Civil Participation Experiences in Budgeting Process

72 Donald P. Moynihan

line-item budget system,in which the legislature identifies spending items in great detail,specifying every machine to be purchased,every employee to be hired,every well to be dug.At the opposite end ofthe spectrum is a program budget,in which legislatures specify general goals but let bureaucrats decide how to spend the resources allocated to reach those goals.Most governments fall somewhere in between,specifying major items to be purchased but leaving the details to bureaucrats.

Regardless ofthe approach,participation matters.Where bureaucrats face a strict line-item approach,citizens can track exactly what should be provided and assess whether resources were actually spent as promised. Where bureaucrats have a high measure ofdiscretion,citizens become more important players.They may undertake lobbying activities and form partnerships to influence the shape ofdisbursement decisions.

Second,actual spending is often at odds with the stated intent ofthe government.Sometimes this may be due to spending cuts as a result of declines in revenue.In this case,money previously allocated is simply not available (World Bank 1998).In other cases,money allocated to service providers is siphoned offas it goes through various administrative levels.

tracking spending in uganda. Despite a doubling of spending on primary education between 1992 and 1995 (mostly on salaries),student enrollment appeared to remain stagnant in Uganda (Reinikka and Svensson 2001).One explanation was that the schools were not actually receiving the money allocated.

To determine where spending on education was going,the World Bank,in collaboration with the Ugandan government,the local Economic Policy Research Centre,and an independent Ugandan consulting firm, MSE Consultants,surveyed 250 government schools,randomly selected from 19 ofUganda’s 39 districts.The survey compared allocations to schools by the central government with the individual schools’records of funding received.

The results showed that between 1991 and 1995,only 13 percent ofnonsalary spending on education reached the schools that the funds were intended to help (Reinikka and Svensson 2004).Most schools received no capitation grants at all.Education offices at the district level had been keeping most of the nonsalary funding—as well as the bulk ofthe tuition fees paid by parents.

Although the problem was widespread,some schools were more likely than others to suffer the effects of leakage.Smaller schools,schools serving children from poorer families,and schools with less qualified teachers received

Citizen Participation in Budgeting: Prospects for Developing Countries 73

less capitation funding (Reinikka and Svensson 2001).This suggested that leakage was less likely to affect schools that actively mobilized and used their political resources.

As a result ofthe survey findings,changes were made.The government reported amounts ofschool transfers to local media.Schools and districts were required to make public the amount ofgovernment money they received.The expectation was that the provision ofthis information to local parents would discourage the leakage offunds for noneducation purposes. With this information,parents and teachers were more likely to mobilize and demand the full funding that government had allocated.

Schools were also given more direct control over resources.Allocations were deposited directly into individual school accounts,and schools became responsible for buying their own goods rather than relying on central purchasing at the district level.A 1998 survey by the government found that these measures were effective in increasing the flow offunding to schools. By 2001,80 percent ofbudgeted funds were reaching the schools,as intended (Reinikka and Svensson 2001).

demystifying the budget and tracking spending in india. In the western state ofGujarat,India,the NGO Development Initiative for Social and Human Action (DISHA) created a relatively simple yet effective way to monitor implementation ofbudgeted allocations.The state budget provides very specific line-item detail on where public resources will be spent and what resources will be spent on.For DISHA this provided an opportunity to hold the government accountable and to demystify what appeared to be an arcane budget process to all but a few government officials.

DISHA is an NGO with very broad membership.Its more than 80,000 members include tribespeople,miners,and forest,agricultural ,and construction workers.Tribal and other indigenous groups,who live in the hilly regions in Gujarat,make up about 15 percent ofthe state’s population (Mistry 2000).

Since the early 1980s,India’s national government has sought to target spending toward tribal regions through a Tribal Area Sub-Plan.While spending increased,the level ofeconomic development and infrastructure spending remained low.DISHA sought to understand where the resources were going.

DISHA examined the budget for allocations to specific projects,such as the construction ofroads and the digging ofvillage wells.(The state budget details allocations for all sectors,schemes,and programs to the village level.) It then surveyed village authorities and asked them whether and to what

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extent the project had actually been implemented.M.D.Mistry ofDISHA (1999) summed up the approach as follows:

One can really find out,which we do in our office,that the money that was put in was spent.We write to the village saying that this money,the 10,000 rupees, was spent in constructing a road from your village to the main road linking your village to the main road.Please let us know whether this road is built or not.And you get an answer from them....So it is easy to find out whether the money is spent or not,and ifnot,then raise it a) in assembly b) you write and c) give it to the press and raise it,thereby holding them accountable.

By surveying villages,DISHA raises awareness ofpolitical promises and provides village authorities with valuable information about what resources they should have received.DISHA is then able to incorporate the village’s political support in efforts to lobby for these resources (World Bank 2001).

DISHA has also cultivated the support oflocal officials by offering budget training to village representatives (sarpanches).Some 300 current and former sarpanches from about 140 different villages took part in a budget workshop in 2000.They learned skills such as how to read and understand budgets,identify allocations for their villages,recognize and discuss local investment needs,and plan lobbying and protest efforts.

DISHA has complemented budget execution analysis with other types of analyses that contribute to the approval stage.In analyzing a budget,DISHA identifies what spending will benefit the poor,points out any errors in calculations or in fiscal discipline,and looks at the relationship between public statements by the finance minister and proposed allocations.Some ofthe information DISHA develops is very basic and would be taken for granted in most budget systems.For example,DISHA lists resources allocated for each department and how they compare with previous allocations.It also identifies major areas ofnew spending or spending cuts.These analyses are converted into short budget briefs that aim to equip legislative members, the media,and civil society with basic facts and questions about resource allocation priorities (World Bank 2001).This information,written in local languages and tailored to local interests,is also disseminated to the public, usually through schools in remote areas.

DISHA disseminated its analysis to members ofthe state legislature and the media.It found that many legislative members were sympathetic to their claims but had trouble understanding the budget.The information DISHA provided gave legislators facts and figures they could use to assess the efficacy ofdisbursements.As M.D.Mistry ofDISHA notes,“The elected members ofthe party at various levels felt ‘empowered’with handy

Citizen Participation in Budgeting: Prospects for Developing Countries 75

information and began to participate in the debate on public expenditure. [Provision ofthis information] shifted the debate on public expenditure from the selected few to a majority ofmembers,thus improving governance through improved/enlightened debates”(Mistry 2000).DISHA’s analysis of the execution process in one budget cycle thus influenced the approval process in the next cycle.

DISHA’s activities have raised the quality ofdebate on the budget and grounded it in facts and research.Media coverage is better informed.The finance minister takes greater care to ensure that statements match allocations and that allocations reach intended projects.The demystification process that DISHA fostered has improved basic communication about spending and priorities and enhanced the transparency ofthe budget process.

Participation in audit and performance evaluation The final phase ofthe budget process is its evaluation.Traditionally,this meant that spending was audited to ensure consistency with intended spending.More recently,the audit function has come to incorporate assessment ofthe outputs generated by spending and suggestions for improving performance (Barzelay 1997).There is scope for citizen participation at this stage,particularly in evaluating performance.

A basic performance benchmark is the satisfaction ofcitizens and the quality oftheir interaction with the public sector.By administering surveys on access and satisfaction,NGOs can gauge the success ofpolicies.

In Bangalore,the capital ofthe state ofKarnataka,India,such information is presented in the form ofperformance report cards (Paul 1998).Citizen surveys in Bangalore were first undertaken in 1993 by an individual,Samuel Paul,with help from a private sector marketing firm.The following year Paul formed the Public Affairs Centre (PAC),an NGO dedicated to improving the quality ofgovernance in India.PAC created report cards in Bangalore in 1999 and 2003.The report cards are based on citizen surveys that examine satisfaction with government services in urban areas in Bangalore.Paul (1998,p.3) describes the basic logic and validity involved in using report cards that draw on the experience ofthe users ofa service:

A report card represents an assessment ofthe public services ofthe city from the perspective ofits citizens.The latter are the users ofthese services and can provide authentic feedback on the quality,efficiency,and adequacy ofthe services and the problems they face in their interactions with the service providers. They may not be able to comment on the technical features and standards of the services or to evaluate the overall performance ofa provider.But they are eminently qualified to say whether the service meets their needs,and whether

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the agency is responsive,corrupt,reliable,etc.When customers rate an agency on different dimensions ofthe service, it provides a basis for judging its performance as a service provider.

The first round ofsurveys selected a random sample ofhomes in each ofsix regions ofthe city.It classified respondents as middle or upper income (807 households) or lower income (327 households).Respondents were asked to describe the quality ofthe services they had received in the past six months:their overall satisfaction,staffbehavior,how many visits were required to solve a problem,and whether the problem was actually solved. The 1999 round ofsurveys expanded the number ofparticipants to 1,339 middle-income households and 839 households from slum areas.

The surveys covered basic services,such as water supply,electricity,garbage removal,hospitals,and police services.The 1993 and 1999 surveys found low overall levels ofsatisfaction with services.Relative to middle-income households,the poor had to visit agencies more often to solve a problem,were more likely to have to pay a bribe (usually to police),and were less likely to have their problems solved.Despite these problems,the poor tended to show similar levels ofsatisfaction with services,presumably due to lower expectations.

Upon completion ofthe 1999 survey,PAC sought a way to increase the impact ofthe survey results.It developed the report card format and aggressively promoted the report cards to the media.The cards were unveiled at a press conference that generated significant media coverage.All the major newspapers in Bangalore published the findings,and the high-profile Times ofIndia ran a weekly feature for two months on issues raised by the cards (PAC 2003).PAC appreciates the importance ofthe media,which “has become an active stakeholder in making Bangalore citizens more aware and putting the spotlight on issues that need to be addressed.The big change has been the wide involvement ofresident associations and civic groups in engaging with city agencies in campaigns and initiatives for improving service delivery”(PAC 2003,p.9).Paul (1998,p.17) describes how a reporter from the Times ofIndia used report card information to put the spotlight on service quality and corruption in hospitals:

Armed with the information provided by the report card,the reporter concerned went to the public hospitals and interviewed senior officials and doctors to get their side ofthe story.She then went on to talk to patients to get a confirmation on the report card findings.Her report on the subject in the newspaper was on the front page and generated a public debate ...that went on for several days.The message was loud and clear that the abuses and extortion being practiced in the city’s public hospitals should not be tolerated.Within a few weeks,some nurses in one ofthe public hospitals were arrested on charges ofcorruption and negligence in a child delivery case.

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The report cards also generated a response from the government.“The responses from agency heads and senior government officials were polite but lukewarm except for a few agencies,”according to Paul (1998,p.13).But according to Wagle and Shah (2002),four ofthe eight agencies responsible for the services attempted to reform themselves or expand citizen feedback mechanisms.

PAC tried to foster both improvement and openness by interacting with agency officials.It briefed the agencies on the survey results and organized workshops.In one session public officials met with one another to discuss the efforts they were making to address criticisms.In another session representatives from the agencies met with the public and discussed the problems raised by the report cards.The chiefminister ofKarnataka created a “Bangalore Agenda Task Force”that included prominent city residents in an effort to offer responses to the problems identified.The Bangalore City Corporation also promoted an informal network ofNGOs and city officials called Swabhimana (self-esteem) (Paul 1998).The network discussed ways ofsolving problems and identified new problems as they emerged.PAC played a coordinating role in this network.It also advised the corporation on how to establish a system by which citizens can bring their grievances directly to the government and see them redressed.This led to training officials on how to provide citizens with feedback.After a day-long collaboration with PAC, hospitals in Bangalore agreed to establish help desks to provide better customer service to patients.

The 2003 round ofreport cards surveyed more than 1,700 households. These surveys found increased satisfaction with almost all agencies,a lower incidence ofproblems,and less corruption (figure 2.2).“The performance of these agencies over the last 10 years is a picture ofsignificant improvement in satisfaction ofusers ofservices.Ofthe nine agencies on which citizens of Bangalore provided feedback,all have received satisfaction ratings above 70 percent this time in contrast to less than 40 percent in 1999”(PAC 2003,p.3).

PAC argues that the oversight it provided helped matters but that political response to the problems was also important.“It is clear that without the kind ofpolitical leadership and vision displayed by the ChiefMinister [of Karnataka] in the past four years,this outcome would not have been easy to achieve”(PAC 2003,p.8).

The report card approach has been expanded to the state level,to other Indian cities,and to other countries,including Bangladesh,the Philippines, Ukraine,the United States,and Vietnam.In the United States,university professors and journalists investigate and grade the capacity ofgovernment in a variety ofmanagement settings,including financial management, information management,and human resources (Ingraham,Joyce,and Donahue 2003).