1. Public Expenditure Tracking and Service Delivery Surveys
Jordan Public Expenditure Review
June 15, 2003
Ritva Reinikka
Development Research Group, The World Bank

2. Public Expenditure Tracking and Service Delivery Surveys
First Public Expenditure Tracking Survey (PETS) carried out in Uganda in 1996
Since then, a large number of PETS and related surveys have been implemented
Scope and nature of surveys are differed, but common theme is link between public spending and outputs and development outcomes
Surveys to date
Completed
Uganda (5)
Tanzania (2)
Ghana
Rwanda
Mozambique
Zambia
PNG
Honduras
Peru
Bangladesh
and more…
Ongoing
Ethiopia
Nigeria
Brazil
Laos

3. From policies and spending to benefits
We generally believe that providing financing and flexibility to countries with well-designed policies allows us to leverage good outcomes.
Benefits Government
Outcomes

4. Breakdowns on the way to achieving outcomes are due to gaps in…
Government
Leakage of Funds
Policy
Institutional Incentives
Sub-optimal spending:
High teacher salaries; Insufficient supply of textbooks
Financing
Capacity
Information & Transparency
Low quality instruction
Capacity & Incentives
Curriculum & Technology
Lack of demand
Household Behaviors
Community Norms
Policy
Information/M&E
Capacity
Household Behaviors
Institutional Incentives
Financing
Other Sectors
Local Gov.
Providers
Individuals
Outcomes
Benefits

5. The (missing) link between public spending and outcomes
Broad allocation of resources
Delays and lack of predictability (e.g. salaries, medicine stock-outs)
Problems in budget execution
CORRUPTION
Discretionary reallocation of resources (favoritism, lack of criteria or information, etc.)
Leakage of financial or material resources
PUBLIC EXPENDITURE TRACKING AND SERVICE DELIVERY SURVEYS
Misappropriation of resources (e.g. theft of medicines)
Evidence shows limited impact of public spending on growth and human development indicators
Demand for evidence on efficiency of spending and quality in service delivery
Lack of reliable data in many developing countries
New approaches to aid delivery
Move towards budget support (e.g., PRSC)
Focus on poverty-focused strategic framework (PRSP)
Related fiduciary and accountability concerns
Are budget allocations pro-poor?
Are budget outturns consistent with established allocations?
Quantitative measurement of corruption
Do expenditures result in intended outputs and outcomes?
Problems in service delivery
Absenteeism
Overcharging
Inefficiency, high cost, low quality
Lack of demand for services

6. A framework for service delivery World Development Report 2004
This is a problem for two reasons:
The provider may not have incentives to provide the service. His pay is unaffected by whether or not he provides the service. Absenteeism rates in schools and clinics is an example of this.
One way to improve upon this is to make the provider’s pay depend on the service—as in a contract. A good example is from Cambodia.

7. The Survey Approach
Approach has varied considerably depending on context and focus
Multilevel focus, but frontline providers (schools or health facilities) as main unit of observation
Representative sample
Data collected through interviews and record reviews (financial records, stock cards for medicines, etc.)
Multi-angular approach for validation of data
Some surveys include detailed surveys of frontline provider, including availability/adequacy of inputs, quality, staff and user interviews, etc.

8. What have we learnt? Leakage
Education sector in Uganda 1996
Data from 250 schools and administrative units
Only 13 percent of intended capitation grant actually reached schools ( ).
Mass information campaign by Ministry of Finance (the press, posters)
Follow-up PETS to evaluate impact of the information campaign: 2/3 of reduction in leakage thanks to the campaign
High leakage has also been found in other countries (Tanzania, Ghana, Zambia, Peru)
Many improvements since 1992
macroeconomic stability and growth
shift of public resources from defense to roads and social sectors
decentralization
Poverty Eradication Action Plan (PEAP)
Poverty reduced from 56% in 1992/93 to 35 % in 2000
Strong budget management
MTEF, Poverty Action Fund (PAF)
Sector level performance did not keep up
SYSTEMATIC PATTERNS IN LEAKAGE:
Large schools with wealthier parents and qualified teachers were able to obtain more of their budget allocation.

9. What have we learnt? Ghost workers and absenteeism
Salary payments “leak” differently
Different measurement approaches:
PETS with data collection on payroll and staffing data (Honduras 2000, Peru 2002, Zambia 2002, Mozambique 2002, etc.)
Unannounced visits to schools and health facilities (Bangladesh 2002, India 2002, Uganda 2002)
Health
Educ.
Ghost workers
Honduras
5.0%
8.3%
Absenteeism
Bangladesh
35.0% -
27.0%
14.0%
India
43.0%
23.0%
Peru
26.0%
13.0%
Uganda

10. What have we learnt? Allocation and budget execution
Leakage sometimes difficult to assess due to lack of explicit allocations or entitlements
But surveys can shed light on other important allocation and budget execution issues
Primary health care in Mozambique:
Very large variation across districts and facilities in non-wage recurrent spending, staffing, and distribution of medicines
Severe problems in budget execution, with late first transfers and slow processing of accounts, resulting in low predictability
Weak record keeping at provincial, district, and facility levels, often with large discrepancies between levels
Why this variation? – Corruption may be one factor

11. The strengths of the approach
Useful tool for diagnosing and understanding problems in budget execution and service delivery, including corruption
Multilevel perspective important and not achieved from simple school or facility surveys
District and frontline provider perspective often forgotten at central level
Representative sample provides credibility not achieved through small-sample studies or institutional reviews
Validation of administrative data (financial and output)
Can provide basis for monitoring of changes over time
Surveys provide data for research that can improve our understanding of the determinants of corruption or poor service delivery
Process of designing and implementing survey is useful for understanding institutional and procedural arrangements for budget execution and service delivery

12. Survey Design: Surveying what? Why?
What are the problems? Are there important gaps in our understanding of the nature, extent, and source of problems?
Is a survey the appropriate tool? Stand-alone or as a complement? Worth the cost?
Is it feasible? How is the budget structured and implemented?
Who is the audience and is there a likely impact? Is there a political demand?
Will the information be used? By whom?

13. Implementation issues: Who? How?
Requires skills like any other micro survey
Steps in implementation
Concept
Buy-in across the board
Questionnaire design
Identify (and contract) implementing agency
Pilot
Enumerator training
Field work (including quality control and data entry)
Analysis and dissemination

14. Some limitations Surveys only provide part of the answer
What about inter- and intra-sectoral allocations?
Link with outcomes?
=> Budget analysis and social impact analysis (with household data or through participatory approaches) are still important
Surveys should supplement rather than supplant routine information, control, and integrity systems
Surveys provide information but don’t necessarily result in change
A lack of information about the scope and nature of problems is not always the primary constraint to improving PEM and service delivery
Continuity and link with efforts at strengthening institutions and routine PEM systems important
Link with community and other local stakeholders can be difficult to achieve – important to use findings to strengthen local transparency and accountability mechanisms

15. Finding out more…
Survey reports, instruments, and documentation on:
Some references:
Dehn, Reinikka, and Svensson “Survey Tools for Assessing Performance in Service Delivery.” In Bourguignon and Pereira da Silva, eds. Evaluating the Poverty and Distributional Impact of Economic Policies. Oxford University Press and the World Bank. Forthcoming
Reinikka and Svensson Measuring and understanding corruption at the micro level. In Della Porta and Rose-Ackerman, eds. Corrupt Exchanges: Empirical Themes in the Politics and Political Economy of Corruption. Nomos Verlagsgesellshaft.
Lindelow and Wagstaff “Health Facility Surveys: An Introduction.” Policy Research Working Paper The World Bank.