The relationship between public social spending, social indicators, and poverty reduction is complex and dynamic. How much public social spending reduces poverty depends not only on the amount allocated for education and health care, but also on how efficiently these allocations are spent and how well they are targeted to the poor.21 Education and health care indicators are affected not only by government outlays on education and health care but also by private spending, demographic trends, and public spending in other areas such as sanitation and safe water Empirical research on the link between increased aggregate public spending on education and health care and improvements in related social indicators has yielded conflicting evidence.22 Note, also, that today’s illiteracy and infant mortality rates are normally the result of yesterday’s social policies; poverty reduction reflects past increases in spending on primary education, primary school enrollment, and literacy. Finally, some indicators reflect intermediate outputs, not final outcomes. For example, widespread immunization of infants under 12 months against measles does not by itself yield a low infant mortality rate, especially if other variables, such as access to safe water and female education attainment, are relatively poorly developed.23
This review suggests that considerable progress has been achieved in strengthening spending policies on public education and health care, but that some areas require further efforts.
-
Countries have made considerable progress in establishing comprehensive and structured policy frameworks for such spending; more recently, there have been discernible improvements in targeting and monitoring public spending and positive, albeit modest, developments in related social indicators and outcomes.
-
Efforts to raise spending on education and health care have achieved relatively more success in the HIPC decision point countries (Bolivia, Burkina Faso, Cote d’Ivoire, Mozambique, and Uganda) than in other IMF-supported program countries.
Further improvements, however, are needed to address some inadequacies:
-
Lack of adequate data is commonplace. Data on the composition of education and health care spending are often not available. Data on subnational government spending are scarce. Education and health achievement indicators are either unavailable or available with a long lag (Box 4.1).
-
Policy objectives have not always been clear or articulated in terms of well-defined targets against which progress can be measured, and the definition of targets and monitoring often has changed over time within a single country.
The HIPC Initiative framework has yielded relatively more progress than have other programs, across a more comprehensive range of social sector reforms. The most marked improvements in social indicators during the period under review also have taken place in HIPC countries. No causal association, however, can be established between increased spending and outcomes, because their link is affected by many other factors.
Aggregate Spending on Education and Health Care
IMF-supported programs have sought to promote universal access to basic social services. Programs have increased public spending for such services in countries where this spending was low, supported high-quality expenditure in these sectors, and protected or sought real increases in these expenditures during adjustment periods when poor households might lack the ability to pay for basic social services. The importance programs have attached to these objectives was reflected in the increasing use of quantitative targets, structural benchmarks, and performance criteria aimed at raising education and health care spending (Box 4.2).24
Quality of Social Spending and Indicators Data
Social Spending
Many deficiencies exist in data on public spending on education and health care.
-
In general, spending by local governments is not included; this can be a major handicap in countries that have devolved or are devolving expenditure responsibilities to lower levels of the government, particularly those related to basic education.
-
In many cases, data coverage in fiscal accounts is limited to current outlays, in part owing to the inability of governments to separate donor-financed capital spending by function.
-
In-kind donor contributions to education and health care are not included.
-
Data typically become available with a lag, which for some countries can be as long as two to three years.
-
Virtually no country has consistent annual series for expenditure allocations within the education and health care sectors (e.g., separating between primary and tertiary education, or preventive health care and curative health care), and the data available in many cases are not consistent with aggregate fiscal data.
-
Despite the importance of books and medicine for developments in social indicators, separate data for non-wage and wage outlays in education and health care sectors are available for only very few countries
-
Data on private sector outlays on education and health care are not collected on a regular basis.
Social Indicators
The most serious shortcoming of data on social indicators is that they are generally produced infrequently and with a long lag, or, in many cases, are not collected at all. For instance, data for 1997 are available for only 11 out of 18 indicators of well-being and social development in the working set identified by the OECD/UN/World Bank, and only for a small number of developing and transition countries. Current data for many important indicators are derived from models, rather than from actual observations. For example, for 102 countries, actual observations on infant mortality rates are not available for 1985 or later.
Furthermore, some of the key indicators become available only every five years. In some cases, there is a trade-off between the availability of data on social indicators and their quality. For instance, net enrollment rates, which correct for grade repetition, are available for only about half of program countries, whereas gross enrollment rates, which are available for most countries, count all students regardless of age as part of the school-going population, thus overstating enrollment to the extent students are repeating grades (see Table 4.1). There may also be inconsistencies among data sources and compilation methods, raising questions about data comparability across countries and over time. Because indicators are constructed by using data collected at the national level through censuses, sample surveys, and administrative records, data quality to a large extent depends on the national statistical capacity.
Improvement in Social Indicators in Member Countries, 1985–97
(Current level and average annual percent improvement; number of countries in parentheses)
Latest data available. Mostly refers to 1995-97. Except for life expectancy, which is in years, all the indicators refer to shares of the relevant population groups. See also Box 2.2.
Nonprogram countries, shown for comparison, included Angola, The Bahamas., Bah rain, Seine, Bhutan, Botswana, Colombia, Cyprus, Eritrea, Fiji, Grenada, I.R. of Iran, Kuwait, Lebanon, Malaysia, Maldives, Malta, Myanmar, Namibia, Netherlands Antilles, Oman, Paraguay, Qatar, Seychelles, Soloman Islands, South Africa, St. Kitts and Nevis, St, Lucia. St-Vincent and the Grenadines, Swaziland, Syrian Arab Re public, Tonga, Turkmenistan, and United Arab Emirates.
For infant mortality and under-5 mortality rates, number per thousand. The annual percent improvement in illiteracy, infant mortality, and under-5 mortality rates refers to a decline in these rates. An annual percent improvement of 3.4 in illiteracy, for example, means chat illiteracy rates are falling by 3.4 percent per year,
Gross enrollment rate is the ratio of total enrollment, regardless of age, to the population of the age group that corresponds to the level of education shown. If, for example because of grade repetition, students who fall outside the age bracket for primary or secondary education are nevertheless enrolled, the gross enrollment rate may exceed 100 percent.
Contraceptive prevalence race is the percentage of women who are practicing, or whose sexual partners are practicing, any form of contraception and is usually measured for women aged 15–49.
Improvement in Social Indicators in Member Countries, 1985–97
(Current level and average annual percent improvement; number of countries in parentheses)
Current Level1 | Average Annual Percent Improvement | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Non- program countries2 |
Program countries |
ESAF program countries only |
Non- program countries2 |
Program countries |
ESAF program countries only |
HIPC countries only |
Sub- Saharan Africa |
Asia and the Pacific |
Latin America and the Caribbean |
Transition economies |
||||
Education | ||||||||||||||
Illiteracy rate3 | 15.8 (22) | 27.4 (49) | 45.5 (21) | 3.4 (22) | 3.5 (49) | 2.2 (21) | 2.2 (16) | 2.4 (15) | 3.1 (8) | 2.9 (14) | 7.9 (7) | |||
Female | 18.6 (22) | 32.8 (49) | 53.4 (21) | 3.6 (22) | 3.5 (49) | 2.1 (21) | 2.0 (16) | 2.3 (15) | 3.1 (8) | 3.0 (14) | 8.3 (7) | |||
Gross primary school | ||||||||||||||
enrollment rate4 | 104.2(25) | 92.3(55) | 80.9(25) | 0.1 (25) | 0.8 (55) | 1.0(25) | 0.9 (15) | 0.6(15) | 0.5 (10) | 0.7 (14) | 1.0(13) | |||
Female | 102.8 (25) | 88.6 (52) | 76.6 (24) | 0.3 (25) | 0.8 (52) | 1.1 (24) | 1.2(14) | 1.1 (14) | 1.4 (9) | 0.5(13) | 0.1 (13) | |||
Male | 105.8 (25) | 96.5 (52) | 88.0 (24) | 0.1 (25) | 0.7 (52) | 0.9 (24) | 1.4 (14) | 1.0(14) | 0.0 (9) | 0.6 (13) | 0.8(13) | |||
Gross secondary school | ||||||||||||||
enrollment rate4 | 61.8 (25) | 50.5 (53) | 30.6 (24) | 2.8 (25) | 1.1 (53) | 0.8 (24) | 0.9 (14) | 1.2(14) | 2.2(10) | 1.4 (14) | -0.8(12) | |||
Female | 65.0 (24) | 49.5 (49) | 28.4 (23) | 3.2 (24) | 1.9 (49) | 2.3 (23) | 2.8 (13) | 3.1 (14) | 3.5(10) | 1.2 (10) | -0.5 (12) | |||
Male | 62.6 (24) | 51.9 (49) | 32.5 (23) | 2.7 (24) | 0.6 (49) | 0.2 (23) | 0.5 (13) | 0.3 (14) | 1.6(10) | 1.4 (10) | -0.9(12) | |||
Net primary school | ||||||||||||||
enrollment rate | 84.8 (18) | 74.6 (31) | 58.9 (17) | 0.2 (18) | 0.7 (31) | 0.6 (17) | 0.5(11) | 0.1 (10) | 0.9 (4) | 0.9 (11) | 0.4 (4) | |||
Persistence to grade 5 | 88.5 (21) | 75.3 (23) | 68.0 (11) | 0.5 (21) | 1.7 (23) | 2.0(11) | 2.9 (8) | 2.3 (9) | -0.3 (5) | 2.5(7) | …(0) | |||
Health care | ||||||||||||||
Life expectancy (in years) | 68.1 (33) | 63.3 (45) | 57.6 (25) | 0.4 (33) | 0.2 (45) | 0.2 (25) | 0.1 (12) | -0.1 (13) | 0.7 (4) | 0.5 (9) | 0.0(16) | |||
Infant mortality rate3 | 31.8 (34) | 48.9 (48) | 72.8 (25) | 1.7(34) | 2.5 (48) | 1.5 (25) | 1.6(13) | 1.0(14) | 2.7 (5) | 3.3(10) | 3.0(16) | |||
Under-5 mortality rate3 | 40.1 (29) | 66.6 (29) | 113.2 (14) | 3.8 (29) | 3.7 (29) | 2.9 (14) | 2.3 (3) | 0.8 (8) | …(0) | 3.2 (7) | 5.7(13) | |||
Births attended by | ||||||||||||||
skilled staff | 78.5 (25) | 64.0 (37) | 52.4 (18) | 6.1 (25) | 1.8 (37) | 3.2 (18) | 0.8 (10) | 1.7(9) | 4.2 (10) | -0.1 (11) | -0.3 (4) | |||
Contraceptive prevalence5 | 66.3 (4) | 49.3 (14) | 36.0 (5) | 3.6 (4) | 3.1 (14) | 5.6 (5) | 6.7 (3) | 6.9(3) | 2.0 (5) | 2.5 (5) | 0.0(1) | |||
Access to health care | 94.6(16) | 74.0 (13) | 48.7 (3) | 1.4 (16) | 3.7(13) | 11.2 (3) | 4.0 (4) | 6.6 (5) | 6.2 (2) | 0.4 (4) | …(0) | |||
Percent under 12 months immunized | ||||||||||||||
immunized | ||||||||||||||
DPT vaccination | 86.8 (33) | 82.6 (61) | 74.6 (29) | 4.5 (33) | 4.8 (61) | 6.9 (29) | 7.3(16) | 5.7(15) | 7.7(10) | 3.8(15) | 3.7(16) | |||
Measles vaccination | 85.0 (33) | 83.0 (60) | 75.3 (28) | 5.4 (33) | 4.4 (60) | 6.1 (28) | 6.8 (15) | 4.3 (14) | 9.1 (10) | 3.3(15) | 2.8 (16) | |||
Other basic services | ||||||||||||||
Access to safe water | 81.7(27) | 66.0 (41) | 58.1 (19) | 4.1 (27) | 2.9 (41) | 4.2 (19) | 4.0 (12) | 4.2(12) | 7.7 (8) | 1.6 (14) | -3.5 (5) | |||
Access to sanitation | 73.9 (23) | 57.6 (37) | 41.6 (17) | 2.6 (23) | 4.4 (37) | 6.7(17) | 3.2 (10) | 2.7 (10) | 14.2 (8) | 3.5 (14) | -9.9 (3) |
Latest data available. Mostly refers to 1995-97. Except for life expectancy, which is in years, all the indicators refer to shares of the relevant population groups. See also Box 2.2.
Nonprogram countries, shown for comparison, included Angola, The Bahamas., Bah rain, Seine, Bhutan, Botswana, Colombia, Cyprus, Eritrea, Fiji, Grenada, I.R. of Iran, Kuwait, Lebanon, Malaysia, Maldives, Malta, Myanmar, Namibia, Netherlands Antilles, Oman, Paraguay, Qatar, Seychelles, Soloman Islands, South Africa, St. Kitts and Nevis, St, Lucia. St-Vincent and the Grenadines, Swaziland, Syrian Arab Re public, Tonga, Turkmenistan, and United Arab Emirates.
For infant mortality and under-5 mortality rates, number per thousand. The annual percent improvement in illiteracy, infant mortality, and under-5 mortality rates refers to a decline in these rates. An annual percent improvement of 3.4 in illiteracy, for example, means chat illiteracy rates are falling by 3.4 percent per year,
Gross enrollment rate is the ratio of total enrollment, regardless of age, to the population of the age group that corresponds to the level of education shown. If, for example because of grade repetition, students who fall outside the age bracket for primary or secondary education are nevertheless enrolled, the gross enrollment rate may exceed 100 percent.
Contraceptive prevalence race is the percentage of women who are practicing, or whose sexual partners are practicing, any form of contraception and is usually measured for women aged 15–49.
Improvement in Social Indicators in Member Countries, 1985–97
(Current level and average annual percent improvement; number of countries in parentheses)
Current Level1 | Average Annual Percent Improvement | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Non- program countries2 |
Program countries |
ESAF program countries only |
Non- program countries2 |
Program countries |
ESAF program countries only |
HIPC countries only |
Sub- Saharan Africa |
Asia and the Pacific |
Latin America and the Caribbean |
Transition economies |
||||
Education | ||||||||||||||
Illiteracy rate3 | 15.8 (22) | 27.4 (49) | 45.5 (21) | 3.4 (22) | 3.5 (49) | 2.2 (21) | 2.2 (16) | 2.4 (15) | 3.1 (8) | 2.9 (14) | 7.9 (7) | |||
Female | 18.6 (22) | 32.8 (49) | 53.4 (21) | 3.6 (22) | 3.5 (49) | 2.1 (21) | 2.0 (16) | 2.3 (15) | 3.1 (8) | 3.0 (14) | 8.3 (7) | |||
Gross primary school | ||||||||||||||
enrollment rate4 | 104.2(25) | 92.3(55) | 80.9(25) | 0.1 (25) | 0.8 (55) | 1.0(25) | 0.9 (15) | 0.6(15) | 0.5 (10) | 0.7 (14) | 1.0(13) | |||
Female | 102.8 (25) | 88.6 (52) | 76.6 (24) | 0.3 (25) | 0.8 (52) | 1.1 (24) | 1.2(14) | 1.1 (14) | 1.4 (9) | 0.5(13) | 0.1 (13) | |||
Male | 105.8 (25) | 96.5 (52) | 88.0 (24) | 0.1 (25) | 0.7 (52) | 0.9 (24) | 1.4 (14) | 1.0(14) | 0.0 (9) | 0.6 (13) | 0.8(13) | |||
Gross secondary school | ||||||||||||||
enrollment rate4 | 61.8 (25) | 50.5 (53) | 30.6 (24) | 2.8 (25) | 1.1 (53) | 0.8 (24) | 0.9 (14) | 1.2(14) | 2.2(10) | 1.4 (14) | -0.8(12) | |||
Female | 65.0 (24) | 49.5 (49) | 28.4 (23) | 3.2 (24) | 1.9 (49) | 2.3 (23) | 2.8 (13) | 3.1 (14) | 3.5(10) | 1.2 (10) | -0.5 (12) | |||
Male | 62.6 (24) | 51.9 (49) | 32.5 (23) | 2.7 (24) | 0.6 (49) | 0.2 (23) | 0.5 (13) | 0.3 (14) | 1.6(10) | 1.4 (10) | -0.9(12) | |||
Net primary school | ||||||||||||||
enrollment rate | 84.8 (18) | 74.6 (31) | 58.9 (17) | 0.2 (18) | 0.7 (31) | 0.6 (17) | 0.5(11) | 0.1 (10) | 0.9 (4) | 0.9 (11) | 0.4 (4) | |||
Persistence to grade 5 | 88.5 (21) | 75.3 (23) | 68.0 (11) | 0.5 (21) | 1.7 (23) | 2.0(11) | 2.9 (8) | 2.3 (9) | -0.3 (5) | 2.5(7) | …(0) | |||
Health care | ||||||||||||||
Life expectancy (in years) | 68.1 (33) | 63.3 (45) | 57.6 (25) | 0.4 (33) | 0.2 (45) | 0.2 (25) | 0.1 (12) | -0.1 (13) | 0.7 (4) | 0.5 (9) | 0.0(16) | |||
Infant mortality rate3 | 31.8 (34) | 48.9 (48) | 72.8 (25) | 1.7(34) | 2.5 (48) | 1.5 (25) | 1.6(13) | 1.0(14) | 2.7 (5) | 3.3(10) | 3.0(16) | |||
Under-5 mortality rate3 | 40.1 (29) | 66.6 (29) | 113.2 (14) | 3.8 (29) | 3.7 (29) | 2.9 (14) | 2.3 (3) | 0.8 (8) | …(0) | 3.2 (7) | 5.7(13) | |||
Births attended by | ||||||||||||||
skilled staff | 78.5 (25) | 64.0 (37) | 52.4 (18) | 6.1 (25) | 1.8 (37) | 3.2 (18) | 0.8 (10) | 1.7(9) | 4.2 (10) | -0.1 (11) | -0.3 (4) | |||
Contraceptive prevalence5 | 66.3 (4) | 49.3 (14) | 36.0 (5) | 3.6 (4) | 3.1 (14) | 5.6 (5) | 6.7 (3) | 6.9(3) | 2.0 (5) | 2.5 (5) | 0.0(1) | |||
Access to health care | 94.6(16) | 74.0 (13) | 48.7 (3) | 1.4 (16) | 3.7(13) | 11.2 (3) | 4.0 (4) | 6.6 (5) | 6.2 (2) | 0.4 (4) | …(0) | |||
Percent under 12 months immunized | ||||||||||||||
immunized | ||||||||||||||
DPT vaccination | 86.8 (33) | 82.6 (61) | 74.6 (29) | 4.5 (33) | 4.8 (61) | 6.9 (29) | 7.3(16) | 5.7(15) | 7.7(10) | 3.8(15) | 3.7(16) | |||
Measles vaccination | 85.0 (33) | 83.0 (60) | 75.3 (28) | 5.4 (33) | 4.4 (60) | 6.1 (28) | 6.8 (15) | 4.3 (14) | 9.1 (10) | 3.3(15) | 2.8 (16) | |||
Other basic services | ||||||||||||||
Access to safe water | 81.7(27) | 66.0 (41) | 58.1 (19) | 4.1 (27) | 2.9 (41) | 4.2 (19) | 4.0 (12) | 4.2(12) | 7.7 (8) | 1.6 (14) | -3.5 (5) | |||
Access to sanitation | 73.9 (23) | 57.6 (37) | 41.6 (17) | 2.6 (23) | 4.4 (37) | 6.7(17) | 3.2 (10) | 2.7 (10) | 14.2 (8) | 3.5 (14) | -9.9 (3) |
Latest data available. Mostly refers to 1995-97. Except for life expectancy, which is in years, all the indicators refer to shares of the relevant population groups. See also Box 2.2.
Nonprogram countries, shown for comparison, included Angola, The Bahamas., Bah rain, Seine, Bhutan, Botswana, Colombia, Cyprus, Eritrea, Fiji, Grenada, I.R. of Iran, Kuwait, Lebanon, Malaysia, Maldives, Malta, Myanmar, Namibia, Netherlands Antilles, Oman, Paraguay, Qatar, Seychelles, Soloman Islands, South Africa, St. Kitts and Nevis, St, Lucia. St-Vincent and the Grenadines, Swaziland, Syrian Arab Re public, Tonga, Turkmenistan, and United Arab Emirates.
For infant mortality and under-5 mortality rates, number per thousand. The annual percent improvement in illiteracy, infant mortality, and under-5 mortality rates refers to a decline in these rates. An annual percent improvement of 3.4 in illiteracy, for example, means chat illiteracy rates are falling by 3.4 percent per year,
Gross enrollment rate is the ratio of total enrollment, regardless of age, to the population of the age group that corresponds to the level of education shown. If, for example because of grade repetition, students who fall outside the age bracket for primary or secondary education are nevertheless enrolled, the gross enrollment rate may exceed 100 percent.
Contraceptive prevalence race is the percentage of women who are practicing, or whose sexual partners are practicing, any form of contraception and is usually measured for women aged 15–49.
Overall, considerable progress was made in increasing social spending during 1985-97. Although the lack of consistent data hinders the assessment of public social spending, program countries, on average, have achieved an increase in social spending:
-
For 65 of the 107 countries with IMF-supported programs during 1985-97, government spending on education and health care, on average, has increased both as a percentage of GDP and in real per capita terms. The share in GDP of spending increased by 0.3 percentage point during the program period (about eight years, on average); the spending increased by 2.4 percent a year in real per capita terms (Figure 4.1).25
-
In a subset of 29 countries, of which 19 are ESAF countries, that have data on military spending, such spending on average declined during 1990-97, whereas education and health care spending together increased in relation to both GDP and total government spending.
-
Real per capita social spending has declined in some countries, and the increases have been relatively low in some regions, notably education spending in sub-Saharan Africa.26 In transition economies, real per capita spending on education and health care has declined considerably. A modest decline of 0.1 of a percentage point in the share of spending in falling GDP masks a larger decline in real per capita terms. In these countries, however, education and health care spending have been historically high and inefficient.
-
Countries with ESAF-supported programs have shown relatively strong results. In the 31 countries with ESAF programs, the real per capita growth of spending on education and health care over 1985-97 (4.0 percent and 4.9 percent, respectively) has outstripped, on average, that in other program countries.
Changes in Education and Health Care Spending in Countries with IMF-Supported Programs, 1985–97
(Average change between preprogram year and latest year in percent of GDP; number of countries in parentheses)
Sources: National authorities; and IMF staff estimatesTargets for Public Spending on Education and Health Care in ESAF-Supported Programs, 1994-98
Policy Framework Papers (PFPs) as well as Memoranda of Economic Policies (MEPs) for 44 countries that had ESAF-supported programs during 1994–98 were reviewed to ascertain the extent to which they
-
incorporated targets for budget allocations for education and health care, either in unspecified general or specific quantitative terms;
-
called for structural improvements in the provision of social services; and
-
monitored changes in, and established targets for, social indicators.
ESAF-supported programs have increasingly sought to raise public spending on education and health care and to implement structural reforms in the sectors. Benchmarks and performance criteria have also been increasingly widely used to achieve increases in such spending.
In PFPs, about 80 percent of the 44 countries sought increases in public spending on education and health care during 1994–98, and a slightly lower proportion (60 percent) set quantitative targets for such increases. Targets were most commonly set once during the period while, on average, ESAF-supported programs were in place in the countries for 3-3 ½ years during 1994–98. PFPs for around 60 percent of the 44 countries aimed at increased budgetary allocations for primary education and basic health care during the period, and about one-third of these set quantitative increases. All programs called for structural measures to strengthen the provision of social services during the period, for example, by increasing the number of teachers and doctors and enhancing the role of the private sector. About 45 percent of the 44 countries targeted improvements in social indicators in both unspecified and quantitative terms. The most commonly used indicators were primary school enrollment, including, separately for girls, literacy, infant mortality, and immunization rates.
The picture is broadly similar for MEPs with respect to the proportion of countries that committed to increase budgetary expenditures on health care and education. Compared with PFPs, however, a much smaller percentage of countries (about 45 percent) sought increases in budgetary allocations for primary education and basic health care (either unspecified or in specific quantitative terms) and some 16 percent established specific targets for quantitative increases. A lower percentage of countries (30 percent) identified improvements in education and health care indicators as a policy objective. The use of quantitative targets increased by 40 percent during the period under review.
On a country-by-country basis, commitments to social spending measures were less frequent in MEPs than in PFPs. For example, only about half the countries that sought increases in social expenditures in their PFPs mentioned such increases in the MEPs.
In recent years, programs have relied on benchmarks and performance criteria to seek increases in, and strengthen the efficiency of, social spending. To this end, the MEPs of six countries included benchmarks (Armenia in 1996, Azerbaijan in 1997, Cameroon in 1997, Georgia in 1997 and 1998, the Kyrgyz Republic in 1995, 1997, and 1998, and Uganda in 1997), and two countries included performance criteria (Ghana in 1998 and the Kyrgyz Republic in 1998).
In 1997, public expenditure on education and health care as a share of GDP in countries with ESAF programs approximated that in other program countries. In HIPCs, spending levels remain below those in other program countries in part because of very low initial levels (Figure 4.2). Education and health care spending as a share of total government spending–indicative of the priority assigned to these types of spending–shows the same pattern.
Composition of Spending
Available data for 1985–97 suggest that budget expenditure shares shifted, on average, from current to capital outlays in both ESAF countries and HIPCs, and more so than in other program countries. Whether this led to an increase in such key components in the delivery of education and health care as books and medicine, however, is unclear because available data for these outlays are reported with other types of spending under other goods and services. In all program countries, average spending on other goods and services fell during the period under review.
Although many programs have sought to improve the allocation of budget resources within the education and health care sectors, more can be done. On average, program countries have devoted a relatively large share of their education budget to tertiary education and even a larger part of health care outlays to curative services (Figure 4.3). This suggests that low-income households would benefit from a shift in budgetary resources toward primary education and basic health care.27
Allocation of Education and Health Care Spending in Countries with IMF-Supported Programs, 1994
(In percent of total education and health care spending; number of countries in parentheses; latest year for which data are available) 1
Sources: IMF, Government Finance Statistics database; World Bank. Public Expenditure Review and Poverty Assessment, various issues; and IMF staff estimates.1 Mostly 1994Impact on Education and Health Indicators and Implications for Poverty
On average, the education and health care indicators in the OECD/UN/World Bank working set of core indicators for measuring social development have improved for program countries.28 But there are important exceptions. In sub-Saharan Africa, average life expectancy has declined, reflecting the toll of HIV and conflicts (Table 4.1). Improvements in social indicators in ESAF countries and HIPCs have not been commensurate with the spending increases. Progress in improving infant mortality and primary and secondary enrollment has been slower in these countries than in other program countries. Transition economies have experienced declines in enrollment rates in secondary education and immunizations; reforms in these two areas have been slow, thus increasing the risk that the declines in spending may lead to a permanent setback in social indicators.29
Weak administrative capacity to formulate and execute the budget has reduced the impact of education and health care spending on social indicators. In particular, the capacity to spend resources efficiently can vary at different levels of government, and is likely to be lacking at lower levels of government, at Least initially, during a period of devolution of expenditure responsibilities.30” The allocation of budgetary resources within the social sectors (e.g., between primary and tertiary education) is also important, as is the presence of corruption, which can distort the composition and level of social spending.31
Although improvements in social indicators reflect a country’s social development, they have not been necessarily translated into reduced poverty, which in itself is multidimensional. For example, the poor tend to be less educated and less healthy than the nonpoor.32 For targeted spending to have a considerable payoff, however, the benefits from improved basic social services have to be accompanied by income-earning opportunities.
Data for 29 program countries show that the targeting of education and health care spending could be improved, particularly in sub-Saharan Africa and in the transition economies (Figure 4.4). The poor’s access may be constrained by out-of-pocket costs (both formal and informal) for using public services, excessive distance to the nearest school or health center, poor quality of public services, and gender bias. For sub-Saharan Africa,
Benefit Incidence of Public Spending on Education and Health Care in Countries with IMF-Supported Programs, Early 1990s
(In percent of total spending; number of program countries in parentheses; latest year for which data are available)
Source: Davoodi and Sachjapinan (forthcoming).1The share of the population living in urban areas averages one-third for the countries in the education and health care samples.-
14 percent of total spending on public education and 12 percent of health care spending, on average, accrue to the poorest fifth (quintile) of households compared with 30 percent for the richest quintile for both. These gaps widen for spending on secondary and tertiary education and hospital care;
-
spending on primary education is somewhat better targeted than that on secondary and tertiary education, and the targeting of public spending on education and health care is improving in some countries (e.g., Cote d’lvoire and Malawi).
Targeting has a geographical dimension. For example, government public policy choices with a pro-urban bias reduce the access to vital social services for the poor, most of whom live in rural areas. Data on the geographic distribution of education spending were available for only 10 countries with IMF-supported programs, and show that education spending, on average, has disproportionately favored the urban population, particularly spending on secondary and tertiary education.33 A similar urban bias emerges from limited data on health care spending for six countries.
Experience with Program Targets, Conditionality, and Monitoring in ESAF Countries
A review of 11 countries with ESAF arrangements illustrates a range of approaches and success with public spending on education and health care.34 It is difficult to establish any clear links between meeting benchmarks, performance criteria, and prior actions, on the one hand, and improved access to basic social services, on the other hand. Social indicators in ESAF countries, with the exception of the transition economies (Armenia, Georgia, and the Kyrgyz Republic), were generally poor at the outset of their programs. In nontransition countries, programs emphasized reorienting expenditures to raise spending on education and health care; in Bolivia, Lao People’s Democratic Republic, and Uganda, deficit and/or overall expenditure levels were also programmed to rise as a share of GDP, in part to raise spending on education and health care. In the transition economies, where existing high and inefficient levels of education and health care spending tottered on a collapsing revenue base, programs emphasized quality and efficiency improvements.
In the nontransition countries the program objectives for education and health care spending were set in the context of longer-term goals drawn from the authorities’ strategic plans for poverty reduction.35
-
In several cases, the strategic plans were formal national government plans prepared in collaboration with the World Bank and other development partners (e.g., Bolivia, Côte d’lvoire, Ghana, Malawi, and Uganda).
-
In only a few countries were quantified long-term goals for social outcomes included explicitly in IMF-supported programs, for example, doubling the general literacy rate and increasing life expectancy to 57 years (Burkina Faso).
-
For the HIPCs that reached the decision point (Bolivia, Burkina Faso, Cote d’lvoire, Mozambique, and Uganda) and Ghana (1999), the use of quantitative goals for indicators was significantly expanded (Tables 4.2 and 4.3). In these cases, goals established for education and health care indicators were broadly in line with the OECD/UN/World Bank core set, with adjustments made for the authorities’ specific objectives and local conditions.
-
At the outset of the arrangements, the transition economies did not have overall poverty reduction plans, although for Armenia and Georgia poverty assessments had been completed by the World Bank at about the same time. In general, goals were cast in qualitative terms. For example, the long-term goals for spending on education and health care included a higher standard of living, development of human capital, and alleviation of poverty (Bolivia); better provision of social services by enhancing the efficiency of social expenditures (Georgia); improving basic education and health care and human resources (Ghana); and providing adequate funding for human development and improving living standards (Lao People’s Democratic Republic).
Social Development Indicators, Selected ESAF Countries 1
The countries included are a subset of the 11 ESAF countries for which the experience on program targets, conditionality, and monitoring was reviewed.
Social Development Indicators, Selected ESAF Countries 1
Indicators | HIPC Decision Point Countries | Other ESAF Country |
||||
---|---|---|---|---|---|---|
Bolivia | Burkina Faso | Mozambique | Uganda | Ghana | ||
Education | ||||||
Admission and repetition rates for primary schools | X | X | ||||
Gross/net enrollment ratios for primary and/or secondary schools | X | X | X | X | ||
Primary school completion ratios | X | X | ||||
Gender ratios (to increase ratio of girls to total pupils enrolled in primary schools) | X | X | X | |||
Book/pupil ratio | X | |||||
Cumulative number of schools benefiting from participation in quality improvement programs | X | |||||
Health | ||||||
Life expectancy | X | |||||
Fertility rate | X | |||||
Infant and maternal mortality rates | X | |||||
Child and/or pregnant woman vaccination rates | X | X | X | |||
DPT vaccination coverage | X | X | ||||
Childhood malnutrition rate | X | |||||
Access to clean water | X | |||||
Utilization rate of health centers | X | |||||
Proportion of health posts staffed exclusively with untrained personnel | X | |||||
Proportion of houses receiving measures against endemic diseases (e.g., chagas, malaria) | X |
The countries included are a subset of the 11 ESAF countries for which the experience on program targets, conditionality, and monitoring was reviewed.
Social Development Indicators, Selected ESAF Countries 1
Indicators | HIPC Decision Point Countries | Other ESAF Country |
||||
---|---|---|---|---|---|---|
Bolivia | Burkina Faso | Mozambique | Uganda | Ghana | ||
Education | ||||||
Admission and repetition rates for primary schools | X | X | ||||
Gross/net enrollment ratios for primary and/or secondary schools | X | X | X | X | ||
Primary school completion ratios | X | X | ||||
Gender ratios (to increase ratio of girls to total pupils enrolled in primary schools) | X | X | X | |||
Book/pupil ratio | X | |||||
Cumulative number of schools benefiting from participation in quality improvement programs | X | |||||
Health | ||||||
Life expectancy | X | |||||
Fertility rate | X | |||||
Infant and maternal mortality rates | X | |||||
Child and/or pregnant woman vaccination rates | X | X | X | |||
DPT vaccination coverage | X | X | ||||
Childhood malnutrition rate | X | |||||
Access to clean water | X | |||||
Utilization rate of health centers | X | |||||
Proportion of health posts staffed exclusively with untrained personnel | X | |||||
Proportion of houses receiving measures against endemic diseases (e.g., chagas, malaria) | X |
The countries included are a subset of the 11 ESAF countries for which the experience on program targets, conditionality, and monitoring was reviewed.
All of the programs reviewed included measures to improve fiscal governance. In general, these reforms addressed broad expenditure management issues and covered the setting of budgetary spending allocations and priorities, expenditure controls, and reporting, as well as transparency.36 In Mozambique, reforms included the publication of budget plans and outcomes.
Programs often focused on improving cost-effectiveness and spending composition.
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To this end, programs often included measures to reduce the cost of delivery of social services (e.g., reducing excessive numbers of teachers) and to improve the quality of spending (e.g., improving the school curriculum and introducing second shifts in schools to overcome capacity constraints on the feasible number of hours of teaching).
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Program targets for public spending sought to reorient expenditure composition toward education and health care and, in particular, protect such spending during fiscal adjustment. Most of the the earlier ESAF-supported programs did not include quantitative budget targets for education and health care spending at their outset, but these were introduced at a later stage (Table 4.4). This in part reflected the introduction in 1997 of staff operational guidelines on social spending. All of the programs of the heavily indebted poor countries that had reached their decision points under the HIPC Initiative have included quantitative targets. In the transition economies, part of the strategy for increasing access to education and health care services has been to involve the private sector.
Public Education and Health Care Spending Targets, Selected ESAF Countries1
A program is defined to have a quantitative target when either the staff report, MEP, and/or PFP provides a projection for the category of public Spending. This is a broader coverage than used in Box 4.2, which 15 restricted to MEPs and PFPs.
Year of program approval in parentheses.
Defined as a reference to and/or a discussion of the developments with respect to the quantitative target specified in the request for the ESAF arrangement or subsequent annual arrangements.
Program has performance criteria set in nominal terms as a floor on expenditures on health and education.
Public Education and Health Care Spending Targets, Selected ESAF Countries1
Country2 | Quantified Expenditure Target |
Definition | Monitoring3 | Comment | |
---|---|---|---|---|---|
Transition Economies | |||||
Armenia (1996) | Yes | Current health and education expenditures in percent of GDP. | Yes | Quantitative target specified and monitored from the second annual arrangement. | |
Georgia (1996) | Yes | Social expenditures in percent of GDP (1996). Budgetary appropriations for health and education (from 1997). |
Yes | Quantitative targets specified in the reports but definitions differ across reports. Reports include mostly qualitative discussion of social expenditure developments, but without reference to previously specified targets. | |
Kyrgyz Republic (1994) | No | – | – | – | |
Kyrgyz Republic (1998)4 | Yes | Health and education expenditures in percent of GDP and total spending. | Yes | – | |
HIPC at Decision Point | |||||
Bolivia (1995) | Yes | Health and education expenditures in percent of GDP. | Yes | Quantitative target specified and monitored from the third annual arrangement. | |
Bolivia (1999) | Yes | Health and education expenditures in percent of GDP. | Yes | – | |
Burkina Faso (1996) | Yes | Health and primary education expenditures in percent of GDP. | Yes | – | |
Côted’lvoire (l998) | Yes | Health and education expenditures in percent of GDP. | Yes | – | |
Mozambique (1996) | Yes | Current expenditures on health and education in percent of GDP. | Yes | Quantitative target specified and monitored from the second annual arrangement. | |
Uganda (1997) | Yes | Health and education expenditures in percent of GDP. | Yes | – | |
Other ESAF Countries | |||||
Ghana (1995) | Yes | Health and education expenditures, excluding foreign financed capital expenditures, in percent of GDP | Yes | Target specified and monitored from the second annual arrangement | |
Ghana (1999) | Yes | Health and education expenditures, excluding foreign financed capital expenditures, in percent of GDR | Yet to be reviewed | – | |
Lao People’s Democratic Republic (1993) | No | – | – | – | |
Malawi (1995) | Yes | Current expenditures on health and education in percent of GDR | Yes | Quantitative target specified and monitored from the third annual arrangement. Definition of targets differs across reports. Qualitative discussion of social expenditure and outcome developments, including with reference to previously specified quantitative target. |
A program is defined to have a quantitative target when either the staff report, MEP, and/or PFP provides a projection for the category of public Spending. This is a broader coverage than used in Box 4.2, which 15 restricted to MEPs and PFPs.
Year of program approval in parentheses.
Defined as a reference to and/or a discussion of the developments with respect to the quantitative target specified in the request for the ESAF arrangement or subsequent annual arrangements.
Program has performance criteria set in nominal terms as a floor on expenditures on health and education.
Public Education and Health Care Spending Targets, Selected ESAF Countries1
Country2 | Quantified Expenditure Target |
Definition | Monitoring3 | Comment | |
---|---|---|---|---|---|
Transition Economies | |||||
Armenia (1996) | Yes | Current health and education expenditures in percent of GDP. | Yes | Quantitative target specified and monitored from the second annual arrangement. | |
Georgia (1996) | Yes | Social expenditures in percent of GDP (1996). Budgetary appropriations for health and education (from 1997). |
Yes | Quantitative targets specified in the reports but definitions differ across reports. Reports include mostly qualitative discussion of social expenditure developments, but without reference to previously specified targets. | |
Kyrgyz Republic (1994) | No | – | – | – | |
Kyrgyz Republic (1998)4 | Yes | Health and education expenditures in percent of GDP and total spending. | Yes | – | |
HIPC at Decision Point | |||||
Bolivia (1995) | Yes | Health and education expenditures in percent of GDP. | Yes | Quantitative target specified and monitored from the third annual arrangement. | |
Bolivia (1999) | Yes | Health and education expenditures in percent of GDP. | Yes | – | |
Burkina Faso (1996) | Yes | Health and primary education expenditures in percent of GDP. | Yes | – | |
Côted’lvoire (l998) | Yes | Health and education expenditures in percent of GDP. | Yes | – | |
Mozambique (1996) | Yes | Current expenditures on health and education in percent of GDP. | Yes | Quantitative target specified and monitored from the second annual arrangement. | |
Uganda (1997) | Yes | Health and education expenditures in percent of GDP. | Yes | – | |
Other ESAF Countries | |||||
Ghana (1995) | Yes | Health and education expenditures, excluding foreign financed capital expenditures, in percent of GDP | Yes | Target specified and monitored from the second annual arrangement | |
Ghana (1999) | Yes | Health and education expenditures, excluding foreign financed capital expenditures, in percent of GDR | Yet to be reviewed | – | |
Lao People’s Democratic Republic (1993) | No | – | – | – | |
Malawi (1995) | Yes | Current expenditures on health and education in percent of GDR | Yes | Quantitative target specified and monitored from the third annual arrangement. Definition of targets differs across reports. Qualitative discussion of social expenditure and outcome developments, including with reference to previously specified quantitative target. |
A program is defined to have a quantitative target when either the staff report, MEP, and/or PFP provides a projection for the category of public Spending. This is a broader coverage than used in Box 4.2, which 15 restricted to MEPs and PFPs.
Year of program approval in parentheses.
Defined as a reference to and/or a discussion of the developments with respect to the quantitative target specified in the request for the ESAF arrangement or subsequent annual arrangements.
Program has performance criteria set in nominal terms as a floor on expenditures on health and education.
The scope of spending targets that could be monitored was constrained. The constraints included a lack of data on the intrasectoral allocation of education and health care spending, incomplete coverage of these sectors, and lags in the availability of data. Quantitative spending targets and benchmarks singled out education and health care spending as priorities to be protected from cuts (Bolivia, Kyrgyz Republic, Malawi, and Uganda), or aimed at redirecting public spending in favor of education and health care (Ghana and Malawi) (see Table 4.4). Because the link between expenditure on education and health care and final outcomes is complex and uncertain, programs monitored actual spending and developments in intermediate social indicators such as the hiring or firing of teachers and consolidation of schools (Armenia), increasing water supply and number of classrooms created (Cote d’lvoire), reducing stays in hospitals (the Kyrgyz Republic), and increasing the share of textbooks in the budget (Malawi). Monitoring was also undertaken with a view to assessing the impact of policies on the provision of social services. Program documents also have included qualitative assessments of progress.
A number of innovations have strengthened monitoring.
-
The introduction of explicit targets has contributed to improved monitoring of developments. The staff reports on programs of the HIPCs that had reached the decision point (Bolivia, Burkina Faso, Côte d’lvoire, Mozambique, and Uganda) have systematically covered developments relating to spending targets and social outcomes. In the other countries, the onset of improved monitoring also has reflected the issuance of the staff guidelines on social spending. But significant weaknesses remain in the quality of reporting in some countries. For instance, definitions of targeted spending as set out in the initial request for the ESAF arrangement and those that were subsequently monitored have sometimes been different. As noted earlier, information on actual spending was typically available only with a considerable time lag, which meant that targets had to be based on partial estimates for the preceding year (s). As a result, a clear picture of spending developments and their impact on social indicators emerged only after the passage of several annual programs.
-
In more recent ESAF-supported programs, formulating a clear framework in program documents that integrated social spending targets with a time path of specified indicators and outcomes improved the focus and monitoring of social policy. Such frameworks were used in the case of HIPCs that had reached the decision point and in Ghana’s program (1999), In these cases, the authorities explicitly noted their commitment to education and health care output targets in the Memorandum of Economic Policies (MEP), reinforcing the emphasis given to social issues in the Policy Framework Papers (PFP). The advantages of a well-defined framework also carried through to more focused, comprehensive, and forward-looking assessments of education and health care sector developments. In other countries, improved monitoring of education and health care spending is evident in programs approved after 1997, following the introduction of the staff guidelines on social spending, and program documents provide more specific information on related developments and report spending on education and health care at a disaggregated level.
-
In the HIPC decision point countries and Ghana, information to monitor social developments was drawn from a wider variety of sources, including bilateral donors (Burkina Faso and Ghana). These arrangements also made effective use of information from internal reviews conducted at the local government and community levels. Also, in several countries, poverty monitoring teams and units were set up (examples are given in Table 4.3).
Monitoring Arrangements, Selected ESAF Countries1
The countries Included are a subset of the 11 ESAF countries for which the experience on program targets, conditionality, and monitoring was reviewed.
Monitoring Arrangements, Selected ESAF Countries1
Ghana | |
A broad-based Technical Committee on Poverty comprising officials from various ministries and government departments, donors, and NGOs was established in 1997 and meets regularly. The committee collects and disseminates information on poverty reduction programs. As part of this Continuous Poverty Monitoring System, a pilot survey has been undertaken to provide a systematic and frequent update on key poverty indicators. Also, donor committees meet frequently on health and education issues to coordinate, exchange information, and monitor programs. | |
Malawi | |
A governmental poverty and social policy monitoring unit was established in 1995 to monitor core social indicators to be presented to donors and at Consultative Group meetings. | |
Uganda | |
A poverty monitoring unit including education, finance, and health ministry officials was established in 1998 and made responsible for collecting poverty and social sector information at the local level. Health districts collect quarterly data on health-related indicators and report them to the sector monitoring unit. Expenditure tracking studies were undertaken to identify obstacles that prevented budgeted expenditures from reaching their intended use. |
The countries Included are a subset of the 11 ESAF countries for which the experience on program targets, conditionality, and monitoring was reviewed.
Monitoring Arrangements, Selected ESAF Countries1
Ghana | |
A broad-based Technical Committee on Poverty comprising officials from various ministries and government departments, donors, and NGOs was established in 1997 and meets regularly. The committee collects and disseminates information on poverty reduction programs. As part of this Continuous Poverty Monitoring System, a pilot survey has been undertaken to provide a systematic and frequent update on key poverty indicators. Also, donor committees meet frequently on health and education issues to coordinate, exchange information, and monitor programs. | |
Malawi | |
A governmental poverty and social policy monitoring unit was established in 1995 to monitor core social indicators to be presented to donors and at Consultative Group meetings. | |
Uganda | |
A poverty monitoring unit including education, finance, and health ministry officials was established in 1998 and made responsible for collecting poverty and social sector information at the local level. Health districts collect quarterly data on health-related indicators and report them to the sector monitoring unit. Expenditure tracking studies were undertaken to identify obstacles that prevented budgeted expenditures from reaching their intended use. |
The countries Included are a subset of the 11 ESAF countries for which the experience on program targets, conditionality, and monitoring was reviewed.
In specifying public spending targets and policy measures and in monitoring, IMF staff collaborated with the World Bank and regional development banks. The World Bank provided policy analyses for many countries. Except for Burkina Faso and Georgia, however, comprehensive World Bank Public Expenditure Reviews were not available at the time of the initial request for an ESAF arrangement to guide budget policy. Thus, it was not always possible to ensure that budget allocations for education and health care were in line with an appropriate overall composition of expenditures. Expenditure reviews have since been undertaken or are scheduled to commence in 1999 in all 11 countries.
Conditionality37 was attached to public spending targets and to key reforms for which timely implementation was essential to the success of the program.
-
Conditionality was used sparingly, and primarily took the form of benchmarks38 (Table 4.5). Performance criteria and prior actions have rarely been used. For the most part, conditionality was applied to minimum levels of budget spending with a view to protecting spending on education and health care from the pressure of overall spending restraint, in parallel with World Bank programs to improve the quality of social sector spending (Georgia and the Kyrgyz Republic), or to ensure that additional resources were not diverted to other uses (Uganda).
-
Conditionality was used to encourage the timely completion of sector and national poverty reduction strategies and action plans, which were prerequisites for establishing a clear operational strategy for improving access to social services over the medium term. In Côte d’lvoire a prior action on adopting an antipoverty national plan was introduced to provide stronger evidence of the authorities’ commitment to strengthening spending on education and health care, an area in which there had been slippage and an unmet benchmark in the previous ESAF arrangement Establishing performance criteria on education and health care spending in the Kyrgyz Republic and Uganda programs was combined with measures to ensure the quality of such spending.
Social Policy Conditionality (Prior Actions, Performance Criteria, and Benchmarks), Selected ESAF Countries1
Social policy conditionalities were used in only 7 of the II ESAF countries.
Year of program approval shown in parentheses; suffix indicates the program year (1 to 3).
Program targets are set in terms of expenditures as a percent of GDP.
Prior actions on the level of spending in the quarter following the test date were set as conditions for completing the midterm review, of which that on health was met. In addition, measures to strengthen overall expenditure management were to be introduced and the authorities undertook to ensure that spending on education and health care would be kept at least constant in real terms throughout 1999.
Social Policy Conditionality (Prior Actions, Performance Criteria, and Benchmarks), Selected ESAF Countries1
Country | ESAF Arrangement2 | Policy Measure | Conditionality | Type of Observance |
---|---|---|---|---|
Armenia | ESAF. 3 (1998) | Develop and approve a three-year strategic plan for the health sector by end-September 1999. | Benchmark | Review pending |
Côte d’lvoire | ESAF. 1 (1998) | Adopt a national plan to fight poverty. | Prior action | Met |
Georgia | ESAF. 1 (1996) | Reduce number of budgetary positions, primarily in education, by 10,000 by September 1996. | Benchmark | Met |
ESAF. 2 (1997) | Minimum amount of health expenditures of the republican government cumulative from January 1, 1997. | Benchmark | Not met | |
ESAF.3 (1998) | Minimum amount of health expenditures of the republican government. | Benchmark | Not met | |
Ghana | ESAF. 2 (1995) | Complete medium-term expenditure framework (MTEF) for priority sectors of education, health, and roads. | Performance criteria | Met |
Kyrgyz Republic | ESAF. 1 (1998) | Cumulative floor on budgetary expenditures separately on health and education beginning April 1998.3 | Performance criteria | Waived4 |
Mozambique | ESAF.3 (1998) | Complete National Poverty Assessment and Poverty Action Plan by end-1998. | Benchmark | Met |
Uganda | ESAF. 1 (1997) | Minimum amount of nonwage expenditures on priority program areas in health and education. | Benchmark | Met |
ESAF. 2(1998) | Minimum amount of nonwage expenditures on priority program areas including universal primary education component of domestic development expenditures. | Performance criteria | Met |
Social policy conditionalities were used in only 7 of the II ESAF countries.
Year of program approval shown in parentheses; suffix indicates the program year (1 to 3).
Program targets are set in terms of expenditures as a percent of GDP.
Prior actions on the level of spending in the quarter following the test date were set as conditions for completing the midterm review, of which that on health was met. In addition, measures to strengthen overall expenditure management were to be introduced and the authorities undertook to ensure that spending on education and health care would be kept at least constant in real terms throughout 1999.
Social Policy Conditionality (Prior Actions, Performance Criteria, and Benchmarks), Selected ESAF Countries1
Country | ESAF Arrangement2 | Policy Measure | Conditionality | Type of Observance |
---|---|---|---|---|
Armenia | ESAF. 3 (1998) | Develop and approve a three-year strategic plan for the health sector by end-September 1999. | Benchmark | Review pending |
Côte d’lvoire | ESAF. 1 (1998) | Adopt a national plan to fight poverty. | Prior action | Met |
Georgia | ESAF. 1 (1996) | Reduce number of budgetary positions, primarily in education, by 10,000 by September 1996. | Benchmark | Met |
ESAF. 2 (1997) | Minimum amount of health expenditures of the republican government cumulative from January 1, 1997. | Benchmark | Not met | |
ESAF.3 (1998) | Minimum amount of health expenditures of the republican government. | Benchmark | Not met | |
Ghana | ESAF. 2 (1995) | Complete medium-term expenditure framework (MTEF) for priority sectors of education, health, and roads. | Performance criteria | Met |
Kyrgyz Republic | ESAF. 1 (1998) | Cumulative floor on budgetary expenditures separately on health and education beginning April 1998.3 | Performance criteria | Waived4 |
Mozambique | ESAF.3 (1998) | Complete National Poverty Assessment and Poverty Action Plan by end-1998. | Benchmark | Met |
Uganda | ESAF. 1 (1997) | Minimum amount of nonwage expenditures on priority program areas in health and education. | Benchmark | Met |
ESAF. 2(1998) | Minimum amount of nonwage expenditures on priority program areas including universal primary education component of domestic development expenditures. | Performance criteria | Met |
Social policy conditionalities were used in only 7 of the II ESAF countries.
Year of program approval shown in parentheses; suffix indicates the program year (1 to 3).
Program targets are set in terms of expenditures as a percent of GDP.
Prior actions on the level of spending in the quarter following the test date were set as conditions for completing the midterm review, of which that on health was met. In addition, measures to strengthen overall expenditure management were to be introduced and the authorities undertook to ensure that spending on education and health care would be kept at least constant in real terms throughout 1999.