Home >Documents >National Budget Brief · over half of national budget financing (53 per cent), followed by external...

National Budget Brief · over half of national budget financing (53 per cent), followed by external...

Date post:20-Aug-2020
Category:
View:0 times
Download:0 times
Share this document with a friend
Transcript:
  • 1

    Rwanda

    National Budget BriefInvesting in children in Rwanda

    2019/2020

  • National Budget Brief: Investing in children in Rwanda 2019/2020

    © United Nations Children’s Fund (UNICEF) RwandaDecember 2019

  • 3

    Preface

    This national budget brief explores the extent to which the

    Government of Rwanda’s budget addresses the needs of

    children under 18 years of age through the national budget.

    The brief analyses the macro-economic situation as well as

    the size and composition of budget allocations to priority

    sectors for children; health (including nutrition), education,

    social protection, and water and sanitation for the fiscal year

    2019/2020. The budget brief aims to synthesize complex macro-

    economic and public budget information with a bearing on

    the implementation of children’s rights in Rwanda, as well

    as offering recommendations on how the government can

    improve investments in children.

    Key highlights

    • Rwanda continues to make significant progress in socio-economic and inclusive development, which is essential for improving the well-being of children. The projected growth rate of 8.5 per cent in 2019 is therefore an opportunity to strengthen domestic revenue mobilization to support more investments in children.

    • For 2019/20, the total National budget amounts to FRW 2,876.9 billion up from FRW 2,585.1 billion of the revised budget of 2018/19. This reflects an increase of 11.3 per cent. The national budget allocations are aligned with the National Strategy for Transformation’s strategic ambition to fulfil the objectives of Vision 2020 while transitioning towards Vision 2050.

    • Social sector budget allocations have increased by 4.7 per cent compared to 2018/19, whilst overall the national budget grew by 11.3 per cent. In the future, there is need to align the changes of sector spending with the overall changes in sources of budget revenue and expenditures.

    • The share of domestic resources in the budget has been expanding over the past years but further interventions are required to compensate for decreasing donor support. In 2019/20 tax revenue account for slightly over half of national budget financing (53 per cent), followed by external borrowing (17 per cent), and external grants (14 per cent).

    • Although the overall budget execution rate is very high (101.9 per cent), budget execution within the social sectors is low. In 2018/19 the execution rate was 80.4 per cent for Water and Sanitation, 70.9 per cent for Health and, 58.6 per cent for social protection, which requires further government involvement to ensure high budget execution among social sectors.

    © U

    NIC

    EF/

    UN

    0283

    124/

    Rud

    akub

    ana

  • 4

    1. Introduction

    1.1. Rwanda macro-economic performance

    Rwanda continues to make significant progress to spur economic growth. For the past four years, GDP growth rate has remained robust. In the second quarter of 2019, Rwanda’s growth rate was 12.2 per cent as a share of GDP, up from 8.6 per cent during the first quarter, providing high optimism of achieving the 8.5 per cent projected annual economic growth by 2019.

    GDP per capita in Rwanda has increased from US$ 735 in 2015 to US$ 898 in 2019 as projected (Figure 1). Despite a slowdown in 2016-2017 caused by external shocks, Rwanda has maintained sound macroeconomic performance attributed to several policy reforms ranging from trade, facilitating doing business and increased public investments.

    Figure 1: Economic performance

    0123456789

    10

    0100200300400500600700800900

    1,000

    2015 2016 2017

    GD

    P G

    row

    th

    GD

    P P

    er c

    apit

    a

    GDP per Capita (US$) (left axis)

    2018 2019 (proj)

    GDP Growth rate (%) (left axis)

    Source: MINECOFIN Macroeconomic Framework data

    Rwanda’s inflation level is low. In 2018, it was 1.4 per cent down from 4.9 per cent in 2017 (Figure 2). The low level of inflation is due to good performance of the agriculture sector and declining prices of export commodities at the international

    level.

    Figure 2: Inflation trends

    2.5

    5.7

    4.9

    1.4

    3.0

    0

    1

    2

    3

    4

    5

    6

    2015 2016 2017 2018 2019 (proj)

    Source: MINECOFIN Macroeconomic Framework data

    © U

    NIC

    EF/

    UN

    0300

    496/

    Bel

    l

  • 5

    1.2. Economic sectors’ contribution to GDP in the medium term

    Over the medium term, the country’s economy will continue

    to be driven by the agriculture, services and industrial sectors.

    While the growth of the services sector is projected to average

    8.2 per cent between 2018-2020, the agriculture sector growth

    will average at 5.6 per cent, particularly in food and export

    crops, due to continued investments to improve seeds and

    extend small-scale farming. The industrial sector will play a

    more important role by contributing more than 10 per cent to

    GDP growth in the medium term. The industry sector growth

    will be further enhanced by the Government of Rwanda’s

    efforts to promote locally-produced goods under the “Made in

    Rwanda” programme.

    Table 1: Sectoral growth and near future economic projections

    2016 2017 2018 2019 2020

    GDP Growth rate 6.0% 6.1% 8.6% 7.8% 8.0%

    AGRICULTURE 4.0% 7.0% 6.0% 4.5% 4.3%

    Food crops 3.0% 7.0% 4.0% 5.1% 5.1%

    INDUSTRY 7.0% 4.0% 10.0% 13.1% 13.9%

    Mining & quarrying 10.0% 21.0% 20.1% 31.5% 32.9%

    Manufacturing 7.0% 6.0% 6.1% 7.6% 8.5%

    Construction 5.0% -3.0% 5.2% 10.1% 8.7%

    SERVICES 7.0% 8.0% 9.0% 7.8% 7.8%

    Source: MINECOFIN 2018/19 -2020/21 and NISR- GDP Accounts

    1.3. Employment and Labour Market

    The Government of Rwanda is committed to supporting

    the creation of more than 214,000 decent and productive

    jobs annually to deal with rising youth unemployment. A

    comparison between the 2018 Labour Force Survey (LFS) and

    Q2-2019 LFS findings shows that the working age population

    (of 16 years and above) has increased from 7.0 million to 7.1

    million, or 1.5 per cent. However, the population who reported

    to be out of the labour force has increased by 4.7 per cent

    during the same period, mainly because of a 4 per cent

    increase in the student population and 8 per cent increase of

    discouraged job seekers. Moreover, the unemployment rate

    has increased from 14 per cent in 2018 to 15 per cent in 2019

    (Q2), and this rate excludes the people involved in subsistence

    agriculture. The subsistence agriculture sector accounts for

    52.4 per cent of all the labour force.

    The youth (16 - 30 years old) constitutes 43 per cent of the

    labour force (2019). Additionally, the share of young people

    (16 to 24 years old) neither in employment nor in education or

    training (NEET) declined to 30.8 per cent in 2019 (Q2), down

    from 33.9 per cent in 2018.

    1.4. Monetary sector and external sector development

    For the first half of 2019, the National Bank of Rwanda (NBR)

    maintained an accommodative monetary policy stance.

    The aim was to expand the overall money supply to boost

    economic growth and support the banking sector. The lending

    rate was further reduced from 5.5 per cent in June 2017 to

    5 per cent in 2019. The external trade deficit has continued to

    widen from US$ 601.4 million in 2018 to US$ 767.9 million in

    2019, reflecting an increase of 27.6 per cent. This is due to an

    increased demand for capital goods for ongoing infrastructure

    projects. The Rwandan Franc depreciated by 2.2 per cent

    against the US Dollar by the end of June 2019. Exchange rate

    pressure originated from the increased difference between

    imports and exports.

    1.5. Child Poverty: Multidimensional deprivation: 4-15 Years old

    Conducted for the first time by the National Institute of

    Statistics of Rwanda (NISR) in 2016/17, a multiple overlapping

    deprivation analysis (MODA) explores different deprivations

    that are most commonly experienced simultaneously (the

    overlap of deprivations) among children following a lifecycle

    approach. The fifth Integrated Household Living Conditions

    Survey (EICV5) thematic report on the multidimensional

    poverty of children follows the UNICEF MODA methodology

    and combines several dimensions of deprivation by different

    age groups of children; (i) health, (ii) education, (iii) water,

    (iv) sanitation, (v) and housing. Among the children between

    five and 14 years of age, the highest deprivation identified

    was access to decent housing with 60.4 per cent of this group

    affected, followed by 52.2 per cent of children with deprived

    access to water, and 44 per cent deprived from access to health

    services. The least deprived dimension among children is

    access to education with 6.3 per cent (Figure 3). A combination

    of different dimensions of deprivations shows 25 per cent

    of children between 5 and 14 are deprived in at least three

    dimensions and therefore considered multidimensional poor.

    For children 15 to 17 years, this rate increases to 40 per cent.

    Thirty-three per cent of children between the age of 5 and 14

    are deprived in two dimensions, 28 per cent face a deprivation

  • 6

    in one dimension, while 5 per cent face a deprivation in at

    least four dimensions. Only 14 per cent of children is not

    deprived in any dimension. Additionally, data shows that

    multidimensional child poverty is more prominent in rural

    areas and in female-headed households. In Rwanda, the

    threshold of considering a child multi-dimensionally poor is

    set at three or more dimensions. However, the Government’s

    ambition is to achieve a child deprivation free society to ensure

    all fundamental rights of children are met, and therefore an

    increased effort is still needed to eradicate all forms of child

    deprivation.

    Figure 3: Multidimensional child poverty

    44

    6.32

    52.2

    13.1

    60.4

    46.5

    6.4

    54.3

    14.3

    62.4

    29.4

    5.6

    40.1

    6.2

    49.2

    0

    10

    20

    30

    40

    50

    60

    70

    Health Education Water Sanitation Housing

    National Urban Rural

    Source: NISR-EICV5 2016/17

    1.6. Guiding strategic documents for public budget allocations

    The Government of Rwanda is in its third year of

    implementation of the National Strategy for Transformation

    (NST1) which plays a transitioning role from the Vision 2020 to

    the Vision 2050. The budget allocations for 2019/20 are aligned

    with the NST1 pillars and priority objectives. The following are

    priority objectives for children as indicated in NST1:

    • Promoting resilience and enhancing graduation from

    poverty and extreme poverty

    • Eradicating malnutrition

    • Enhancing demographic dividend by ensuring access

    to quality health for all

    • Enhancing the demographic dividend through

    improved access to quality education

    • Moving towards a modern Rwandan household

    (ensure 100 per cent access to water, hygiene and

    sanitations services and electricity)

    © UNICEF/UN0301403/Bell

    © U

    NIC

    EF/

    UN

    0302

    927/

    Nki

    nzin

    gabo

  • 7

    2. National budget trends

    2.1. Nominal and real budget trends

    For 2019/20, the total national budget amounts to FRW 2,876.9

    billion compared to FRW 2,585.1 billion as per the revised

    budget of 2018/19. This reflects an increase of 11.3 per cent, or a

    17.7 per cent increase when compared to the initially approved

    budget of 2018/19 (Figure 4).

    Figure 4: Budget allocations trends: nominal against real budgets and % changes

    1,954.2 2,115.4 2,585.2 2,876.9

    1905.4 1994.8

    2458.5

    2836.6

    7.8

    2.1

    16.2

    9.7

    0.0

    2.0

    4.0

    6.0

    8.0

    10.0

    12.0

    14.0

    16.0

    18.0

    -

    500.0

    1,000.0

    1,500.0

    2,000.0

    2,500.0

    3,000.0

    3,500.0

    2016/17 2017/18 2018/19 2019/20

    Nominal Budget Allocations (Frw Billion) (left axis)

    Allocations in real terms (Frw Billion) (left axis)

    % of Real budget Changes (right axis)

    Source: State finance laws

    2.2. Original against revised budget trends

    For the past three years the budget has been revised upward

    during the mid-year revision. Article 41 of the Organic Law

    N° 12/2013/OL of 12/09/2013 on State Finances and Property

    provides that the Minister of Finance may submit the revised

    draft budgets to the Chamber of Deputies [...], thus, in January

    the national budget is revised and most of the sectors register

    some budget changes. The revised budget is the final budget

    as it captures the emerging priorities during the budget

    year and additional donor financing that comes in through

    the budget execution cycle. A comparison of the originally

    approved and revised budgets indicates that, over the past

    three years, the national budgets were revised upward. For

    example, in 2018/19 the national budget increased from FRW

    2,585 billion up from FRW 2,444 billion.

    Figure 5: Original against revised budget trends

    1,949 2,095 2,444

    2,877 1,954.2

    2,115

    2,585

    -

    500

    1,000

    1,500

    2,000

    2,500

    2016/17 2017/18 2018/19 2019/20

    Original (Billion FRW) Revised (Billion FRW)

    Source: State finance laws

  • 8

    3. Budget allocations by NST pillars and NST sectors

    The FY 2019/20 is at the peak of Rwanda’s Vision 2020

    implementation, and therefore budget interventions are

    expected to fast-track implementation towards 2020 objectives

    and transition into Vision 2050. The resource allocations for

    2019/20 and in the medium-term are guided by the strategic

    objectives and the transformational goals of NST1. Looking

    at the three pillars, allocations are as follows: The economic

    transformation pillar was allocated 56.9 per cent, the social

    transformation pillar 27.2 per cent and the Transformational

    Governance pillar 15.9 per cent. The allocations by NST pillars

    and sectors show a quasi-similar trend over the medium term

    (Table 2).

    Table 2: Budget allocations by NST 1 pillars

    NST1 Pillars Billion Frw/% 2018/19 allocations 2019/20 allocations 2020/21 allocations (projected)

    Economic

    Transformation

    Frw 1,435,068,311,103 1,636,840,408,486 1,824,120,593,859

    % 55.5 56.9 56.5

    Social

    Transformation

    Frw 739,374,327,010 781,183,985,481 888,706,298,898

    % 28.6 27.2 27.5

    Transformational

    Governance

    Frw 410,707,948,605 458,891,946,822 514,214,691,613

    % 15.9 15.9 15.9

    Total Frw 2,585,150,586,717 2,876,916,340,789 3,227,041,584,371

    % 100 100 100

    Source: State finance laws

    Specifically, among the NST 1 sectors the Public Finance

    Management (PFM)1 sector takes the largest share of the

    national budget with FRW 832 billion representing 28.9 per

    cent of total budget, followed by Education with FRW 310

    billion, and Justice, Law and Reconciliation takes third position

    with FRW 272 billion (Figure 6).

    Figure 6: Budget allocation by selected NST sectors

    832

    310

    272

    268

    235

    163

    159

    154

    140

    111

    67

    51

    0 100 200 300 400 500 600 700 800 900

    Environment and Natural Resources

    Water and Sanitation

    Social Protection

    Private sector Development & Youth Employment

    Agriculture

    Energy

    Governance and Decentralization

    Health

    Transport

    Justice, Reconciliation, Law and Order (JRLO)

    Education

    Public Finance Management (PFM)

    2019/20 allocations (FRW Billion)

    Source: State finance law 2019/20

  • 9

    4. Budget trends by priority sectors for children

    2019/20. Despite this nominal increase, the social sectors’

    budget as a share of the national budget has remained

    constant over the past four years (around 26 per cent) (Figure

    7).

    Nominally, the budget of the social sectors has increased from

    FRW 703.8 billion in 2018/19 to FRW 737.1 billion in 2019/20

    reflecting an increase of 4.7 per cent. However, allocations to

    priority sectors as a share of the total national budget slightly

    decreased from 27.2 per cent in 2018/19 to 26.4 per cent in

    Note: Since social protection allocations cut across different sectors including health, the allocations shown in the national

    budget brief are lower than those outlined in the social protection budget brief to avoid double counting.

    Figure 7: Budget allocations by priority sectors and as a share of total national budget

    204 193.6232.4 230.8

    220241 278.2

    310.2

    82 94141.1 153.9

    29.3 39.3 48.465.2

    26.9 26.5 27.1 26.4

    0

    5

    10

    15

    20

    25

    30

    0

    100

    200

    300

    400

    2016/17 2019/202017/18 2018/19

    HealthEducationSocial ProtectionWater and SanitationSocial sector budget as % of NB (right axis)

    Source: State finance laws

    © U

    NIC

    EF/

    UN

    0300

    113/

    Mug

    wiz

    a

  • 10

    5. Decentralization of social sectors budget

    In nominal terms, the budget allocations to decentralized

    entities (districts) increased from FRW 240.7 billion in 2018/19

    to FRW 250.4 billion in 2019/20. However, the decentralized

    budget of social sectors as a share of the overall social sector

    budget has remained relativelty constant (34 per cent) over

    the past two years (Figures 8).

    Figure 8: Decentralized budget for social sectors

    524.2 555.1698.7 737.2

    197.4 222.9 240.7 250.4

    37.7 40.2 34.5 34.0

    -

    10.0

    20.0

    30.0

    40.0

    50.0

    0.0

    200.0

    400.0

    600.0

    800.0

    2016/17 2017/18 2018/19 2019/20

    Social Sectors budget and decentralizations

    Total Social Sectors budgets (FRW Billion)

    Decentralized Social Sectors Budget

    Decentralized Social Sector as % of total Social sectors buget

    Source: State finance laws

    © U

    NIC

    EF/

    UN

    0302

    570/

    Hou

    ser

  • 11

    6. Financing the National Budget

    The domestic financing component (tax and non-tax

    revenues) and government borrowing of the budget have

    been increasing over time. For 2019/20, the tax and non-

    tax revenues amount to FRW 1,749.5 billion, up from billion

    1,507.4 billion in 2018/19, reflecting an increase of 16 per cent.

    Proceeds from borrowing and grants amount to FRW 1,127.4

    billion, up from FRW 927.6 billion in 2018/19, reflecting the

    increase of 21.5 per cent (Figure 10).

    Figure 10: Financing trends of the National budget in FRW billion

    1,186.3 1,338.5

    1,507.4 1,749.5409.1

    411.1 531.4

    717.6326.6

    352.9 396.3

    409.8

    -

    500.0

    1,000.0

    1,500.0

    2,000.0

    2,500.0

    3,000.0

    3,500.0

    2016/17 2017/18 2018/19

    Tax and Non tax Borrowings

    2019/2020

    Grants

    Source: State finance laws

    The national budget is mainly financed through domestic

    financing, tax and non-tax revenues. Tax revenues make up

    for half of national budget financing (53 per cent), followed by

    external borrowing with 17 per cent and external grants at 14

    per cent (Figure 9)

    Figure 9: Revenue sources National budget in 2019/20

    53%

    7%1%

    8%

    14%

    17%

    Tax revenues Non-tax revenues

    Drawdown from Government reserves Domestic borrowing

    External grants External borrowing

    Source: State finance law 2019/20

    © U

    NIC

    EF/

    UN

    0302

    570/

    Hou

    ser

  • 12

    7. Budget outturn and execution

    7.1. Budget outturn-Revenue

    Rwanda has recorded stronger public finance performance in the 2018/19 fiscal year: (i) total revenue and project grants projected were achieved at 100.2 per cent; of which (ii) tax revenues collection performed at 102.1 per cent and non-tax revenues performed at 105.2 per cent. The high performance was due to payment of arrears under peace keeping operations. However, budgetary grants and loans performed slightly lower at 84.1 per cent and 92.9 per cent respectively

    (Figure 11).

    7.2. Budget outlays performance- expenditure

    Figure 12 shows that total expenditure and net lending reached

    101.9 per cent of which current expenditure performed at 103.2

    per cent, capital expenditure at 99.8 per cent and net lending

    at 103.3 per cent. Higher government spending and stronger

    public finance performance in different dimensions imply a

    high level of national budget credibility.

    7.3. Budget execution among the social sectors- priority sectors

    In spite of the high national budget outturn and outlay performance in 2018/19, the budget execution rate among the child-focused sectors has been relatively low. The education and social protection sectors achieved higher budget execution of 91 per cent in 2018/19; the Water and Sanitation sector executed its budget at 80.4 per cent, Health at 70.9 per cent (Figure 13). Further insights into the budget execution of each sector are provided in the specific sector budget briefs.

    Figure 11: Budget outturn July 2018 -June 2019

    100.2 102.1 105.2

    84.192.9

    0.0

    20.0

    40.0

    60.0

    80.0

    100.0

    120.0

    0.00

    500.00

    1,000.00

    1,500.00

    2,000.00

    2,500.00

    Revenue andgrants

    Tax revenue Non-taxrevenue

    Budgetarygrants

    Loans

    2018/19 Proj 2018/19 Prov. Act Performance (%)- (right axis)

    Source: MINECOFIN- Budget execution report 2018/19

    Figure 12: Budget outlay performance for 2018/19

    101.9 103.2 99.8 103.3

    0.0

    20.0

    40.0

    60.0

    80.0

    100.0

    120.0

    0.00

    500.00

    1,000.00

    1,500.00

    2,000.00

    2,500.00

    3,000.00

    CurrentTotalexpenditure and

    net lendingexpenditure

    Capital Net lendingexpenditure

    2018/19 Proj 2018/19 Prov. Act Performance (%)- (right axis)

    Source: MINECOFIN- Budget execution report 2018/19

    Figure 13: Social sectors budget execution

    84.1

    96.3

    77.1 74.364.3

    87.5 92.1 84.472.8 65.6

    86.291.0

    70.9

    91.080.4

    0.0

    20.0

    40.0

    60.0

    80.0

    100.0

    120.0

    National Education Health

    2016/17 2017/18

    Social Protection Water andSanitation

    2018/19

    Source: MINECOFIN’s budget execution reports

    © U

    NIC

    EF/

    UN

    0301

    226/

    Bel

    l

  • 13

    Over the past decade, Rwanda’s PFM sector has undergone

    a series of reforms, involving institutional strengthening

    and individual capacity building both within central and

    decentralized entities. A new Public Financial Management

    Sector Strategic Plan (PFM SSP 2018-2024) was developed to

    support the implementation of NST1.

    The PFM SSP is defined by three high-level results articulated

    around the pillars of NST-1: (i) efficient and accountable use of

    public resources; (ii) effective service delivery and investments

    by districts and subsidiary entities; and (ii) effective and

    responsible resource mobilisation and sound investment

    decisions.

    The PFM SSP will support the expansion of the coverage

    and functionalities of the Integrated Financial Management

    Information System (IFMIS), including to non-budget agencies

    such as schools, health facilities and all decentralized entities

    within the government. The strategy further focusses on

    investments in capacity development and professionalisation

    of the PFM workforce, as well as the transition towards

    accrual-based accounting according to International Public

    Sector Accounting Standards (IPSAS) by 2024.

    8.1. Public Finance Management and external oversight

    The Office of the Auditor General of State Finances (OAG) is

    the Supreme Audit Institution (SAI) of Rwanda. The OAG was

    created in 1998 and became a SAI in 2003 with the mandate

    to annually audit revenues and expenditures of the State,

    including local administrative entities, public enterprises,

    parastatal organisations and government projects. The Auditor

    General covers compliance, performance, financing and IT

    (information and Technology Audits). The Auditor General

    presents his report to Parliament within nine months after the

    end of the Fiscal Year (April).

    The coverage of audited government finances has been

    expanding over time, reaching 86.4 per cent of consolidated

    national expenditure in 2017/18 compared to 81 per cent in

    2014/15. The number of published audit reports has increased

    from 131 reports in 2014/15 to 165 in 2017/18. During the

    same period, the number of clean audit reports (unqualified

    audit opinions) also increased from 57 to 82 reports (Figure

    14). The increase in clean audits reports (especially on

    financial statements) is an indication of prudent public

    finance management. However, an important challenge lies

    with the implementation of the OAG’s recommendations

    showing a declining trend from 60 per cent in 2015 to 48 per

    cent in 2018 (Figure 15). Decreasing the compliance levels

    of the OAG recommendations constitutes a concern about

    the effectiveness and sustainability of PFM reforms being

    implemented by the Government of Rwanda. The review of

    the Auditor General’s reports by type shows that there are

    different degrees of audit opinions among compliance audits

    and financial audits (Figure 16).

    Figure 14: Audit trends, reports and opinions

    165

    139

    157

    131

    165

    147

    159

    157

    82

    88

    78

    57

    0 20 40 60 80 100 120 140 160 180

    May 2017 to 20 April 2018

    June 2016 to April 2017

    June 2015 to April 2016

    June 2014 to April 2015

    Reports with unqualified audit opinions

    Number of audit reports issued

    Number of public entities and projects audited

    Source: Calculated using OAG Reports

    Figure 15: Audit coverage, clean audit and implementation of OAG

    recommendations

    86.4

    85

    82

    81

    50

    60

    50

    36

    48

    50

    51

    60

    0 20 40 60 80 100

    May 2017 to 20 April 2018

    June 2016 to April 2017

    June 2015 to April 2016

    June 2014 to April 2015

    Implementation of AG's recommendations (%)

    % of unqualified audit opinions

    Audit coverage (%)

    Source: Calculated using OAG Reports

    8. Public Finance Management

  • 14

    Figure 16: Auditors General’s findings by audit types in 2018

    3357

    34

    23

    3319

    0

    20

    40

    60

    80

    100

    120

    Compliance audits Financial audits

    % Unqualified % Qualified % Adverse % Disclaimer

    Source: Calculated using OAG Reports

    8.2. Recent budget reforms

    Over the past decade, the Government of Rwanda has been

    implementing programme-based budgeting; a budgeting

    structure where money is distributed by programme or

    functional area and based on the nature of the activities

    performed by the programme. Starting from 2019/20, the

    Ministry of Finance and Economic Planning (MINECOFIN)

    also piloted performance-based budgeting, the practice

    of developing budgets based on the relationship between

    programme funding levels and expected results from that

    programme. The priority sectors for children piloted for

    performance-based budgeting are the Ministry of Education

    and all affiliated agencies, the Ministry of Health and all

    affiliated agencies and the Ministry of Infrastructure including

    water and sanitation. The performance-based budgeting

    approach is expected to strengthen the efficiency and

    effectiveness of public expenditure by linking the funding of

    public sector organizations to the results they deliver, as well

    as making systematic use of performance information while

    prioritizing budget allocations.

    © U

    NIC

    EF/

    UN

    0300

    526/

    Bel

    l

    © U

    NIC

    EF/

    UN

    0300

    547/

    Bel

    l

  • 15

    ANNEXES

    Annex 1: Key development indicators

    Indicators

    Total population (2019, projection) 12,374,397

    Child population < 0–17 years (2018, projection) 5,571,555

    Share of child population (0–17 years old) to total population 45.0%

    GDP per capita (2018) US$787

    Poverty rate 38.2%

    Extreme poverty rate 16.0%

    Multidimensional poverty rate 29%

    Total government expenditure as a per cent of GDP 31.3%

    Total social expenditure as a per cent of the total budget 25.6 %

    Share of budget deficit (2019/20) to GDP - 5.2%

    Share of external finance to national budget (grants and loans combined) (2019/20) 31.5%

    Share of tax and tax revenues to national budget 60.0%

    Public debt to GDP ratio including grantees (2018) 49.0%

    External public debt ratio to GDP 53.1%

    Headline inflation (2019) 0.7%

    Food inflation (2019Q3) 4.0%

    Annex 2: Rwanda’s economic performance (GDP Growth rate) in comparison to the select countries

    0.0

    2.0

    4.0

    6.0

    8.0

    10.0

    12.0

    2015 2016 2017 2018 2019 2020

    Ethiopia Rwanda Tanzania Kenya South Africa

    Source: IMF Economic outlook data 2019

  • 16

    Annex 3: Key events in the budget calendar

    Month Activities

    October • Issuing of planning and budgeting guidelines at central and decentralized government levels

    • Training of Ministry Districts and Agencies (MDAs) on planning and budget requirements, including training on IFMIS planning module and data entry in IFMIS

    November/December • Inter-sectoral consultations, including districts and the private sector

    • Joint planning session between central and local governments, including infrastructure needs

    • Submissions of planning documentations to Ministry of Finance and Economic Planning (MINECOFIN)

    January • Planning consultations (ministers present sector plans)

    • Public investment committees

    • Dissemination of the second Planning and Budget Call Circular

    • Budget revision of the previous fiscal year

    February • Preparation of budget proposals, including earmarked transfers to districts

    • Budget submissions in Smart IFMIS and organization of budget consultations

    April/May • Conduct Forward-Looking Joint Sector Reviews (FLJSR)

    • Submission of Budget Framework Paper (BFP) to the Parliament and parliamentary budget hearings

    • Preparation of Imihigo

    June • Approval of finance law by Parliament

    • Finalization of Performance contracts

    Endnotes

    1 This includes the allocation to support (i) Administration, operation, or support of executive and legislative organs, (ii) Administration of fiscal affairs and

    services, (iii) Management of public funds and debt, (iv) the operations of treasury, the national budget office, planning and statistical services, (v) the

    administration of the external affairs and services.

  • 17©

    UN

    ICE

    F/U

    N03

    1079

    7/M

    uelle

    nmei

    ster

  • 19

  • 20

    United Nations Children’s Fund Ebenezer House1370 Umuganda Boulevard KacyiruKigali

    P O Box 381Kigali

    Tel: +250 788 162 700Email: [email protected]: www.unicef.org/rwanda

    www.facebook.com/unicefrw

    twitter.com/unicefrw

    www.instagram.com/unicefrwanda

Click here to load reader

Reader Image
Embed Size (px)
Recommended