed to effectively interrogate government programs and champion the interests of the most marginalized.

Local power dynamics need to be considered.
As one official explained to us, SSAAT audits allow for “impartiality at every level.”  To prevent the intimidation of the auditors by local elites, SSAAT trains youths from different locales to audit one another’s villages; and public hearings are overseen by district level representatives rather than local politicians.

This is more relevant for a context where communities can rely on a politically powerful state institution to lead the audit and ensure that its findings are remedied, rather than those where communities have only themselves to rely on. Nonetheless, there may be cases where it would be useful to creatively consider how localized power dynamics should be managed – whether through circumvention or challenge.

Next Steps

Over the next few years we will support PlanAct and Afesis Corplan to undertake their first audits. With Benchmarks, we will experiment with the use of audits to hold mining companies to account. Drawing on our lessons from India, Equal Education, SJC and NU will experiment with different approaches and adapt these insights to the South African context.

Collectively, these actions will hold government to account for failures to provide sanitation to informal settlements in Cape Town, the appalling conditions in township schools in Gauteng, and unreliable water provision to settlements in Mpumalanga. While these will address problems in specific locales, we hope they will also catalyze country wide action that strengthens participatory and oversight institutions, public services, and, most importantly, the citizenry’s ability to ensure that public funds are used to improve their lives.

 

 

The Post-2015 Agenda: Good Progress but Room for Improvement

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This article was written by Claire Schouten and Ryan Flynn, International Budget Partnership.

Source: Flickr/Ministerie van Buitenlandse Zaken

Source: Flickr/Ministerie van Buitenlandse Zaken

The post-2015 Sustainable Development Goals (SDGs) are now more or less finalized. However, two big questions remain: How will the SDGs be paid for? And how should progress towards their achievement be measured?

In the last few weeks, two draft documents speaking to each of these questions have been published. On the first, the United Nations General Assembly released a “zero draft” of the Financing for Development Outcome Document. On the second, the UN Statistical Commission (UNSC) has released a set of draft indicators (PDF) for measuring progress towards achieving the SDGs and targets.

There is much to like in both of the drafts, with budget transparency and participation explicitly included in each. Crucial details, however, are missing in both documents and we have recommendations for ways to improve future iterations.

Financing for Development

The “zero draft” is the first shot at a document that will eventually answer the not insignificant question of how global development – including achieving the SDGs – will be financed. It also seeks to ensure that resources are used effectively.

Paragraph 30 of the draft contains some welcome language on transparency, pledging to “increase transparency and participation in all aspects of the budgeting process, and encourage those who have not yet done so to join the Open Government Partnership.” This focus is welcome and should be upheld. It is nevertheless essential to articulate the steps needed to achieve this. In other words, how to deliver on the commitments.

Building on the lessons learned from the Millennium Development Goals (MDGs), and 20 years of development and budget experience, IBP and our partners recommend strengthening these commitments as follows:

  • Specify that budget documents covering each stage of the budget cycle should be published in a regular and timely manner. The Open Budget Survey Tracker has demonstrated that many governments are failing this basic test, leaving serious gaps in our understanding of how budgets are being planned, executed, and audited.
  • Further define what is meant by public participation in the budget process. This should include identifying practical and accessible mechanisms, such as public hearings, for the public to participate in all stages of the budget process and governments to report on how public inputs have been taken into account.
  • Connect resources with development outcomes by pledging to track both spending and results at the global and national level. This information should be made publically available to ensure all stakeholders can monitor progress.

Measuring Commitments: The Indicators Framework

The UN Statistical Commission has published a draft of the indicators that will be used to monitor progress toward achieving the SDGs and targets. As a part of this process, national statistical offices around the world were asked to grade each of the indicators according to their feasibility, suitability and relevance.

While we welcome the inclusion of budget indicators in the draft, much like the Financing for Development draft, the devil is in the details. Three indicators under Goal 16 could be greatly improved by firming up how transparency and participation are measured (see Table below).

Improving the Indicators for SDG 16


Target 16.6
Develop effective, accountable and transparent institutions at all levels.

Indicator
Actual primary expenditures per sector and revenues as a percentage of the original approved budget of the government.

Ratings from National Statistics Offices
B) Feasible with strong effort B) We need to discuss and/or consider other indicators B) Somewhat relevant.

IBP Comment
This is difficult to assess when fiscal reports are not produced and made available. It is also difficult to define “primary expenditures” and “sector.”

Suggested Indicator
Regular reporting on budgeted vs. actual revenues and expenditures, disaggregated by type of revenue and by sector/sub-sector.


Target 16.7
Ensure responsive, inclusive, participatory, and representative decision-making at all levels.

Indicator 1
Diversity in representation in key decision-making bodies (legislature, executive, and judiciary).

Ratings from National Statistics Offices
B) Feasible with strong effort B) We need to discuss and/or consider other indicators A) Very relevant.

Indicator 2
Percentage of population who believe decision-making at all levels is inclusive and responsive.

Ratings from National Statistics Offices
C) Difficult, even with strong effort B) We need to discuss and/or consider other indicators B) Somewhat relevant

IBP Comment on Both Indicators
There is growing consensus that public participation in budgeting is an essential component of any public finance management system and decision-making process. This consensus is affirmed by the High Level Principles on Fiscal Transparency issued by the Global Initiative for Fiscal Transparency (GIFT), endorsed by United Nations General Assembly Resolution 67/218. This consensus is also supported by the International Monetary Fund, which recently included public participation as an indicator in its revised Fiscal Transparency Code, and by the Organization for Economic Cooperation and Development, which has similarly included public participation in its Principles of Budgetary Governance.

Suggested New Indicator
Legislatures conduct public hearings at the enactment and evaluation of the budget and government reports on how inputs were taken into account.


Target 16.10
Ensure public access to information and protect fundamental freedoms, in accordance with national legislation and international agreements.

Indicator
Percentage of actual government budget, procurement, revenues, and natural resource concessions that are publicly available and easily accessible.

Ratings from National Statistics Offices
B) Feasible with strong effort B) We need to discuss and/or consider other indicators A) Very relevant.

IBP Comment
Bundling these elements together makes it difficult to measure their public availability and accessibility as a percentage. On budgets, at least five budget documents should be made publically available (Executive’s Budget Proposal, Enacted Budget, Year-End Report, Audit Report, and Citizens Budget). Each should provide breakdowns according to expenditure allocated and spent towards each of the SDGs.

Suggested Indicator
Publication of key budget documents, off-budget revenue documents, procurement and natural resource contracts that are publicly available and easily accessible.


 

What’s Next?

Humanity has sufficient resources at its disposal to make substantial progress toward eradicating extreme poverty and achieve each of the SDGs. But only if these resources are managed effectively and allocated equitably. We welcome the recognition, in each of these draft documents, that transparency and participation are means by which we can ensure global resources are managed well. But without further detail – and firmer commitments for measuring and financing these lofty goals – we risk merely articulating good intentions, rather than ensuring good policies and actions.

Both documents remain, of course, in draft form. So we’ll be looking out for the next iterations.

On Financing for Development, the next drafting session will be held in New York from the 13 to 17 April. We hope participants will seize this opportunity to firm up commitments to transparency and participation as per our recommendations above.

On the SDG indicators, the UNSC is calling for feedback on the draft. We will be submitting our recommendations and welcome further engagement to advance this agenda.

Myanmar Needs Better Governance, Not Just a Stronger Government

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This article was written by Anjali Garg and Ryan Flynn, International Budget Partnership.

Source: Flickr/Tom Godber

 

Myanmar is a country in the midst of enormous change. In 2011 the country embarked on a series of reforms that have helped pull it out of decades of isolation. The transition from military rule toward more open governance has included establishing a parliament, implementing a more market-based economic system, relaxing media censorship, and negotiating ceasefire agreements aimed at ending some of Asia’s longest-running conflicts.

The government has also signaled a willingness to improve transparency and accountability, including signing on to the Extractive Industries Transparency Initiative (EITI) and the Open Government Partnership (OGP). And a new law loosening the government’s grip on civil society was enacted in July 2014.

Progress toward more open budgets remains nascent. IBP’s Open Budget Survey Tracker – an online tool that monitors the availability of budget information – shows most documents still remain under wraps. Despite producing a wealth of budget information, the government is currently publishing only the final Enacted Budget. This means that crucial documents produced by the government, such as the Draft Budget and the Audit Report, remain off limits to the public.

IBP recently sent a team to Myanmar to explore opportunities to expand budget transparency, participation, and accountability. We found that current efforts to strengthen Myanmar’s budget system are focused primarily on building government’s capacity.

A similar commitment should be made to strengthening local civil society and opening up space for public participation.

Strengthening Public Finance Management (PFM)

Recognizing the links between better budgets and improved service delivery, donors have made strengthening the government’s ability to manage public finances a priority. The World Bank, the United Kingdom, and Australia have committed a collective $55 million over the next five years (through 2019) to providing Myanmar with technical and financial assistance for public finance management reforms.

Few would question the need for government to have the skills and capacity to manage public money, and donors are doing an impressive job of matching these needs with resources. But an effective budget is more than the product of strong government systems: the ability of those outside government to understand and participate in budget decisions, and to hold government to account for how money is raised and spent, is crucial.

More Inclusive Budgets

Many of the donors we met with acknowledged the importance of reforming budgets to be more inclusive. But so far the process has been to inform rather than consult those outside government about reforms. Little has been done to facilitate a much-needed dialogue between local civil society and the finance ministry. As a result, many are left disconnected. This is a missed opportunity to ensure that issues that are often championed by civil society, such as transparency and participation, are high on the PFM reform agenda.

Importantly, donors are currently investing too little in building the capacity of local civil society to directly engage in budget issues and undertake budget analysis. Holding government to account for how it is raising and spending public money depends on the ability of civil society to analyze and use budget information. We know from experience that, much like building the capacity of government, equipping civil society organizations with the necessary knowledge and skills takes time.

A Country in Transition

If civil society appears to be largely disconnected from the reform process, the general public appears to be struggling to make sense of the enormous changes underway. A groundbreaking report by the Asia Foundation found that the public, while generally upbeat about the country’s future, has “very limited knowledge about the current structure and functions of various levels of government.” At the same time, those surveyed placed remarkable importance in citizen participation in governance: 94 percent believe it to be very or somewhat important; virtually no one believes it is unimportant (see chart below).

Myanmar Participation

Source: The Asia Foundation http://asiafoundation.org/publications/pdf/1445

A lack of understanding on the particulars of government should not be an excuse for excluding the public from the process of reform and government decision making more broadly. Rather, the Myanmar government and donors should seize on this widespread optimism and appetite for public participation to inform and involve the people in governance decisions.

In the context of government budgets, this means laying the foundation for an informed and engaged civil society that can shape budget priorities, draw the public’s attention to budget issues, and hold the government to account on its management of public resources.

Now’s the Time

To its credit, the UK’s Department for International Development (DfID) has earmarked US$6.8 million from its PFM program to support civil society. While this is a good sign, so far none of the funds have actually been disbursed according to DfID’s Development Tracker.

Delaying this effort has the effect of sequencing civil society budget work until after other reforms have taken root and, in doing so, threatens to undermine some of the fundamental objectives of donor support. Building more accountable, inclusive budgets, in which the public plays a greater role, is not a narrow technocratic exercise. International experts can help to deliver better budget systems, but building the capacity of local civil society to monitor and influence public spending is essential to better outcomes.

Investing in civil society is also likely to stoke demand for greater budget transparency and space for participation. Donors can add momentum by encouraging the government to make more budget information publicly available. If the government is serious about instituting a more open and participatory governance system, a significant step toward this can be achieved at little or no cost by simply publishing the budget documents that are already produced.

Increasing opportunities for the public to participate in budget decisions is no less important. The finance ministry should organize meetings around Myanmar to collect citizens’ views on budget priorities, and the national parliament should open their hearings on budget oversight decisions to the public. The Asia Foundation’s findings suggest that there is an optimistic populace eager to engage, but it lacks a solid understanding of how the government works. Greater participation from the public will not only help the government better understand people’s priorities and needs, but also allow the public to “learn by doing” as they engage in budget and service delivery decisions that have a direct bearing on their lives.

These three elements – supporting local civil society, increasing budget transparency, and encouraging public participation – should happen at the same time as investments in better budgetary systems and improvements in government capacity.

Without each of these, donors run the risk of merely strengthening Myanmar’s government, not strengthening Myanmar’s governance.

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The Open Budgets Blog features news, analysis, and opinions related to transparency, participation, and accountability in government budgeting, civil society budget analysis and advocacy, and public finance management.

Each post is the responsibility of the individual author alone, and does not necessarily represent the views of the International Budget Partnership, our donors, or partners.

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