Child Poverty in Mozambique. A Situation and Trend ... - Unicef
Child Poverty in Mozambique. A Situation and Trend ... - Unicef
Child Poverty in Mozambique. A Situation and Trend ... - Unicef
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
The agenda for exp<strong>and</strong><strong>in</strong>g water supply to meet the MDGs does not, however, simply<br />
<strong>in</strong>clude the required volume of f<strong>in</strong>anc<strong>in</strong>g. If this rapid expansion is to be realised,<br />
the sector’s poor budget execution rates will need to be addressed. Sector figures<br />
<strong>in</strong>dicate that the overall execution rate for <strong>in</strong>ternal <strong>in</strong>vestment spend<strong>in</strong>g was about 65<br />
per cent <strong>in</strong> 2005 (compared to around 55 per cent <strong>in</strong> 2004), while the National Water<br />
Directorate (DNA) with<strong>in</strong> the M<strong>in</strong>istry of Public Works <strong>and</strong> Hous<strong>in</strong>g executed only 47<br />
per cent of its budget (compared to 53 per cent <strong>in</strong> 2004). Sectoral figures available for<br />
rural water provide a good illustration of the problem.<br />
Figure 3.32: Comparison of allocation <strong>and</strong> execution of <strong>in</strong>ternal resources <strong>in</strong> the<br />
State Budget, 2001 - 2004<br />
60<br />
57.5<br />
58.7<br />
Billion of Meticais<br />
40<br />
20<br />
18.0<br />
17.5<br />
31.0<br />
24.4<br />
45.4<br />
11.0<br />
0<br />
2001 2002 2003 2004<br />
Allocated<br />
Executed<br />
Source: National Water Directorate, cited <strong>in</strong> GoM (2006)<br />
As with other service delivery sectors, timely disbursal of funds from the M<strong>in</strong>istry of<br />
F<strong>in</strong>ance is cited by the sector as a cause of this problem, with many months see<strong>in</strong>g<br />
very limited or even non-existent disbursements due to liquidity constra<strong>in</strong>ts. This is<br />
illustrated by the fact that the more f<strong>in</strong>ancially autonomous <strong>in</strong>stitutions <strong>in</strong> the sector<br />
– the Investment <strong>and</strong> Assets Fund for Water Supply (FIPAG) <strong>and</strong> the Southern Region<br />
Water Adm<strong>in</strong>istration (ARA-sul) – were able to realise execution rates of 100 per cent<br />
<strong>and</strong> 94 per cent respectively accord<strong>in</strong>g to sector data.<br />
The sector also faces a grow<strong>in</strong>g debt burden, which reached around US$2.5 million<br />
by the end of 2005 (GoM <strong>and</strong> PAP, 2006). The key drivers of <strong>in</strong>creased debts are<br />
arrears <strong>in</strong> VAT payments <strong>and</strong> other counterpart contributions that the National Water<br />
Directorate has <strong>in</strong>curred under externally funded projects. As discussed <strong>in</strong> Chapter<br />
II, many donors refuse to pay these charges on their <strong>in</strong>vestment projects, <strong>and</strong><br />
under Mozambican law the Government must assume the responsibility to meet<br />
contractors’ claims. However, the budgetary allocations made to meet these fiscal<br />
charges are very often <strong>in</strong>adequate, ma<strong>in</strong>ly due to fiscal constra<strong>in</strong>ts limit<strong>in</strong>g domestic<br />
revenues available for counterpart fund<strong>in</strong>g. While this problem affects the health <strong>and</strong><br />
education sectors it is particularly pronounced <strong>in</strong> the water sector. This is seriously<br />
delay<strong>in</strong>g the execution of externally funded projects, thereby reduc<strong>in</strong>g their economic<br />
returns <strong>and</strong> <strong>in</strong>creas<strong>in</strong>g the costs of procurement, as contractors <strong>in</strong>corporate delays<br />
<strong>and</strong> non-payment of VAT <strong>in</strong>to their bids (Orlowski, 2006). For the Government, the<br />
128 CHILDHOOD POVERTY IN MOZAMBIQUE: A SITUATION AND TRENDS ANALYSIS