2010年-世界发展银行全球_Addis_Ababa_City___Public_Expenditure_Review_34页_667kb

Addis Ababa City Public Expenditure Review Summary (July 2010)

Core Content

This report provides an overview of the fiscal and budgetary management system of Addis Ababa City, focusing on the decentralization process, expenditure and revenue trends, and service delivery outcomes in key sectors such as education, health, road infrastructure, and housing development.

Main Objectives

• To review institutional arrangements for managing public finances
• To assess the level, trend, and composition of public revenue, spending, and financing
• To evaluate the planning and budgeting process
• To examine service delivery outcomes in selected sectors

Key Findings

Fiscal Devolution

• Addis Ababa has achieved significant decentralization since 2003, with sub-cities and Kebeles playing a role in service delivery.
• The city has fiscal autonomy, including the ability to collect taxes and non-tax revenues, and does not receive federal aid or participate in financial equalization schemes.
• Sub-cities receive allocations from the city budget and are free to use funds for their priorities, but they are still largely influenced by city-level decisions.
• The practice of fiscal devolution is supported by the city charter and federal laws, with the city council authorizing transfers of authority to sub-cities and Kebeles.

Revenue and Expenditure Trends

• Revenue collection in Addis Ababa has grown at an annual average rate of 21% from 2004/05 to 2008/09, but it remains below the level of economic activity.
• The city has faced significant budget deficits, especially in 2007/08 and 2008/09, which were financed by issuing bonds amounting to birr 1 billion.
• Nominal expenditure has grown faster than revenue, with capital expenditure increasing by an average of 2.3 times more than current expenditure.
• Per capita total expenditure has increased from 714.3 birr in 2004/05 to 2,165.1 birr in 2008/09, with capital expenditure being the largest component.
• Addis Ababa has the highest per capita spending and capital expenditure share among all regional states, with capital expenditure accounting for 74% of total spending in 2008/09.

Expenditure Structure

Pro-Poor Expenditure

• Pro-poor expenditure, including housing development, has increased significantly over the period.
• However, the share of pro-poor spending in education and health has declined, with public health receiving only about 3% of total spending in 2008/09.
• This is less than one third of the average share in other regional states, leading to weak service delivery in the health sector.
• Education and health services are largely underfunded in capital expenditure, despite being strategic priorities.

Service Delivery Outcomes

• Education: There has been a significant increase in the number of government schools and students at the secondary level, but primary and junior schools have shown less improvement. Residents prefer non-government schools for better quality.
• Health: Public health services remain weak, with little improvement over the five years. Kebeles do not play an active role in health service delivery, which is managed by sub-cities.
• Road Infrastructure: There has been a substantial increase in road length from 2,200 km in 2004/05 to 2,814 km in 2008/09. Quality and coverage have improved.
• Housing Development: The city has constructed about 77,991 condominium houses, with over 60% allocated to women. However, housing remains a challenge for all income groups, and the targeting of benefits to the poor is not always effective.

Challenges

• Capacity Gaps: Kebeles lack the capacity to fully exercise decentralized service provision, while sub-cities have stronger capacity.
• Budget Deviation: Revenue outturns are often lower than budgeted, leading to high expenditure deviation and delays in project implementation.
• Financial Sustainability: Despite high capital expenditure, the city's revenue is not sufficient to meet its expenditure needs, resulting in continuous budget deficits.
• Service Delivery Inequality: While road and housing development have seen positive outcomes, education and health services have not kept pace with the city's strategic priorities.
• Participation and Transparency: Although participation is encouraged at the sub-city and Kebele levels, it is not fully realized. Transparency in the budget process is also limited.

Institutional Context

• The city is divided into state functions and municipal functions.
• State functions are managed by specialized bureaus such as Education, Health, and Finance, while municipal functions are handled by the Mayor and city managers.
• The city has an Integrated Budget and Expenditure (IBEX) system that links different administrative levels, with support from BoFED for sub-city planning and capacity building.

Conclusion

The city has made progress in decentralization, but capacity challenges persist, especially at the Kebele level. While major infrastructure projects like road and housing development have shown positive outcomes, education and health services remain underfunded and underdeveloped. The city's expenditure pattern reflects its strategic priorities, but the lack of alignment between revenue and expenditure, along with limited community participation, continues to pose significant challenges.