Eradicating poverty

Courtesy : www.imf.org/

The revision of the PEAP in 2000 draws on the progress made since 1997, including the development of sector-wide approaches, the participatory research carried out by the Uganda Participatory Poverty Assessment Project (UPPAP), the constraints identified in the Poverty Status Report, and the development of costings of public actions and monitorable indicators in key, poverty-oriented sectors. It will also place a greater emphasis than the 1997 document on the actions which promote private sector development and therefore contribute indirectly to poverty-reduction. The revised PEAP is Uganda’s Comprehensive Development Framework.Uganda’s planning framework

There have been a number of initiatives to strengthen the planning process in recent years. This includes major consultative exercises concerning Uganda’s long term goals and objectives, such as Vision 2025, describing national aspirations, and the 1997 Poverty Eradication Action Plan as a national planning framework to guide detailed medium term sector plans, district plans, and the budget process. In turn, detailed sector-wide plans and investment programmes have reached varying stages of completion, set within an overall medium term expenditure framework. A programme of strengthening district capacity to prepare medium term expenditure frameworks is also underway.

The modern approach to planning involves ensuring that the right framework has been established to enable effective programming, implementation and monitoring. Chart 1 describes the flows and relationships between different plan/policy processes in Uganda. The most important point to note is that these elements interact in an ongoing process. Uganda’s over-arching national planning document is the Poverty Eradication Action Plan, signalling poverty eradication as the fundamental goal of the Government. Chart 1 shows the relations between the PEAP and other plans. The PEAP is not a blueprint for sector activities. It provides a framework for the development of detailed sector plans and investment programmes. Implementation of the PEAP demands sector-wide programming to determine sector objectives, outputs and outcomes expected from sector expenditures, and the activities which the expenditures will fund in order to achieve the desired outputs and outcomes.

Thus the 1997 PEAP has guided the preparation of detailed sector plans. Capacity constraints within line ministries, which have been a serious limitation in sector planning, are being overcome by support from our donor and NGO communities in a spirit of partnership and teamwork. In recent years, major advances have been recorded in production of the Ten Year Road Sector Development Programme, the Education Strategic Investment Plan and the Health Sector Plan, and the Plan for the Modernisation of Agriculture. Also underway are plans for the energy sector and the justice sector. Eventually all sectors will be covered by up-to-date, resource constrained sector plans and investment programmes which focus on achieving the goals of the PEAP.

In turn, the PEAP and the sector plans set the framework for preparation of district plans (although these are still at an early stage of development). Under Uganda’s decentralised system of governance, the local authorities are responsible for determining the implementation plan for sector programmes based on local priorities. Involvement of communities in the planning framework is also being strengthened. Under the Uganda Participatory Poverty Assessment Project (UPPAP), the second phase will include dissemination of the perspectives of the poor in order to help guide policy at both national and district levels, and there will be further work in nine pilot districts to enhance community-level participatory planning and monitoring capacities.

It is important to note that the relationship between both the PEAP and sector plans, and between sector and district plans, and between district and lower local council plans, is an iterative one. The PEAP sets the framework for other plans, but is also a product of those plans. For example, the current PEAP revision reflects the policy statements made in various sector plans, and tries to balance the sector objectives within a national framework. In turn, revisions of sector plans should take note of national priorities and constraints as outlined in the PEAP in refining their own sector strategies. The National Planning Authority, according to its mandate in the Constitution, will have the role of ensuring that the different plans are consistent. The same principle applies to the relationship between sector and district plans.

While medium term plans establish a policy framework and desired outputs and outcomes, they are meaningless unless disciplined by hard budget constraints. Therefore another critical element of the planning framework is the medium term expenditure framework (MTEF). Since 1992, MFPED has been developing an MTEF, which is presented to Cabinet as part of the annual “Budget Framework Paper” (BFP), covering three fiscal years.

Preparation of the annual BFP includes detailed discussions with sector working groups each year to monitor performance of current programmes and projects. These discussions identify implementation bottlenecks, inefficiencies in existing operations, and potentially unsustainable imbalances in the size of the recurrent and development programmes. The discussions also take account of any upcoming policy initiatives in order to ensure that all new policies are comprehensively costed to reveal the full extent of their fiscal implications, and in order to propose how the Government’s expenditure programme can be adjusted in light of new policy priorities, both within and between sectors. The important point is that, in the medium term, public resources can be redeployed in accordance with changing strategic priorities; it only requires development of the capacity and willingness to reprioritise spending needs and reallocate expenditures in a disciplined way.

More recently, there have been attempts to broaden the consultation of the BFP process by increased discussion with donors, especially on the sectoral priorities of Government expenditure and on the consistency of Government assumptions regarding external financing with actual donor financing plans. Steps are also being taken to involve civil society in the consultation process. An abbreviated version of the BFP (the version that goes to Cabinet before the expenditure allocations are approved by Cabinet) is published in the annual “Background to the Budget”, and a detailed summary of the composition of expenditure for all sectors for the three year MTEF is published as an appendix table in the Budget Speech document.

In 1999, a start was made on extending the BFP process to the districts, when training workshops were organised for the local Governments. Technical expertise is being provided by the central ministries to help district administrations to prepare their own three year expenditure planning frameworks consistent with resource availability. Government hopes that in due course this capacity can be extended to lower level local councils.

The final element of the planning framework is an assessment of the impact of plans and budgets on civil society and beneficiaries, shown at the bottom of Chart 1 as “civil society”. There are a variety of monitoring techniques, such as technical assessments of project/programme performance, statistical surveys, and more participatory methods to complement the traditional household survey methods such as the Uganda Participatory Poverty Assessment Project, which is attempting to bring the voice of the poor into national, district, and lower level planning. The results of monitoring activities provide feedback at all levels of the planning system.The revision of the PEAP

While the basic principles behind the 1997 PEAP remain valid, there have been significant developments since its preparation both in outcomes—such as the huge increase in educational enrolments—and in the preparation of sectoral plans and the information available about poverty. Hence, to remain relevant, the plan has to be revised. It is envisaged that the revision of the PEAP will be a regular process carried out every two years, drawing on the results of the Poverty Status Report which will also be prepared every two years.

Preparation of the revised PEAP remains a highly participatory process. Government recognises that the planning system does not consist of decision-making by a single institution at the centre. Rather, the system involves the interaction of a number of processes within an overall framework. As such, the process is much more dynamic and responsive to changes in policy priorities and/or resource constraints. The involvement of a much larger number of agencies in the planning process makes it important that planning linkages are clearly specified and understood. Substantial effort is being made to improve the partnership process in Uganda. As mentioned above, participatory approaches have increasingly been adopted both for sector plan preparation and monitoring and appraisal exercises.

In revising the PEAP we have summarised and consolidated the results of previous consultations and research findings. The revised PEAP builds on an ongoing process of consultation. An initial “discussion draft” was circulated to a wide range of stakeholders to stimulate dialogue and debate. Later drafts incorporate the results of this wide consultation. In order to ensure reasonable levels of participation in preparation of the revised PEAP, the editorial team prepared a Participatory Action Plan. This includes consultations at the central government level as well as with local governments, with donors, with Parliamentarians, and with civil society, as well as the development of adequate feedback mechanisms to ensure that all stakeholders have contributed effectively to the drafting process.

General consultative workshops: the revision process includes two major consultative meetings involving wide representation of stakeholders (politicians; ministries; donors; NGOs; private sector; civil society; urban and local authority representatives, media). The objective of these workshops is to review current drafts and to provide detailed comments on policy issues arising from the drafts.

Regional meetings for district officials: MFPED, working with the Ministry of Local Government, has already undertaken some regional work to explain the PEAP, UPPAP findings and budget issues. District officials will be presented with drafts of the revised PEAP at a series of regional workshops. As mentioned above, the CSO Task Force will also be promoting discussion of PEAP related issues within districts and communities.

Donor consultations: in addition to participation in the general consultative workshops, the current draft has been presented at the Donor Consultative Group meetings in March 2000.

Political consultation: In addition to attendance at the general consultative workshops, another meeting for members of all Parliamentary sessional committees was held in February 2000. This will be followed by further briefing sessions for specific sessional committees on issues relevant to their sector.

Feedback mechanisms: It is very important to ensure that there is adequate time for written responses and contributions. Drafts have been widely circulated for the consultative workshops in February and April. There will be active follow-up, especially at the district level, to ensure that written responses are received from every district and sector ministry.

Building on existing consultative processes: Issues raised during the revision process will not only be followed up at the general consultative meetings, but also raised through existing consultative fora (such as the sector working groups for the budget framework process; NGO consultative meetings; and regular donor meetings).

Contents2. National vision and overall goals

Poverty has many dimensions including low and highly variable levels of income and consumption, physical insecurity, poor health, low levels of education, disempowerment, a heavy burden of work or unemployment, and isolation (both social and geographical). Drawing on recent evidence (including household surveys and the Uganda Participatory Poverty Assessment Project), the PEAP highlights the many dimensions of poverty in the Ugandan context. It recognises the importance of increasing income to poor households, and places a high priority on eradicating income poverty. It also views ignorance as a particularly constraining feature of the lives of poor people, and is concerned to improve literacy and educational achievement among the population at large. Health is another central concern for the poor, and the Government has established clear goals for improving the health of Ugandans. It is essential that poor people have an effective voice in the design and implementation of public policy. The objective of the PEAP is to marshal public effort at improving these dimensions of household wellbeing.Reducing absolute income poverty:

Income levels are low in Uganda, and large sections of its population are unable to buy the basic necessities of life—food, clothing, and shelter. Low incomes also lead to poor health and limited education. Consumption poverty levels are high. In 1997, 44 percent of the population was estimated to consume less than what is required to meet the basic needs of life.

Low rates of economic growth, and the effects of civil disorder, are important historical factors causing poverty in Uganda. Incomes are also highly unequally distributed, which reduces the impact of economic growth on poverty reduction. At the level of the household, poverty is related to rural residence (specifically to living in the north or the east), to land shortage, to low levels of education, to being headed by a female widow or by someone old, and to limited access to markets. Unequal sharing of resources within the household reflects not only cultural factors but unequal access to education and physical assets such as land, in which women are disadvantaged. Poverty also reflects society-wide phenomena including insecurity, the quality of public services, the availability of productive employment, macroeconomic stability and the functioning of markets, health information, and the technical information available throughout society.

But there are clear signs of improvement:

• The proportion of Ugandans in consumption poverty fell from 56 percent in 1992 to 44 percent in 1997.
• Average real household consumption rose by 17 percent over the period, and rose in every year (this is confirmed in the national accounts data).
• The expenditures of the bottom 20 percent rose even more: those of the bottom 10 percent rose by 29 percent, and those of the of the next 10 percent by 23 percent over the period.
• A major factor in the reduction of poverty was the benefit farmers gained from the increase in coffee prices, reflecting the combined effect of the boom in world coffee prices and the liberalisation policy, which passed the price increase on to farmers.
• There was no systematic trend in inequality in the 1990s. But although inequality is not definitely getting worse in Uganda, it would be desirable to reduce it.

These data are encouraging: incomes are rising without a significant increase in inequality, and therefore poverty is falling. However, not all groups participated equally in the growth in incomes. Although poverty fell in all regions, average incomes grew faster in the regions which were initially better off. So although overall inequality did not increase, regional inequality increased significantly (Table 2.1).

The income group which benefited most dramatically was cash crop farmers, reflecting the increase in cash crop prices. Poverty in this group fell from 60 percent to 44 percent between 1992 and 1996 (Table 2.2). Income poverty among food crop farmers remained largely unchanged (falling marginally from 64 percent to 62 percent).

Participatory data from the UPPAP indicate that many communities consider that poverty is increasing. This probably reflects two differences from the household survey. First, the participatory assessment was confined to poor, mainly food-producing communities, which gained the least from recent improvements. And the perceptions of poor people covered in the UPPAP were probably based on a broader view of poverty, encompassing more than simply low income.

The Government of Uganda considers that absolute poverty must be eradicated. It has set itself the objective of reducing the headcount of income poverty to 10 percent of the population by 2017.Raising educational achievement of Ugandans

The PEAP aims to raise educational achievement of the Ugandan population, especially among children of poor households. The significance of education is that it increases incomes and economic growth, and it offers an intrinsic benefit in itself. In 1997, the policy of free education for four children in every family was introduced and primary enrolment increased enormously from 2.6 million in 1996 to 6.5 million currently. Almost three million children entered the schooling system and the gross enrolment rate, using school-based data, rose to 128 percent in 1997 and 145 percent in 1999. Participatory evidence clearly shows that this increase is greatly appreciated by poor people.

These data show that the main issue in primary education is no longer increasing quantity, but maintaining quantity while enhancing quality. It is generally agreed that the quality of education in Uganda declined seriously between the mid-1970s and the late 1980s, and the increased enrolment is now straining the system. While the 1998 National Integrity Survey found that 60 percent of parents were satisfied with the quality of their children’s education, the UPPAP investigation found widespread concern with schooling quality among the poor communities contacted. This is borne out by more formal investigations of schooling quality. The heavily burdened primary schooling system cannot meet the immediate demands for classrooms, teachers, and teaching/learning materials.

Educational policy thus faces two central challenges: first, how to keep the increased number of children in school: and secondly, how to ensure that quality is maintained and improved given the expansion in the system.

Enrolment rates in secondary and tertiary education remain low, although they have increased in recent years. Total secondary enrolment rose from 336,022 in 1997 to 427,592 in 1999. The draft strategic plan for secondary education estimates that only 10 percent of the secondary school age population is in school and that only 6 percent of the poorest 25 percent complete secondary education whereas 22 percent of the best-off 25 percent do so. Whereas Uganda is now well ahead of most countries in Africa in primary education, it is behind the others in secondary education. Although current policy will be focussed on achieving sustainable universal primary education, the requirements of a growing modern economy will place increasing emphasis on secondary schooling, and such schooling is certain to figure prominently in future PEAP revisions.

The Government of Uganda has achieved its objective of universal primary education. The challenge it now faces is to encourage children to remain in school, and to acquire relevant skills for adult life. This implies the following objectives:

• Maintain universal primary school enrollment (including poor households)
• Reduce drop out rates and raise completion rates
• Raise the cognitive skills of primary school graduates (as reflected in results from the National Assessment of Progress in Education).