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
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There are two pr<strong>in</strong>cipal drivers beh<strong>in</strong>d the profound changes underway <strong>in</strong> how<br />
external development assistance is provided to <strong>Mozambique</strong> <strong>and</strong> other recipient<br />
countries. Firstly, it is recognised that Government ownership <strong>and</strong> leadership – for<br />
example <strong>in</strong> mak<strong>in</strong>g strategic resource allocation decisions – is essential for the<br />
susta<strong>in</strong>ability of the development process. Overall assessment of performance<br />
coupled with measures to improve the universality of the Government’s plann<strong>in</strong>g<br />
<strong>and</strong> budget<strong>in</strong>g <strong>in</strong>struments addresses some of the difficulties of fragmentation <strong>and</strong><br />
gaps <strong>in</strong> coverage. At the policy level, greater harmonisation <strong>and</strong> alignment should also<br />
reduce the tendency to subject Government to a vast <strong>and</strong> often compet<strong>in</strong>g array of<br />
recommendations, thereby produc<strong>in</strong>g ‘reform fatigue’. 26<br />
Secondly, current changes <strong>in</strong> how external development assistance is provided are<br />
a direct result of the dramatic development progress realised. The drive to exp<strong>and</strong> <strong>in</strong><br />
the service delivery sectors – where much aid is concentrated <strong>and</strong> which have direct<br />
impacts on children’s lives – is <strong>in</strong>creas<strong>in</strong>gly compet<strong>in</strong>g with the need to <strong>in</strong>crease or<br />
at least ma<strong>in</strong>ta<strong>in</strong> the quality of exist<strong>in</strong>g services such as health, education <strong>and</strong> water<br />
<strong>and</strong> sanitation (GoM <strong>and</strong> PAP, 2006). As a result, current budgets for salaries <strong>and</strong><br />
goods <strong>and</strong> services are stra<strong>in</strong><strong>in</strong>g under the conflict between the need to f<strong>in</strong>ance<br />
the operation of exp<strong>and</strong><strong>in</strong>g systems <strong>and</strong> the need to respect the fiscal constra<strong>in</strong>ts<br />
required to ma<strong>in</strong>ta<strong>in</strong> hard-won macroeconomic stability (i.e. balanc<strong>in</strong>g <strong>in</strong>vestment<br />
<strong>and</strong> recurrent costs – see discussion on State Budget Recurrent <strong>and</strong> Investment<br />
Expenditures <strong>in</strong> Annex IV).<br />
Table 2.7: External fund<strong>in</strong>g <strong>in</strong> the 2005 State Budget by modality<br />
Modality Number of Fund<strong>in</strong>g % Total<br />
Donors<br />
(million US$)*<br />
Grants 89 500.7 57.1<br />
Budget support 16 172.2 19.6<br />
Common Funds (SWAPs)** 8 97.9 10.0<br />
Project Aid 65 240.6 27.4<br />
Credits 18 376.9 42.9<br />
Budget Support 1 57.7 6.6<br />
Lend<strong>in</strong>g to parastatals 5 73.7 8.4<br />
Project aid 12 245.5 28.0<br />
Total 107 877.6 100.0<br />
Note: *Exchange rate of 23,061 MZM/USD used.<br />
**Number of donors refers to number of different funds only.<br />
Source: 2005 State Budget, cited <strong>in</strong> Arndt et al. (2006)<br />
(ii) Analysis of implications for children<br />
a. Longer term implications<br />
Know<strong>in</strong>g the totality of available resources is a key precondition for genu<strong>in</strong>e policydriven<br />
allocation of public funds for children. Fund<strong>in</strong>g fully or partially outside the<br />
budget process is termed “off-budget.” In <strong>Mozambique</strong> such funds are comprised<br />
ma<strong>in</strong>ly of external assistance flows, although sector own-revenues (often lack<strong>in</strong>g a<br />
legal basis) are also problematic. Off-budget funds underm<strong>in</strong>e Government’s efforts<br />
to prioritise, plan, budget, monitor <strong>and</strong> evaluate effectively, damag<strong>in</strong>g the credibility<br />
26 For example, the 2004 Fiduciary Risk Assessment noted that, <strong>in</strong> the field of public f<strong>in</strong>ance management alone, donors <strong>and</strong> fund<strong>in</strong>g agencies<br />
had made no less than 280 recommendations <strong>in</strong> various studies <strong>and</strong> reports between 2000 <strong>and</strong> 2003 (Scanteam, 2004). The common practice of<br />
referr<strong>in</strong>g to the need for second <strong>and</strong> “third-generation” reforms is <strong>in</strong>dicative of this problem too.<br />
66 CHILDHOOD POVERTY IN MOZAMBIQUE: A SITUATION AND TRENDS ANALYSIS