2010年-世界发展银行全球_Uganda_-_Agriculture_Public_Expenditure_Review_102页_809kb

Uganda Agriculture Public Expenditure Review Summary

Core Content

This report, titled Report No. 53704-UG, is an Agriculture Public Expenditure Review (AgPER) conducted in Uganda, focusing on the efficiency and effectiveness of agricultural sector expenditures. It is part of a larger annual Public Expenditure Review (PER) by the Government of Uganda (GoU) and the World Bank, and aligns with the New Partnership for Africa's Development (NEPAD) and the Comprehensive Africa Agriculture Development Programme (CAADP), which require countries to allocate 10% of their national budget to agriculture.

The review includes a comprehensive analysis of the agricultural sector budget, which encompasses various agencies such as the Ministry of Agriculture, Animal Industry, and Fisheries (MAAIF), the National Agricultural Research Organization (NARO), National Agricultural Advisory Services (NAADS), Uganda Coffee Development Authority (UCDA), Uganda Cotton Development Organization (UCDO), and district agricultural extension staff.

Main Points and Key Information

1. Trends in Agricultural Sector Expenditure

• Two distinct phases in agricultural sector expenditure from 2001/02 to 2008/09:
  • Phase 1 (2001/02–2003/04): The budget fell sharply in both nominal and real terms.
  • Phase 2 (2004/05–2008/09): It began to recover, with cumulative growth of 46% in nominal terms by 2008/09.
• Real terms growth was 38% from 2004/05 to 2008/09, but remained similar to 2001/02 levels.
• The agricultural budget share of the national budget dropped from 5.7% in 2001/02 to 3.8% in 2008/09.
• The agricultural budget as a share of GDP remained stable at 1.6%, though released budget was 10% lower than approved, reducing the share to 1.2%.
• The agricultural sector budget is not much larger under the COFOG classification, which measures the share of agricultural spending in GDP.

2. Public Expenditure and Competitiveness

• Uganda's agricultural spending is lower than many other countries, especially middle- and high-income ones.
• The share of agriculture budget in GDP is 1.5%, while the adjusted share (considering the size of the sector) is 0.05%.
• International comparison (Table E1) shows that Uganda spends less than most Sub-Saharan African countries, but similar to others.
• Despite lower public spending, Uganda's agricultural competitiveness is not necessarily compromised, as seen in countries like Brazil, Australia, and New Zealand.

3. Conditions for Maximizing Impact of Public Spending

• Three conditions are necessary for maximizing the impact of public spending on agriculture:
  1. Few price distortions in agricultural markets.
  2. Efficient allocation of resources (allocative efficiency).
  3. High technical efficiency in the delivery of agricultural services.

4. Agricultural Price Distortions

• Agricultural price distortions have been largely eliminated, with most farm-gate prices at reference border prices adjusted for marketing costs.
• The rate of assistance to agriculture in 2001–2004 was 1%, with no taxation on exportables and 13% support on importables like rice.
• The nonagricultural rate of assistance has declined, reducing input prices and stimulating resource flows to agriculture.
• The policy environment is conducive for public expenditure to have a lasting impact.

5. Allocative Efficiency of Public Expenditure

• Allocative efficiency is low, as the sector budget is heavily skewed towards nonwage recurrent expenditures.
• Development expenditure makes up 80% of the agriculture budget, but is mainly directed at nonwage recurrent expenditures (e.g., inputs) rather than capital expenditures.
• Capital expenditure was 6% of the 2008/09 approved budget, down from 11% in 2005/06.
• Capital expenditure share in MAAIF’s budget was 22% in 2008/09, which is lower than the development budget.
• Low capital expenditure has negative implications for rural infrastructure, which affects agricultural trade, farm diversification, and poverty reduction.
• Input distribution is supply-driven, favoring wealthier farmers, and fails to meet the criteria of smart subsidies.
• As subsidized inputs increase, so will fiscal burden, economic distortions, and displacement of private sector input sales.

6. Technical Efficiency

• Technical efficiency is low, as the mechanism for delivering inputs is not well-targeted and does not strengthen private input suppliers.
• Operating costs for MAAIF Headquarters are 35% of the total recurrent budget, higher than other departments.
• This high ratio is due to higher wages for senior staff, transport costs, and general services.
• Technical departments (e.g., pest and disease control) face severe constraints on operating funds, which undermines their effectiveness.

7. Budget Process and Performance

• The budget preparation process is well-established, with clear procedures.
• Budget execution has been inconsistent, with released budgets often lower than approved.
• Budget performance monitoring is inefficient, and there is a need for improved tracking and evaluation.
• The budget process is critical for maximizing the impact of scarce resources.
• Collaboration with local governments is increasingly important for implementing agricultural programs.

8. Policy Recommendations

• The agricultural sector budget needs to be better aligned with GoU priorities.
• Public expenditure management system should be strengthened to maximize the effectiveness of scarce resources.
• Collaboration with local governments should be improved.
• Capital expenditure needs to be increased, especially for rural infrastructure.
• Input distribution should be reformed to be more targeted, support private suppliers, and ensure better access for small-scale farmers.
• Fiscal burden and economic distortions must be monitored to prevent waste and leakages.
• Technical efficiency in public services should be improved, especially for technical departments.
• Smart subsidies should be implemented to support market-oriented agricultural development.
• Off-budget spending by donors is significant, but fragmented and difficult to track.
• NGO expenditures are also significant, but pose coordination challenges.

9. Key Findings

• Agricultural sector expenditure is expected to decline in the future, as per the Medium-Term Expenditure Framework.
• By 2012/13, the agricultural budget is expected to be 3.2% of the national budget, down from 3.8% in 2008/09.
• Resources will be shifted to infrastructure and social development, which can have indirect benefits for agriculture.
• NAADS is increasingly responsible for input distribution and technical support, but the current model is inefficient.
• Technical departments are underfunded and inefficient, which hampers agricultural development.
• Public expenditure tracking and evaluation are needed to improve the quality of service delivery and resource allocation.

Conclusion

The AgPER highlights the need for improved efficiency and effectiveness in Uganda’s agricultural sector expenditure. Despite some progress in reducing price distortions, the sector budget remains low, and funding is not well-targeted. Technical and allocative inefficiencies are significant challenges, and improvements are necessary to enhance the impact of public spending on agricultural development. The report calls for reforms in input distribution, capital investment, and budget processes to ensure better outcomes for agricultural growth and poverty reduction.