2007年-世界发展银行全球_West_Bank_and_Gaza_-_Public_Expenditure_Review___From_Crisis_to_Greater_Fiscal_Independence_Volume_1_74页_5mb

West Bank and Gaza Public Expenditure Review Summary

Core Content

This document is a Public Expenditure Review (PER) of the West Bank and Gaza (WBG), conducted by the World Bank in March 2007. It outlines the fiscal challenges faced by the Palestinian Authority (PA) and provides policy recommendations to address them. The review is divided into two volumes, with Volume I focusing on the macro-fiscal context, public financial management (PFM), civil service reform, and intergovernmental fiscal relations.

Main Issues and Findings

Fiscal Crisis

• The PA is experiencing a severe fiscal crisis, with tax revenues dropping dramatically due to the Israeli decision to withhold clearance revenues and the U.S. threat to prosecute banks dealing with the PA.
• In 2006, monthly tax revenues were only $17 million, compared to $104 million in 2005.
• Monthly expenditures in 2005 were around $172 million, and by 2006, they had fallen by more than half.
• The wage bill alone reached $93 million per month by December 2005, with some estimates suggesting it was even higher.
• The PA had already reached a fiscally unsustainable position by late 2005, with assets being liquidated or mortgaged to meet current expenditure needs.

Public Expenditure Trends

• The PA's wage bill has grown rapidly, with an average annual increase of 9% since 1999, far exceeding population growth.
• The civil service had grown to over 81,000 by 2006, while security services had reached over 77,000 (including trainees), totaling 158,000.
• The Ministry of Education and Higher Education saw a 36% increase in the number of teachers and an 80% increase in salary budget since 2000.
• The Ministry of Health experienced a 73% increase in salary budget and a nearly doubling of medical personnel from 2000 to 2005.
• Non-wage expenditures (e.g., supplies and maintenance) have been drastically curtailed, relying heavily on donor support.

Table 1: Budget and Funding for Non-Salary Recurrent Expenditure in Health

Table 2: Selected Palestinian Authority Budgetary Expenditures, 2005

Key Policy Recommendations

1. Macro-Fiscal Policy Recommendations

• Bring aggregate expenditure closer to likely revenues and available financing.
• Improve expenditure efficiency to ensure sustainable fiscal management.

2. Public Financial Management (PFM) Policy Recommendations

• Restore the Central Treasury Account (CTA) to ensure transparency and central management.
• Develop a clear action plan for improving PFM capacity, including training and technical assistance.
• Reform the accounting system, including the chart of accounts and classification system.
• Ensure line ministries take more responsibility for their own expenditure management.
• Improve financial transparency for the Palestine Investment Fund (PIF), Petroleum Corporation, and Cement Company.
• Encourage donors to align their financial management requirements with the CTA and PA's accounting system.

3. Civil Service Reform Policy Recommendations

• Implement a comprehensive payroll audit.
• Introduce biometric systems (e.g., "electronic fingerprints") to improve payroll integrity.
• Develop computerized human resource information systems that facilitate information sharing between the MOF, General Personnel Council (GPC), and Ministry of Interior (MOI).
• Consolidate payroll authority for all security service personnel under the MOF.
• Clarify the roles of the GPC and MOF under new civil service legislation.
• Strengthen anticorruption institutions and develop a national anti-corruption strategy.
• Enhance court system efficiency to better handle corruption cases.
• Consider a new staffing structure with defined job descriptions and qualifications.

4. Reforming Intergovernmental Fiscal Relations

• Address the financial arrears in local governments.
• Reduce reliance on utility service surcharges as a revenue source.
• Focus on rationalizing local expenditures, especially for general administration and wages.
• Strengthen institutional restructuring to reduce overlap and duplication.
• Improve policy coordination and ensure a comprehensive state apparatus is in place to deliver public services.

Conclusion

The PA's fiscal and administrative challenges are deeply rooted in both structural and political factors. While donor support has played a critical role in sustaining the economy and public services, the long-term goal is to achieve fiscal independence and administrative efficiency. The review emphasizes the need for coordinated efforts among all stakeholders to implement reforms in PFM, civil service, and intergovernmental fiscal relations. The reduction of government employment and wages, along with improved internal incentives, is central to achieving these goals. The restoration of the CTA and the establishment of a sustainable fiscal configuration are seen as top priorities.

Key Takeaways

• The PA's fiscal crisis is a result of revenue collapse and uncontrolled public employment.
• Donor dependency has increased due to the suspension of clearance revenues.
• PFM reforms have improved transparency and corruption control, but are now at risk.
• Civil service reform is critical for reducing the wage bill and improving governance.
• Local government faces challenges in financial sustainability and service delivery.
• Institutional restructuring and rationalization are necessary to improve efficiency and reduce overlap.