UGANDA'S POVERTY ERADICATION ACTION PLAN - DOC

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					UGANDA’S POVERTY ERADICATION ACTION PLAN:
NATIONAL SUSTAINABLE DEVELOPMENT STRATEGY
                   PRINCIPLES TESTED


                      A PRESENTATION


                               AT


 International Forum on National Sustainable Development
                      Strategies (NSDSs)
             (Accra, Ghana, 7-9 November 2001)




                               By


                      Mary C. Muduuli (Mrs.)
               Ag. Deputy Secretary To The Treasury
  Ministry Of Finance, Planning And Economic Development, Uganda
                UGANDA'S POVERTY ERADICATION ACTION PLAN:
    NATIONAL SUSTAINABLE DEVELOPMENT STRATEGY PRINCIPLES
                                                     TESTED


Introduction


In 1995, Uganda started a process of developing a comprehensive and sustainable development
strategy, with an overall objective of wiping out abject poverty in the country. This process
culminated in the formulation in 1997 of the draft Poverty Eradication Action Plan (PEAP) 1, which
aims at reducing the population living in absolute poverty to 10% in 2017. In 2000 this was revised
to incorporate new information generated from the widened consultations and analysis, particularly
from the pilot Participatory Poverty Assessments (PPAs) undertaken and analyzed over the past 3
years. The revised PEAP also reflects progress in various sectors in terms of elaborating on their
policies, investment plans, outcomes and performance indicators. Besides Roads and Education
Sectors, the major additions relate to the Health Sector, Modernization of Agriculture which covers
environment, Private Sector Competitiveness, Water and Sanitation and Justice, Law and Order. The
PEAP, for that matter is a fairly Comprehensive Development Framework (CDF) 2 and the PEAP
summary was adopted in 2000 as Uganda’s Poverty Reduction Strategy Paper (PRSP)3.


Based on the PEAP as the guiding policy framework, Uganda has pursued the development and
implementation of sector-wide policies, investment plans and programmes, with the participation of
representatives of as many stakeholders as possible, in a genuine partnership, which involves
Government at the centre and in the decentralized lower levels of government in the Districts;
external funding agencies (development partners); the Civil Society and NGOs and the Private
Sector. Uganda's strategic action plan for mass poverty eradication is based on four interrelated
pillars for ensuring: sustainable economic growth and structural transformation; good governance
and security; ability of the poor to raise incomes; and improve their quality of life.


1
 The Poverty Eradication Action Plan (PEAP) is issued in three Volumes: Vol.1-Strategic Policy Framework, Vol. II-
Public Investment Plan and Vol. III-Principles for Improved Partnerships. These and all major publications by MFPED
are available at the Website: www.finance.go.ug
2
  The CDF is a holistic, overarching framework which covers macro and microeconomic, financial, structural, social,
institutional, environmental and human resource considerations which enables a country to transform society and the
economy to effectively reduce poverty.
3
 The World Bank and the IMF accepted Uganda’s PRSP as providing an adequate basis for their assistance programmes
and for reaching the enhanced HIPC completion point.

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In Uganda, the focus of economic planning has moved away from the forecasting and management
of macroeconomic aggregates, to the process of refining and implementing a Poverty Reduction
Strategy (PRS) which is sustainable in terms of policies, plans and programmes, ensuring proper
resource management (NSSD) and operating within a fully Comprehensive Development Framework
(CDF), to transform Uganda into a modern economy in which all agents, in all sectors, can
participate in economic growth, keeping in mind the needs of future generations.


This presentation attempts to assess the extent to which the NSDS principles have been relevant in
the process for the formulation and implementation of Uganda’s Poverty Reduction Strategy, the
PEAP/PRSP. The paper highlights principles in which the country has had greatest success and
those which still present major challenges.


Principles With Greatest Success

   (i)     Strong political leadership
   Uganda’s strategy formulation and implementation has been backed by strong top political
   leadership starting from the national level.     The broad-based NRM Government, under the
   leadership of one President, has survived for now fifteen years, and this has guaranteed that the
   policies (or trend in policies) and institutional changes required for the strategy development are
   effected, the resources are committed and institutional roles are clarified and responsibilities are
   assumed. Through decentralization, this leadership principle is extended to the process in district
   and urban authorities.


   (ii)    Shared strategic and pragmatic vision
   Given the background of where Uganda was coming from in 1986, building a strategic and
   pragmatic vision took long to prioritize.      It was not until 1999 that Uganda in a national
   consultative process produced Vision 2025, on which basis the 2000 Revised PEAP/PRS overall
   goals were built. Vision 2025 reflects the country’s history, core values and aspirations with
   objectives and goals which are achievable. The theme for Vision 2025 is “Prosperous People,
   harmonious nation and beautiful country”.


   (iii)   Nationally owned and country driven processes
   Uganda’s experience, particularly since 1995 represents a base of strong national ownership (at
   least with reference to major stakeholders) and country driven processes given the commitment
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by Government to develop and implement a poverty reduction strategy. The processes for
elaborating the sectoral policies, the sector investment plans, targets setting and programming of
interventions are all driven by the country. More and more stakeholders are being involved in
these activities particularly as regards local governments, private sector and civil society. The
area requiring greater improvement is that of keeping Parliament focused on the national
development agenda and avoiding their pursuing personal interests in this process.


(iv)   Build on existing knowledge, expertise and capacity
To a very large extent, Uganda has endeavoured to use all information, expertise and capacities
available in developing the poverty reduction strategy.        Optimizing use of local skills,
particularly within the Civil Service, has been hampered by poor remuneration and the delayed
fiscal space to provide for this requirement. Otherwise, extensive use of the private sector,
research and academic institutions has been made. Use of traditional knowledge and institutions,
if greatly improved, could reap significant benefits especially in the health, agriculture and
environmental management areas.       Capacity development is recognized as a high priority
particularly for poverty analysis, monitoring and evaluation, accountability and general planning
and budgeting, and particularly in local governments.


(v)    Build on existing processes and strategies
Uganda’s strategy for poverty reduction (PEAP/PRS) was certainly built on the then existing
strategies, policies and processes.   Since 1986, Government had systematically insisted on
moving systematically from reconstruction, to rehabilitation and then to sustainable development.
The processes for planning in a Sector Wide Approach (or Programme Approach) and
prioritization of expenditure were already in place. Participatory development had already been
accepted and provided for under the decentralization policy and processes were developing to
engage different stakeholders in planning and budgeting. Government had already undertaken
serious policy reforms and planning and budgeting has been developed until it culminated into a
Medium Term Framework (MTEF).


(vi)   A strong institution should spearhead the process
The former Ministry of Planning and Economic Development and later the merged Ministry of
Finance, Planning and Economic Development has stood out as the lead institution in
spearheading the process of strategy development and enforcing systematic implementation.
This has been possible with full support of the Head of State and the political and technical
strength of the Ministry. For this reason, the choices for the senior Minister and the Permanent
                                                                                                3
      Secretaries in this Ministry have always been critical. Fortunately for Uganda, there has been
      great stability for the appointments in these positions4.


      (vii)    Ensuring the widest possible participation
      Uganda has worked very hard to build strong mechanisms for wide participation by all
      stakeholders, first as a right and to open up for new ideas and sources of information; expose
      issues and develop a consensus on policies and actions. The decentralization policy, regular
      policy dialogues e.g. Private Sector Forum, SWAPs, PPAs, public hearings on environmental
      matters and consultative budget processes etc. are all examples of efforts for wide participation.
      National commitments in relation to international commitments require that we work in close and
      effective partnerships within our regions and with our development partners.                     Uganda has
      developed partnership principles as Volume III of the PEAP and was active in supporting the
      process for development of the OECD/DAC Guidelines for donors in their support for poverty
      reduction. The civil society organizations have been active in PEAP revision policy dialogue,
      research and advocacy and service delivery. Considering that economic growth in Uganda is
      considered critical for poverty reduction, participation of the private sector and civil society in
      general will require even greater enhancement.


      (viii)   Anchor the strategy process in sound technical analysis
      As far as poverty is concerned, a lot of effort has been made to build appropriate technical
      databases and undertake analysis on which the strategy processes are anchored. Since the 1995
      World Bank Country Study findings5, poverty analysis and monitoring has been put top on the
      agenda. The establishment of the Uganda Bureau of Statistics as an autonomous institution with
      a network to the lowest levels; the institutionalization of an Annual Household Surveys, Service
      Delivery Surveys, poverty assessments and the establishment of A Poverty Monitoring Strategy
      and Framework are some of the major efforts. In analyzing Household Survey data since 1992,
      Uganda has used international expertise both to ensure credibility of the analysis while building
      capacity at the same time. We have established clear trends indicating that poverty is declining,
      although more recently, for areas of the North, poverty increased thus pointing to serious issues
      of inequality and regional imbalance. The inclusion in poverty analysis of external pressures like
      globalization, climate change and other external shocks, remain a major challenge.


4
 The Permanent Secretary and Secretary to The Treasury, the technical head first of the MPED and later the merged
MFPED served for 16 years in this position.
5
    “The Challenge of Growth and Poverty Reduction” - A World Bank Country Study, 1996.

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    (x)       Link the short to the medium and long term
    The national planning framework provides for Uganda’s long-term vision to be handled in the
    framework of the PEAP/PRS whose aim is to reduce the level of abject poverty to 10% by 2017.
    While the long-term plans may not be so clear, the medium-term planning and budgeting system
    allows for annual plans (short-term plans) to be rolled over the medium-term, to achieve specific
    outputs which contribute to agreed targets or outcomes. The targets are set by sector over a
    longer term and these are expected to be achieved through performance on intermediate targets.


    The linkage between periods is very critical given the multi-dimensions of poverty and the
    requisite reduction strategy, the limited human capacity and financial resources to achieve these
    goals and targets. In addition, the International Development Goals (IDGs) now developed as the
    Millennium Development Goals                 (MDGs) require sustained achievements for long-term
    outcomes at the country levels.


    (xi)     Coherence between budget and strategy priorities
    Government has introduced Outcome Oriented Budgeting (OOB) and Result Oriented
    Management in an effort to relate budgets to the desired outcomes and results. For most sectors
    the annual budget process is directly linked to the expected outputs and outcomes in the
    implementation of the PEAP. In particular, resources available under the Poverty Action Fund
    (PAF)6 are targeted to action areas of greatest impact on poverty.. This increasingly direct
    linkage between the PEAP priorities and the whole budget has helped to coordinate donor
    policies, in terms of which areas to support, and has disciplined Government not to engage in
    long-term plans and long wish lists of activities which are unaffordable. Improving the capacity
    to project resource availability and predictability, both domestically and from external sources
    significantly enhances the coherence between budgets and the strategy priorities. The biggest
    challenge still being faced relates to balancing the need for an effective Government and
    legislature while ensuring sufficient allocation of resources to the strategy priorities.


    (xv)     Ensure continuity of the strategy development process
    Although Uganda is operating without political parties, the basis of the development strategy
    within a national vision; the institutionalization of participatory processes frameworks and


6
 The PAF was established to present accountability for the use of HIPC initiative funds and additional donor support for
PAF activities.

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mechanisms for planning and budgeting; the entrenchment of decentralization whereby people
participate in taking decisions at lowest level; and the quality of the Public Service at the Centre
should together provide sufficient guarantee for continuity of a sustainable strategy development
process. Any changes which tampers with the above fundamentals will certainly interrupt such
continuity with significant ramifications of economic and social indicators.


Principles Presenting Major Challenges


(ix)    Integrated and balanced strategy
While I have argued above that the PEAP is fairly comprehensive, and while bottom-up planning
is inherent in the decentralization policy, there are serious challenges to integrate more
strategically all the sectors of the economy particularly as they impact on the most disadvantaged
and marginalized groups of society (the poorest of the population). Balancing the poverty
reduction strategy between economic growth (which has to be rapidly accelerated), social
development (which is urgent considering the quality of social indicators including the rate of
population growth) and effective management of the environment (allowing access to natural
resources for production and subsistence) but making sure that there is no environmental
degradation, even in the face of natural disasters. While perfect integration and balance may not
be achievable, the experience of preparing the Plan for the Modernization of Agriculture has
demonstrated the importance of this principle.


(xii)    Set realistic but flexible targets
The process of setting targets both on the macro and micro levels have proved very challenging.
For poverty reduction, the macro targets like GDP growth, domestic revenue to GDP, and
inflation are very crucial. While the earlier period saw greater success in the setting and
achievement of the macro targets, the past few years have not been as successful due to a mixture
of internal and external shocks. We have however learnt to be more realistic and improvements
in databases and macro-analysis has also helped.


As for sectoral targets, issues related to inputs and capacities for service delivery have been a
serious challenge. Working in a SWA, and through regular sector reviews involving intensive
analytical work, it is becoming increasingly easier to set more realistic targets (based on the
wider information availed particularly on constraints in the process) and allow for adequate
flexibility.


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       (xiii) Link national and local priorities and actions
       The law and the process for national planning provides for the linking of national and local
       priorities and actions. In fact the low (both the Constitution and Local Governments Act)
       promote bottom-up planning.             Decentralization has meant devolution of power and many
       functions leaving those that rightly belong to the center at that level 7. The consultative planning
       and budgeting process and PPAs are helping to facilitate this process of translating national
       strategic priorities into local priorities and actions.                   However, the detailed planning,
       implementation of policies and programmes and monitoring of performance will remain a major
       challenge for some time on account of institutional and human capacity gaps. The related
       challenge is for mobilizing and allocating resources to priorities. This principle gets more
       challenged in an election year where linkages become very blurred.


       (xiv)    Build mechanisms for monitoring, follow-up, evaluation and feedback
       Uganda has drafted a Poverty Monitoring Strategy, to be implemented in an agreed framework
       and with a network of players at different levels and across the various sectors of the economy.
       Sectors have been focused on developing a few appropriate and monitorable performance
       indicators, and for different levels. The intensive analytical work during sector reviews has been
       instrumental in refining indicators and identifying the follow-up actions.                      Determining the
       appropriate environmental management performance indicators have proved quite difficult.
       Based on the findings of the PPAs, the integration of quantitative and qualitative indicators is
       inevitable. Activities under the PAF are particularly monitored by all stakeholders.


       The system of comprehensive poverty monitoring is developing, with a balanced emphasis of
       tracking the fundamental objectives of policy and tracking the indicators of Government
       performance in this respect. In fact since 1999 Uganda has been issuing a biannual Poverty
       Status Report (PSR) to indicate progress achieved, based on the performance of different sectors
       and on poverty indicators agreed for monitoring.


       Evaluation of progress and the long-term impact of the overall strategy and the feedback on
       lessons particularly to the policy makers and affected population remain a challenge. However,
       what is clear is that given the capacity constraints, progress in all these areas is a long-term



7
    The responsibilities of Central Government are specified in the Sixth Schedule to the Constitution 1995.

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objective.. To an extent, the PPAs are being used to disseminate monitoring results and obtain
feedback on the impact of policies and programmes.


Conclusion


The experience of Uganda presents a relatively good case for testing the principles of NSDs for
confirming the importance and the challenges faced by countries struggling to develop and
implement National Sustainable Development Strategies.        What is also clear is that the
challenges have to be managed in an environment of good governance, political will and
reasonable human and institutional capacities to assess the economic, social and environmental
situation, and evolve a nationally owned and participatory strategic process for sustainable
growth and development. What is also very clear is that effective partnerships with development
partners are critical to keep this process moving.




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