2013年-世界发展银行全球_Pakistan_-_Khyber_Pakhtunkhwa___Public_Expenditure_Review_138页_4mb

Summary of Pakistan - Khyber Pakhtunkhwa Public Expenditure Review (PER) 2012

Core Content

This report provides a comprehensive analysis of the fiscal policy, performance, and expenditure trends in Khyber Pakhtunkhwa (KP), Pakistan, with a specific focus on the education and health sectors. It was prepared in collaboration with the Government of KP and supported by the World Bank and the Multi-Donor Trust Fund (MDTF). The report outlines the challenges and opportunities for improving public financial management (PFM) and public expenditure management (PEM) in the province.

Main Objectives

• To assess the overall fiscal and financial management system of KP.
• To evaluate the efficiency and adequacy of expenditure on education and health.
• To recommend reforms that could enhance fiscal sustainability and public service delivery.
• To highlight the need for strengthening PFM and PEM systems to support development goals.

Key Points

Fiscal Policy and Performance

• KP is one of the least-developed and crisis-prone provinces in Pakistan, with a significant portion of its population living in rural areas and facing challenges such as low literacy, poor access to tap water, and high unemployment.
• The province has seen notable improvements in its fiscal situation over the past two years, primarily due to increased federal revenue transfers, including arrears payments from hydro-electric profits and a new NFC Award.
• KP's share of federal revenue increased from approximately 7-8% of PGDP to 11.3% in 2010-11, leading to a fiscal surplus of 0.7% of PGDP.
• Despite these improvements, there is still a need for further fiscal space to support development. The province's reliance on federal transfers remains high, with less than 2.1% of expenditures coming from provincial revenues.
• Structural rigidities in pay and pensions have constrained the ability to increase operational and maintenance spending, which is essential for infrastructure upkeep.

Reforms and Initiatives

• KP has initiated several reforms with the support of DFID, including the implementation of an output-based Medium Term Budget Framework (MTBF), District Output-Based Budgeting (OBB), and the Integrated Public Financial Management Reforms Strategy.
• These reforms aim to improve the link between strategy, planning, and budgeting, as well as to enhance fiscal decentralization and accountability mechanisms.
• The report emphasizes the importance of addressing knowledge and capacity gaps to further accelerate the reform process and improve the efficiency of public expenditure.

Education Sector

• Progress in education-related indicators has stagnated, with net enrollment rates (NER) for 6-10 year olds rising from 51% to 64% but remaining stable since 2010.
• Education expenditure in KP has grown at double-digit rates over the last decade, with development expenditure increasing faster than recurrent.
• The proportion of current budget allocated to education is around 26%, slightly less than Punjab but more than Sindh.
• Despite increased allocations, the number of teachers and facilities per school remains inadequate, especially at the primary level.
• Private sector involvement in education is relatively small but significant, concentrated in a few districts.
• Conflict and natural disasters, such as the 2010 floods, have disrupted education services, leading to budget reallocations for recovery.

Health Sector

• KP faces significant health challenges, including high infant and maternal mortality rates, poor health service utilization, and low per capita health expenditure.
• Health spending in KP is below the national average, and the sector is heavily reliant on federal transfers and international aid.
• The LHW (Lady Health Worker) program has shown some positive performance, but there are disparities in access to health services across income quintiles.
• The report highlights the need for increasing health expenditure, especially for public health services, and improving the quality of care and service delivery.

Key Recommendations

• Enhance revenue collection by rationalizing and deepening the tax structure, reducing tax exemptions, and implementing a single income tax.
• Strengthen tax administration and improve the efficiency of public expenditure management.
• Focus on maintaining physical infrastructure through increased operation and maintenance spending.
• Ensure predictability of funds by timely release of resources and avoiding thin spreading of budgets.
• Improve the link between inputs and outputs in the budgeting process to enhance service delivery.
• Address knowledge and capacity gaps to support the implementation of reforms.
• Reallocate resources to ensure more equitable distribution and better service delivery in primary education.

Conclusion

The report underscores the importance of continued reform efforts and the need for a more integrated and efficient public expenditure management system in KP. While there have been some positive developments, challenges remain in terms of fiscal sustainability, service delivery, and addressing the underlying structural issues in public financial systems. The support of donors and the collaboration with the provincial government are crucial for the successful implementation of these reforms.