Programme Budgeting in Mauritius Joint Country Case Study

Introduction Programme based budgeting (PBB) has been on the reform agenda for a number of years in many African countries. As part of its ongoing work on budget reform, CABRI has undertook a Joint Country Case Study (JCCS) on reviewing the design and implementation of programme based budgeting (PBB) in Mauritius in March The research was conducted by a team of experts, consisting of senior budget officials from the ministries of finance of Ethiopia (Mr Melaku Kifle), Kenya (Mr Samuel Kiiru), Rwanda (Mr Elias Baingana and Mr Charles Karakye) and South Africa (Dr Kay Brown), an independent consultant, Adrienne Shall, and Helene Ba from the CABRI Secretariat.

Objectives of the study The objectives of the review are threefold: – To describe the conceptual design of PBB in Mauritius. – To review and assess the implementation strategy of the MFEE, identifying successes and challenges. – To assess the impact of implementing PBB, identifying any improvements in budgetary processes and outcomes.

Scope of research The review firstly described the conceptual design of PBB in Mauritius. The focus of this was to understand the technical detail of the PBB system. Secondly, the review examined and assessed the implementation process. This aim was to uncover the key challenges in implementing PBB, the successes achieved and the lessons learnt during the implementation process. Thirdly, the review assessed the impact of the introduction of PBB. Bearing in mind that Mauritius was still in the early stages of PBB implementation, we focused more on shorter-term outputs rather than longer-term outcomes. However, where outcomes have been achieved, these were noted. Due to time constraints and the early stages of implementation, it was not possible to evaluate individual programmes and sub-programmes. The evaluation will rather concentrated on broader behavioural changes in the budget process.

Methodology The review was conducted using both primary and secondary research. Primary research was carried out through interviews and secondary research by means of documentation received from the MFEE, Mauritius. Due to limited time on site and to add a broader perspective, the review team used focus groups as well as one-on-one interviews. Focus groups consisted of between 10 – 15 people and were made up of officials within one ministry or from a number of ministries. The interview then took place within the group rather than as individuals

Developing questionnaires The interviews and focus group meetings were carried out using a set questionnaire based on the scope of research outlined above. Variants of a generic questionnaire were developed according to the target group being interviewed. The groups identified were: – Ministry of Finance and Economic Empowerment (MFEE): The emphasis for MFEE staff was on the implementation process both in terms of the budget formulation process, the execution stage including changes to accounting systems, and performance monitoring. This questionnaire also focused on support given to line ministries. – Line Ministries: The focus was on support received from the MFEE; improvement in budget processes and systems; the effectiveness of prioritization; and improvement in service delivery objectives. – Parliament: The emphasis was on whether PBB has aided Parliament in debating the passing of the budget, playing their oversight role and holding the executive to account. – Civil society organizations: This group was questioned on the improvements in external organizations' ability to analyze budget implementation and service delivery.

Selection of interviewees The list of potential interviewees was broad and included not only senior management but also programme implementers. Line ministries included those that are direct service delivery ministries as well as those that are support ministries. – MFEE - Officials from the Departments of Budget Strategy and Management; Department of Knowledge and Human Capital; Department of Public Expenditure Management system and review; the Accountant General’s Office; and the original group of those who were trained as trainers for the implementation of PBB – Line Ministries – Ministries of Health and Quality of Life; Education, Culture and Human Resources; Civil Service and Administrative Reforms; Public Infrastructure, Land Transport and Shipping; and Environment and National Development – Parliament - Members of the Budget/Finance Committee; and also Members of the relevant Portfolio Committees for the ministries identified above – Civil Society organizations - Civil society organizations that are involved in applied budget work

Background to MTEF reforms in Mauritius In 2003, an attempt was been made to introduce PBB and MTEF in six pilot ministries. The method for piloting the MTEF was primarily a process of converting line items to a programme classification and then using an incremental approach to forecast the outer year estimates. Within the pilot ministries there was no change in the culture of budgeting which remained incremental and adversarial. With no explicit policy framework guiding the budget process, ministry officials had little incentive to prioritize and control spending within politically agreed hard budget constraints. For the rest of government, budget documents remained in the traditional format, there seemed to be no change in the budget formulation or implementation process and budgeting was regarded as business as usual.

Background to MTEF reforms in Mauritius The election in 2005 further hindered the implementation process during that year. Thus between 2003 and 2005, the implementation of the MTEF and PBB did not realize the goals of using the budget as a policy instrument of rationalizing and prioritizing resource allocation and introducing performance orientation in budget management. In 2006, the newly elected government launched an economic reform programme, part of which aimed to strengthen fiscal management. Acknowledging that PBB in an MTEF context was an important area of fiscal management, there was a renewed impetus for the successful implementation of these reforms. The Government of Mauritius itself was the main driver of the PBB reform with assistance from external partners such as the IMF, the World Bank and the UNDP. Within government, the MoFEE was the driving engine of the reform process. To overcome the initial perception that PBB and MTEF were just an add-on with no real impact, the new implementation strategy included implementing PBB in all ministries simultaneously. Furthermore, the MoFEE recognized the importance of basing the PBB and MTEF on a sound medium term budget framework to improve the link between policy decisions and budget allocations.

Key Findings Mauritius embarked on an ambitious reform programme in 2006, part of which included the implementation of PBB within the context of a medium term expenditure framework (MTEF). The design aspects of the PBB reforms are now largely in place and the focus is shifting to consolidating and deepening the reforms so as to reap the benefits of aligning resource allocation to policy priorities and improving service delivery implementation. Mauritius has achieved notable successes in: – Instilling a sense of performance orientation across government; – Ensuring an enabling environment for PBB with good sequencing of reforms; – Restructuring the budget using a programmatic approach and including performance information in the budget documentation; – Encouraging debate within the MoFEE and open communication and consultation between MoFEE and the line ministries; and – Implementing a new COA which enables budget execution according to PBB