HomeAnalysisBreaking the transparency ceiling in national policies

Breaking the transparency ceiling in national policies

Tendai Jaravaza
The African continent is shouldering massive amounts of crippling debt of about USD700 billion, with a sizable number falling short of the lower income and lower middle-income status due to these debt burdens.

Zimbabwe’s current debt status staggers at USD17 billion and faces a deeper fall as a result of financing required to ameliorate effects of the Covid-19 pandemic and climate shocks.

One of the major fragilities affecting the country stems from lack of transparency in Public Finance Management (PFM). Notable policy and process weaknesses and insufficient allocation of public funds towards social protection and gender sensitive programs rank high among impacts of the transparency ceiling in PFM.

The issue of Public Finance mismanagement has been  rampant in Africa where countries like South Africa have made deliberate efforts to evolve from exclusive and centralised public finance processes and systems to  participative approaches that demand accountability and transparency as required by the new constitution.

In Tanzania, similar reforms in PFM have resulted in administrative, fiscal and political decentralisation albeit the government’s policy on social services like free primary and lower secondary education may prove unserviceable due to insufficient public funds.

The PFM bill of 2021 is currently being considered by parliament to address its disconnection from the Constitution’s guidelines. The PFM framework in Zimbabwe premised under the PFM Act Chapter 22:19 has been displaced from the Constitution’s guidelines which sets prudent principles of PFM such as transparency and accountability, national development orientation, equal sharing of public expenditures and resources, efficient distribution of public funds, clear fiscal reporting, and transparent public borrowing.

These principles were not stipulated in the PFM Act which implies that the regulation carried limited liability to insubordination. The Act also lacked provision of administrative and institutional frameworks that can be used by Parliamentarians in their oversight role on PFM.

These weaknesses coupled with other incoherencies such as opaque public borrowing transactions, unfair distribution of revenues to provincial and local authorities, and limited advisory powers of the Finance Minister, and unaddressed illicit financial flows, paralyse the overall effectiveness of Public Finance Management in the country.

Prudent policy design, execution and evaluation requires the participation of civil society organisations and academic research bodies, however, incidences such as the gazetted November 2021 Private Voluntary Organisations (PVO) Bill amendments raises concern over the restrictive nature of the Bill towards Civil Society participation in advocating and influencing progressive rights based policies.

Lack of transparency is demonstrated in the Auditor General’s report presented to the parliament this year which shows public funds unauthorised excess spending of ZWL100 billion dollars and demonstrates parliamentary and public oversight defects on transparent use of public funds.

The global agenda on the cross-feeding between PFM and social protection is an important catalyst for achieving the 2030 Agenda for sustainable development. However, weak fiscal policies, fiscal deficit and lack of transparency and accountability in budget formulation and execution have been sources of weak social protection budgets, policies and prioritisation.

Countries in Africa are facing insurmountable debt stocks and struggle to execute their set social protection programs.

Countries such as Nigeria, Zambia and Zimbabwe spend less than 5% of the GDP on health care with Zimbabwe being ranked at the 155th position out of 191 on quality health care.

With the country estimated to be losing around USD3 billion  each year to illicit financial flows, it goes without mention how significantly the health sector is being affected as only 12,7% of the total budget is expended on the health sector. This is still less than the 15% required in the Abuja Declaration .

Actual spending on health care is often less than what is budgeted for and this exacerbates the implications of current insufficient funding towards providing health facilities especially in the rural areas.

While this contravenes the PFM legislation, there is no communication of the lack of transparency and accountability on this paradox. Moreover, provision of clean water in both urban and rural areas in Zimbabwe has also been negatively affected by the lack of transparency and accountability on water resources and sanitation policies and institutional frameworks as well as mismanaged public finance directed towards this sector.

This subsequently places a greater toll on the health sector due to increased incidences of waterborne diseases at a time where the country faces limited capacity on medication, health care infrastructure and brain drain (doctors and nurses migrating to other countries).

The education sector is another area of concern where the government spends less than 5% of its GDP, most of which is spent on employment costs.

This relatively low rate, compared to countries like Botswana which spends close to 10% of its GDP, as well as other challenges within the sector such as the fragile economic status of the country and poverty leads to an increase in migration of teaching staff, higher rates of school dropouts and early child marriages.

The lack of transparency and accountability on how government funds are sourced and managed results in important sectors taking least priority on national budgets.

There has been growing concern over disparities between African governments backing gender equality while providing insufficient funding towards relevant sectors.

Countries such as Rwanda and Uganda have experienced noticeable headway in formulating gender-oriented budgeting. This has subsequently resulted in an increase in the rates of access to education, healthcare facilities and employment/ entrepreneurship in the 2000s.

The government of Zimbabwe’s initial adoption of gender budgeting was in 2007 which draws its guidance from the National Gender Policy.

Zimbabwe’s current gender responsive budgeting, with reference to the country’s Gender Inequality Index, indicates a low status of public finance channelling to gender sensitive programs and projects in various sectors. As a result, corrective measures to implement and thrust ahead the gender mainstreaming agenda, an estimated 65% of the total country’s budget will be directed toward gender sensitive programs and projects.

However, with corruption and inflation counter attacking this progress the realisation of effective gender-oriented budgeting may be overcome by debt repayment obligations and spiralling illicit financial flows, both of which are exacerbated by lack of transparency during loans contractions and resources mobilisation.

Strengthening transparency and accountability of public finance requires strict implementation of adherence to fiscal policy, process and reporting. The government’s support to parliament’s role in fiscal policy and budgets formulation as well as budgetary processes, if strengthened, ameliorates opaque public finance management.

Budget performance reports should be made public and open to scrutinisation by academia, CSOs, and the general public. Information should be easily accessible.

Measurable progress should be achieved in addressing issues noted in the Auditor General’s findings report as they affect effective governance and subsequently transparency of public finance management.

Government ministries, agencies and commissions should be capacitated to advocate, influence and ensure that budgeting principles and annual allocations are gender responsive.

Breaking the transparency ceiling in PFM is an inclusive process which requires full participation from all stakeholders. An inclusive approach allows transparency in acknowledging and addressing PFM policy weaknesses while strengthening legislative and oversight roles of parliament as well as achieving progressive measures on dealing with PFM defects noted in audit reports. Citizens’ participation in the PFM cycle will enable transparency on allocation of public funds to social protection and gender sensitive programs and projects.

  • Jaravaza writes in her personal capacity. Her interests are in sustainable entrepreneurship and socio-economic development. These weekly New Horizon articles published in the Zimbabwe Independent are coordinated by Lovemore Kadenge, an independent consultant, past president of the Zimbabwe Economics Society (ZES) and past president of the Chartered Governance & Accountancy Institute in Zimbabwe (CGI Zimbabwe). — kadenge.zes@gmail.com and mobile No. +263 772 382 852.

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