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Programmes
Value for Money in Agriculture Financing PDF Print Email

A billion people around the world face severe poverty and hunger and two billion are malnourished. Three quarters of the world’s poor depend on small plots of land for their food and income. In Sub-Saharan Africa, 80% of the population rely on agriculture for their livelihoods and they do so with low levels of agricultural productivity. For example, the average farmer in Sub-Saharan Africa (SSA) gets just over a ton of cereal per acre, while the average Indian farmer harvests twice that, the average Chinese farmer gets about five times that and the average American farmer about seven times that amount (Gates Foundation, 2011). The reason proposed for the disparity is that farmers in other regions have tools, techniques and resources that African farmers do not.

Maize

 Agriculture is critical in food security, poverty reduction and overall economic growth. As such, agricultural spending is one of the  most vital instruments to promote growth and alleviate poverty. The 2003 Maputo Declaration on Agriculture and Food Security  calls for 10 percent of national budget allocation to agricultural development which for the vast majority of countries are yet to be  met. While it is important to assess whether poor agricultural outcomes are explained by under-investment, it is equally and perhaps  more important to assess whether there is agricultural funds are being utilised effectively and efficiently.

 The Agriculture Sector Dialogue will be the fourth in a series of sector dialogues. CABRI has established dialogues as an additional  peer learning mechanism comprising thematic seminars for a small number of countries to allow for in-depth exchange of  knowledge and experience. The aim of the dialogue is to share ideas and obtain an in-depth understanding of the challenges in the  agriculture sector and to find better and more efficient ways to plan, finance and manage public spending in the sector. The  dialogue also aims to improve the communication and mutual understanding between finance and line ministries.

Governments have to use their scarce resources for a number of priorities; the agriculture sector is no different: a limited budget needs to be prioritised over a number of commodities, inputs, sub-programs (such as R&D over extension). With a better understanding of the relative returns of various investments, agriculture policies can target resources where there is most bang for the buck, to increase agricultural production (and productivity) to inform higher poverty reduction. The Agriculture Sector Dialogue will therefore focus on the ways to improve public spending, within budget constraints to increase agricultural productivity, improve efficiency, and contribute to poverty reduction and economic growth. The discussions will be based on a set of analytically tractable studies that address specific agricultural policy issues and provide a set of recommendations.

The dialogue discussions will be informed by research studies and will focus on the following themes:

1. Understanding the Agriculture Challenge in Africa

2. Efficiency in Agriculture Spending

3. Budgeting for Agriculture

4. Innovative Financing for Agriculture


The CABRI Sector Dialogue on the policy challenge and efficiency in agriculture spending

The Agriculture Sector Dialogue, held on 29 and 30 July, 2013 in Dakar, Senegal, was the fourth in a series of CABRI sector dialogues after dialogues on infrastructure, health and education. The Dialogue participants included budget and agriculture officials from ten countries: Botswana, Burkina Faso, Ghana, Kenya, Mali, Mauritius, Niger, Rwanda, Senegal and South Africa. There were also policy experts from the: Bill and Melinda Gates Foundation; Food and Agriculture Organisation (FAO); International Food Policy Research Institute (IFPRI); Department of Agriculture at the University of Pretoria; Africa Risk Capacity (ARC); and the Initiative Prospective Agricole and Rurale (IPAR). The dialogue provided a platform for the exchange of knowledge and experience in: planning; budgeting and financing; and management of expenditure in the agriculture sector. Below are some of the highlights of the discussion from CABRI’s perspective.

Are we spending enough? The 6% agriculture growth rate and 10% expenditure targets that have been set by the Comprehensive Africa Agriculture Development Programme (CAADP) was an interesting starting point to the discussion. Budget officials have expressed the view that these targets undermine the credibility of the budget process by not sufficiently examining trade-offs, opportunity costs, and efficiency gains. Its relevance was also questioned given that the targets were supposed to have been met by 2008. For some countries like South Africa, spending less than 2% on agriculture, the target is not seen as realistic. For other countries like Burkina Faso, Niger, Mali, Ethiopia, Malawi, that are spending relatively high shares of total expenditure on agriculture, a valid question is whether the spending is in response to tangible returns or merely in response to an agreed-upon spending target. It was pointed out that the countries which are spending close to the CAADP target tend to be mainly in the Sahel region which face large climatic risks. The high levels of expenditure would therefore be expected. The consensus at the end of this discussion was that the targets should be used as a guide that is informed by individual country circumstances.

Are we getting value for money in agriculture spending? It’s difficult to say on a general level. Senegal was forthcoming in sharing that they are spending more than 10% according to forecasts but are seeing very little value for money: yields have not improved since independence; production levels have not increased; exports are on the decline; rice is imported, etc. On the other hand, there was also a view that Africa is indeed getting value for money from the increased spending. The problem is we don’t really know what government is spending on. So far, the data is fragmented and highly aggregated. In the end, value for money heavily relies on a proper monitoring and evaluation system. This is lacking. A request was made to the CABRI Secretariat at the dialogue to commission a set of valuation studies in agriculture as a learning tool for countries.

How can we assess and ensure increased productivity in agriculture? The background research prepared for the dialogue showed that there has been an increase in agricultural production over the past decade. But, this is not the case for productivity. While some countries such as South Africa, Egypt and Morocco show high rates of labour productivity, which are probably also a reflection of capital investment, the majority of countries in SSA have very low levels of productivity. In terms of assessing productivity, available research suggests that a good rate of return to investment is about 20%. This would require governments to adopt a private-sector-like approach with a stringent view of the profitability of its investments. But, can governments operate this way? This was a question posed in a group discussion on production and productivity. The consensus was clear. Governments, in this instance, cannot operate like the private sector. Governments have broader economic, social and political objectives that cannot be confined to rates of return/profitability. Cost-benefit and other quantitative and qualitative analyses are the preferred tools as well as impact evaluations. At the same time, it’s important for governments to demonstrate that they are doing something to optimise investments. This is an area that needs further reflection and exploration.

What is the way forward? A recurring theme in the dialogue was the need for countries to have at their disposal appropriate tools to assist officials in planning, monitoring and evaluating investments in Agriculture. This will be the focus of the second agriculture dialogue. CABRI with input from the Africa Rick Capacity (ARC) has already initiated a management tool called the Africa Agriculture Planning Scorecard (AAPS), which was piloted at the dialogue. It’s an innovative framework designed to define the main features of best practice in agricultural planning; help focus planning reforms; encourage exchange of experience over which features are most difficult to implement; help ministries of agriculture focus on improving planning across all elements and provide a possible framework for agricultural sector budget support. CABRI and the ARC will continue to develop it further.

group photo

For additional information, contact the sector dialogues coordinator, Dr. Nana Adowaa Boateng, nana.boateng(at)cabri-sbo.org


The research documents that were discussed are available for download below.

For more information, please download the programme of the Dialogue here

Keynote Papers:
The Agricultural Policy Challenge
Budget Efficiency in Agriculture


Country Case Studies: 
Ethiopia’s Agricultural Development Policy Challenges
Budget Efficiency in Uganda
Should Ghana give a Discount on Main Crop Cocoa Beans to Local Cocoa Processors?


Presentations:

The Policy Challenge for African Agriculture
Agricultural Public Expenditure in Africa a cross-country comparison


Case Studies:
Ethiopia’s Agricultural Policy Challenges
Should Ghana give a discount on main crop cocoa beans to local cocoa processors? 
Budget Efficiency : Case of National Agricultural Advisory Services in Uganda
Case Study: Choice of Optimal Instruments for Boosting Food Sufficiency – the case of agricultural input subsidies in Senegal


Country Presentations:
Mali Agriculture Presentation 
Kenya Agriculture Presentation
Rwanda Agriculture Presentation 
Mauritius Agriculture Presentation 
Botswana Agriculture Presentation


Group Work:
Enhancing Agricultural Production and Productivity via Budget Processes
Climate Change and Disaster Preparedness


African Agricultural Planning Scorecard
The African Agricultural Planning Scorecard: Framework
Exercise 
Feedback 

Please click here, to view a CABRI blog post on the agriculture work as well. 


The evaluation results of the first Agriculture Dialogue are available here



Please find some media coverage as well as the press release on the first CABRI Sector Dialogue on Agriculture attached below (media articles are in French):

The Second CABRI Agriculture Dialogue will take place in South Africa from 14-15 April 2014.

This dialogue will focus on instruments that can assist policy officials in making the difficult decisions: how to decide which intervention will deliver more bang for buck as well as determining whether funds are being spent efficiently and effectively. Some of these instruments will include: public expenditure reviews, public expenditure tracking surveys, randomised trials, policy simulation models and M&E systems. The purpose is not to deliver a technical training but to equip policy officials with some intuitive understanding of the various instruments available so that they can make decisions on incorporating them in their work.

For more information, please download the programme for the dialogue here.

 
Value for Money in Education Financing PDF Print Email

The Collaborative Africa Budget Reform Initiative (CABRI), a peer learning network of senior budget officials in Africa, is undertaking a programme of work on improving efficiency in spending with regards to education in Africa. The programme of work culminated in a CABRI Dialogue on the planning, financing and management of education expenditure. The Education Dialogue was the third in a series of sector dialogues. CABRI has established dialogues as an additional peer learning mechanism comprising thematic seminars for a small number of countries to allow for in-depth exchange of knowledge and experience.

The dialogue aimed towards sharing ideas and obtaining an in-depth understanding of the education challenge and to find better and more efficient ways to plan, finance and manage public spending in the education sector. The dialogue also aimed at improving the communication and mutual understanding between Finance and line ministries.

The Education Dialogue focused on 3 important areas of education finance, targeted to the needs of officials from the Ministry of Finance and the Ministry of Education.

The following research papers are available:

Understanding the Education Challenge in Sub-Saharan Africa: Policy and Institutions (Keynote paper)

Efficiency in Education Spending for Learning Outcomes (Keynote paper)

Innovative Financing for Education (Keynote paper)

Decentralisation and Institutional Reforms for Basic Education in Ghana (Case study)

Three Financing Mechanisms to Improve Education Outcomes in Mozambique (Case study)


Below are the presentations given during the dialogue:

Understanding the Education Challenge in Sub-Saharan Africa: Policy and Institutions

Efficiency in Education Spending

Innovative Finance in Education

A Ghana Case-study of Decentralisation and Institutional Reforms for Basic Education

Three Financing Mechanisms to Improve Education Outcomes in Mozambique

High-Level Projections for Education (HIPE) - A Resource Planning Tool for Effective Policy Makers

Impact Evaluations for Education Policy - JPAL

TCAI: Lessons from First Endline


A CABRI blog on the education dialogue is available here

Please also find a briefing paper on ways in which education can be improved through the more efficient and effective management of expenditure here.

 
CABRI's Strategic Plan PDF Print Email

CABRI's three-year Strategic Plan gives an overview af all CABRI Programmes from 2012 to 2015. It can be downloaded here.

 
Budget Transparency Promotion PDF Print Email

Supporting Fiscal Transparency and Participation Reforms in Africa

Fiscal transparency and participation is crucial for good governance and macroeconomic stability. In the past decade, numerous studies have been published about the role of transparency in good governance. Findings point to a possible link between fiscal transparency, lower corruption levels and better socio-economic development (Islam, 2003; Bellver & Kaufman, 2005; Glennerster & Shin, 2008). It has also been argued that the lack of transparency and oversight has contributed to the unsustainable expansion of credit markets which led to the financial crisis (OECD, 2009). Greater budget transparency can lead the way for greater participation and oversight in the budget and policy process from citizens, civil society, parliaments and supreme audit institutions. Especially in countries that are aid dependent or rely heavily on resource revenues, fiscal transparency and participation can help to regain accountability of governments to their citizens, civil society, parliaments and supreme audit institutions. Therefore, fiscal transparency is an intrinsic element of good public financial governance and forms a key part of the public financial management reform agenda.

Read more »
 
Value for Money in Health Financing PDF Print Email

The CABRI health sector programme looks at the planning, financing and expenditure management in the health sector. The programme looks at how strengthening the linkage between Ministry of Finance and Ministry of Health can contribute to higher value for money. Understanding the complementary role of national and sector level in policy formulation and budget processes and making these processes more efficient and better integrated should foster the provision of quality services for better health outcomes.


Read more »
 
Good Financial Governance PDF Print Email

In order to promote economic growth and sustainable development an effective state should be able to mobilise revenue, borrow prudently, plan and manage the spending of public money in an effective and efficient way and to account for the use of funds and the results achieved. Sound public finance management (PFM) contributes to these outcomes through its elements of transparency, participation, responsiveness, oversight, accountability and predictability. These are elements of good public financial governance (GPFG) - a prerequisite for a state’s economic and social development and a focal area of CABRI’s work.

In this regard, CABRI, the African Organization of Supreme Audit Institutions (AFROSAI) and the African Tax Administration Forum (ATAF), have jointly produced  a research study on GPFG with the support from the African Development Bank (AfDB) and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ GmbH), German Technical Cooperation.

Read more »
 
Budget Management and Public Financial Accountability PDF Print Email

CABRI's aims at achieving its main objective by organising activities that arm African countries with practical ways to undertake reforms in public finance management and deepen and transfer capacity in budgeting institutions across the contient.

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Budget Practices and Procedures PDF Print Email

In 2008, CABRI collaborated with the OECD to include African countries’ budgeting practices and procedures in the database. Twenty-six African countries have completed the 99-question survey, which encompasses the budget cycle and includes a section on aid management. The survey results have undergone a peer review process and have been analysed by the LSE and compiled in a joint publication with the African Development Bank.

Read more »
 
Fiscal Elements of Growth and Development PDF Print Email

7 September 2007
Durban, South Africa

The South African National Treasury and CABRI co-hosted the African Policy Seminar on Fiscal Elements of Growth and Development. The seminar brought together senior policy-makers and G-20 members to engage in debates on current thinking and to discuss future opportunities for fiscal policy in commodity based economies and for investing in economic infrastructure.

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Putting Aid on Budget PDF Print Email

Using the Paris Declaration as a starting point, and notably the principle on alignment, CABRI has argued for aid to be aligned to countries' public finance management systems in order to:

  • Improve budget transparency and comprehensiveness
  • Improve governments' allocative efficiency and accountability
  • Strengthen countries' financial systems.
Read more »
 
Value for Money in Infrastructure Financing PDF Print Email

Ensuring value for money in infrastructure projects is a challenge for African states if they want to bridge the infrastructure gap and deliver basic public services to their populations. In many African countries infrastructure projects are publicly-funded and represent a substantial portion of the annual budget. Weaknesses such as difficulties in appraising projects that have the highest returns, access to financing - including the rise of financing and delivery by the private sector- and low execution rates have plagued the management of public infrastructure projects.


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