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Ministry of Education

Budget Execution March 28, 2010 As of

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Approved Operating budget and Execution Rate in 1388 (as of 28/03/2010)

Program Budget Expenditrue BalanceBurn-Rate

General Education 13,101,700,104 13,028,328,927 73,371,177 99%Teacher Education 444,319,492 434,268,449 10,051,043 98%Infrastructure 108,205,402 104,822,871 3,382,531 97%Curriculum 127,346,341 126,833,249 513,092 100%Islamic Education 653,087,993 638,252,214 14,835,779 98%TVET 464,780,074 456,778,744 8,001,330 98%Literacy 273,260,675 260,085,046 13,175,629 95%Admin Reform 616,691,809 599,303,136 17,388,673 97%

Total 15,789,391,890 15,648,672,636 140,719,254 99%

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Operating budget expenditure percentage in diagram

Ordinary Budget Burn-Rate (%)

99%

98%

97%

100%

98%98%

95%

97%

99%

92%

93%

94%

95%

96%

97%

98%

99%

100%

Program

Pe

rce

nta

ge

of

Ex

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nd

itu

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Approved Development Budget and Expenditure Rate in 1388 as per decree (as of 16/03/2010)

Program Budget ExpenditureProjection till end of

1388Burn-Rate

General Education 23,139,023$ 12,403,663$ 13,672,710$ 54%Teacher Education 47,120,047$ 10,152,100$ 16,974,278$ 22%Infrastructure 62,793,777$ 34,220,916$ 35,672,367$ 54%Curriculum 19,996,176$ 8,717,628$ 11,104,787$ 44%Islamic Education 3,500,004$ 502,180$ 2,184,456$ 14%TVET 16,644,950$ 5,493,579$ 8,410,682$ 33%Literacy 5,274,887$ 3,169,863$ 4,232,926$ 60%Admin Reform 15,108,669$ 9,476,776$ 8,813,522$ 63%Total 193,577,532$ 84,136,704$ 101,065,729$ 43%

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Approved Development Budget and Expenditure Rate in 1388, as per actual available budget (as of 28/03/2010)

Program Budget Expenditure Burn-Rate

General Education 20,265,002$ 12,403,663$ 61%Teacher Education 15,706,667$ 10,297,645$ 66%Infrastructure 60,437,576$ 34,220,916$ 57%Curriculum 9,396,919$ 8,717,628$ 93%Islamic Education 3,500,000$ 502,180$ 14%TVET 16,329,435$ 6,697,778$ 41%Literacy 5,274,882$ 3,169,863$ 60%Admin Reform 13,029,413$ 9,476,776$ 73%

Total 143,939,893$ 85,486,447$ 59%

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Development budget expenditure percentage in diagram Development Budget Burn-Rate (%)

61%66%

57%

93%

14%

41%

60%

73%

59%

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10%

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30%

40%

50%

60%

70%

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90%

100%

Program

% o

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xp

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Burn-Rate

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Development Budget Execution Rate in the last three years (%)

25%

43%

59%

0%

10%

20%

30%

40%

50%

60%

Bu

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Development Budget Comparative Report (Budget vs Actual) 1386-1388

1386

1387

1388

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Development Budget Execution Rate in the last three years (million dollars)

The nominal amount of budget expenditure in 1388 is 42% more than 1387

30

60

85

0

20

40

60

80

100

Ex

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Development Budget Comparative Report 1386-1388

1386

1387

1388

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Programs request budget for the projects

Proposed budget is processed

Budget is approved

Programs request

allotment based on the contract

Processing the allotment in budget

execution office

Processing the allotment in

AFMIS, Budget and Treasury department

Processing the allotment by

finance department

Processing the allotment in

education sector at MoF

Budget Execution by MoF

Allotment Execution

Process

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Finance Department

Allotment for Advisors and Operating Expenditures

Allotment for constructing companies

Preparing a checklist Preparing a checklist

receiving supporting documents and work progress reports from construction

department

Peshneshad, Invoice and Allotment

Preparing M16 according to allotment and approving that by the authorized

head

Preparing M16 according to allotment and approving that by the authorized head

Control Control

Sending the documents to treasury department of MoF

Sending the documents to treasury department of MoF

Sending the cheque to Da Afghanistan Bank then transferring the money to personal bank accounts

Payment Process

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Major reasons for low expenditure rate in development budget (Internal reasons)

Accurate and detailed program plan and budget documents are not prepared in due time

Unrealistic plans - fail to implement full plan Excessive delays in preparation of programs/

procurement documents Late submission of the documents thorough programs /

procurement for allotments execution Shortage of Technical Capacity in some programs

(planning, budgeting, procurement) Delay in extension of the construction companies

contracts

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Major reasons for low expenditure rate in development budget (Internal reasons)

Submission of uncompleted payment and allotment documents by programs and procurement.

Weak communication skills of some programs staff in conveying the message and issues properly & clearly.

Weak coordination between programs, procurement and finance department, for example, late contracts submission to World Bank.

Weak M&E system (program, budget, procurement)- combined periodic reports (program + budget execution) is not produced and shared regularly

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Major reasons for low expenditure rate in development budget (external reasons)

Contract approval for more than one year: many development budget contracts are for long-term and can not be completed in one year. Thus, expenditure of mentioned contracts will take two or more than two years. For example development budget of teacher training program is for three years but the whole budget is included for one year in the budget decree.

Late approval of the budget annex in 1388: budget annex approved in 30th of JAWZA – delay of Three months in all the carry forward allotments which make a big share of the budget.

Unavailability of physical Cash with donors: 1388 approved budget is only included in the budget decree based on the donors commitment in the beginning of the year, but after approval of the budget , the whole committed budget was not available to MoE and it is supposed to decrease the amount in the mid year review.

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Major reasons for low expenditure rate in development budget (external reasons)

Long-term process of procurement: Donors (World Bank, etc) procedures, no objections In 1388 procurement law of Afghanistan caused obstacles in

implementation. Breaking procurement is small lots - teacher training service contract divided in four separate lots throughout Afghanistan for total cost of 55 million.

Procurement process of teacher training program started in 1387 and completed in end of 1387. Ministry of education couldn't pay first installment of this program.

Allotments process through ministry of economy: based on ministerial council decision (cabinet) in 1388 and Afghanistan government decree, development project allotments should be executed through ministry of economy. This caused allotment delay from 3-15 days.

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Major reasons for low expenditure rate in development budget (external reasons)

Allotment process in accordance with work progress: New procedure introduced in 1388 (processing allotment

based work progress) It is more time consuming due to additional

report/document preparation requirements. Implementation of new procedure was taking up to 21

days for allotments (previous one was 7 days). Lower technical capacity in provinces and

MASTUFIATS: Lower technical capacity in provinces and MASTUFIAT causes delay budget execution.

Various procedure of various MASTUFIAT: Unavailability of physical cash in Banks

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Suggestions and solutions to improve budget execution in 1389

On time approval of budget (preferably 1 month before the start of the year).

Establish plan, finance, procurement units within the official structure of each program.

Prepare technical guideline & Training material & train related program staff on planning, budgeting, procurement and monitoring and reporting.

Develop and implement quality control measures to ensure complete set of documents correctly prepared are sent to procurement, finance & Accounting department while requesting for procurement, allotments and payments.

Preparation of realistic and technically sound proposal, plans and budget by the relevant programs.

MoE to ensure that MoF record the annual budget of program in the budget decree not the total budget of the program if for more than one year

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Suggestions and solutions Prepare annual procurement plans (based on program and

province) before the start of the new year Prepare M&E plans and integrated periodic reports (achievement

of targets and execution of budget) and address the issues on time. Support development of M&E systems and use of systems Develop technical capacity of programs and department across

ministry (national and sub-national) by recruiting enough number of capable TAs.

Provide suitable working environment for staff. Establishment of an authorized problem solving and coordination

committee participated by a focal point from each program. Establish regular coordination meetings with MoF

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Thank You!