The challenges confronting the new Ministry of Monitoring and Evaluation

Written by Derek Powell Saturday, 30 May 2009 11:07

The first issue is to clarify the Ministry’s role in relation to the budgeting and planning activities of national departments. Three roles are possible. The Ministry could get involved in determining departmental budgets, or in shaping their strategic spending plans, or it can sit above these processes and provide ex-post fact reports on performance to cabinet. It should do all three. And its role and powers should be clearly and formally spelled out, sanctioned by cabinet and built into budget and reporting processes. Any uncertainty about its function will undermine its mandate, and should be removed quickly.

The budget is a hard constraint on planning, meaning that departments must fit their plans to a finite resource envelope. The budget is locked in several months before departments do their plans for the next financial year. During budget processes department bids far exceed the funds available. The National Treasury plays a crucial role in tailoring budgets to Government’s policy priorities, ensuring that public expenditures are affordable, and detecting budget gaming. These processes could be adapted to provide a larger footprint for the new Ministry.          

Departments present their annual strategic plans to cabinet as part of their cluster (i.e. in the aggregate) before those plans are tabled in Parliament, sometime after the start of the financial year. As far as I am aware, Directors-General are not required to defend their strategic plans to cabinet – individually. This is a gap. Discrepancies between the outputs in the budget vote and in strategic plans are common, a problem often singled out in audit reports. Directors-General should be required to defend their annual plans to a special cabinet committee chaired by the new Minister before they are tabled in Parliament. A department that has received a qualified audit for two consecutive years should also have to submit practical turnaround strategies that are closely monitored by the Ministry.

The second issue is clarifying its role in relation to provincial and local governments. This introduces an intergovernmental dimension to its work. National government has the constitutional authority and duty to oversee the other two spheres of government, but not an unfettered right to demand reports from them, because provinces and municipalities are not departments under national control but elected governments in their own right. Oversight and reporting procedures are in place, and the Ministry’s role should be built into these. To remove any uncertainty, its intergovernmental oversight role should be set out in a formal protocol and endorsed by the President’s Coordinating Council.

Thirdly, streamline and more efficient reporting systems are needed. Although public finance legislation intended to streamline in-year and end-year reporting, in reality there are multiple layers of reporting, with processes often running in parallel, or duplicating each other. An ineffective reporting system increases opportunity and transaction costs, because it diverts managers and resources away from management and service delivery to compliance tasks. One study estimated that provincial and local governments must comply with several thousand line items of financial and non-financial reporting from just five national departments. There are also few incentives for provinces and municipalities to report in detail on specific matters, in the hope that they will have an impact on national policy, if those specificities are subsumed into aggregate cluster reports. The entire reporting system should be reviewed, and incrementally streamlined and formalized.

Fourthly, monitoring and evaluation is only as good as the statistical data coming into the system. There are some large discrepancies in the data. Many reports are not linked to reporting accountabilities and some come in through third parties, even consultants. A recent National Treasury study also shows how difficult it is to assess impact when data are poor. National government is also far upstream. Consequently, national reports focus on aggregate performance and are ex-post facto. What is needed in addition is a red-flag system that will allow the Ministry to detect problems before they become failures. Each public institution should be graded according to functional criteria, and those that are in a persistent state of distress placed under some form of heightened scrutiny. A permanent forensic body should also be created to track the money.

Finally, M&E must improve public accountability to the citizen. The tendency is for M&E to focus on reporting upwards in government, which in turn becomes compliance-driven. The Ministry must ensure that at every level accountability to the citizen is strengthened. It could consider involving civil society in monitoring government, and conducting its own citizen satisfaction surveys.