Programme-Based Budgeting in

Kenya: Past challenges and way

forward for 2015/16
Vivian Magero
Jason Lakin, Ph.D.

Background
National government shifted from line-item to program-based
budgeting in 2013/14 (following international best practice and
PFM Act)
First year was challenging.but in 2014/15, Kenya made big
improvements in its PBB presentation.
Still a number of challenges
Question: have we built on successes and addressed
challenges of 2014/15 in 2015/16?

What is a PBB?
Budget organized around a set of programs
What is a program? A group of government
activities that help to achieve a common objective
Example: Crime Prevention Program
Objective of CPP: "Reduced crime and greater
security of persons and property
CPP might then include various activities related
to policing, security cameras, etc. requiring both
recurrent and capital, staff, etc.

A good PBB
Focuses on outputs and service delivery objectives of
spending, not inputs.
Has substantive narrative link between inputs and outputs
and explanation of changing priorities
Is arranged around a set of programs with clear and
specific objectives, not just administrative units
Is usually broken down further into subprograms to provide
clearer information about activities and objectives
Program performance measured through clear indicators
and targets with credible baselines and timelines.

Has Kenyas PBB improved budget

presentation and transparency?

Kenyas 2012/13 Line item budget

Focused on inputs only, like fuel and stationery
Limited or no narrative explanation and link
between inputs and outputs
Ministries defined by administrative units, no
programs or subprograms
No measures of performance (indicators and
targets)

Kenyas 2013/14 PBB

Eliminated certain information e.g. wage information,
key personnel and job groups
Inadequate narrative information on programs,
unclear links between narrative and budget figures
Limited number of programs, no subprograms and
unclear objectives
Some indicators and targets lacked actual figures,
had no clear timelines or baselines
Difficult to understand how public money used to
generate things we care about

Kenyas 2014/15 PBB: Major Improvements

Revised PBB format, rectified a number of
flaws.
Substantive narrative information available in
many areas
Increased number of programs with somewhat
clearer objectives
Introduction of subprograms, broken down further
into economic classification
Improved presentation of indicators and targets
Additional documents available to clarify PBB

Despite achievements, 2014/15 PBB lacked:

Narrative clearly linking priorities and budget allocations
Clear and distinct program objectives (program objectives overlap)
Clear/sensible targets and baselines (e.g. % of facility based
maternal deaths had a target of 100%)
Clear economic classifications (e.g. use of other development for
major spending)
Information on key personnel and costs that was available in old
format
Any information on Appropriations in Aid (eliminated completely
information on external funding)

Kenyas 2015/16 PBB: Overview

On balance: minor improvements, but lack of explanation
for changes leads to confusion
Reorganization of programs and subprograms, leading to more
logical presentation but confusion about changing allocations
Reorganization of indicators and targets leading to improved
focus, but also confusion as certain indicators have
disappeared without explanation
So.some challenges to be able to compare with last years
budget

2015/16 PBB: Overview Continued

Improvement in comparability over time with inclusion of
column for 2014/15 approved budget
Narrative is similar to 2014/15; weak connection to budget
numbers
Program objectives have improved, but still challenges
Indicators and targets are improved, but still lack baselines
that allow us to track if money=improving services
Vague economic classifications still major share of spending
Information on wage costs and Appropriations in Aid still
missing

2014/15 vs 2015/16 PBB in Detail

Narrative information
Programs with clear objectives
Indicators/targets
Subprograms and further disaggregation
Information on key personnel and costs
Appropriation in Aid (AiA)

Narrative Information

Narrative Link to Allocations? 2014/15

Narrative links to allocations 2015/16?

Narrative challenges continue

There is no real explanation of changes in emphasis at
program/subprogram level from year to year (why
some programs receive larger share than others?)
For example, big change in health sector in 2015/16 is
increase in funding for Health Policy subprogram, but
not mentioned
How do proposed initiatives and allocations for the year
respond to challenges mentioned each year?

Programs with clear and distinct

objectives

Programs and objectives, 2014/15 and 2015/16

Curative health services program 2015/16

Indicators, targets and timelines

Indicators/targets and timelines

Indicators still have no baselines
Some of the indicators/targets that did not make sense
dropped. E.g. % maternal facility deaths with target of 100%
But some targets still at odds with other government figures
In 2014/15 budget, % births conducted by skilled attendant
target 44%, but this was below what was already achieved as
per other government figures (66% in-facility births)
In 2015/16, same issue with Average Length of Stay target at
Kenyatta National Hospital: target for 2015/16 is 10.7 Days but
sector report says have already achieved this in 2014/15

Key Performance Indicators

2014/15

2015/16

From 2014/15 (Above) to 2015/16 (Below) we have lost two indicators

Clear subprograms and further

disaggregation of allocations

Do subprograms have clear objectives?

SPs are meant to be further breakdown of
programs, so they are meant to align with the
objectives of the larger program
Neither 2014/15 nor 2015/16 have clear
subprogram objectives
Many subprograms are not clear, and are not
clearly aligned with the program objectives

Program: General Administration, Planning &

Support Services
2014/15 objective: To improve service delivery and provide
supportive function to government agencies under the health
sector.
2015/16 objective: To strengthen Leadership, Management,
Planning & Financing of the health sector

In both years, these program have a subprogram

Health Policy, Planning and Financing.
What does this SP do to contribute to admin and
planning?

2014/15

Subprogram: Health Policy, Planning and Financing

2015/16

Does the economic breakdown help?

Information on personnel costs

Still no information about staff, job group, wages
or benefits of staff by ministry in 2014/15 or 15/16
This information was present in 2012/13 line item
budget as shown in the next slide
No breakdown beyond compensation to
employees at program/subprogram level

2012/13 Line Item Budget

Generic economic classification

Appropriation in Aid (AiA)

AiA includes donor funding and some local funds raised
by ministries on their own (user fees, etc.)
In 2012/13, extensive information was provided for each
ministry, administrative unit on the source, type of donor
etc.
In 2013/14, information on AIA was provided by program
with medium term projections but no breakdown by local
v. external, source, or purpose
2014/15 PBB eliminated this information altogether
Same in 2015/16 PBB

ARE THERE GOOD EXAMPLES

FROM COUNTIES IN 2014/15?

Consider same aspects of the budget

but also project breakdown

Narrative quality
Program Clarity and distinctness
Indicators and targets
SP Clarity and further disaggregation
Staff information
AIA
Project information to ward level

Narrative: West Pokot example

Homa Bay

Bungoma: Project breakdown

Some challenges at county level in

2014/15
Many of same challenges as national level, but more severe
Lack of summary tables in many budgets
Weak connection between priorities in narrative and budget numbers
Limited breakdown of economic classification
Programs have unclear objectives, and lack of clear subprograms makes
it difficult to understand what they do and how they do it
Main staff costs are improperly classified under administration
Indicators and targets are extremely weak, incoherent or simply nonexistent

2015/16 County Budgets: Improving?

We have looked so far at:
Nyeri
Taita Taveta
Elgeyo Marakwet
Lamu
Nairobi
There are successes and cross cutting issues in
these budgets

Good practices in 2015/16 County PBBs

Summary table at the program level (Lamu, Taita
Taveta and Elgeyo Marakwet)
Summary table at both the program and subprogram
level (Elgeyo Marakwet)
Most indicators and targets improved from last year,
but still lack baselines
Budget broken down into items under programs;
combining line item and program provides additional
information that is useful (Lamu)

Cross cutting issues in 2015/16 County

PBBs

Narrative is not linked to program allocations or does

not explain trends adequately (all counties)
Subprograms lack or have no objectives (All
counties)
Staff put under the Administration program rather
than service delivery programs (All counties)
No staff breakdown apart from Nyeri county
Indicators lack baselines, while some lack targets
(Taita Taveta)

Recommendations
Major programs should be broken down into subprograms, with sufficient detail provided to
understand their distinct objectives
Narrative details should be improved, particularly
to ensure clear link with allocations at
program/subprogram level
All indicators should be clearly linked to a specific
program and to specific program objectives, with
baselines and clear and realistic targets

Recommendations
If there is a shift in programs or subprograms that
would affect the indicators and targets over the years,
explanation should be provided for the shift.
Information on the breakdown of employees should be
restored to the budget as per the 2012/13 budget
The economic classification could be further broken
down for all categories
Reduce the use of other recurrent and other
development for major spending

Thank you