2008年-世界发展银行全球_Kyrgyz_Republic_-_Education_Sector_Fiduciary_Capacity___Assessment_Report_86页_878kb

Kyrgyz Republic Education Sector Fiduciary Capacity Assessment Summary

Core Content

This report assesses the fiduciary capacity of the Kyrgyz Republic's education sector, focusing on financial management, procurement arrangements, and institutional capacity. It outlines key findings and proposes action plans to improve the system's accountability and efficiency.

Main Objectives and Scope

• Objective: To evaluate the fiduciary capacity of the education sector and propose action plans for improvement.
• Scope: Includes the Ministry of Education and Science (MOES), oblast, rayon, and ayil okmotu levels.
• Output: Two-phase action plans for capacity building, including short-term and medium-term measures.

Public Financial Management (PFM) Framework

• The Kyrgyz Republic initiated PFM reforms in the mid-1990s, which were a key component of the National Poverty Reduction Strategy (NPRS) from 1996 to 2005.
• A legal framework, budget procedures, and a treasury system have been established, but implementation has been inconsistent.
• Progress has been made in developing new budget classifications, but slower in adopting public sector accounting standards and internal audit frameworks.
• Weak budget preparation and execution, lack of qualified staff, and poor management of reforms have hindered the overall PFM system.

Education Sector and Its Institutions

• In 2007, nearly 10 billion som (about 275 million USD) or one fourth of the national budget was allocated to the education sector.
• Education expenditures accounted for 20-23% of the national budget and increased to 6.5% of GDP in 2007.
• Most national education expenditures (60%) go to primary and secondary education, with school education increasing to 77% in 2007.
• The MOES directly manages 90 educational organizations, while the remaining 3,000 are financed by local governments and other entities.
• Budgeting follows a top-down approach, leading to deviations from planned figures and unpredictability in fund availability.
• There is a need for a bottom-up approach to budget formulation, based on sectoral policy and strategy.

Budgetary Flows

• Funding sources are fragmented, making it difficult to have a consolidated view of the sector.
• The MOES lacks the ability to track periodic budget flows, such as quarterly fund receipts.
• There is a lack of transparency and fairness in the allocation of categorical grants from the national budget to local institutions.
• Local authorities report budget performance monthly and quarterly to their respective kenesh, but inspections are insufficient.

Financial Reporting and Information Systems

• The MOES does not currently prepare consolidated financial statements for the entire education sector.
• Financial reporting is done manually at all levels, necessitating the development of a more efficient system.
• The implementation of the MOF Treasury system and a review of financial reporting requirements are essential for consolidated reporting.
• External assistance may be needed to computerize the accounting system based on the "project intent" document.

Internal Controls and External Audit

• Internal control is underdeveloped, with an overemphasis on compliance and insufficient understanding of broader internal control concepts.
• The MOES needs an internal audit unit to conduct audits at headquarters, rayons, and individual schools.
• Rayon administrations and ayil okmotus require internal manuals for financial management.
• The Chamber of Accounts (COA) conducts external audits, but its staff lack adequate training in public procurement.

Procurement Issues

• The implementation of the 2004 Public Procurement Law (PPL) has been ineffective, leading to various weaknesses in the procurement system.
• Procurement is often handled by accountants, creating potential conflicts of interest.
• Permanent tender committees are used at all levels, but they should be replaced with ad hoc committees as per the PPL.
• The National Procurement Training Center (NPTC) provides training, but its high fees deter participation.
• The SAPPMR (State Agency for Public Procurement and Material Reserve) supports procurement at oblast, rayon, and ayil okmotu levels, but its role is limited.

Case Studies of Expenditure Items

• Salaries: Significant increases in staff salaries despite a drop in student numbers.
• Food Items: A law mandates breakfast for primary students, but implementation is inconsistent.
• Textbooks: Purchased from the national budget, but there is no clear tracking or accountability.
• Utilities and Maintenance: Ineffective use of funds and high maintenance costs.
• Higher Educational Institutions: High administrative costs relative to student numbers.

Action Plans for Capacity Building

Phase 1 (Short-Term, 2008–2009)

• Strengthen the MOES's fiduciary capacity.
• Improve financial management, accounting, and procurement practices.
• Enable more efficient and economic use of budgetary resources.
• Gradually assume responsibility for donor-funded projects.
• Create favorable conditions for new implementation mechanisms such as SWAp.
• Estimated cost: US$659,000.

Phase 2 (Medium-Term, 2009–2010)

• Focus on rayon and ayil okmotu levels.
• Implement reforms to improve procurement and financial management at these levels.
• Develop internal controls and audit frameworks.
• Enhance transparency and accountability in local budget management.

Key Recommendations

• Develop a bottom-up budgeting approach.
• Computerize the accounting system.
• Train procurement staff and establish internal audit units.
• Replace permanent tender committees with ad hoc ones.
• Strengthen the PFM system, including treasury modernization and accounting reforms.
• Ensure compliance with the PPL and improve procurement practices.
• Increase transparency and fairness in the allocation of categorical grants.

Conclusion

The education sector in the Kyrgyz Republic faces significant fiduciary challenges, which are closely linked to broader issues in the country's PFM system. Improving the sector's capacity requires coordinated efforts, including institutional reforms, staff training, and the development of efficient information and reporting systems. The proposed action plans aim to address these weaknesses and enhance the sector's accountability and effectiveness.