Joint strategic evaluation of budget support to Uganda (2004-2013) : final report. Volume 1.
Date: 2022-05-04
Institutions: Directorate-General for International Partnerships
Subjects: EU policy - national policy, Uganda, World Bank, aid evaluation, budget, commitment of expenditure, development policy, poverty, report, transparency in decision-making

Joint Evaluation of Budget
Support to Uganda

Final Report

Volume 1
May 2015
___________

Evaluation jointly managed by the European
Commission (DG DEVCO Evaluation Unit) and the World
Bank’s Independent Evaluation Group (IEG) with the
Government of Uganda (Ministry of Finance , Planning, and
Economic Development, and Office of the Prime Minister),
Ireland (Department of Foreign Affairs and Trade) and the
UK (DFID)

International
Cooperation and
development

Acknowledgments

This  Final  Report  was  prepared  under  the  general  direction  of  Mark  Sundberg  (Manager,  IEG-PS

evaluation unit), Federica Petrucci (Evaluation manager, DEVCO Evaluation Unit) and Juergen Lovasz

(Team leader of the budget support section, DEVCO Evaluation Unit).

The  Final  Report  is  authored  by  a  joint  IEG  and  EU  team  of  evaluators.  The  EU  team  of  evaluators

was provided by Particip GmbH, a Germany-based consultancy firm.

The evaluation team comprises Zeljko Bogetic (Team Leader, IEG, who provided overall coordination),

Enzo  Caputo  (Team  Leader,  EU),  Camilla  Valmarana  (Deputy  Team  Leader,  EU) and  the  following

evaluation  specialists: Ann  Bartholomew  (EU expert), Simon  Dietrich  (EU expert), Björn  Ekman  (EU

expert), Marian Meller (EU expert), Clarissa Mulders (EU expert), Moritz Piatti (IEG expert), Tino Smaïl

(EU expert) and Alastair  Sussock  (IEG  short-term  consultant).  The  evaluation  team  also  benefitted

from  the  valuable  technical  advice  on  specific  aspects  of  social  sectors,  gender,  and  survey  design

from Elena Bardasi, Lauren Kelley, Bahar Salimova, Pia Schneider and Kathryn Steingraber (all IEG

evaluation  specialists).  Georg  Ladj (EU  expert) provided  quality  assurance  support. Peer  reviewers

were  David  Dollar  (Senior Fellow,  Brookings  Institution), Birgit  Hansl  (Lead  Economist, Russian

Federation, World Bank), Alex Mourmouras (Division Chief, East Asia and Pacific, IMF) and Marcelo

Selowsky (Consultant, IEG). Written comments were also received from Dave Coady (Division Chief,

Fiscal Affairs, IMF).

The evaluation team would like to express gratitude to the ministries and agencies of the Government

of  Uganda,  international  donors,  think  tanks,  and  civil  society  organizations  that  kindly  shared  their

views, data, and information during this evaluation. We also thank the World Bank and EU offices in

Uganda for the overall support provided to facilitate the implementation of the study.

The opinions expressed in this document represent the views of the evaluation
team, which do not necessarily represent official views of the European
Commission, IEG or the authorities of the countries involved.

© cover picture rights Moritz Piatti

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CONTACT INFORMATION 

European Commission 
Directorate-General for International Partnerships (DG INTPA) 
Directorate D - Sustainable Development Policy and Coordination 
Unit D.4 - Performance, Results and Evaluation; Internal Communication, Knowledge Management and Collaborative Methods 
Email: INTPA-EVALUATIONS@ec.europa.eu  
B-1049 Brussels, Belgium 

EU International Partnerships: 
https://ec.europa.eu/international-partnerships/our-impact/monitoring-and-evaluation_en 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
i

Table of Contents

Executive Summary .............................................................................................................................vii

1

Introduction ..................................................................................................................................1

1.1

1.2

1.3

1.4

Objectives and scope of the evaluation ....................................................................................1

Management of the evaluation and presentation of findings ....................................................2

The outputs of the evaluation....................................................................................................2

Structure of the final report .......................................................................................................2

2

Context ..........................................................................................................................................3

2.1

2.2

2.3

Key features of the socio-economic context .............................................................................3

National policy framework .........................................................................................................3

Evolution of budget support to Uganda.....................................................................................4

3

Key methodological elements ....................................................................................................5

3.1

3.2

3.3

3.4

3.5

General issues ..........................................................................................................................5

The specific theory of change of BS and the 3-Step approach ................................................5

Surveys .....................................................................................................................................6

The Intervention Logic...............................................................................................................6

List of the Evaluation Questions ...............................................................................................8

4

Main findings and responses to the evaluation questions......................................................9

4.1

4.2

4.3

Step 1 ........................................................................................................................................9

Step 2 ......................................................................................................................................44

Step 3 ......................................................................................................................................68

5

Overall assessment....................................................................................................................73

5.1

5.2

5.3

5.4

5.5

Relevance and design.............................................................................................................73

Achievement of budget support objectives .............................................................................75

Risk to development outcomes...............................................................................................78

Government performance .......................................................................................................78

Donor performance .................................................................................................................79

6

Key recommendations and detailed lessons ..........................................................................80

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ii

List of tables

Table 1
Table 2
Table 3

Table 4

Table 5
Table 6

Table 7

Table 8

Table 9

Table 10

Table 11

Table 12

Exchange rates over the evaluation period ................................................................... vi
Overview of the Evaluation Questions............................................................................8
Synthesis  of  BS  contributions  to  Government’s  policies  (Step 1) –
Education ......................................................................................................................40
Synthesis of BS contributions to Government’s policies (Step 1) - Water &
Sanitation ......................................................................................................................41
Synthesis of BS contributions to Government’s policies (Step 1) – Health ..................42
Synthesis  of  factors  determining  changes  observed  at  the  outcome  and
impact levels (Step 2) - Education ................................................................................51
New safe water sources constructed and population served in rural areas
by NGOs in FY2009/10 and FY2010/11 .......................................................................58
Synthesis  of  factors  determining  changes  observed  at  the  outcome  and
impact levels (Step 2) - Water & Sanitation ..................................................................60
Synthesis  of  factors  determining  changes  observed  at  the  outcome  and
impact levels (Step 2) – Health.....................................................................................67
Synthesis  of  BS  contributions  to  government  policies  (Step  1)  and  their
contribution to development results (Step 2) - Education.............................................69
Synthesis  of  BS  contributions  to  government  policies  (Step  1)  and  their
contribution to development results (Step 2) - Water & Sanitation...............................70
Synthesis  of  BS  contributions  to  government  policies  (Step  1)  and  their
contribution to development results (Step 2) – Health..................................................71

List of figures

Figure 1

Figure 2
Figure 3

Figure 4
Figure 5

Figure 6
Figure 7
Figure 8

Figure 9

Figure 10
Figure 11

Figure 12
Figure 13

Figure 14
Figure 15

Figure 16

Figure 17

Figure 18

Simplified  representation  of  the  budget  support  contribution  to  the
achievement of targeted development results............................................................... xi
Patterns of growth and poverty reduction in Uganda .....................................................3
Uganda:  Trends  in  GBS  and  SBS  (USD  millions,  left  scale;  percent
shares, right scale)..........................................................................................................4
Overall intervention logic ................................................................................................7
ODA and amount of aid on budget of  which  BS and  project aid,  in USD
million)...........................................................................................................................13
GoU expenditure by source of funding (% of GDP)......................................................14
The Structure of Uganda’s Government Revenues......................................................20
Aid  and  Budget  Support  as  a  %  of  GoU  expenditure  and  as  a  %  of
Development expenditure.............................................................................................21
Uganda  vs.  Sub-Saharan  Africa  (SSA):  CPIA  Scores  on  the  Quality  of
Budgetary and Financial Management Rating, 2005-12 ..............................................24
PFM Stakeholder Survey Results by Interest Group....................................................25
Real  PAF  budget  allocation  and  release  (Primary  Axis),  and  per  capita
release (Secondary Axis)..............................................................................................28
Trends in spending composition and defense budget and outturn...............................28
Trends  in  LG  budget  (Billions  of Ush)  and  LG  share  of  total  budget
envelope .......................................................................................................................29
Hypothetical BS contribution to sector expenditure (in percent) ..................................34
Uganda  vs.  Sub-Saharan  Africa:  CPIA  scores  on  the  quality  of  policies
and 
in  the  areas  of  transparency, accountability,  and
corruption in the public sector.......................................................................................38
Evolution of enrolment in primary and secondary education over the past
decade ..........................................................................................................................44
e-Survey - Sector  evolutions  linked  to  the  reforms  implemented  in  the
past decade ..................................................................................................................46
Education expenditure, 2003-2013, billion Ush (nominal)............................................47

institutions 

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iii

Figure 19

Figure 20
Figure 21
Figure 22
Figure 23
Figure 24
Figure 25
Figure 26
Figure 27

Figure 28
Figure 29

Figure 30
Figure 31
Figure 32
Figure 33

Education  real  per  capita  domestic  expenditure,  2003-2013,  constant
2010 Ush.......................................................................................................................47
Education sector basic service delivery indicators .......................................................50
Rural population served with safe water and with effective sanitation .........................53
Situation in terms of geographical disparities ...............................................................54
Evolution of average equity values ...............................................................................54
Water & Environment (nominal) expenditures, 2003-2013 (in billion Ush)...................55
Water & Environment real per capita expenditure (in Ush) ..........................................56
DWSDCG budgets, releases and expenditures (in billion Ush) ...................................57
Deliveries  in  health  facilities  by  residence  and  household  wealth  index
(2011)............................................................................................................................62
Percentage of deliveries in Government and PNFP facilities (2013) ...........................62
e-Survey - Progress  linked  to  the  reforms  implemented  in  the  past
decade ..........................................................................................................................63
Health expenditures, 2003-2013, billion Ush (nominal)................................................64
Health real per capita expenditure................................................................................64
Field survey - % of health units fully staffed (by profession) ........................................65
Simplified  representation  of
achievement of targeted development results..............................................................72

the  budget  support  contribution  to  the

List of boxes

Box 1
Box 2

Definition of budget support............................................................................................1
DPs support to PFM......................................................................................................23

List of acronyms and abbreviations

AHSPR

Annual Health Sector Performance Reports

ALD

BFP

BoP

BS

CBM

CEF

CIFA

CPIA

CSO

Aid Liaison Department

Budget Framework Paper

Balance of Payments

Budget Support

Comunity Based Maintenance

Comprehensive Evaluation Framework

Country Integrated Fiduciary Assessment

Country Policy and Institutional Assessment

Civil Society Organisations

OECD-DAC

Organisation for Economic Co-operation and Development - Development Assistance
Committee

DG DEVCO

Directorate General Development and Cooperation (European Union)

DFID

DLGs

DP

DWD

DWO

Department for International Development

District Local Governments

Development Partner

Department of Water Development

District Water Office

DWSDCG

District Water and Sanitation Development Conditional Grant

EFA

Education for All

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EFMP

EMIS

EPRC

EQ

ESSP

EU

Economic and Financial Management Project

Education Management Information System

Economic Policy Research Center

Evaluation Question

Education Sector Strategic Plan

European Union

FINMAP

Financial Management and Accountability Programme

FY

GAPR

GBS

GDP

GER

GHI

GIZ

GNI

GoU

HIPC

HLAM

HMC

HQ

HSBS

HSSIP

HSSP

ICR

IEG

Fiscal Year

Government Annual Performance Report

General Budget Support

Gross Domestic Product

Gross Enrolment Ratio

Global Health Initiatives

Deutsche Gesellschaft für Internationale Zusammenarbeit

Gross National Income

Government of Uganda

Heavily Indebted Poor Countries

High Level Action Matrix

Health Management Committee

Headquarters

Health Sector Budget Support

Health Sector Strategic and Investment plan

Health Sector Strategic Plan

Implementation Completion Report

Independent Evaluation Group (World Bank)

IFMIS

Integrated Financial Management Information System

IGG

IL

IMF

JAF

JBS

JBSF

JICA

JPF

Inspectorate General of Government

Intervention Logic

International Monetary Fund

Joint Assessment Framework

Joint Budget Support

Joint Budget Support Framework

Japan International Cooperation Agency

Joint Partnership Fund

JWSSP

Joint Water and Sanitation Sector Programme Support

LG

LGDP

MDAs

MDG

MG

Local Government

Local Government Development Project

Ministries, Departments, and Agencies

Millenium Development Goals

Management Group

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v

MoES

Ministry of Education and Sports

MoFPED

Ministry of Finance, Planning and Economic Development

MoGLSD

Ministry of Gender, Labour and Social Development

MoH

MoU

MTEF

MWE

NDP

NER

NGO

NHP

NPA

NSA

OAG

ODA

OPM

PAF

PE

PEAP

PEFA

PER

PFAA

PFM

PLE

PNFP

PRSC

QEI

RG

RGC

SBS

SIP

SSA

ST

SWAp

SWG

TA

TASU

ToR

TSU

Ministry of Health

Memorandum of Understanding

Medium Term Expenditure Framework

Ministry of Water and Environment

National Development Plan

Net Enrolment Ratio

Non-Governmental Organisation

National Health Policy

National Planning Authority

Non-State Actors

Office of the Auditor General

Official Development Assistance

Office of the Prime Minister

Poverty Action Fund

Public Expenditure

Poverty Eradication Action Plan

Public Expenditure and Financial Accountability

Public Expenditure Review

Public Finance and Accountability Act

Public Financial Management

Primary Leaving Examinations

Private Non-for Profit

Poverty Reduction Support Credit

Quality Enhancement Initiative

Reference Group

Rural Growth Centre

Sector Budget Support

Sector Investment Plan

Sub-Sahara Africa

Small Town

Sector-Wide Approach

Sector Working Group

Technical Assistance

Technical and Administration Support Unit

Terms of Reference

Technical Support Unit

UBOS

Uganda Bureau of Statistics

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vi

UDHS

UJAS

Uganda Demographic and Health Survey

Uganda Joint Assistance Strategy Paper

UNESCO

United Nations Educational, Scientific and Cultural Organization

UNICEF

United Nations Children's Fund

UNMHCP

Uganda National Minimum Health Care Package

UPE

UPPET

USAID

USE

USF

USh

Universal Primary Education

Universal Post Primary Education and Training

United States Agency for International Development

Universal Secondary Education

Uganda Sanitation Fund programme

Uganda Shillings

UWASNET

Uganda Water and Sanitation NGO Network

VAT

VfM

WB

Value Added Tax

Value for Money

World Bank

WESPR

Water and Environment Sector Progress Reports

WSDF

Water and Sanitation Development Facility

WSDF-SW

Water and Sanitation Development Facility-South West

WSP

Water and Sanitation Programme

Fiscal year and Exchange rates
The fiscal year (FY) in Uganda runs from July 1st to June 30th.

Table 1

Exchange rates over the evaluation period

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

EUR/Ush

2414.9

2281.5

2157.1

2304.3

2471.3

2715.4

2735.2

3008.2

3181.9

3508.5

3423.2

USD/Ush

1932.6

1677.1

1824.2

1749.0

1682.1

1926.1

1907.6

2265.2

2468.7

2661.4

2483.7

Source: EU DG Budget; exchange rates for January of the given year.

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vii

Executive Summary

Objective, scope and method of the evaluation

The main objective of this evaluation is to assess to what extent the General Budget Support (GBS)
and Sector Budget Support (SBS) in Uganda contributed to the expected results by giving means to
the partner government to implement its national / sector strategies, and to enhance the efficiency and
effectiveness of its policies, strategies, and spending actions. The evaluation also analyses how GBS
and SBS have contributed (or not) to improved transparency within government systems and stronger
accountability.
The  evaluation  covers 10  years  of all  development  partners’ Budget  Support  (BS)  operations to
Uganda,  from  2004  until  2013.  This  covers three distinct periods  in  the  evolution  of  BS  to  Uganda:
i) pre-JBSF1 period (2004-2008);  ii) JBSF period (2009-2012);  and  iii) the  High-Level  Action  Matrix
(HLAM) period (2013).  With  specific  reference  to  World  Bank  (WB)  budget  support,  which  had
accounted  for  a  substantial  share  of  the  overall  BS, the  evaluation  includes the Poverty  Reduction
Support Credits (PRSCs) over the period of analysis.2

Context

Uganda  experienced  robust economic  growth over  the  last  decade,  resulting  in  steady  gains  in  per
capita income. Growth has been accompanied by significant poverty reduction, although poverty and
vulnerability  remain  high. Important  gains  were  achieved  in  access  to  basic  education,  health,  and
water  and  sanitation. Uganda,  however,  continues  to  experience  very  high  rates  of demographic
growth, among the highest in the world at 3.3 percent per year, which makes further poverty reduction
and service delivery more difficult.
In  1998,  the government  introduced Poverty  Eradication  Action  Plan  (PEAP) framework  as  the
Government’s  overarching  policy  planning  framework. Then, in  2010, the  Government  developed  an
ambitious  new  vision,  aiming  to  achieve  middle-income  status for  the  country within  30  years.  The
National  Development  Plan 2010-2015  entails  a  significant  shift  in  emphasis  towards  economic
infrastructure,  linked  to  the  discovery  of  oil,  gas  and  minerals.  Social  services  sectors––which  have
been  the  long-standing  focus  of  the  Government’s  policies  and  external  donor  support––including
education, health, and water and sanitation, assumed secondary priority.
Uganda  has  traditionally  received  large  amounts  of  international  aid in  the  form  of  BS.  Total  BS
decreased  substantially 
to  well  below
USD 100 million as of FY12/13. Of the twelve BS partners, the World Bank was the biggest contributor
with  USD 1.2 billion 
the  EU  who  provided  USD 480 million  and
USD 290 million respectively.
Against  this  backdrop, in  recent  years, the  donors  reduced  their  engagement  and  volumes  of  BS  in
response in  part  because  of diverging objectives from  the  government’s. On  the  one  hand,  the
government  increasingly  emphasized  productive  sectors  and  infrastructure  investments  to  support
long-term growth and poverty reduction. On the other, it significantly expanded the administrative and
other politically driven expenditure. Such new priorities, given the low and stagnant domestic revenue
mobilisation (at  about  13  percent  of  GDP) have  been funded partly  at  the  expense  of  additional
investments in the social sectors. The donors for their part continued to focus their BS operations on
social  sectors.3 They  also initiated a  wide dialogue  on political and principle issues with  the
government. These developments and several corruption episodes resulted in the gradual erosion of
trust between the donors and the government and the temporary secession of budget support in 2012.

from  a  high  of  almost  USD 700 million 

the  UK and 

followed  by 

in  FY06/07 

1 The Joint Budget Support Framework (JBSF), launched in 2008, brought budget support partners into a single
system for performance monitoring and policy dialogue.
2 This joint evaluation report does not single out specific donor budget support but treats all donor budget support
as one, joint modality. By contrast, the evaluation of the World Bank’s PRSCs in this period has been undertaken
in parallel by the IEG in a separate, Project Performance Assessment Review (PPAR) (World Bank 2015).
3 The World Bank aligned its strategy to the Government and supported its objectives in financing infrastructure
through  investment  projects,  in  addition  to  providing  reduced  volumes  of  budget  support. The  EU  has  also
provided  significant  support  to  the  productive  sectors;  transport  and  agriculture  /  rural  development  constituted
key  pillars  of  the  intervention  strategy  over  the  whole  evaluation  period,  although  in  these  areas  support  was
provided in the form of programme aid rather than budget support.

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viii

In 2013, in the context of the High-Level Action Matrix (HLAM) agreed with the donors to address the
corruption  and  governance  concerns,  the  Government  took  important  corrective  actions.  On  that
basis,  some  donors  restarted  engagement  but in more  reduced  scope  and  volumes  than  before.
However,  there  remain  fundamental  questions  about  the  direction,  scope  and  content  of  future  BS,
Government-Donors partnership and policy dialogue, mix of support modalities, and sectoral priorities.
This  report  evaluates  all BS to  Uganda  during  2004-13  period  with  the  view  to  providing  not  only  a
comprehensive retrospective assessment but also lessons and recommendations for the future.

Methodology

The methodology applied in this evaluation follows the 3-Step approach as established in the OECD-
DAC guidelines and elaborated in the Inception Report (2014) of this evaluation. Some integrations of
the standard methodology have been introduced, however, along two main lines: (i) as the evaluation
is executed by a joint IEG-EU team, data and analytical approaches to different questions, field visits
and surveys have all benefitted from combined and closely coordinated efforts of the two institutions
involved, and adjustments of the approach have been introduced to ensure that the evaluation report
is compatible with the methodological standards of both; (ii) since the evaluation occurs in a process
of  review  of  the  3-Step  methodology,  some  ad  hoc  innovations  and/or  specifications  have  been
introduced  regarding  mainly  a  better  understanding  of  the  theory  of  change  and  the  related
contribution  analysis  in  Step  1,  and  the  causal  analysis  in  Step  2,  including  the  use  of  quantitative
methods (as described in a the methodological annex).

Overall assessment

The relevance of Budget Support objectives in support of the government’s poverty reduction strategy
was  high:  the  donors’  objectives were  strongly  aligned  with  Government  objectives  and  harmonised
among  the Development  Partners  (DP).  There  was considerable  degree  of  coordination  and
harmonization of BS among different DPs. The quality and ownership of the policy dialogue in the first
part  of  the  period  under  review  was  solid.  The overall  relevance  of  objectives,  however,  was
undermined  by  diverging  objectives  in  the  latter  part  of  the  period  under  review  as  well  as  missed
opportunities  in  several  major  policy  areas,  such  as  increasing  revenue  mobilization,  controlling
population  growth,  strengthening  local  Government  revenue  base  and  capacity, reducing gender
inequities, and giving greater priority to agriculture and increasing rural productivity. The government’s
shift in its objectives towards infrastructure and productive sectors had merit from the viewpoint of the
need for sustained growth and poverty reduction, as reflected in considerable analytical work, but the
continued policy focus on social sectors was also needed to sustain gains in service delivery.
The relevance of the design was moderate. Apart from the missed opportunities mentioned above, the
shift  to  GBS  helped  elevate  the  level  and  coordination  of  the  policy  dialogue  and  broadened  the
consultation process. However, by moving away from the explicit protection of sector funds for basic
services,  it  may  also  have  overestimated  the  actual  convergence  between  Government  and  DPs  in
terms of policy and expenditure priorities. This, in turn, may have affected the relevance of BS design,
which continued to focus mainly on education, health, and water and sanitation.
Despite  the  reduction  of  volumes over  time, BS  funds have  ensured  significant  resources  to  finance
development expenditure and, apart from the very last years, have partly ‘covered’4 the development
expenditure  in  the  three  focal  sectors.  The dialogue  framework before  the  JBSF  was  particularly
focused at sectoral level and at the level of the MoFPED. Subsequently, the JBSF promoted a wider
and stronger coordination of the DPs and elevated the dialogue to the level of the Office of the Prime
Minister (OPM). This helped improve the general performance monitoring framework and procedures,
but  the  link  with  the  sectors  was  partly  lost. Technical  assistance,  under  the Joint  Assessment
Framework  (JAF),  was  focused  on Public  Financial  Management  (PFM), but in  the  other  areas,
especially at the local level, it was not adequately connected and prioritized through the dialogue. The
Technical and Administration Support Unit (TASU) supported the dialogue through significant studies
and analyses, especially regarding public financial management. TASU managed Uganda’s first Local
Government PEFA Assessment, and undertook an in-depth analysis of the relationship between fiscal
decentralization, fiscal incentives, and decentralized service  delivery  outcomes in Uganda.  However,
TASU was not involved in capacity development at the sectoral level.

4 Funds being fungible, this means that the amount of BS funds, compared to the actual development expenditure
in the three sectors, corresponded a significant share of it (see specific data in the main text).

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ix

BS  contributed  to solid overall fiscal  management during  the  early  years  under  review,  but  frequent
supplemental budgets, especially during periods of elections have undermined budget credibility. The
strong  influence  of  the  electoral  cycle  on  budget  management  is  a  recurring  issue.  Perhaps  most
important,  at  about  13  percent  of  GDP,  the Government’s exceptionally low  domestic revenue
mobilisation has  been  the  Achilles  heel  of  the  overall  policy  framework  supported  by  BS. It  has  its
roots in the political economy of large tax exemptions, patronage, and the culture of non-compliance. It
has taken place against the backdrop of significant volumes of budget support but no corresponding
improvements in domestic revenues. As the BS volumes declined, low domestic revenue mobilization
contributed  to  the cuts  in  the  current  and  development  expenditure,  with  negative  consequences  on
the funding and quality of services and sustainability of social service outcomes.
Uganda  has  been  a  strong performer in PFM matters  over  much  of  the  last  decade  and  BS  has
provided significant support in this area. Legislative framework, budget reporting, transparency, audits,
and  the  implementation  of Integrated  Financial  Management  Information  Systems  (IFMIS) at  central
and  local  government levels have  all improved substantially. However, the  PFM reform process falls
short  in several  areas  and  some  key  PFM  indicators  have  deteriorated  in  the  last  few  years.
Weaknesses  are  noted  in  the  areas  of budget  credibility,  transparency  of  inter-governmental  fiscal
relations, and the quality of the PFM reform process at the decentralised level.
After the initial surge in allocations to the national Poverty Action Fund (PAF) until 2003/04, increases
in pro-poor  allocations  gradually slowed.  Instead, increases in  the  allocation  for  productive  sectors,
defence and  various  administrative expenditures took  precedence  and  their  execution frequently
exceeded  the  approved  budget.  Furthermore,  efforts  to  reduce  the  deficit  without  raising  domestic
revenues  increased  trade-offs  between  pro-poor  and  productive  sector  expenditure.  BS  has  been
irreplaceable in partially protecting pro-poor allocations until it has been drastically reduced.
Sectoral  policies  and  institutional  capacities have  not  improved  in  the  education  and  health  sectors
during the evaluation period. BS funds have only partially contributed to protecting sectoral allocations.
As  BS  volumes  declined  and  revenue  mobilization  remained  low,  funding  for  social  services  came
under  pressure  and  some  outcome  indicators  deteriorated. BS  dialogue  has  contributed  to the
establishment  of  a  useful  performance  assessment  framework  that  also  improved  over  time.  In  the
water  sector,  by  contrast,  results  were  better,  reflecting  a  well-functioning  sector-wide  approach
supported by the integration of SBS with other aid modalities and accompanying measures.
Governance indicators have improved, especially in the earlier years of the evaluation period and on
the upstream side of the accountability chain. Budget support and related policy dialogue, directly and
indirectly, helped strengthen some key governance and accountability institutions such as the Auditor
General’s office and Inspector General’s office. However, progress is especially lacking downstream of
the  accountability  chain  e.g.,  following  up  on  upstream  decisions,  enforcement  of  prosecution,  and
recovery  of  funds. More  broadly,  decisions  at  the  top  political  levels often  interfere  with  the  main
direction  of  economic  policy.  This  is  reflected  in  major  policy  initiatives  and  changes  that  were
sometimes  introduced  with  little  broad  consultation  and  mobilization  of required  resources  and
capacity (e.g., purchase  of  fighter  jets,  proliferation  of  districts,  free post-primary  education, various
reflecting  political  and  political economy
supplemental  budgets). These  decisions,  mainly 
considerations, appear  to have  undermined policy effectiveness in  priority  sectors  and  complicated
fiscal management.

Outcomes in the focal sectors and the role of BS
Education. The significant increase in basic access to education at both primary and secondary level,
including achieving gender equality  at primary level,  has been a result of GoU education policy. The
main role of BS has been in funding sector strategies, which have resulted in significant improvements
in access. However, in the second half of the period this contribution has declined. The contribution of
BS sector dialogue has been moderate. Despite the support of BS dialogue, particularly in the second
part  of  the  considered  period,  government  actions  to  enhance quality  in  education and  learning
achievements  have  had  limited  effects.  BS  has  also  supported  gender  policies  incorporated  into
national education policies, with gender parity in terms of gross enrolment achieved at primary level.
However, much less attention was paid to addressing large dropout rates, the reasons why girls drop
out, and very limited attainment. Finally, BS has missed the opportunity of providing specific capacity
development support  to  enhance  the  efficiency  of  the  implementation  at  the  local  level,  which  was
critical in ensuring sustainability of local service delivery.
Water  and sanitation.  GoU’s  strategy  of  decentralised  and  deconcentrated  implementation  has
resulted  in  an increased  access  and  functionality of  rural  and  small  towns’  water  supply,  and  in
improvements  of  equity of  this  critical  service. The  sector  has  been  characterised  by  a  successful
sector  wide  approach  (SWAp),  led  by  GoU  and  supported  through  SBS and  other aid modalities
(basket funds, etc.). In this context, BS has contributed through funds, policy dialogue, and capacity
building,  which  enhanced  sector  policy  design  and  implementation.  However,  the  stagnation  in  key

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x

performance indicators against trends in funding, suggests that sector funding is insufficient to reach
sector  targets,  notwithstanding  improvements  in  efficiency  and  maintenance.  Gender  mainstreaming
in the sector is mainly through monitoring and reporting, but does not promote concrete improvements
of the role and activities of women.
Health. The health sector has seen several quantitative and few qualitative improvements. Access to
most  medical  services has  improved  due  to  important  public  investments.  Improvements  have  been
unevenly  distributed,  however, with  a  clear  and  persistent  urban-rural  gap.  Although  health  related
gender  outcomes,  such  as  access  to  maternal  health  care,  have  improved  during  the  period,
improvements  have  slowed  down and  some  indicators  are  worrisome  (e.g.,  HIV  infection  rates).
Fertility  rates  are  high  and  maternal  mortality  rates,  while  declining, remain  at  a  comparatively  high
level. BS, mainly through policy  dialogue, has contributed to the development of a series of policies,
strategies, and plans over the past decade, and BS funds have made possible the implementation of
some ambitious initiatives, e.g., expansion of provider networks, abolishment of patient user-fees, and
sustained management of HIV patients.
Risks at outcome level. There is high risk that even mixed basic outcomes in education and relatively
poor outcomes in health and better outcomes in water and sanitation will not be sustained because of
future  underfunding  due  to  low  revenue  mobilization. This  is  compounded  by  very  limited
implementation capacity  at  the  local  level. Other  outcomes  are  at  risk  because  of  continued  policy
uncertainty, financial (funding), economic (country or sector level), political, and social factors as well
as  government  ownership, commitment,  and  governance.  Mitigating  these  risks  will  require  their
clearer  recognition and greater  policy  emphasis  on the  critical  problem  of revenue  mobilization,
including  at  the  local  level,  and  more  concerted  effort  in  implementing  sector  policies,  building  local
capacity, and improving efficiency in delivery of services at sector and local levels.
The  diagram  that  follows  visually  synthesises  the  overall  contribution  of  budget  support and  other
factors to the achievement of the targeted development results (see next page).

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Figure 1

Simplified representation of the budget support contribution to the achievement of targeted development results

xi

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xii

The way forward

In response to the overall assessment, the evaluation has formulated lessons from the past as well as a
set  of comprehensive,  forward-looking recommendations  to help  the  stakeholders  review the  present
GoU-DPs  partnership,  strengthen  the  dialogue  around  a  shared  agenda,  and  work  together  towards
new forms of cooperation. Regarding the future directions, four areas are important in defining the way
forward:  focusing  on  the  areas  of  highest  impact  and  need,  implementing  sector-wide  approaches,
broadening the mix of support instruments, and strengthening mutual accountability and dialogue.
Focusing on areas of highest impact and need. Given the growth challenges and serious risks to the
key  social  and  economic  achievements made  so  far,  the future partnership  between  GoU  and  DPs
should  consider  less  ambitious  support  programmes and  focus  on  areas  of  highest  impact  and  need,
with a view to:








increase government revenues,
reverse underfunding and serious deterioration of social service delivery,
strengthen downstream governance institutions, accountability and enforcement,
support longer term strategies for growth and poverty reduction including those focused on
infrastructure and agriculture,
integrate gender equality and equity, civil society participation, and local implementation
capacity into the top of the sectoral development agendas.

Implementing sector Wide Approaches (SWAps). The development of solid sector wide approaches
(SWAps)  seems a most  suitable  framework  to  enhance  sectoral  outcomes  and  ensure  effective,
implementation-driven dialogue between GoU and DPs, including their harmonisation and alignment.
Broadening the mix of external support instruments. Under solid SWAps, the use of a broader mix
of external support instruments will allow to ensure flexible responses to specific problems. In the social
sectors,  sector  budget  support  (SBS)  and  basket  funds,  for  example, would  ensure  the  protection  of
sectoral investment, while avoiding excessive project fragmentation and weak GoU ownership. Various
accompanying  measures including in  the  form  of  individual  projects  should  be  considered  as  well,  to
enhance implementation capacity. There should also be some scope for experimentation, for example,
with  new,  results  oriented  aid  modalities. This mix of  aid  modalities could  be also accompanied  by a
limited BS  to  support  MoFPED  and  reinforce  cross-sector  coordination. This  should  also  be
accompanied by much stronger emphasis on local capacity building.
Strengthening mutual  accountability,  policy, and  political  dialogue. A  focus  on  sectoral  and
unambiguous results will increase mutual accountability of GoU and DPs, facilitate policy dialogue and
consolidate  the  already  important  achievements  of  the  High  Level  Action  Matrix  (HLAM).  Political
dialogue should take place in separate instances, limiting overlapping with BS dialogue while enhancing
complementarities with  sectoral  policy dialogue, shared understanding  on  principles, and reduction  of
political risks.

Lessons from the past and lessons for the future

The  main  lessons  of  the  evaluation  regarding  both  the  past  experience  and future  prospects  are
summarised in  the  table  below.  Fifteen lessons  from  the  past  are  highlighted,  with  corresponding
lessons and recommendations for the future. They are clustered around cross-cutting issues and those
affecting sectors of the evaluation focus: education, health, and water and sanitation.

No.

Lessons from the past

Lessons for the future

Cross cutting issues
 BS Effectiveness. BS has supported
macro-economic stability, PFM, and
upstream governance and accountability,
and development in key social sectors. But
it has also shown significant weaknesses:
escalation of public expenditure in
administrative sectors combined with low
levels of government revenue and
inadequate funding for basic services. BS
targeted results––compared to performance
matrices and to past trends and regional
standards––have been below the
expectations.

1

Cross cutting issues (DP, GoU, Civil Society)

 Ensuring a more selective focus on the key

challenges. Going forward, DPs and GoU should consider
less ambitious and more selective programmes and focus
on areas of highest impact and need, e.g., downstream
accountability and enforcement, budget credibility and
transparency, very few priority sectors, to reverse
underfunding and serious deterioration of social service
delivery, backed by local government capacity building
and a forceful emphasis on increasing government
revenues.

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No.

Lessons from the past

 Partnership. Partner relations between

Lessons for the future

xiii

GoU and BS DPs have gradually
deteriorated in terms of divergence of
priorities, interests, and trust. The decision
to strengthen GBS at the beginning of the
evaluation period overlooked the risks
linked to such a divergence of interests.
GBS and its comprehensive dialogue
framework have become increasingly
ineffective. It gradually lost touch with policy
implementation in the key sectors and
pursued overambitious objectives spread
over too many policy areas. Only in the very
last phase of the evaluation period, the
HLAM managed to restore a framework of
mutual accountability, potentially creating
the basis for renewed trust and
cooperation.

 Polarization of GBS and project-led

strategies. The two strategies were often
viewed as mutually exclusive. GBS has
built a high-level consultation framework
and tried to embrace from the top a very
wide and ambitious range of issues. But as
GBS declined, on-budget investment
projects have multiplied resulting in
fragmentation, and SBS declined sharply.
Apart from the water sector, the polarization
and lack of coordination between BS and
projects has been a factor of inefficiency
and ineffectiveness.

 Capacity building. With the exceptions of
PFM, and upstream governance institutions
––policy areas and institutions showing
most improvement–– capacity
development, be it in the form of
accompanying measure to BS or specific
project support, has been generally
overlooked, especially at the local
government level, and in health and
education (a shortcoming which was not
addressed through the introduction of
TASU in 2010).

 Dialogue. Many DPs contributed to a wide
range of policy areas. But focus—needed
for implementation and results––was lost.
In the JBSF period, previously close links
with sectoral priorities and implementation
weakened. In addition, there has been an
increasing overlap of political, human rights,
and economic elements in the overall policy
dialogue – without the necessary clarity,
distinctions, and complementarities – which
has affected its strength and mutual trust.

 Reinforcing the practical foundations of the

partnership between GoU and DPs. This will help
rebuild trust around more focused but genuinely shared
agenda. A more pragmatic approach will help address the
complex challenges and risks linked to the potential
transition of Uganda toward a middle-income oil exporting
economy. Moving policy dialogue nearer to the
practical/technical problems and the local implementation
level would help find a new convergence of interests on a
more realistic set of objectives. Solid sector-wide
approaches (SWAps) in the key areas should help re-
launch the effectiveness of the partnership.

 Broadening of the mix of modalities, while ensuring

sector coherence, coordination and
complementarities. A flexible and coordinated mix of
financing modalities and instruments should be adopted to
address specific sector objectives at central and local level
and adapt to the specific constraints. This may include
SBS and/or basket funds, which are able to protect sector
investment while avoiding excessive project fragmentation
and weakening of government ownership. Various
accompanying measures even in the form of individual
projects should be considered to enhance implementation
capacity. There should be scope for some
experimentation, for example, with results oriented
instruments. Such mix could be accompanied by limited
GBS to support MoFPED and reinforce cross-sector
coordination.
Innovative forms of partnership (e.g. PPP) should be
identified and supported in infrastructure, science and
technology, and other growth-related areas. In the short-
medium term, the priority should be on reversing the
negative trends in the social sectors and on strengthening
resource mobilisation and coordination at MoFPED level.



Increasing capacity building, with an emphasis on the
local level. The delivery of funds, under different
modalities, should be complemented with coordinated and
significant institutional building and capacity development
measures at all levels. Local capacity building should be
considered a high priority and a key component of the
sectoral programmes in order to enhance their
effectiveness.

 Restoring sector dialogue and SWAps. Dialogue

between GoU and DPs should remain firmly anchored in
the realities of the sectoral and local performance. SWAps
seem the most suitable framework to develop an open and
constructive dialogue to improve policy formulation and
implementation, identify capacity gaps, and ensure the
complementarity of the different aid modalities and
programmes. Political dialogue should be separated from
the sectoral policy dialogue. Political dialogue could aim at
improving political understanding, limiting political risks,
and possibly enhancing technical and financial
cooperation.

 DPs coordination. This has shown various
weaknesses, even in the JBSF period and
has been affected by the lack of focus on

 Shifting DPs coordination mainly towards sectors but
with important role for MoFPED. DP coordination should
be mainly based on sector wide approaches and

2

3

4

5

6

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No.

Lessons from the past
sectoral implementation. Despite a joint
PAF, each DP has pushed somewhat
different priorities within the overall donor
frameworks. DPs were also taking
independent and, at times, uncoordinated
disbursement decisions, undermining BS
predictability and credibility of the joint
framework, and complicating the
government’s budget management.
 Civil society. The level of civil society

participation in policy implementation and
as a watchdog has been generally low in
the areas focused by BS, particularly in
PFM and education. This lack of effective
participation of the civil society has
contributed to the mixed performance in the
sectors. BS dialogue has not included any
specific focus and target in this area.

 Gender. Gender equality and equity

principles have been often declared in BS
performance assessment frameworks and
in government sectoral policies. But they
have almost never been effectively
implemented through specific policies and
measures, while BS dialogue has been
unable to support their prioritisation. Below
the surface of some basic indicators of
gender parity, major gender inequities
remain.

 Data availability / reliability. The
availability and reliability of data
represented a major challenge in the
evaluation. After more than a decade of BS
data collection and processing on service
delivery and results in the targeted social
sectors, there remain serious gaps in the
quality and reliability of data on priority
sectors.

Sectoral and thematic issues
 The shift of JBSF dialogue at the OPM level

has overlooked the importance of
MoFPED, which remains a key technical
agency and an actor for policy
development, coordination and
implementation. This is in particular in view
of the critical need to increase domestic
revenue and expand local revenue base,
and improve expenditure efficiency and
effectiveness at national, sector and local
level.

 Fiscal Management. Persistent, low

revenue mobilization has undermined
sustainability of social sector outcomes.
Frequent, poorly justified supplemental
budgets undermined budgetary credibility
and worsened the composition of public
expenditures.

 Sector wide approaches in Education
and Health have deteriorated. The
institutional and technical capacities have
progressively eroded over the past years,
particularly at decentralised levels. A

7

8

9

10

11

12

xiv

Lessons for the future

strengthening of the cross-sector coordination of the
MoFPED, with a close link to the actual programme
implementation. More general and principle issues should
be addressed through political dialogue in the specific
instances where this takes place.

 Enhancing civil society participation to complement
government action, especially in education and other
social sectors, and to control public expenditure
transparency and effectiveness should be put at the centre
of the sector policy dialogue to enhance policy outcomes.

 Gender equality before the law and institutions and
gender equity in terms of economic and social
opportunities and outcomes should be included much
more forcefully in all sectoral programmes to ensure
their implementation through specific measures and
monitoring indicators, including funds (for the
establishment of gender focused services) and capacity
development support at national and local levels. Given
the critical role of women in household welfare, child
health, and the rural economy, greater gender equity
would directly support poverty reduction and sector
outcomes.

 Data collection and processing in the targeted sectors
should be considered a key priority of the policy dialogue
and should be addressed during the formulation of future
BS and other policy support programmes. Possible joint
programmes financed by different DPs should be included
in the relevant financing agreements, or added as
complementary, accompanying measures either at
sectoral or general level. Equally important, better quality
priority sector data should be made widely available, to the
government, the civil society, and the DPs for monitoring
and policy making purposes.

Sectoral and thematic issues (GoU and DPs)
 GoU. Enhance the role of MoFPED to strengthen the
credibility and sustainability of the budget and improve
expenditure efficiency.

 DPs. Priority actions should include:

 BS of limited size to be agreed upon with MoFPED, with
a focus on revenue mobilisation and PFM (namely Local
finance), and efficiency for poverty reduction and
sustainable growth.

 Capacity development (complementary to BS) on

revenue and local finance.

 GoU. Make annual increases in domestic revenues in
terms of revenue-to-GDP ratio a top fiscal priority and
ensure accountability of relevant agencies. In addition to
the new budgetary contingencies, consider stricter legal
limits and criteria on the passage, size and structure of
supplemental budgets.

 DPs. Future BS should be clearly and strictly conditional
on the achieved improvements in domestic revenue
mobilization.

 GoU. Strengthen SWAps in the social sectors to help

recover a path of quality improvement.

 Education

 GoU. Strengthen sectoral policy implementation (SWAp)

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No.

Lessons from the past

Lessons for the future

xv

sector wide approach in water and
sanitation, has been preserved, thanks to
a stronger sectoral leadership supported by
some SBS programmes and a coordinated
mix of other aid modalities. It could be a
model to resuscitate dialogue in other
sectors, although some specific features of
the water sector (namely the predominance
of capital intensive interventions) may have
played a facilitating role.

to reactivate sectoral dialogue and strengthen capacity.
 DPs. SBS and/or Basket funds5, combined with capacity
development support. Such modalities would allow to: i)
re-launch in-depth sector policy dialogue by providing
stronger incentives for sector participation and
involvement, and ii) strengthen linkages between
measures foreseen and complementary capacity
building. They would also allow the possibility of
protecting given levels / categories of sector / sub-sector
expenditures through the inclusion of specific
conditionalities.

 Health

 GoU. Strengthen sectoral policy coordination and
implementation (SWAp) to overcome the sectoral
fragmentation, reactivate sectoral dialogue and
strengthen capacity.

 DPs. SBS and/or Basket funds, combined with capacity
development support (see remarks made under the
education sector.)

 Water and sanitation (and environment)
 GoU. Continue the SWAp in the sector.
 DPs. Mix of aid modalities as currently envisaged by the

latest sector program.



In the area of Law & Justice the strong
progress registered in the upstream side of
the accountability chain (e.g. anti-corruption
legal framework and governing legislation
and OAG and IGG) has not been met by
equal progress on the downstream side
(e.g. enforcement of prosecution and
recovery of funds).

 GoU. Strengthen training, capacity and incentives for
law enforcement against petty and economic crime
and corruption. Require high government officials to lead
by example by publicly and transparently and routinely
disclosing assets and incomes and paying taxes on farm
and non-salary incomes. Use the experience of countries
that successfully made concerted improvements in the
fight against corruption.

 BS DPs have had a relatively ambiguous
attitude toward the country challenges in
energy and infrastructure that are
affecting growth and social development as
well. Despite the comprehensive nature of
GBS and the specific sectoral involvement
of the World Bank and the EU, such sectors
have been only marginally addressed in the
JBSF.

 Policy implementation at the local levels
shows heavy capacity gaps and low levels
of expenditure efficiency. The multiplication
of the districts and the low level of financing
create unsustainable pressures on the local
capacities. BS has not addressed directly
these issues, although the World Bank has
implemented a specific programme at the
beginning of the period.

 Policy dialogue and support to agricultural
productivity and rural development has
been a major missed opportunity in support
of growth, poverty reduction and reducing
gender inequities.

 DPs. Sector programmes with a strong capacity
development component, monitoring and results
indicators.

 DPs. Recognize that there is a role for public

infrastructure in development and consider supporting it
through highly selective, coordinated sector programmes
investment strategies in energy and infrastructure, to
sustain rapid growth and limit negative feedbacks on
poverty and equity.

 GoU. Put local implementation capacities on national
policy priority agenda, through increasing local financial
resources, improving local PFM and strengthening local
capacities and systems.
DPs. Consider improvements of local implementation as a
key priority. Support local component of PFM at MoFPED
level. Support programmes focused on local institutional
strengthening and capacity development. Build on the
experience of previous support.

 GoU. Put agricultural productivity at the top of the

policy agenda and engage DPs in a reinvigorated sector
dialogue with stepped up funding and capacity building.
 DPs. Consider reviving agricultural policy dialogue using

alternative support modalities and lessons from the sector
dialogue in water and sanitation.

13

14

15

16

5 Pooled  funds or  Basket  funds  refer  to a  form of  aid  where  donor  resources  are  pooled but  kept  separate  from
other (government) resources intended for the same purpose. The water and health sectors provide two different
examples  of  the  use  of  pooled  funding  in  Uganda.  Here, it  is  recommended  that  the modality  with  which  pooled
funds are used in the water sector be extended to the health and education sectors.

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1

1 Introduction

1.1 Objectives and scope of the evaluation
The main objective of the evaluation is “to assess to what extent the General Budget Support (GBS)
and  Sector  Budget  Support  (SBS)  in  Uganda  contributed  to  achieve  the  expected  results  by  giving
means  to  the  partner  government  to  implement  its  national  /  sector  strategies,  and  to  enhance  the
efficiency and effectiveness of its policies, strategies  and spending actions. The evaluation should also
analyse  how  GBS  and  SBS  have  contributed  (or  not)  to  improved  transparency  within  government
systems and stronger accountability.”6
The evaluation takes stock of what has been achieved with a forward looking perspective in order identify
lessons learnt and propose recommendations to inform on:









the conditions under which GBS/SBS has an effect (or not) and the possible intensity and nature
(positive or negative) of such effect in Uganda;

the design and implementation of future GBS/SBS operations in Uganda, taking into account the
withdrawal from budget support by several partners following the corruption scandal in 2012, and
the expected increase in domestic revenues from oil;

improvements that development  partners  and  the  Government  of  Uganda may  undertake to
maximize GBS/SBS impacts in synergy with other complementary joint aid modalities in Uganda;

constraints  in  government  policies,  institutional  structures, and  administrative  arrangements  in
Uganda,  which  might  impede  the  overall  effectiveness  and  impact  of  spending  actions  and
targeted public policy.7

The evaluation covers 10 years of Budget Support (BS) operation to Uganda, from 2004 until 2013. This
covers  different  periods  in  the  evolution  of  BS  to  Uganda:  i) the pre-JBSF  (2004-2008);  ii) the JBSF
(2009-2012); and iii) HLAM (2013). The assignment covers all BS operations financed during this period
(see definition of budget support in Box 1). With specific reference to World Bank (WB) budget support,
the evaluation focuses on the PRSCs over the period analysed.

Box 1

Definition of budget support

For  the  purpose  of  this  evaluation – and  in  line  with  the  ToR  (p.1) – Budget  Support  is  defined  as  a
method of financing a partner country’s budget through a transfer of resources from an external financing
agency  to  the  partner  government’s  national  treasury.  The  funds  transferred  (grants  or  loans)  are
therefore managed  in  accordance  with the recipient’s  budgetary  procedures and  are not tracked within
the government systems. In the specific context of Uganda, this definition thus also includes HIPC debt
relief, earmarked sector budget support to the Poverty Action Fund (PAF) and budget support to the PAF
in  general.8 Budget  support  is part  of  a  broader  support  package  which  comprises  other  components,
namely policy dialogue and capacity development.

Furthermore, the evaluation has paid attention to other aid modalities (in particular, projects), in order to
assess  the  complementarity and  synergy  between  them,  including  (comparative)  advantages  or
disadvantages, taking into account the country context.
The  evaluation  has  followed  the  methodological  framework  for  the  evaluation  of BS developed  by  the
OECD-DAC,  which  relies  on  the  so-called  3-Step  Approach  (see ToR  in Annex  1 for  further  details).
More specifically, in line with the thematic scope of the evaluation as foreseen in the ToRs:





In Step 1,  the  analysis  of  BS  contribution  to  the  policy  and  institutional  processes  covers  all
sectors  that  have  been  supported  through  BS  operations,  including:  Macro-economy  (including
on  growth,  fiscal  and  debt  issues)  and  income  poverty  reduction;  Public  Finance  Management
(PFM); Governance (including Accountability, Rule of Law and Justice); Health; Education; and
Water and Sanitation.

In Step 2,  the  assessment  of  the  outcomes  and  their  determinants  focuses  on:  Health,
Education; and Water and Sanitation sectors for which in-depth case studies have been carried
out.

6 Terms of Reference of the ‘Joint Evaluation of Budget Support to Uganda’ (July 2014), p.6.
7 Ibid.
8 It  is  noteworthy  that the  earmarking  is  purely  notional in  this  context as  there  is  no  tracking  of  budget  support
resources through the expenditure cycle in Uganda.

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2

In  addition,  the  evaluation  has  assessed  under  Step  1,  how  and  to  what  extent gender has  been
mainstreamed  through  Budget  Support  operations  in  Uganda,  including  both  the  BS  programme
documents and the supported policies, while under Step 2 specific attention has been devoted to actual
gender inclusion in the specific sectoral outcomes.
Then, in Step 3, the two assessments are compared and integrated to explain the actual contribution of
BS to the targeted results.
Some  integrations  of  the  standard  methodology  have  been  introduced,  however,  along  two  main  lines:
(i) as  the  evaluation  is  executed  by  a  joint  IEG-EC  team,  data  and  analytical  approaches  to  different
questions,  field  visits  and  surveys  have  all  benefitted  from  combined  and  closely  coordinated  efforts  of
the  two  institutions  involved,  and  adjustments  of  the  approach  have  been  introduced  to  ensure  the
evaluation report is compatible with the methodological standards of both; (ii) since the evaluation occurs
in a process of review of the 3-Step methodology, some ad hoc innovations and/or specifications have
been  introduced  regarding  mainly  a  better  understanding  of  the  theory  of  change  and  the  related
contribution  analysis  in  Step  1,  and  the  causal  analysis  in  Step  2,  including  the  use  of  quantitative
methods (as specified in a specific methodological annex).

1.2 Management of the evaluation and presentation of findings
The  overall  process  has  been  led  by  a  Management  Group  (MG),  consisting  of  the  Independent
Evaluation Group (IEG) - World  Bank  and  the  evaluation  unit  of  DG  DEVCO – European  Commission
(lead  partners),  the  Government  of  Uganda  represented  by  the  Ministry  of  Finance,  Planning  and
Economic Development (MoFPED) and the Office of the Prime Minister (OPM), as well as the Evaluation
&  Audit  Unit,  Department of  Foreign  Affairs  &  Trade – Ireland, and  the  Department  for  International
Development (DFID) - UK.
The MG was responsible for the timely realisation and quality of the evaluation. The overall approach of
the  MG  has  been  to  work  in  a  transparent  manner  based  on  regular  consultations  with  the Country
Reference  Group (RG),  which  consisted  of  key  government stakeholders,  civil  society,  Parliament
representatives and interested Development Partners (DPs).

1.3 The outputs of the evaluation
The outputs of the evaluation (three volumes: synthesis, detailed evaluation, and technical annex) will be
presented and discussed at different levels: in Kampala, Brussels and Washington. A first workshop will
be held in Kampala to discuss the findings, conclusions and recommendations with government officials,
academics,  CSOs,  private  sector  representatives  and  the  donor  community.  The  report  will  then  be
revised  and  finalised  in  light  of  comments  and  discussions.  The  dissemination  workshops  in  Brussels
and  Washington  at  EU  and  IEG  headquarters will  focus  on  methodological  aspects  and  the  overall
lessons learned, including the prospects for possible future collaboration on this type of joint exercises.

1.4 Structure of the final report
The report consists of three volumes. Volume I, the synthesis––consists of six main sections:











Section 1. Introduction: it includes a brief overview of the evaluation objectives and scope;

Section  2.  Context: it presents  some  key  elements  of  the  national  context  and  overview  of  the
evolution of budget support to Uganda (key figures);

Section  3.  Key  methodological  elements:
evaluation as well as some methodological challenges and limitations;

it details  the  conceptual  framework  used  in  the

Section 4. Main findings and response to the Evaluation Questions: it provides the results of the
analysis for each of the evaluation questions (core of the report);

Sections 5 and 6. Overall assessment, lessons learnt and recommendations of the evaluation.

Volume II is a detailed report, which presents the complete information matrix with the main evaluation
evidence that underpins the synthetic findings of the evaluation.
Complementary information, including complete results of stakeholder and service provider surveys and
statistical analysis, is provided in various annexes compiled in Volume III.

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2 Context

3

2.1 Key features of the socio-economic context
Uganda experienced robust economic growth over the last decade, resulting in steady gains in per capita
income,  despite  rapid  population  growth.  Per  capita  GNI  (World  Bank  Atlas  method)  has  increased
steadily from USD 270 per person in 2004 to USD 600 in 2013. Over the past five  years, however, the
economy  grew  at a slower  pace,  an  average  of  5.8  percent,  compared  to  7  percent  over  the  past  two
decades and the GNI per capita grew at 2.5%. While robust overall, Uganda’s growth has lagged behind
some of the regional comparators (e.g. Tanzania 7.1 percent; Rwanda 7.4 percent).
Sectorally, the main drivers of economic growth are services, especially telecommunications, wholesale
and retail trade and, to a lesser extent, public administration. By contrast, although the agriculture sector
employs a large proportion of workers, growth in agriculture has been lower than expected. The share of
agriculture as a proportion of GDP, which has historically hovered around 25 percent, dropped sharply to
13 percent in 2013. The services sector has picked up the slack and increased its share of GDP from 45
to 53 in 2013, while the industry sector continues to make up about a quarter of total economic activity.

Figure 2

Patterns of growth and poverty reduction in Uganda

Uganda Sectoral Growth Rates

Uganda GDP Growth and Poverty

16%

14%

12%

10%

8%

6%

4%

2%

0%

12%

10%

8%

6%

4%

2%

0%

60%

50%

40%

30%

20%

10%

0%

2006

2007

2008

2009

2010

2011

2012

2013

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

GDP total

Agriculture

Industry

Services

GDP growth rate (left axis)

Poverty incidence (right axis)

Source: Uganda Bureau of Statistics and World
development indicators.

Robust  growth  has  been  accompanied  by  significant poverty reduction, especially when  growth  in
agriculture  was  strong.  While  the  poverty  incidence  of  people  living  under USD 1.25  per  day was
reduced  from  51.5  to  38.0  percent  over  the  time  period  of  2006  to  2009,  there  are  indications  that  the
overall  poverty  reduction stalled  since then, with  2013  poverty  rate  still  at  37.8  percent  using  the
international  poverty line  (World  Development  Indicators). However, the national  poverty line of USD 1
per  day (which  is  below  the international  poverty line) shows  a  further  decline,  from  39 percent in  the
early 2000s to under 20 percent in 2013 (GoU, 2014). Taken together, these figures imply that, despite
progress achieved (measured by the national poverty line), broader measures of income poverty suggest
high  persistence  of  poverty  and  vulnerability among  large  segments  of  the  population. Geographically,
progress  has  been  unequal  across  regions  with  the Northern regions  most  notably  lagging  behind.  In
those regions, much of the progress can be attributed to a catch-up effect after a period of violence and
political instability.
Against  this  backdrop, Uganda  continues  to  experience  very  high  rates  of demographic  growth  and
urbanization. At  3.3  percent  per  year,  population  growth  in  Uganda  is  among  the  highest  in  the  world,
and it has remained stable since 2004. Exceptionally high birth rates and overall population growth result
in very unfavourable overall dependency ratio, which means that (relatively) few, very young people with
limited  skills  that  are  in  the  labour  force  must  provide  for  very  large  and  growing  cohorts  of  the  young
(and  older)  dependents.  This  is  making  income  poverty  reduction  more  difficult  at  the  household  and
individual levels. Furthermore, urban population growth outpaces rural population growth with respective
rates  at 5.4  and  2.9  percent,  posing  additional  challenges  to  service  delivery  and  poverty  reduction  in
both urban and rural areas. But, with low domestic revenue mobilization and reduced aid inflows, this has
resulted  in  major  pressures  on  the  already  overstretched  urban  services.  At  the  same  time,  delivery  of
basic services in rural areas continues to lag behind, contributing to the massive rural-urban migration.

2.2 National policy framework
In  1998,  the Poverty  Eradication  Action  Plan  (PEAP) framework  was  introduced  to  enable  the  GoU  to
manage  its  resources  more  strategically  in  support  of  its  long-term  objective  of  poverty  eradication.  It
acted  as  the  overarching  planning  framework  until  2010.  The  Ministry  of  Finance,  Planning  and

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4

Economic  Development  collaborated  closely  with  the  Development  Partners  in  the  development  of  the
first plan and its successor covering the period of 2004-2008, which was eventually extended to 2010. It
covered  five  pillars:  (1)  economic  management;  (2)  production, competitiveness, and  incomes;  (3)
security,  conflict-resolution, and  disaster  management;  (4)  governance;  and  (5)  human  development.
The Government’s priorities during this period were, by and large, focused on the expansion and quality
of  frontline  health care  and  primary  education  services  along  with  programmes  to  support  income
generation through the commercialisation of agriculture.
In  2007,  the  National  Planning  Authority  was  established,  which  took  stewardship  of  the  national
planning  process  and  commissioned  an  independent  evaluation  of  the  PEAP.  Some  of  the  high-level
findings were that: (i) the PEAP was effective as an instrument for the prioritisation of public policy, but
that  this  prioritisation  has  weakened  over  time, and  (ii)  changing  political priorities  have  created  a
growing gap between the priorities of the PEAP and the capacity of the budget to fund them. Though the
Poverty Action Fund (PAF) has been effective within the budget in protecting and reinforcing the original
poverty eradication policy settings, it appears to also have had a negative effect on the PEAP’s capacity
to adapt its strategy as national circumstances have changed.
The National Planning Authority developed an ambitious new vision for the development of the country,
aiming  to  achieve  middle-income  status  within  30  years  through  the  implementation  of  a  series  of  five
year  plans.  The  first  of  these  plans  (National  Development  Plan 2010-2015)  incorporated  the  main
recommendations from the evaluation of the PEAP. The new plan entails a significant shift in emphasis
towards  economic  infrastructure,  linked  to  the  discovery  of  oil,  gas  and  minerals.  Social  services
sectors - which  have  been  the  long-standing  focus  of  external  donor  support - including  education,
health, and water assume secondary priority.

2.3 Evolution of budget support to Uganda
Uganda  has  traditionally  received  large  amounts  of  international  donor  in  the  form  of  BS.  Total  BS,
including  General  Budget  Support  (GBS),  Sector  Budget  Support  (SBS)  and  Balance  of  Payment /
Heavily Indebted Poor Countries (HIPC) debt relief initiative support, decreased substantially from a high
of almost USD 700 million in FY06/07 to well below USD 100 million as of FY12/13. There is broad trend
of  decline  in  the  last  ten  years  and  a  sharp drop  from  FY12  to  FY13,  reflecting  the  aftermath  of  the
episode of the diversion of donor funds (see Figure 3).

Figure 3

Uganda: Trends in GBS and SBS (USD millions, left scale; percent shares, right scale)

800
700
600
500
400
300
200
100
0

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

 GBS

 SBS

 BoP/HIPC

Share of SBS / Total

Share of GBS / Total

Note: the sum of the shares of SBS and GBS does not necessarily amount to 100%, as the overall
amount also includes the funds provided under the BoP / HIPC initiative.
Source: Own elaboration based on data provided by the ALD, MoFPED (2014).

Of a total of USD 3.5 billion in BS extended to Uganda during 2004-13 period, USD2 billion went toward
GBS and USD 1 billion toward SBS, with the rest provided in the form of BoP/HIPC (see Figure 3). Of the
twelve BS partners, the WB was the biggest contributor with USD 1.2 billion followed by the UK and the
EU who provided USD 480 million and USD 290 million respectively (see Annex 4 for details).

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3 Key methodological elements

5

3.1 General issues
The  methodology  applied  in  this  evaluation  follows  the 3 Step  approach  as  established  in  the  OECD-
DAC guidelines9. To ascertain how and to what extent the opportunities provided by BS have been used
to  strengthen  the  government  policies  geared  towards  the  achievement  of  the  agreed  results,  the
evaluation uses a contribution analysis, divided in two steps (Step 1 and Step 2) and then synthesised in
Step 3. Through the evidence collected, the contribution analysis aims at building a credible story on the
relationships between BS inputs and targeted development outcomes, via the government policies.
As a result, two separate assessments are carried out: Step 1 focusing on the contribution of BS to the
country’s  policy  and  institutional  process  and  Step  2 focusing on  the  achievement  of  the  BS  targeted
results  in  some  focal  sectors  and  the  underlying  causal  factors.  Then,  in Step  3,  the  two  assessments
are  compared  and  integrated  to  explain  the  actual  contribution  of  BS  to  the  targeted  results.  This
approach  allows  a  full  consideration  of  the  interaction  between  the  policy  processes  and  the  context,
including the consideration of country political economy and the overall national economic environment.
Its  comprehensiveness  also  appears  suited  to  the  assessment  of  clusters  of  BS  operations  for  which
issues  of  coordination,  harmonization,  and  broad  political  and  political  economic  context  might  be
particularly important.
Some  integrations  of  the  standard  methodology  have  been  introduced,  however,  along  two  main  lines.
First, the evaluation, being a joint exercise carried out by an EC-IEG team, introduced some adjustments
to the  approach  to  ensure  the responsiveness  of evaluation  report to the methodological standards  of
both  institutions.  This is  particularly  evident  in  the synthesis  chapter  structured in  line  with  the IEG
objectives-based  approach  to  project  validation  and  assessments,  consistent  with  the  key  DAC
evaluation criteria. This chapter also responds to the requirements of the Overall assessment section as
foreseen by the  standard  3  Step  methodology. In  addition,  as  the  evaluation  is  executed  by  the  joint
team, data and  analytical  approaches to different questions, field visits and surveys have all benefitted
from combined and closely coordinated efforts of EC and IEG teams.
Second,  the  evaluation  occurs  in  a  process  of  review  of  the  3-Step  methodology,  based  on  the
experience  carried  out  in  seven  new  countries,  since  2012.  This  implies  that,  in  addition  to  the
aforementioned  EC-IEG  collaboration, some  ad  hoc  innovations  and/or  specifications  have  been
introduced and are addressed from the methodological point of view in an annex to the present report.

3.2 The specific theory of change of BS and the 3-Step approach
The theory of change underpinning the evaluation  of budget support operations differs very much from
the one used for project evaluation, as BS  is a modality of aid in  which the  use of the funds and other
inputs provided to a government by its DPs (providing a coordinated, aligned, and harmonized “cluster”
of BS operations) is not submitted to pre-defined implementation conditions or operational plans. Funds
are  mainly  disbursed  according  to  the  achievement  of  a  shared  set  of  development  results  (including
intermediate targets), monitored trough a dialogue framework. It is generally recognised that the recipient
government  has  the  necessary  policy  and  implementation  tools,  which  may  be  strengthened  by  further
technical support included in (or complementary to) the BS package. In some BS designs, namely those
of  the  World  Bank,  specific  policy  matrices  highlight  the specific engagements  of  the  government  on
given policy processes while only some of the related indicators are used as “prior actions” (conditions of
approval)  and triggers in  multi-operation,  “programmatic”  BS. So  the  two  approaches  and  associated
theories  of  change,  while  related,  could  be  thought  of  as  one where  the  subject  is  a  cluster  of  BS
operations  by  different  DPs  versus  one  where  it  is  a  single  operation  or  a  series  of  closely  related
operations (as in World Bank BS operations, standalone or programmatic).
BS, according to the specific agreements with the recipient government (Level 1 of the Intervention Logic
– IL – as shown in Figure 4), puts in place a number of inputs that represent new opportunities for the
government (Level 2 of the IL) to implement and strengthen its policy and institutional processes (Level 3
of the IL) to enable economic and social actors to achieve a set of targeted outcomes (Levels 4 and 5).
The  recipient  government  will  use  the resources  and  capacities  provided  through BS  (funds,  dialogue
and  TA) according  to its  own  systems  and  priorities.  Indeed,  there  are  cases  of  DPs  that  consider  the
funds provided by BS as an ex-post reward for the achievement of the agreed results and not as a tool to
achieve them.

9 http://www.oecd.org/dac/evaluation/dcdndep/
Methodological%20approach%20BS%20evaluations%20Sept%202012%20_with%20cover%20Thi.pdf

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6

The evaluation follows a heuristic framework rather than a normative one. It aims at discovering how the
opportunities  provided  have  been  used  to  develop  the  policy  process,  and  how - and  through  which
dynamics - the targeted development outcomes have evolved, rather than analysing whether an agreed
path of actions has been put in place and has produced (or not) the agreed outcomes.
In Step 1, the evaluation aims to ascertain, first, if the resources provided by BS may be appropriated by
the  government  to strengthen  its  development  policy  and  institutional  process  in  the  given  context
(relevance). Then it has to investigate to what extent and how the government has used the capacities
and opportunities provided by BS to strengthen its own policy and institutional processes (efficiency and
effectiveness).  Indeed,  different  governments  might  use  the  resources  provided  in  different  ways,
although obtaining similar results, either positive or negative, and there might also be capacity gaps that
if not adequately addressed, hamper the use of the resources.
As  a  result, the  formulation  of  the  Evaluation  Questions  (EQs) related  to  Step  1 has  to  contain  the
various hypotheses and indicators necessary to understand how the government has used the resources
provided and  how  the  dialogue  has  allowed  (or  not)  to  facilitate  a  constructive  use  of  such  resources.
Instead of verifying a pre-defined sequence of causal links, as happens in a project evaluation, the EQs
must  help  identify  the broader  context within  which the  cluster  of  BS  operations takes  place,
the
opportunities created, those missed, as well as the actual use that the different parties have made of the
resources and opportunities. This is possible through a number of standardised assessments, which are
detailed in the specific methodological annex (see Volume 3).
In  Step  2 the  focus  is  on  development  outcomes.  Here, the  evaluation  has  to  assess  whether  the
government policies have been able to generate the targeted improvements in the livelihood of the poor
(shorter and longer term impact). Sometimes it is said that the Step 2 assessment includes an attribution
analysis and allows the identification of the determining factors of the targeted outcomes. To support this
idea,  the  use  of  quantitative  econometric  analyses  has  been  considered  the  most  important  tool  in  the
Step 2 assessment.
In  this  evaluation,  this  idea  has  been  partially  reviewed.  In  Step  2,  the  evaluation  carries  out  (a)  a
descriptive analysis to identify the most significant changes occurred in the targeted outcomes during the
evaluation period, (b) a causal analysis to identify the main causal factors of such changes. The objective
of this causal analysis is to identify the causal links between the GoU policies supported by BS and the
changes  in the targeted outcomes, and to  understand the role of other  policy  and non-policy factors in
the  causality  process.  At  the  end,  the  Step  2  provides  a  reasonable  understanding  of  the  causality
process in relation to the targeted outcomes, although not a definitive attribution of the related changes.
In this causal analysis, a mix of qualitative and quantitative methods have been adopted (see Volume 3 -
Annex 5).  The  latter  have  been  used  when  permitted  by  the  availability  and  reliability  of  the  data.
Considerable  efforts  were  expended  in  collecting  and  reconciling  official,  DP,  and  international
development  agency  data,  as  well  as  generating new  quantitative  and  qualitative  data  and  associated
knowledge, including two surveys, extensive interviews, field visits, and statistical analysis.
Step 3 then synthesises Steps 1 and 2 and allows to: i) validate the analyses carried out under the two
previous steps and ii) verify their consistency by identifying the correspondence between the conclusions
of  the two  Steps,  i.e.  whether  the  policies  that  have  improved  thanks  to  the  contribution  of  BS  are  the
same policies that have contributed  to the achievement of the targeted outcomes. By so  doing, Step 3
enables the identification of the actual contribution of BS to the targeted results through the identification
of causal links between BS and development outcomes, via the government policies.

3.3 Surveys
Two different surveys have been carried out in the framework of this evaluation, thereby integrating the
methodology with new research tools:





eSurvey: an online survey  has been addressed to the key stakeholders (government, DPs and
civil  society  representatives)  to  collect  their respective  opinions  on  some  of  the most  important
issues dealt with in the Step 1 evaluation questions;

Field survey:  a  survey  carried  out  in eight districts  has  complemented  the  documentary
information and the direct  observations of the experts on the specific conditions of the frontline
service delivery.

3.4 The Intervention Logic
The  Figure below shows  the  overall  Intervention  Logic used in  this  evaluation.  It  highlights  the  causal
links among the different elements in the causal chain.

Joint Evaluation of Budget Support to Uganda
Final report - Volume 1 - 2015 - IEG and Particip GmbH

Figure 4

Overall intervention logic

7

Inputs to government policies and spending actions

Government policies and spending actions
(strategy)

Development results

Inputs

Direct Outputs
Direct Outputs

Induced Outputs
Induced Outputs

Outcomes

Impact

INPUTS of GBS / SBS

Policy dialogue and
performance
matrices (JAF...)

Capacity
development inputs
incl. technical
assistance (e.g. TASU
under the JBSF...)

Transfer of funds
US$4.28 billion to
account at Central
Bank / Treasury

Main government
programmes and other
SPECIFIC INPUTS

INPUTS of other (non-
BS)  external assistance
programmes
funded  by bilateral and
multilateral donors:
US$5.04 billion

&
S
P
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,
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A
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A
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T
O

OVERALL and SECTOR SPECIFIC
IMPROVEMENTS IN THE
RELATIONSHIP BETWEEN EXTERNAL
ASSISTANCE and THE NATIONAL
BUDGET & POLICY PROCESSES

Policy dialogue architecture
(evolutions during the period) and
performance matrices, including
gender indicators

TA and complementary actions are
connected  to budget support
according to the actual needs and
complement/strengthen  the
dialogue (e.g. TASU as of 2010)

BS strengthens the alignment with
GoU systems, helps reducing
transaction costs and is conducive  to
harmonisation among donors.

Increased size and share of budget
available for discretionary spending
to support achievement  of national
dev objectives and progress towards
MDGs

Increased size and share of external
assistance funds made available
through the national budget

OTHER EFFECTS FROM VARIOUS OTHER
GOVERNMENT INPUTS
Domestic revenue funding and
domestic policy inputs…

OTHER EFFECTS FROM OTHER EXTERNAL
ASSISTANCE

IMPROVED PUBLIC POLICIES, PUBLIC
SECTOR INSTITUTIONS & PUBLIC
SPENDING PROCESS
Improved macroeconomic management,
including fiscal and monetary policies

PFM and procurement  systems, incl. At
decentralised level, strengthened

-------------

Transparency and accountability
increased, incl. fight against corruption

Public institutions capacities, at central
& decentralised level, to plan and
implement  the relevant policies,
strengthened
Enhanced interaction between GoU, the
CSOs and the private sector in policy
processes

Improved public policy formulation and
execution processes, including evidence-
based policy making, M&E and
accountability

IMPROVED PUBLIC SERVICE DELIVERY /
PUBLIC SERVICE MANAGEMENT

• Vacancy rates in social sectors  (health
and education) decreased
• Absenteeism  rate in public health
facilities & schools  decreased
•Terms in performance  agreements for
Primary School Head Teachers and
Hospital Directors  complied  with
•Primary school teachers with approved
schemes of work ↑

Water and Sanitation:
• % of people  within  benchmark distance of
an improved water source increased
• %  of improved rural water sources that
are functional at time of spot check

G
e
n
d
e
r

r
e
s
p
o
n
s
i
v
e
b
u
d
g
e
t
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n
g
&
g
e
n
d
e
r

i

m
a
n
s
t
r
e
a
m
n
g

i

POSITIVE RESPONSES BY
BENEFICIARIES (service
users and economic actors)
– to government policy
management and service
delivery

Education:
• Proficiency  at Primary
6 (literacy  & numeracy
rates), improved
• No of primary pupils
passing PLE with grades
I-III↑
• Gender equality
outcomes ↑

Health:

• % of deliveries  in

• Proportion  of health
facilities without stock-
outs for 6 tracer
medicines/supplies  ↑
• Number and
proportion  of children
immunised
with DPT3 ↑
• Gender equality
outcomes ↑

Water & Sanitation:

• No of people  with
access to rural and
urban water services ↑
• No. of households
with access to safe and
effective sanitation ↑
•Gender equality
outcomes ↑

POTENTIAL FOR
SUSTAINABLE AND
INCLUSIVE GROWTH
& POVERTY
REDUCTION
TOWARD

Enhanced
sustainable
and inclusive
economic
growth

Reductions in
income poverty
& non-income
poverty

Gender
equality

Empowerment
and social
inclusion of poor
and
marginalised
people (rural /
urban divide)

INTERVENTION CONTEXT & EXTERNAL FACTOR

• Entry conditions: existing policy
framework and related implementation
• Past support through HIPC and BS
since 1998

• MDG Targets, MTEF consolidated;
• Paris Declaration/aid effectiveness
agenda

• High capacity  & commitment of MoF,
importance of inter-sectoral coordination
• Urban and rural demand for services
•Increased domestic accountability

•Economic growth and political pressure towards
productive priorities
• Foreign capital inflows and new potentials for export
• Responses  to changing incentives

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8

3.5 List of the Evaluation Questions
Within  this  framework,  ten  evaluation  questions  (EQs)  have  been  formulated based  on  the  extensive
discussion of the relevance and focus of BS under evaluation as well as their sectoral focus. The table
below lists these EQs and indicates the link with the overall intervention logic.
Table 2

Overview of the Evaluation Questions

No.

EQ 1

EQ 2
EQ 3
EQ 4
EQ 5

EQ 6
EQ 7
EQ 8
EQ 9
EQ 10

Scope of Evaluation Question

Relevance and design of BS operations

Direct effects of BS financial and non-financial inputs
Quality of macroeconomic management
Quality of Public Finance Management (PFM)
Level and composition of public spending / allocative and operational
efficiency at both central and local levels
Policy formulation and implementation processes
Governance / accountability including anti-corruption
Outcomes and causality analysis in the Education sector
Outcomes and causality analysis in the Water sector
Outcomes and causality analysis in the Health sector

Step/Level

Step 1, Level 01
Step 1, Level 2
Step 1, Level 3
Step 1, Level 3

Step 1, Level 3

Step 1, Level 3
Step 1, Level 3
Step 2, Level 4
Step 2, Level 4
Step 2, Level 4

As highlighted in the table below, the analytical framework used combines the EQ-based approach of
the  OECD-DAC  methodological  guidelines  to evaluate  budget  support  and  the  objective-based
approach of the IEG for strategic evaluation.
Table 3

Cross-linkages between the Step-3 OECD-DAC approach to evaluate budget support
(EQ-based;  first  column)  and  the  IEG  approach  (objective  based,  project;  remaining
columns)

Questions (Step-3 Analysis)

EQ1 – Relevance and Design of BS

EQ2 – Direct effects of financial and non-financial
inputs

EQ3 – Macro-economic management

EQ4 – PFM

EQ5 – Allocative and operational efficiency of
public spending

EQ6 – Policy formulation & implementation
processes

EQ7 – Governance & Accountability

EQ8 – Education

EQ9 – Water

EQ10 – Health

Synthesis

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The criterion is largely covered by the EQ

The criterion is partially covered in the EQ

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Final report - Volume 1 - 2015 - IEG and Particip GmbH

 
 
 
 
 
 
 
 
 
 
 
 
4 Main findings and responses to the evaluation questions

9

4.1 Step 1

4.1.1

Evaluation question 1

EQ1 - Relevance and Design of BS
To what extent did the design of the budget support interventions respond to the specificities
of the political, economic and social context of Uganda, to the government’s policy and to the
aid framework?

Background and context
Within the 10-year period covered by the evaluation (2004-2013), it is possible to identify three different
phases  of  budget  support  to  Uganda.  This  periodicity  is  important  in  that  it  coincides  with  important
changes  in  the  relations  between  the  donors  and  the  government,  coordination,  and  the  level  and
quality of policy dialogue underpinning budget support.







Phase one (2004-2008) or “pre-JBSF period”10: this sub-period coincides with the last period
of implementation of the GoU Poverty Eradication Action Plan (PEAP).
Phase two (2009-2012) or “JBSF period”: this sub-period coincides with: i) the launching of
the National Development Plan (NDP); ii) the coming together of all BS DPs under the umbrella
of the Joint Budget Support Framework (JBSF); and iii) a partial shift back to projects by DPs.
Phase  three (2013-ongoing)  or  “HLAM  period”: although  still  under  the  JBSF,  this  sub-
period marks the development of the High Level Action Matrix (HLAM) in response to the total
freeze  (in  some  cases,  only  temporary)  of  BS  decided  by the donors  in  FY  2012/2013.  This
took place following the corruption scandal involving the diversion of donor funds earmarked for
the recovery of Northern Uganda.

Main findings11

Alignment of objectives to GoU and DPs strategies (see also Volume 2: JC1.1, JC1.2 and JC1.4)
Overall, BS operations were very much aligned to the development goals and objectives as set out in
the various country assistance strategies of DPs and policies as outlined in statements from their HQs.
In addition, there  is a strong degree  of correspondence between the focus and results outlined  in  the
BS documents and the stated objectives of the GoU’s development strategies (PEAP and NDP).
The  strong  degree  of  correspondence  of  objectives  is also evident  when  looking  at  the  three  focal
sectors:


In the education sector, the core objectives of BS operations reflect evolving GoU priorities and
needs with the support to Universal Primary Education (UPE) focusing on the need to increase
the number of children in primary school and increase the education levels of the population in
order to raise skill levels and productivity and therefore economic potential. The main objectives
outlined in the PEAP and NDP were reflected in the ESSP and the revised ESSP, which was
reworked  in  order  to  include Universal  Post-Primary  Education (UPPET) objectives.  Similarly,
there was consistency between goals and indicators in BS PAFs and those in the NDP, PEAP
and sector policies.





In  the health sector,  BS  has  supported  the  development  and  implementation  of  the  Health
Sector  Strategic  Investment  and  Plans - phase  I  (2005/06-2009/10)  and  phase  II  (2010/11 –
2014/15).  These  sector  plans  set  out  the  overall  direction  of  the  GoU’s  plans  for  the  health
sector,  including  a  defined  set  of  priorities  and  targets  for  which  achievements  have  been
reported annually in the Annual Health Sector Performance Reports (AHSPR).

In  the water  and  sanitation sector,  there  is  full  alignment  of  BS  operations  with  GoU’s sector
priorities  and  country  needs  which  is  explicitly  and  clearly  visible  in  light  of  the  adoption  of  a
sub-set  of  the  golden  indicators  used  to  assess  sector  progress  by  the  GoU  in  the  BS
assessment performance frameworks.

However,  while gender mainstreaming  and  equality  were  an  integral  part  of  DPs’ overall goals  and
objectives, this has not been consistently incorporated in the design of specific BS operations. None of

10 The DFID Review of Budget Support to Uganda 1998-2012 (ODI, 2014), which covers a broader time span, also
includes  an  additional  phase  (1998-2001)  which  is  characterized  by  the  provision  of  SBS  in connection  with  the
Poverty Eradication Action Plan (PEAP) and the Poverty Action Fund (PAF).
11 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.

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10

the bilateral BS financial agreements reviewed refers to gender equality as a key BS objective. Nor do
the  performance  matrixes  include  gender-specific  indicators  beyond  the  use  of  gender  disaggregated
data  to  monitor  performance of selected  indicators  in  the  social  sectors  (e.g. in education  and  use  of
maternal health and maternal mortality indicators in the health sector).
Moreover,  the  alignment  of  most  donors  to  the  World  Bank’s  PRSCs  in  the  pre-JBSF  period  did  not
always allow to adequately reflect the specific priorities supported by some of the individual  DPs. For
instance,  DFID strategy  showed  a  specific  emphasis  on  the  creation  of  an  improved  investment
framework while the World Bank country assistance strategy showed a particular focus on PFM. In the
JBSF  period,  this  problem  was  overcome  with  the  articulation  of  the  JAF  in  four  sections12 and  its
emphasis on the four underlining principles which allowed taking into account differing DPs’ priorities.

Relevance of design (Vol. 2: JC1.3)
BS  inputs  (dialogue  and  capacity  building)  were  also  generally  adapted  to  address  the  specific,
identified development  bottlenecks. The  broad  links  between  BS  objectives  as  reflected  in  PEAP  and
NDP  and  BS  inputs  are  reasonably  articulated.  Links  with  the  results  and  M&E  frameworks  are
comparatively  weaker in the earlier part of the period  under review but strengthened in the JBSF and
HLAM  period.  Also,  because some individual programmes targeted  very  specific  elements  of  the
PEAP/NDP  agenda,  while  well  aligned, tended  to  show weaker  links  between  objectives,  inputs,  and
M&E indicators.
The policy dialogue  has  focused  on  the  MoFPED as  the  main  counterpart and  the  key  sectors  in  the
pre-JBSF period. By contrast, it focused on the OPM and the overall policy coordination across many
sectors in the JBSF period.
BS design and complementary actions have given sufficient emphasis to the risks related to PFM and
significant  capacity  development  inputs  have  been  provided  in  this  area,  through  the  Financial
Management and Accountability programme (FINMAP) and some World Bank expenditure reviews. The
same  emphasis  has not  been  given,  however,
to  the  risks  related  to  the  actual  implementation,
especially  at  local level. In this  area, capacity  development inputs have been  limited to a World Bank
support programme to local governments and other scattered inputs.
Despite the alignment of objectives on paper and the elements of convergence on some sector issues
highlighted above, overall priorities pursued by the GoU on the one hand and by the DPs through BS on
the other, started to diverge in practice since the early 2000s.
The  GoU  gradually  shifted national  investment  priorities  toward  productive  sectors  and periodically
increased public administration expenditure during the electoral cycles. This has been complicated by
the  proliferation  of  districts  and the erosion  of  the  local  revenue  tax  base. At  the  same  time,  despite
many policy pronouncements and targets to the contrary, domestic revenue mobilization remained low.
Moreover, beyond many practical signals, the GoU explicitly stated – through the issuing in 2003 of the
revised  Partnership  Principles  by  the  MoFPED – that  DPs  should  no  longer  expect  to  see  an
additionality effect of the BS funds in the different sectors. GBS was expected to help GoU to address,
with enhanced flexibility, the new economic and financial challenges.
The  DPs supported GoU’s  preference  for  GBS and a more  flexible  use of  BS,  which  remained
substantial. But the relevance of this design and continued large BS volumes has been undermined by
“moral  hazard”  suggested  by stagnant domestic revenues and persistent
inefficiencies  in  public
expenditure with  attendant  risks  for the  efficient  use  of  the  BS  funds as  well. Simply  put,  in  the
environment  of  plentiful  external  BS,  there  was  little  incentive  for  the  government  to  implement  its
declarations  on  increasing  government  revenues  nor  to  reduce  waste  and inefficiencies in  its
expenditure programmes. After all, the design of the results framework of BS itself had weaknesses and
some actions and indicators were not sufficiently results oriented. More directly, much more emphasis
in design was on upstream elements and dialogue, ensuring BS expenditure spending and consultation
In  this
and  consensus  building  and  less  on  impact,  implementation,  and  development  outcomes.
context,  following  requests from  their  headquarters  to  focus  on  new  priorities,  the  DPs  became
increasingly concerned about issues related to corruption and human rights with a view to limit the risk
of new events that could prove unacceptable for their respective stakeholders and public opinions.
These developments in the cooperation context translated into significant changes in the framework for
delivering  BS.  The  establishment  of  the  JBSF  and  the  related  Technical  Assistance  Support  Unit  in
2008 responded to the new challenges created with the introduction of the GBS but also to the objective
of  strengthening  the  mutual  accountability  by:  i)  increasing  the  DPs  harmonisation  and  alignment,

12 Underlying principles: Broad progress in areas of human rights, democracy, peace and stability in the region;
Section I: Preconditions for effective and efficient implementation of government policies.
Section II: Cross-cutting reforms in the areas of governance and institutional restructuring.
Section III: Sector specific performance. See Volume 2, JC 1.3 for further details.

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11

ii) introducing  a  stronger  focus  on  transparency,  human  rights  and  accountability,  and  iii)  at  a  later
stage, simplifying the PAF.
The “JBSF period” saw a shift from the assessment of performance largely based on the PRSC matrix
to one based on the JAF, which explicitly  incorporates governance issues  within the BS framework in
the form of underlying principles focused on democracy, human rights, rule of law and access to justice.
The  set-up  of  the  JBSF  and  the  JAF  responded  to  some  of  the  key  lessons  identified  during  the
previous phase of BS in the country, and allowed to increase donor harmonization and increase country
ownership.  At  the  same  time,  other  lessons  learnt  with  regards  to:  i)  excessive  overloading  of  the
assessment matrixes; ii) need to place more emphasis of the identification and measurement of results;
and iii) need to strengthen the link between the cross-cutting reform agenda and sectoral reforms were
also progressively taken on board through the development of the successive JAFs.13.
The JBSF and JAF period also saw a shift in the management of BS on the GoU side from the Ministry
of Finance to the Office of the Prime Minister. This change, although driven by internal GoU processes
in  light  of  the  coordinating  role  within  GoU  held  by  the  OPM,  well  responded  to  the  DPs  desire  for
inclusion of broader governance issues within the BS dialogue, issues which fell beyond the remit of the
MoFPED.
Such  changes  in  the  BS  design and  cooperation  architecture have  addressed  some of  the  problems
mentioned  above.  In  particular, they  have  increased  the  coordination  among  DPs  and  have  elevated
the dialogue at the highest decision making level, thereby improving the alignment between GoU and
DPs. Also,  the  policy  matrixes  have  gradually  improved  in  concreteness  and  quality  of  indicators. But
apparently, these changes have not resulted in adequate mechanisms and tools to analyse and support
the actual implementation (including financial and technical capacities) at sectoral and local level.
The JBSF phase also saw a further divergence of expectations. Interviews and documentation reviewed
record  concerns  from  both  sides.  On  the  one  hand,  the  Government  questioned  the  inclusion  of
underlying  principles  within  the  JAF  framework,  asked  for  clear  indicators  against  which  performance
could be clearly assessed, and raised the issue that the JAF did not adequately reflect GoU priorities
and  was  not  sufficiently  aligned  with  annual  performance  commitments  in  Budget  Framework  Papers
(BFPs).  On  the  other  hand,  DPs  expressed  concern  over  progress  on  governance  and  corruption
(‘questionable  commitment  to  upholding  the  rule  of  law  and  the  protection  of  constitutionally  defined
human rights’, lack of compliance with pre-conditions on anti-corruption actions as foreseen in both JAF
1 and JAF  2), increasing  expenditures on  defense (including the off-budget purchase of fighter jets in
2010),  lack  of  “net  improvement  in  performance  in  the  education  and  water  and  sanitation  sector
indicators  since  JAF  1”,  and  continuing  diverging  GoU  budget  priorities  vis-à-vis  donors’  interests.14
These differences over the underlying principles and public expenditure priorities further increased the
GoU-DP distance within the existing higher level dialogue structures and show how–despite the formal
convergence of objectives on paper–priorities pursued diverged in practice.
Despite  these  frictions,  DPs  failed  to  take  coordinated  action in  response.  In  general,  this  phase  is
characterized by a strong ambivalence and lack of consensus on the DPs side between conflicting DP
views and objectives of (i) supporting continued poverty reduction  actions by funding the GoU  budget
and (ii) sending strong signal about disagreements with some objectives and outcomes by withholding
aid. This ambivalence led to uncoordinated, individual DP cuts in budget support rather than to a long-
term change in the coordinated approach to the provision of aid. It is only in 2012 that JBSF DPs jointly
decided  to  suspend all budget  support  disbursements  in  response  to  the  publication  of  the  special
investigation  into  financial  management  at  the  OPM  released  by  the  Auditor  General  showing  that
approximately  USD 15 million  of  donor  funding  in  support  of  recovery  in  Northern  Uganda  had  been
“misappropriated”.
The third sub-period, marked by the development of the High-level Government Financial Management
Reform Action Matrix (HLAM) in November 2012, marks the resumption of dialogue on budget support
(as of mid-2013) based on the progress achieved under HLAM, because of the GoU agreed corrective
actions although with some concerns regarding selected key results. At the same time, inconsistency of

13 The  JAF  links  these  cross-cutting  constraints  to  efficient  service  delivery  in  areas  such  as  public  financial
management, public service management and anti-corruption, to sector-specific reform needs in the four JAF target
sectors:  health,  education,  transport  and  water  and  sanitation.  By  tackling  these  broader  sector  governance  and
institutional constraints such as administrative and financial systems and procedures, service delivery units will be
better able to deliver quality services to the Ugandan population. It is important to note, however, that the number
of indicators and actions included in the JAFs had been progressively growing before being drastically reduced with
the JAF 5 to 29 indictors. (Previously, 42 indicators and 56 actions under JAF 1, became respectively 44 and 79
under JAF 2, then 66 and 95 under JAF 3, and 74 and 71 under JAF 4). Source: JAF Appraisal Reports.
14 Quotes taken from the JAF 2 Appraisal cover letter of 16/12/2010.

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12

DPs’ reactions resumed. While continued commitment and progress in the fight against corruption was
a pre-condition for all, decisions to restart budget support would be taken by individual DPs. As a result,
some  DPs,  despite  expressing  disappointment  on  not  having  achieved  more  with  the  Matrix,  decided
that  further  pressure  would  not  yield  any  better  results  and  decided  to  resume budget  support
disbursements, dependent on performance.
What  kind  of alternative  choices could  have  limited  the specific risks encountered  during  the
implementation  of the  different  types  of  BS (particularly  GBS) over  the evaluation period?  Several
considerations could be relevant in this regard.
First, the adoption of a project-only aid modality instead of BS would have limited the total cost but not
necessarily  individual  project risks of  an  inefficient  and  non-transparent  use  of  the  resources. But it
would  probably  not  have  ensured a high-level  or  comprehensive  multi-sector  or  sectoral  dialogue  or
more coherent  policy  development.  As  a  result,  such  project-only  modality would  have  remained
fragmented  with potentially  substantial  relevance,  coherence,  and sustainability  problems. It  would
remain  subject  to  fiduciary  and  governance  risks,  albeit  at  lower  volumes  of  aid  per  year  implicit  in
projects-only strategy.
Second, fewer but well targeted SBS programmes in the focal sectors and PFM, as experienced in the
previous  period  and  later-on  in  W&E, perhaps would  have  been  a  better  tool  to  enhance  sectoral
dialogue and improve  the  implementation  of  sector  policies.  This  could  have avoided the  negative
funding  implications  of  the  trade-offs  between  GoUs  and DPs  priorities. Their potentially stronger  link
with  implementation  would  have  also  facilitated  the  complementarity  with significant capacity
development  support, especially  at  local  level. To  be  sure,  sector  BS  would  not  have necessarily
contributed to the building of a national development strategy and a comprehensive governance system
as  is the  aim  of  GBS. But with  hindsight, this  less  ambitious  BS  approach  coupled  with  stronger
emphasis  on  implementation  and  some  of  the  missed  opportunities  in  the  policy  agenda would  have
been a more relevant and realistic approach.

Summary answer to the evaluation question
The relevance of BS was overall substantial, but it had important gaps and it diminished over time. The
design  of  BS  operations  was  very  much  aligned  to  the  specific  DPs’  strategies.  It  has  also  reflected
different  phases  of  the  country  context.  Also,  on  paper,  there  is  a  strong  degree  of  correspondence
between the stated objectives of the GoU’s development strategies (PEAP and NDP) and the focus and
results  outlined  in  the  BS  documents. Coordination  among  donors,  extensive  process  of consultation,
and development of M&E are strong elements that must be recognized in any assessment of the overall
relevance of BS.
In  a  nutshell,  when  DPs  acted  in  a  coordinated  fashion  and  when  their  objectives  were  aligned  with
GoU,  the  BS  worked  relatively  well.  And  when  coordination  and  alignment  suffered,  BS  relevance,
process, and results deteriorated.
The  first  sign  of  these  problems  appeared  already  in  the  early  2000s  when  priorities  pursued  by  the
GoU on the one hand and by the DPs through BS on the other started to diverge. The GoU gradually
shifted  national  expenditure  and  investment  priorities  toward  productive  sectors.  This  has  been
accompanied by periodic increases in public administration expenditure in connection with the electoral
cycles,  proliferation  of  districts,  and  the  erosion  of  local  revenue  tax  bases  as  well  as  low  overall
revenue mobilization.
The  DPs  supported  GoU’s  preference  for  GBS  and  the  move  away  from  additionality  and  a  more
flexible  use  of  the  modality.  The  establishment  of  a  new  budget  support  framework  in  2008  (JBSF)
strengthened  DPs  coordination  and  their high-level dialogue  with  GoU,  but  increased  the  distance
between  the  BS  dialogue  and  the  actual  policy  implementation  at  sectoral  and  local  levels.  However,
large  budget support inflows against stagnant national revenues and persistent inefficiencies in public
expenditure might have adversely affected incentives for efficiency, including in the use of the BS funds.
The  need  for  stronger  protection  of  funds,  implementation,  and  enhanced  capacity  development  was
overlooked  (see  also  EQ  5,  section  on  ‘Evolution  of  pro-poor  allocations  and  actual  disbursements  at
central  and  decentralised  level’). With  hindsight,  a  less  ambitious,  sectoral  BS  approach  earlier  in  the
JBSF period, coupled with stronger emphasis on implementation and some of the missed opportunities
in the policy agenda (local and overall revenue mobilization) and greater capacity building especially at
the  local  level,  might  have  been  a  more  relevant  and  realistic  approach.  It  might  have  also  provided
stronger  incentives  for  domestic  revenue  mobilization,  greater  efficiency  in  the  public  expenditures
(including the use of BS funds), and results on the ground.

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13

4.1.2

Evaluation question 2

EQ2 - Direct effects of financial and non-financial inputs
To what extent have the financial and non-financial inputs of budget support contributed to the
establishment of an improved aid management framework?

Background and context
The  period  covered  by  the  evaluation  (2004-2013)  saw  a very  significant  variations  in  the  number  of
donors providing BS (with a reduction from 12 to 615), in the overall amounts of aid provided in the form
of BS as well as in the share of BS of total GoU public expenditure.

Figure 5

ODA and amount of aid on budget of which BS and project aid, in USD million)

2.000
1.800
1.600
1.400
1.200
1.000
800
600
400
200
0

70%

60%

50%

40%

30%

20%

10%

0%

Budget Support

Off budget aid

Project Support (on budget)

BS / total ODA (right axis)

Aid on budget / total ODA (right axis)

Note: Aid flows (bar) against primary axis and share of total ODA against secondary axis.
Source: own elaboration based on data from MoFPED, Finance Statistics and OECD statistics.

The  pre-JBSF  and  JBSF  periods  saw a  strong  dominance  of  BS  over  other  forms  of  aid,  with  BS
accounting on average for over 66 and 58 percent, respectively, of all annual aid recorded on budget.
The  situation  is  reversed  during  the  HLAM  period  (2012/13-2013/14)  with  the  freeze  (in  some  cases
only temporary) of BS by all JBSF donors.
The entire 2004-2013 period also saw an increase of more than 50 percent in overall ODA to Uganda
(from USD 1 billion in FY 2003/04 to USD 1,69 billion in FY 2013/14). But it also saw a reverse trend in
the absolute amounts of aid recorded on budget by the GoU, which steeply declines from an initial USD
634 millions in FY 2003/4 to less than half that amount by FY 2013/14. In particular, the relative share
of on-budget aid vis-à-vis total ODA declines from 64 percent at the start of the period to just 16 percent
at the end. Interviews and documentation link the significant decrease in the shares of aid going to the
government  sector  vis-à-vis off  budget aid  flowing  directly  to  non-state  actors,  research  institutes,
foundations,  private  sector  or  project  aid  implemented  directly  by  the DPs to ‘governance  challenges’
and to the shifting and deteriorating partnership between DPs and GoU over the period analysed.
Main findings16

Aid under the GoU budgeting process (Vol. 2: JC2.1)
Budget Support has ensured a substantial amount of resources to finance development expenditure in
the national budget over the whole evaluation period (see figure below). In FY 2003/04, BS covered 6.5
percent of  GDP  and  27 percent of  total  public  expenditure  (PE),  while  on-budget  projects  covered

15 Out  of  the  twelve  BS  DPs  (AfDB,  Austria,  Belgium,  Denmark,  EU,  Germany,  Ireland,  Netherlands,  Norway,
Sweden,  UK,  World  Bank), the  AfDB,  Ireland,  Netherlands,  Norway,  Sweden  and  the  UK  have  decided  to  stop
providing BS.
16 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.

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14

another  2.7 percent of  GDP  and  11 percent of  PE. In  the  same  fiscal  year,  BS  covers  70 percent of
development PE (excluding wages, non-wage current expenditure and  interests’ payments),  while on-
budget projects cover the remaining 30 remaining. This level of BS funds dramatically shrinks already in
FY 2005/06  (BS=3  of  GDP),  then  it  collapses  a  first  time  in  2009/10  (BS=1.6  percent of  GDP)  and  a
second time in 2012/13 (BS=0.4 percent of GDP).
After  2006/07,  the  on-budget  projects  also  start  to  decline,  with  a  minor  recovery  in  2012/13.
Consequently,  the  total  PE  has  partly  shrunk  as  a  percentage  of  GDP  (from  about  24  percent  in FY
2003/04 to  21 percent in FY 2009/10) and, since the  revenue has not increased, deficit financing has
grown. Importantly, the decline in DP budget support has also coincided with the global recession that
put huge pressure on DP governments’ budgets and weakened the willingness of their constituencies to
provide high levels of aid under conditions of domestic fiscal problems.

Figure 6

GoU expenditure by source of funding (% of GDP)

P
D
G

f
o
e
r
a
h
S

30%

25%

20%

15%

10%

5%

0%

30%

25%

20%

15%

10%

5%

0%

P
D
G

f
o
e
r
a
h
s

s
a
e
r
u
t
i
n
d
e
p
x
E

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

e
r
u
t
i
d
n
e
p
x
e

l

a
t
o
t

f
o
e
r
a
h
s

s
a
e
u
n
e
v
e
R

Domestic Revenue

Budget Support

On-budget Projects

Deficit & others

Tot rec exp

Total devt exp

Revenue as share of total exp

Source: own calculation based on MoFPED, World Bank and OECD National Accounts.17
Despite the reduction of BS flows, however, from FY 2005/06 to FY 2008/09, BS still covered between
40 percent and 30 percent of development PE, with on-budget projects covering a bit less. Only in the
last  period from  FY  2011-12 (HLAM),  domestically  financed  development  expenditure  exceeded  the
amount financed through BS and on-budget projects.
The  reasons  that  underlie  the  progressive  reduction  of  BS  levels  are  related  to  the reductions  in the
overall amounts committed by BS DPs and the shortfalls in actual disbursements by DPs vis-à-vis the
committed amounts.
The deterioration in the partnership between GoU and DPs has affected both the overall levels of BS
flows  and  the  predictability  of  BS disbursements  (the  latter  has  also  been  affected  by  delays  due  to
procedural issues) as evidenced by the delayed or cancelled donor budget support disbursements due
to  government  failure  to  undertake  agreed  actions  or  meet  agreed  performance  indicators.  Examples
include cuts  of USD 68 million  applied  by five  bilateral  donors  in  protest  over  democratic  governance
issues in the run-up to the 2006 elections; the withdrawing of the Netherlands from BS in 2011 due to
lack  of  results  in  the  areas  of  corruption,  education  and  justice, and  similar  action taken by  Norway
shortly  after;  a  GBP10 million  cut  applied  by  the  UK  in  FY  2003/04  in  reaction  to  excessively  high
increase in defence spending; continuous withholding by the EU of all annual performance tranches of
the MDG contract due to lack of fulfillment of agreed conditions; and finally, the freeze by all 10 BS DPs
of  BS  disbursements  in  reaction  to  the  OPM  scandal  whereby  only  23%  of forecasted  amounts  was
actually disbursed in FY 2012/13.
Documentation  and  data  reviewed  consistently  point  to  low  levels  of  predictability of  budget  support,
with  the  PEFA  reports  indicating  a marked deterioration  (from  a  C+  score  in  2005  to  D  in  2008  and
2012). Interestingly,  the  results  of  the  online  survey  conducted  in  the  framework  of  the  evaluation
indicate  that  budget  support  was  perceived  as  fairly  predictable  by  the  majority  of  respondents  (68
percent)  with  DPs  viewing  it  as  less  predictable  than  GoU  respondents.  This  is  due  to  the robust
strategy  put  in  place  by  the  GoU  (with  the  IMF  and  Central  Bank)  to  cushion  spending  plans  from
budget  shortfalls. As  a  result,  budget  support  cuts  applied  by  DPs  in  reaction  to  governance and
performance issues did  not appear  to  have affected budget  implementation substantially, with  the
exception of FY 2012/13 (reduction in outturns vis-à-vis budgeted amounts). That said, they did enable

17 Sources: MoFPED, Annual Budgetary Central Gov Finance Statistics data; World Bank National accounts data,
and  OECD  National  Accounts  data  files. Current  expenditures  include:  wages  &  salaries,  other  recurrent
expenditure, and interest payments.

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Final report - Volume 1 - 2015 - IEG and Particip GmbH

 
 
 
 
 
 
 
 
 
 
 
donors to express their dissatisfaction over government actions and sent a clear signal to their national
constituencies.

15

Frameworks for policy dialogue (Vol. 2: JC2.2)
The pre-JBSF period is already marked by an articulated structure for policy dialogue largely based on
pre-existing  sector  and  budgetary  forums  (Sector  Working  Groups - SWGs),  the  PRSC  Steering
Committee, and various other dialogue fora including: the Public Expenditure Review; the Partnership
for  Democratic  Governance  /  Donor  Democracy  and  Governance  Group;  and  the  EU’s  Political
Dialogue with Uganda framed by the Cotonou Partnership Agreement.
With the JBSF, structures for dialogue become more articulated and are managed through the existing
(Prime  Minister;  Head  of  Public
government  coordination 
Service/Secretary to Cabinet; Permanent Secretary in the OPM; and in SWGs). In addition, JBSF DPs
meet through both Heads of Mission, and technical and policy dialogue taskforce meetings. Below the
level  of  monitoring  by  OPM  and  MoFPED,  sector  performance  is  also  monitored  through  the  SWGs,
which  coordinate  closely  with  the  JBSF technical  and  policy  dialogue  taskforce.  These  structures
remain unchanged under the HLAM.

framework  at  different 

levels 

Content of policy dialogue (Vol. 2: JC2.2)
Overall, there is strong evidence that policy dialogue taking place at the formulation and implementation
stages of BS included substantive policy matters (ICRs of PRSCs, JAF Appraisal Reports). Irrespective
of  this  and  of  the  comprehensiveness  of  the  dialogue  fora,  varying  degrees  of  interest,  quality  and
effectiveness  of  dialogue  can  be  witnessed  depending  on  the  issues  at  stake  and  on  the  degree  of
alignment between GoU and DPs interests over the period.
As of the early 2000s (pre-JBSF phase), the dialogue and partnership shifted from a strong focus on the
expansion of  basic  services  to  an  increasing  focus  on  the  efficiency  of  spending  across  the  entire
budget,  and  associated  legal  and  other  reforms  to  improve  public  service  management  and
accountability. Documentation and interviews alike report that BS (most of which hinged on the PRSCs
during  this  period)  proved  very  effective  in  providing  a  forum  to  discuss cross-cutting  issues  such  as
issues related to public service reform and decentralization. At the same time, however, it is during this
period that divergences between GoU and DPs priorities which had started to manifest themselves prior
to  2004  become  more  marked,  putting  an  end  to  the  earlier  days  characterized  by  common
expectations and underpinned by a strong partnership.
Asymmetries in the relative interest of the two parties to dialogue on the different issues can be traced
back to a number of issues: i) DPs’ reluctance to adapt the budget support dialogue framework to take
into account the shift in government priorities towards economic infrastructure and growth with ensuing
divergences  over  budgetary  priorities  which  also  extended  to  spending  on defence and  public
administration;18 ii)  the  GoU  decision  to  end  the  additionality  of  BS  which  limited  the  prospects  of
increased  sector  expenditure  and, in  turn, reduced  the  sectors’  incentive  to  engage  in  dialogue  with
budget support donors; iii) the influence of political concerns and high-ranging powers of the President
as exemplified for example by the announcement of universal secondary education and the decision to
abolish the graduated tax in 2006; and iv) growing DPs governance concerns – particularly in relation to
corruption and human rights – which were not met by an equal interest by the GoU.
According to most interviewees,  while the JBSF allowed to bring together all partners as a group and
talk  to  government  collectively,  it  also  carried  with  it  a  broadening  of  themes  and  rising  expectations,
defined as ‘unrealistically high’ by most interviewees.  The different sections of the JAF brought  within
the dialogue fora a multitude of issues and the role of governance issues in policy dialogue become an
issue  of  contention.  While  fora  for  policy  dialogue  remained  active  and well-structured as  attested  by
the minutes of meetings, interviewees indicated that in some cases all actors went through the motions,
with  Policy  Coordination  Committee  meetings  becoming  a  formality  with  limited  opportunity  for  real
debate and resolution of differences.
At technical / sectoral level, DPs who support donor engagement in different sectors, reveal concerns
about variation in the quality of discussion in Sector Working Groups (SWGs). Generally however it is
recognized  that  the  JBSF  provided  the  opportunity  to  link up  dialogue  with  the  Government  Annual
Performance  Reports  (GAPRs)  which  was  highly  appreciated  by  DPs  and  GoU  alike  as  it  provides  a

18 DPs did, indeed, support investment projects and productive sectors. But they often did so through alternative
aid  modalities. The World  Bank  aligned  its strategy  to  the  Government  and  supported  its  objectives  in  financing
infrastructure through  investment  projects,  in  addition  to  providing  reduced  volumes  of  budget  support. Similarly,
the EU provided significant support to the productive sectors, whereby transport and agriculture / rural development
constituted key pillars of the intervention strategy over the whole evaluation period; support was, however, provided
in the form of programme aid rather than budget support.

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16

framework  within  which  annual  sector  performance  is  assessed,  emerging  issues  are  discussed,  and
agreements are reached on new undertakings and quantitative targets at Joint Sector Reviews.
Finally,  following  the  freeze  of  BS  in  reaction  to  the  OPM  scandal,  dialogue  was  re-launched  in  July
2013 following the development of the HLAM by MoFPED and progress recorded against the seven key
results action taken to tackle key issues articulated in the matrix.19
Just as gender did not feature prominently in the design of the programmes (see EQ 1), it also played a
minor role in the policy dialogue processes linked to BS. Review of documentation allowed to uncover
only  one  instance  where  the  implementation  status  of  gender  mainstreaming  and  equity  policies  is
treated (JAF 4 Appraisal report). A further exception is found in the water and sanitation sector where it
is reported that BS, through policy dialogue, did push for addressing gender issues in the sector though
implementation of gender awareness while gender promotion still lags behind.

Accompanying measures (Vol. 2: JC2.3)
As  seen  under  EQ  1,  no  clear  trends  can  be  identified  among  the  different  DPs  approaches  with
regards  to  provision  of  complementary  capacity  building  measures.  During  the  pre-JBSF  phase,
capacity development assistance followed the shift towards greater emphasis on efficiency of spending
across sectors (in line with the same shift witnessed in the focus of BS operations). As a result, project
support and TA increasingly focused on systems such as the IFMIS (Integrated Financial Management
Information  System),  on  the  role  of  external  audit  for  greater  ex  post  accountability  and  on  M&E
functions.
Complementary  project  support  played  a  big  role  under  section  II  of  the  JAF  (cross  cutting  technical
reforms)  through  projects  such  as  the  Financial  Management  and  Accountability  Programme
(FINMAP)20 and  the  Public  Sector  Reform  project  which  in  some  cases  was  explicitly  targeted  to
support  the  achievement  of  JAF  actions.  Complementarities  are  also  evident  between  BS  operations
and support provided by both DFID and the EU to enhance GoU’s M&E functions through the provision
of  cross-institutional  technical  and  financial  support  to  the  three  organisations  (OPM,  MoFPED  and
UBOS) responsible for the design and/or implementation of Government's M&E functions. Efforts made
by the  World  Bank  and  other  donors  to  coordinate  their  capacity-building  support  to  PFM  in  Local
Governments through the  second Local Government Development Project (LGDP), second Economic
and  Financial  Management  Project  (EFMP-II)  instead  did  not  allow  to  fully  develop  the  potential
complementarities between BS dialogue (and conditions), and project support.
While  the  introduction  of  the  TASU  in  2010  has  streamlined  some  of  the  processes  regarding  the
identification and carrying out of studies and underlying analytical work, the TASU and more generally
the  JBSF  did not succeed  in  promoting  a  clearly  established  framework  to  ensure  the  coordinated
provision of TA and capacity building measures in connection with BS operations.21 As a result, similar
concerns and critiques to the lack of effective coordination between projects and BS remain during the
JBSF period.
At  sector  level,  while  some  donors  explicitly  provided  technical  assistance  to  complement  their  SBS
(e.g. the Swedish and Danish in Water and Sanitation), in most other cases, TA and capacity-building
modalities  and  strategies  were not necessarily integrated  as  part  of  sectoral  strategies.  As  a  result,
evidence from the sectors is mixed.
Under  the  period  covered  by  the  evaluation,  there  was  little  capacity  building  support  provided  in  the
form of complementary measures in the education sector (Ireland provided TA to HIV AIDS as part of
the SBS package while Belgium provided complementary flexible TA for policy and analysis). Similarly,
in the health sector, there is evidence of very limited accompanying measures, such as TA, analytical
products,  reviews  and  studies  and  no  clear  evidence  of  systematic  cross-fertilization  between  HSBS

19 The JAF 4 appraisal report (August 2013) mentions an “anomalous” quality and relevance of the dialogue over
the reporting period due to the intense focus on the high-profile corruption scandal. The report also highlights: “a
constructive  result-based  policy  dialogue  [.which  contributed.]
to timely  action  in  the  areas  of  repayment  of
misappropriated  funds,  implementation  of  recommendations  on  the  IFMIS,  and  the  appointment  of  two  deputy
IGGs. [… However …] less progress was made on administrative sanctions and criminal prosecutions of officials
implicated in the misuse of public funds.”
20 FINMAP is financed by GoU and development partners through a basket fund established by a memorandum of
understanding between GoU and Ireland, Norway, Sweden, the United Kingdom, and (from 2008/09) the European
Commission. The World Bank supports specific FINMAP activities.
21 A certain ambivalence can be seen with regards to the appreciation of the work carried out by TASU. On the one
hand,  the  JBSF  DPs  highly  value  the  work  done  on  fiscal  analysis  and commentary,  budget  cycle  analysis,  the
many  technical  notes  produced  on  issues  linked  to  the  JAF  process and to  the  JBSF  policy  dialogue  including
policy proposals. On the other hand, while the quality of the work was recognized and appreciated, questions were
raised by most DPs with regards to linkages between the work carried out and the priorities of the DPs as well as
on the lack of interactions between TASU and bilateral DPs.

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17

operations and other programmes and projects by DPs. At sector level, best practices can be seen in
the water and sanitation  sector where  as  of  the  pre-JBSF  period,  budget  support  was  provided  in
parallel  to  contributions  to  the  Joint  Partnership  Fund  (JPF),  a  pooled  project-like  funding  mechanism
which  allows  to  fund  capacity building  and  innovative  activities  which  would  not  be  otherwise  funded.
The  year 2008  sees  the  development  of  the  Joint  Water  and  Sanitation  Sector  Programme  Support
(JWSSP),  which  included  a  highly  appreciated  mix  of  complementary  aid  modalities  (MWE,  2011).
Parallel  on-budget  project  assistance  ensured  the  provision  of  TA  and  capacity  building  measures
tailored  through  policy  dialogue,  to  ensure  responsiveness  to  the  sector  capacity  development
strategy.22
The results of the online stakeholder survey conducted in the framework of the evaluation confirm these
findings. Respondents indicated that ‘based on their experience, capacity development measures in the
different  sectors  (either  complementary  or  included  in  the  budget  support  package)  strengthened  the
effects  of  budget  support’  to  a  fairly  high  extent  in  the  areas  of  PFM  and  water  and  sanitation,  to  a
lesser extent in the education and health sectors and poorly with regards to gender mainstreaming (the
lowest scores). The most critical comments (but not scores) come from the DPs and NSAs categories
of  respondents  which  point  to  the  need  to  better  link  capacity  development  and  budget  support
including through the setting aside of funds to strengthen local institutions and capacities.

Coordination / complementarity between BS and other DPs programmes (Vol. 2: JC2.4)
Although donor coordination had been growing since the late 1990s23, it is in 2005 with the development
of  the  Uganda  Joint  Assistance  Strategy  Paper  (UJAS)  that  a  harmonized  approach  of  assistance  by
DPs centred on the PEAP is formalised. During this period, all BS operations were designed jointly with
a  view  to  harmonise  aid  transfers modalities,  reduce  transaction  costs  for  both  GoU  and  donors,  and
increase the predictability  of budget support. That said, most BS operations also integrated additional
conditions  in  more  politically  sensitive  areas  such  as  governance  or  human  rights,  and  disbursement
decisions were perceived as disjointed from the main evaluation and often inconsistent across donors.
A review of the UJAS concluded that while increased coordination, in particular among DPs, had been
achieved,  transaction  costs  had  not  been  significantly  reduced.  GoU’s  interest  or  buy-in  to  the  UJAS
was  extremely  limited  and  further  reduced  following  BS  DPs  reduced  disbursements  over  the  events
leading to the 2006 elections.
Partially in response to these findings, BS DPs developed a Joint Budget Support Framework (JBSF),
an  approach  which  emphasizes  harmonization  and  alignment  in  line  with  the  Paris  Declaration,  the
Accra Agenda for Action and the Busan Partnership Principles and aimed at reducing transaction costs
to  the  Government,  increasing the  predictability  of  disbursements,  and  creating mutual  accountability.
Under  the  JBSF,  coordination  among  DPs  is  further  increased. All  BS  operations  hinge on  a  single
performance  framework  and  on  a  common  appraisal  process  although each  DP  then  draws  its  own
conclusions  with  regard  to  actual  disbursement  levels.  Therefore,  while  the  JBSF  did  not  necessarily
have the desired effects in terms of predictability (although improvements in aligning disbursements to
the  GoU  budget  cycle  were  pursued),  it  did  indeed  contribute  to  reduce  transaction  costs  to  GoU  by
harmonizing  donor  policy  inputs  to  the  BS  operations  and  related  policy  dialogue.  At  the  same  time
however,  while donor coordination  greatly  increased,  the JBSF also  entailed “heightened transactions
costs on the donor side and a degree of rigidity in the implementation framework”.24
Results  of  the  online  survey  largely  confirm  these  findings  but  also  highlight  divergences  in  views
between the different categories of stakeholders whereby over 50 percent of respondents from the DPs
category but only 33 percent among the GoU category indicated that the international donor community
coordinated “to a great extent” its efforts in providing BS to Uganda.
Finally,  it  is  worth  mentioning  that  BS  both  directly  and  through  the  provision  of  complementary
measures,  has  contributed  to  improvements  with  regard  to  the  development  and  adoption  of  shared
M&E frameworks. The provision of TA by DFID and the EU in conjunction with efforts deployed by the
GoU25 led  to  the  institutionalisation  of  the  Government  Annual  Performance  Reports  (GAPRs)  which
aim  at  providing  timely  information  to  policy  makers  and  implementers  on  previous  performance  and

22 These also covered studies used to inform the design and formulation of the joint support programmes. Among
these,  the  Fiduciary  Risk  Assessment  of  the  Water  and  Sanitation  Sector,  and  Review  and  Evaluation  of
effectiveness  of  Technical  Assistance  Support  Modalities  in  the Water  and  Sanitation  Sector  (both  in  2007), and
the Identification Study and Feasibility Assessment of Options to Establish Water Supply Development Facilities -
WSDF (2008).
23 Donor  coordination grew through  the  development  of  sector-wide  approach  programmes (SWAps),  pooled
funding mechanisms, joint sector working groups, joint missions, joint analytical work and advisory services, etc.
24 TASU Mid-Term Review, 2012, p.21 and ICR of PRSCs 8-9, 2014
25 In particular, the GoU developed a National Integrated Monitoring and Evaluation Strategy (NIMES) in 2003-4,
which was followed by the introduction of the draft framework for M&E of the NDP.

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18

challenges.  Review  of  the  GAPRs  produced  in  the  last  years  and  interviews  with  both  GoU  and  DPs
representatives attest to the continuous improvement in the quality of the reports.

Counterfactual analysis
The direct effects of the different BS components (funds, dialogue, conditionalities, and accompanying
measures) varied greatly both in terms of contributions to the different results and time-wise across the
different periods followed (pre-JBSF, JBSF and HLAM).
Flow-of-funds effects have been particularly strong during the first period. This has greatly contributed
to  increasing the  amount  of  financial  aid  aligned  to  the  GoU  budgeting  process  although  effects  on
predictability,  in  theory  also  strong,  have  been  lessened  by  the  high  number  of  reduced  or  delayed
disbursements.  It  is  extremely  unlikely  that  alternative forms  of  aid  to  GBS  and  SBS  could  have
contributed  as  well  as  BS,  to  strengthen  government  policy  decision  processes.  Further  analyses
(under other EQs) will show whether alternative modalities, including projects or earmarked SBS, could
have  better  contributed  to  matching  funds  and  shared  development  objectives,  in  a  period  in  which
there were growing political divergences between DPs and GoU about the spending priorities.
The contribution of BS (namely GBS) to the framework for policy dialogue has been strong and unique.
The  existing  dialogue  frameworks  have  progressively  evolved  becoming  extremely  articulated.  Such
dialogue however has not been able to forge an effective partnership between GoU and DPs, based on
shared principles and priorities and has often been jeopardized by contrapositions in terms of principles.
In the meantime, sector dialogue has  been  weakened (with the exception  of W&S sector), due to the
political uncertainty which has characterized the budget allocation process.
Could better results have been achieved through other aid modalities? It could be questioned whether a
different balance between GBS and more focused SBS or other pooled sectoral funds might have had
better effects. The centrality of BS and more specifically of GBS particularly in the later periods, in some
cases  diverted  attention  from  sector  specific  issues  with  dialogue  focusing  on  conflicting  views and
coordination leaving  little  room  for  discussion  at  the  higher  level  for  joint  problem  solving  or  targeted
assistance to overcome specific constraints. Findings from the education sector for example point to the
deterioration  of  intensity  and  quality  of  dialogue  and  more  generally  of  the  weakening  of  aid
coordination frameworks as a result of the move from SBS to GBS and the discontinuation of SBS. In
the  water sector instead, it is reported by some that the mechanisms established at sector level (joint
programme, strong dialogue in W&S) are such that even in the absence of GBS, overall policy dialogue
would remain strong.
Finally, it should be noted that the centrality of GBS and the weakening of the sector wide approach in
some key  sectors  diverted  attention  away  from  efforts  to  consider  how  remaining  projects  could  have
played a more complementary role in each sector as part of a mix of instruments. Although again, this
can  only  be  partly  attributed  to  the  form  of  aid  in  and  of  itself  as  opposed  to  the  lack  of  a  more
coordinated approach at sector level as has happened in the water sector and / or to a more strategic
approach in the design of BS programmes or TASU.

Summary answer to the evaluation question
While  ODA  to  Uganda  has  significantly  increased  (namely  non-government  grants)  in  the  period
considered, BS has shrunk from almost 70 percent of government development expenditure to about 4
percent,  with  significant  reductions  in  2005-06,  2009-10  and  2012-13.  This  evolution  is linked  to  a
deterioration  of  the  trust  between  GoU  and  DPs  and  has  had  consequences  on  the  level  of  public
expenditure  and  on  the  government  discretion  in  the  budget  allocation.  The  global  crisis  and  related
pressures on DP governments’ budgets also played a role in the declining BS in the JBSF period.
The dialogue framework before the JBSF was particularly focused at sectoral level and at the level of
the MoFPED. The JBSF promoted a stronger coordination of the DPs and elevated the dialogue at the
level  of  the  OPM.  This  improved  the  general  performance  monitoring  framework  and  procedures,  but
the link with the sectors was partly lost, also for a reduced interest of the sectors in GBS and the related
end  of  BS  additionality  both  in  theory  and  practice.  The  dialogue  overlooked  the  implementation  and
focused more and more on principles and political disputes.
In  the  early  period,  TA  and  complementary measures  focused  on  the  efficiency  of  public  spending.
Under the JAF, important complementary actions were carried out in the PFM, public sector reform and
performance monitoring areas. Other areas, such as support to local government were addressed but
were not adequately connected to and prioritised through the dialogue. The establishment of TASU in
2010  enhanced  the  assistance  to  the  BS  dialogue  process  and  contributed  with  some  high  quality
studies  and  analyses  namely  in  the  fiscal  area.  However,  it  was not  able  to  improve  the  access  to
capacity development resources in specific areas linked to the DPs and GoU dialogue.

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4.1.3

Evaluation question 3

EQ3 - Macro-economic management
To  what  extent  has  budget  support  contributed  to  the  improvements  in  the  quality  of
macroeconomic  management,  and increased  fiscal  space  and  discretionary  expenditure  at
sectoral and decentralised levels?

Background and context
In 1991-1992, the country  experienced  a budget funding crisis  which  led to  a spike in  inflation. Fiscal
discipline  subsequently  received  renewed  attention  by  GoU  and  the  institutional  environment  for
macroeconomic management was largely re-organised with, in particular, the merging of the Ministry of
Finance and the Ministry of Planning in 1995. During the 1990s, Uganda made substantial progress in
liberalising the economy, establishing macroeconomic discipline, and implementing budgetary reforms.
A massive expansion in basic service delivery in health, education and water took place in the late 90s.
In 2000, Uganda was included in the Heavily Indebted Poor Countries (HIPC) debt relief initiative and
was the first country to reach the completion point. During the same period, Uganda was increasingly
being  seen  as  a  ‘donor  darling’  and  important  external  resources  were  mobilised  to  accompany  the
reforms  underway  in  the  country. Trust  between  DPs  and  GoU  was  high.  It  was  based  on  a  shared
understanding  of  development  objectives  and  strategies  mainly  focused  on  expanding  the  budgetary
envelope in support of social sector service delivery which were seen as critical for poverty reduction.
Main findings26

Macroeconomic management, fiscal management and debt sustainability (Vol. 2: JC3.1)
Uganda’s  macroeconomic, and in  particular,  fiscal  performance  (measured  in  terms  of  fiscal  deficits,
debt levels, and debt sustainability risks) has been broadly adequate, especially during the early years
of the period under review. Uganda’s long-term reform and macroeconomic reform track record made it
eligible for the large external debt reduction under the HIPC initiative. Following the substantial external
debt reduction in the context of the HIPC completion point in 2006, Uganda’s external public debt was
reduced dramatically, from 43 percent of GDP to 11 percent in 2006/7. External debt was since kept at
manageable  levels,  in  part  because  of  the  continued  economic  growth  and  continued,  highly
concessional terms of its new external debt.
International metrics of the quality of macroeconomic policy remained favourable throughout the period
of  review,  compared  with  regional  benchmarks,  albeit  with  gradual deterioration  in  terms  of fiscal  and
overall  macroeconomic  management. Overall, macroeconomic  performance  and  macroeconomic
developments  broadly  mirror  fiscal  performance.  Twin  fiscal  and  external  deficits  increased  over  time
while  the  pace  of  economic  activity  moderated,  especially  since  the  onset  of  the  global  recession  in
2008/9. At the same time, it should be noted that basic and comparative macroeconomic indicators do
not  fully  capture  important  political  economy  aspects  of  macroeconomic  and  fiscal  performance.
Increasingly  frequent  and  politically  motivated  supplementary  budgets  undermined  budget  credibility
and  predictability  (for  details,  see also EQ4).  More  broadly,  there  was  considerable  and  increasing
uncertainty  about  direction  of  policies  arising  from  several  sources (e.g.,  supplemental  budgets,
repeated failure to substantially raise domestic revenue mobilization).

Revenue mobilization (Vol. 2: JC3.2)
Despite  repeated  policy  pronouncements  and  revenue  targets,  as  well  as  myriad  of  measures  to
strengthen  tax  administration,  government  revenue-to-GDP  ratio  remained  among  the  lowest  in  the
region (at  about  13  percent  of  GDP)  during  the  period  under  review. An  analysis  of  the  structure  of
government’s  revenues  reveals  that  it  has  largely  remained  unchanged,  except  for  the  most  recent
addition of oil revenues (Figure 7). It would, however, be expected that key revenue instruments such
as  VAT  and  excises  would  rise  proportionately  or  more  than  nominal  income  with  the  considerable
increase  in  real  economic  activity  and  consumption  tax  base during the  last  decade. Technical
discussions,  field  visits,  and  related  analyses  strongly  indicate  that  reasons  behind  this  poor  revenue
performance  are  in  political  economy  of  large  VAT  exemptions,  clientelism,  and  culture  of  non-
compliance  with  tax  code,  including  by  top  public  sector officials  who  own  and  operate  private
businesses with little or no compliance. These reasons suggest that the issue goes beyond short-term
government  policy.  As  such  it  can  only  be  addressed  by  forceful  signal  and  implementation  of a
fundamental change in the rules of the game at the top political levels.

26 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.

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Figure 7

The Structure of Uganda’s Government Revenues

20

18%

16%

14%

12%

10%

8%

6%

4%

2%

0%

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

International trade taxes

Income taxes

Excises

VAT

Non tax

Oil revenue

Source: IMF.

As  BS  dwindled  in  the  second  half  of  the  decade  under  review,  the  failure  to  increase  revenue
mobilization translated into rising fiscal deficits despite efforts to control them. Public expenditure came
under increasing pressure, at the sectorial and local levels, contributing to  deteriorating public service
delivery.  Still,  domestic  revenues  did  not  increase. The  roots  of  the  low  revenue  mobilization  can  be
traced  to  the  political  economy  factors,  large statutory  and  non-statutory exemptions,  and  culture  of
non-compliance,  especially  among  wealthier  segments  of  the  population  and  the  private  sector,
including members of parliament and government.
In 2014, in the context of drastically reduced BS and the need to control fiscal deficit, GoU has taken
renewed  actions  to  address  the  problem.  As  of  1  July  2014,  Parliament  approved  the  elimination  of
many VAT exemptions. In addition, several zero-ratings for some goods were eliminated and corporate
income  tax  base  was  expanded.  Excise  duties  were  also  increased  on  fuels,  sugar  and  money
transfers.  However,  as  of  writing  this  report,  these  actions  are  yet  to  translate  into  tangible  gains  in
revenue mobilization. As noted above, this will require clear and forceful signals and measures from the
top political level and public officials owning and operating private businesses leading by example and
paying taxes on their private sector incomes.

Expenditure control (Vol. 2: JC3.3)
Overall,  the  government  managed  to  control  aggregate  public  expenditures,  which  was  helped  by  a
series  of  the  IMF  programmes,  except  during  the  periods  of  elections  characterized  by  large
expenditure  escalations  followed  by  sharp  tightening.  This  suggests  substantial  political  cycle
component in the trajectory of public expenditures. The aggregate control was tighter during the period
of  substantial  BS  in  the  first  part  of  the  decade  under review.  Deviations  of  outturn  from  budgeted
current  expenditures  were  significant,  especially  during  the  periods  of  elections  and  related
supplementary  budgets.  In  the  latter  part  of  the  period  under  review,  as  BS  declined  while  revenues
remained  low,  the government  cut  both  current  and  development  expenditures  to  keep  the  deficits
within  manageable  levels.  Unable  to  raise  domestic  revenues,  deficits  increased.  Also,  this  translated
into  significantly  reduced  funding  for  social  sectors  (education,  health,  and  water  and  sanitation)  at
sectoral and programme levels, which undermined service delivery. It also does not bode well for future
poverty reduction dependent on new gains on access and quality in basic service delivery.

BS contributions
Regarding  the  BS contribution  to  fiscal  management,  it  is  possible  to  distinguish  two  periods.  In  the
fiscal years 2003/4 until 2006/7, BS amounted to almost a quarter of total expenditure, expanding the
fiscal  space  and  flexibility  of  the  government  to  fund  priorities  broadly  agreed  with  the  development
partners.  Aggregate  gains  in  fiscal  space  from  BS,  therefore,  were  substantial.  Compared  with  the
counterfactual of the absence of BS and realistic annual gains in domestic revenues of 0.5 percent of
GDP per year, the actual BS still provided more than 4 percent of GDP, equivalent to about 20 percent
in additional public expenditures than what would have been possible otherwise.

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Figure 8

Aid  and  Budget  Support  as  a  %  of  GoU  expenditure  and  as  a  %  of Development
expenditure

21

120%

100%

80%

60%

40%

20%

0%

On budget aid / dvt spending

BS / dvt spending

On budget / GoU spending

BS / GoU spending

Source:  own  calculations  based  on  MoFPED,  Annual  Budgetary  Central  Government
Finance  Statistics  data.  GoU  expenditure  includes  both  recurrent  and  development
expenditures  excluding  donor  funds;  whereas  development  expenditures  includes  both
GoU and donor funds.

Did the large BS in the early period contribute to “crowding out” local revenue mobilization? The answer
is  probably  yes,  based  on  a  basic  review  of  the  trends  in  the  size  of  BS  aid  relative  to  revenues  and
expenditures, as well as comparisons with relevant international experience. Uganda is unique among
other  African  countries  with  substantial  BS  in  that  it (i)  received  exceptionally  high  levels  of  BS  aid
compared with revenues and expenditures in the early part of the period and, yet, (ii) failed to increase
domestic  revenues substantially  during  that  period  and  later  on. Because  BS  aid  was  always
considered  ultimately  transitional,  with  an  eventual  downward  trajectory,  this  directly  undermined
sustainability of BS outcomes. This is a major policy omission with shared responsibility with DPs. BS
failed  to  include  hard  conditionality  on  increasing  domestic  revenues  in  contrast  to  many  other
countries.27 Given the large BS, the DPs were in a strong position to require corresponding increases in
domestic revenues.
In  the  second  period,  since  2007/8,  BS  significantly  declined  as  the  mutual  trust  between  the
government  and  the  development  partners  began  to  decline  in  response  to  corruption  episodes.  The
priorities  also  began  to  diverge  as  the  government’s  focus  shifted  towards  productive  sectors  and
infrastructure  while DPs  BS  operations largely  remained  focused  on  the  social  sectors.  Finally,  the
global  recession  of  2008-9  hit  hard  many  developed  countries  that  provided  BS  to  Uganda,  changing
their  domestic  political constraints  and  attitudes  on  large-scale  external  BS,  including  to  Uganda.  BS
declined to 7 percent of total public expenditures in 2009/10 and 2 percent in 2012/13, and, at the same
time, became less predictable.
BS  supported  and  contributed  to  solid  fiscal  management  during  the  early  years  of  the  period  under
review, through the provision of significant funding for government expenditures and service delivery as
well as a broadly coordinated policy dialogue and consensus on the policy agenda. In the second part
of the period of the review, however, BS began a steady decline, while fiscal deficits rose. At the same
time, dialogue around BS did not succeed in adequately addressing the risks associated to the political
economy aspects of macroeconomic and fiscal performance mentioned above.
Overall, lack  of government’s  effective  revenue  mobilization  strategy  and poor revenue  outturns  have
been the largest omission of the overall policy framework supported by BS as well as the government’s
economic policy over the decade of review.
The issue of revenue performance was raised repeatedly by the donors and the issue features in most
of the policy dialogue documents. However, revenue mobilization was not one of the top priorities in the
policy dialogue. The donors continued to provide substantial budget support during the first part of the
decade under review, irrespective of the repeated slippages in government revenue performance.

27 See European Commission (2014). Meta-evaluation of Budget Support – Volume One (draft), Synthesis Analysis
of the Findings, Conclusions and Recommendations of 7 Country Evaluations, of Budget Support, September.

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Summary answer to the evaluation question
Overall, Uganda has maintained  broadly solid policy  performance over the period under evaluation. It
has also been building on the previous tradition of solid macroeconomic management. This has allowed
the country to draw on several IMF programmes, obtain huge debt reduction support through the HIPC
mechanism, and receive considerable donor BS. The government managed to control aggregate public
expenditures,  except  during  the  periods  of  elections.  This  suggests  substantial  political  cycle
component in the trajectory  of public expenditures. In the latter  part  of the  period under review, since
external resources (including budget support) and revenues remained insufficient, the government cut
current  and  development  expenditures  to  keep  the  deficits  within  manageable  levels.  However,  this
translated  into  significantly  reduced  funding  at  sectorial  and  programme  levels,  which  undermined
service delivery.
BS contributed to solid fiscal management during the early years under review. However, Government’s
revenue  mobilization  strategy  and  revenue  mobilization  outturns  have  been  the  Achilles  heel  of  the
overall policy framework supported by  BS. Despite strong awareness among DPs and declarations of
intent  including  within  policy  dialogue  frameworks,  this  issue  did  not  become  one  of  the  top  priorities
and DPs continued to provide substantial BS during the first part of the period under review, irrespective
of  the  repeated  slippages  in  government  revenue  performance. Political  economy  of  large  tax
exemptions,  entrenched  interests,  and  culture  of  non-compliance  conspired  in  this  outcome.  Until  this
political  economy  equilibrium  is  disrupted  by  strong  political  leadership  to  secure  broader  and  more
robust domestic revenue base, it is difficult to foresee future gains in mobilization based on declarative
tax policy measures only.

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4.1.4

Evaluation question 4

EQ4 - PFM
What were the  improvements in the quality of  Public Finance  Management and to what extent
BS operations have contributed to these improvements?

Background and context
The  Budget  Act  of  2001  and  the  Public  Finance  and  Accountability  Act  (PFAA)  of  2003 provided  the
legal platform for the budget formulation process during the most of the evaluation period. The Budget
Act  of  2001  stipulated  the  information  and  timeline  of  information  that  the  Government  is  required  to
present  to  parliament.  The  PFAA  provided  the  legal  framework  for  the  control  and  management  of
public resources, fiscal transparency, and accountability.
In the years leading up to the JBSF, the largest partners in supporting PFM reform were the World Bank
(in particular, through the Poverty Reduction Support Credits - PRSC), the EU and DFID. Over the past
decades,  there  had  been  substantial  investment  by  DPs  in  project  support  to  PFM  strengthening  in
relation  or  not  with  wider  BS  operations.  In  an  effort  to  harmonise  their  support,  DPs  combined  to
provide  basket  funding  in  the  form  of  the  Financial  Management  and  Accountability  Programme
(FINMAP).  The  programme  started  in  January  2007  and  has  been  financed  by  GoU  and  five  DPs
(Ireland,  Norway,  Sweden,  the  United  Kingdom,  and  the  European  Union) with  the  World  Bank
supporting  specific  activities.  A  second  phase  of  the  programme  was  launched  in  2012  to  deepen,
widen and consolidate reforms in PFM.

Box 2

DPs support to PFM

Prior to 2008, DPs provided their support based on bilateral agreements and disbursement conditions.
For  the  PRSCs,  conditionality  included:  agreements  with  donors  on  the  Public  Expenditure  Review
(PER), the MTEF, and the execution of the budget in line with agreed allocations (e.g., Poverty Action
Fund  (PAF) share);  expenditure  for  public  administration  in  line  with  agreed  allocations;  the
presentation  of  a  procurement  bill  to  parliament;  the  drafting  and  revision  of  an  audit  bill  to  ensure
adequate  operational  independence  for  the  Auditor  General;  and  satisfactory  progress  on  actions
agreed in the Joint Annual Review of Decentralization. The EU GBS included indicators related to, for
instance, the implementation of annual PER demonstrating progress in particular in the reform of public
finances,  or,  the  involvement  of  partners  in  the  dialogue  on  PFM. DFID was,  in  particular,  actively
involved around the governance matrix in the PEAP.
With  the  onset  of  the  JBSF  and  the  associated  JAF,  a  set  of  mutually  agreed  indicators,  updated
annually, were chosen to monitor progress in PFM. Relevant preconditions for support included: internal
budget  accountability  and  external  budgetary  control  that  satisfy  the  basic  conditions  for  good  PFM
(including  transparency,  accountability  and  effectiveness  of  use  of  resources);  credible  and  relevant
programme to improve PFM and procurement systems in place; and progress in performance recorded
over  the  period  under  review.  Key  performance  indicators  used  were  the  budget  variance  between
allocations  and  releases  of  JBSF-targeted  sectors;  budget  variance  between  releases  and  actual
expenditures  of  JBSF-targeted  sectors;  central  government  units  receiving  quarterly  releases  as  per
agreed cash flow plans; arrears as percentage  of total  expenditures; LG publishing financial transfers
and budgets  at  the  local  level;  clean  audit  reports;  government  revenue  as  share  of  GDP;  and
improvements in procurement practices.

Main findings28

Overall performance in PFM (Vol. 2: JC4.1 and JC4.2)
Before  2004,  Uganda  was  showing  mixed  performance  in  PFM. Budget  formulation,  execution  and
management  was  quite  weak  (see  IMF  2002  Article  IV  Consultation29 or  World  Bank  2004  CIFA
report30).  Line  ministries’  budget  framework  papers  outlining  priorities  for  the  next  fiscal  year  lacked
realism. The efficiency of public expenditures suffered from frequent supplementary budgets and within-
year  budget  reallocations,  weak  management  of  arrears,  and  limited  local  government  capacity.  This
was  compounded  by  poor  revenue  projections  partly  due  to  highly  variable  DPs’
financing
commitments.
During the last decade, Uganda gradually developed a sound PFM system and consolidated its position
as  a  strong  performer  in  PFM.  The  country  scored  frequently  above  regional  averages  in  a  variety  of
assessments.  The  2005,  2008,  and  2012 PEFA  assessments,  annual  reports  conducted  by  the  IMF

28 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.
29 International Monetary Fund (2003): 2002 Article IV Consultation. IMF Country Report No.03/83.
30 World Bank (2004): Country Integrated Fiduciary Assessment.

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under the Policy Support Instrument and other assessments involving directly the DPs (e.g. the regular
Fiduciary  Risk  Assessments  by DFID and  the  2008-2014  BS-related  Joint  Assessment  Framework
reports) all highlight strong progress in several areas.
In particular, the PFM system is now characterised by sound budget formulation and planning. There is
a  strong  political  engagement  of  both  parliament  and  cabinet  during  the  budgeting  process,  and  an
adherence to a comprehensive budget calendar. The budget is based on a resource envelope derived
from credible multi-year macro-fiscal forecasts and a sound debt profile. A number of sectoral strategies
have been developed and costed in line with the NDP. The 2012 PEFA rates the comprehensiveness of
the information included in the budget documentation as strong.
Improved  efficiency,  accountability  and  transparency  can  also  be  observed. Fiscal  information  to  the
public has become quite transparent. MoFPED now publishes the national, sectoral, and district budget
framework  papers  annually  on  its  website  along  with  budget  speeches,  annual  budget  performance
reports,  audited  financial  reports,  etc. The  Integrated  Financial  Management  Information  System
(IFMIS),  a  chart  of  accounts  that  aligns  all  government  financial  activity  to  budgets,  users,  purpose,
organizational  structure  and  accounting  types  for  fiscal  discipline, has  significantly  improved  the
efficiency and transparency of PFM operations.
However, Uganda PFM reform process still falls short in a number of areas. While Uganda has made
some progress in the creation of a statutory enabling environment for gender budgeting, there is little to
no  substance  or  implementation  of  the  initiatives  in  this  area  and  no  funding  is  available  for  gender
activities per se. Moreover, budget ceilings for overall expenditure and sectoral allocations often do not
match earlier MTEF expenditure forecasts31 and there has been an increasing divergence of the budget
from  the  NDP.  In  recent  years,  political  pressure  during  budget  formulation  and  execution  has  also
seriously undermined budget credibility. Despite a strong de jure policy formulation process, uncertainty
remains  in  the  face  of  frequent  and  unanticipated  ad  hoc  changes  in  major  policy  directions  coming
from  the  state  house,  often  bypassing  the  standard  consultative  process.  Moreover,  increasing
domestic  supplier  arrears,  regular  practice  of  supplementary  budgets32,  and  frequent  bypassing  of
internal controls in execution has resulted in a serious decline in budget credibility.
These  shortcomings  are  reflected  in  the  deterioration  of  the  overall  Country  Policy  and  Institutional
Assessment (CPIA) rating on the quality of budgetary and financial management33 (see figure below).

Figure 9

Uganda vs. Sub-Saharan Africa (SSA): CPIA Scores on the Quality of Budgetary and
Financial Management Rating, 2005-12

e
r
o
c
s
A
P
C

I

6

5

4

3

2

1

0

2005

2006

2007

2008

2009

2010

2011

2012

Source: World Bank’s CPIA database.

Uganda

SSA average

31 Effectively, the MTEF is considered a one-year plan, revised each year, with little medium-term constraint on the
scale and composition of revisions.
32 Sizable supplementary budgets have regularly (especially around elections) been allowed. As it is illegal for any
expenditure vote to spend more than its approved budget, any deviation must be covered through supplementary
authorization of Parliament (Constitution of Uganda, section 156 (2)). Large supplementary expenditures were, for
example, justified for the Ministry of Defence to buy fighter jets and pay for salary shortfalls, the Ugandan Police to
cover security efforts related to the 2011 elections, the Ministry of Energy to clear payment arrears, etc.
33 Quality  of  budgetary  and  financial  management  in  the  CPIA  assesses  the  extent  to  which  there  is  a
comprehensive and credible budget linked to policy priorities, effective financial management systems, and timely
and accurate accounting and fiscal reporting, including timely and audited public accounts.

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The sub-national PEFA carried out in 2013 also highlights persistent weaknesses at the decentralised
level, despite some progress in specific areas such as procurement and efficiency of budget execution.
The report notes that the central government did not respect its commitments on transfers to the LGs
related to earmarked grants. Low performance of LG systems can be illustrated by the weak forecast of
internal  revenue  and  the  absence  of  cash-flow  planning.  Evidence  gathered  during  interviews  and
through  the  field  survey  echoes  the  observations  made  in  the  PEFA  assessment  and  relates  them  to
important gaps in terms of local government capacity which have been inadequately addressed in the
past decade.

BS contributions
Budget  Support  has  contributed  in  many  ways  to  the  evolutions  observed  in  PFM.  BS  was
accompanied  by  substantial  technical  assistance,  capacity  building  activities,  and  analytical  services,
which  have  been  key  in  the  development  and  implementation  of  the  PFM  reforms.  Stakeholders
consulted in interviews and the e-Survey (see Figure 10 below) note that BS had a positive impact on
the  pace  and  content  of  the  reform.  There  has  been  broad  agreement  across  stakeholders  that  BS
dialogue in PFM improved  policy formulation and implementation of reforms, and that it helped sector
and cross-sectoral dialogue. Capacity development efforts, provided in tandem with BS, also appear to
be an important contributory element.

Figure 10

PFM Stakeholder Survey Results by Interest Group

0,0

0,5

1,0

1,5

2,0

2,5

3,0

Capacity development in PFM has strengthened the
effects of budget support

Budget support helped PFM sector dialogue

Budget support dialogue helped to improve the policy
formulation and implementation of PFM reforms

PFM reforms supported by budget support advanced

There has been progress in PFM linked to the reforms

There has been progress in budget credibility linked to
the reforms

Total

Government

Development partners

Non-State actors

Scale: Respondent agrees 0 – not at all, 1 – to little extent, 2 – to some extent, 3 – to a great extent
Source: eSurvey 2014 (Particip).

PFM was central and increasingly important to BS since 2004. This was particularly stressed again after
the  misappropriation  of funds  in  2012.  It  was  widely  noted  in  team  discussions with  stakeholders  that
DPs  who  passed  on  the  responsibility  of  their  funds  to  the  Government  by  channelling  it  through  the
consolidated  fund  services  were  intrinsically  more  interested  in  sound  government  PFM  systems  to
manage their funds well and transparently than DPs who retained control of their funds through vertical
aid  channels.  Budget  support,  therefore,  acted  as  a  catalyst  for  DPs  to  strengthen  government  PFM
systems, while at the same time providing the necessary leverage to pursue reform at the central level.
Consequently,  it  can  be  argued  that  absent  such  channelling  of  resources  through  the  government’s
PFM systems, important progress in building PFM systems and capacity to date would have been more
limited. Further, abandoning, or substantially reducing BS would reduce the DPs capacity to contribute
to PFM improvements through political pressure and high-level dialogue.
Throughout the evaluation period, the government demonstrated commitment to the reform programme,
as is documented in the various JAFs, independent PFM assessments, as well as in the IMF Article IV
consultations.  This  commitment  is  in  part  driven  by  the  strong  emphasis  on  progress  through
conditionality agreements, and in part advanced from within government: an authorized PFM workforce
increasingly recognized the need to improve the performance of systems for effective service delivery.
The  example  often  cited  was  the  set-up  and  progressive implementation  (since  2004)  of  the  Oracle-
based IFMIS, which is now sought after by district officials who have not yet made the transition.
By contrast, progress in domestic revenue generation was modest, reflecting a combination of factors
such as the lack of political will, local political economy, large non-statutory exemptions and the culture
of  non-compliance,  and  inadequate  focus  by  BS  partners.  To  be  sure,  as  of  end-2014,  GoU,  in

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26

collaboration with the IMF has taken steps to eliminate statutory VAT exemptions and other measures
to  strengthen  tax  administration  and  increase  revenues  by  0.5  percentage  points  of  GDP  per  year.
However, the overall performance in this area for the period of review is unambiguously weak. This is
discussed in more depth in EQ3.
The Technical Assistance Support Unit (TASU) set up in the context of the JBSF was also instrumental
in  PFM  reform.  The  TASU  managed  Uganda’s  first  sub-national  PEFA,  and  undertook  an  in-depth
analysis of the relationship between fiscal decentralization, fiscal incentives, and decentralized service
delivery  outcomes  in  Uganda.  Additionally,  TASU  supported  the  development  and  monitoring  of  PFM
JAF indicators and actions, and it supported research and policy formulation agenda.
Some progress could have been achieved through alternative aid modalities (other than BS) in specific
project-level areas. However, BS provides a contractual framework to establish and monitor the mutual
commitment that projects do not provide, thereby being less effective at addressing broad institutional
changes. Given the institutional set up for the BS dialogue described above, it is unlikely that the same
level of government commitment would have been generated and progress achieved with PFM systems
and capacity without BS and related PFM conditionality agreements.

Summary answer to the evaluation question
Uganda has been a strong performer in PFM matters over much of the last decade and the PFM reform
process has improved at various levels. Important achievements can be observed in terms of the quality
of  budgeting  and  planning  and  the efficiency  of  public  expenditures.  However,  despite  important
positive evolutions in the early stages of the evaluation period, Uganda PFM reform process falls short
in a number of areas and some key PFM indicators have even deteriorated in the last few years. Areas
of  concern  include,  in  particular,  budget  credibility,  the  transparency  of  inter-governmental  fiscal
relations and the quality of the PFM reform process at the decentralised level.
Budget  Support  has  contributed  in  many  ways  to  the  evolutions  observed  in  PFM  reform.  Budget
support  acted  as  a  catalyst  for  DPs  to  strengthen  government  systems,  while  at  the  same  time
providing the necessary leverage to pursue reform at the central level. Moreover, substantial technical
assistance,  capacity  building  activities,  and  analytical  services  provided  in  the  framework  of  BS  were
key  in  the  development  and  implementation  of  the  reforms.  However,  BS  failed  to  enhance  domestic
revenue generation and to address the important needs in terms of capacity building at the local level.
As  of  writing,  at  end-2014,  the  government  has  pressed  ahead  further  with  important  legislative  PFM
reforms  and  the  second  phase  of  the  FINMAP  programme  covers  the  entire  financial  management
spectrum. A comprehensive PFM bill has been presented by the authorities to parliament to deal with
some  of  the  structural  weaknesses  including  lack  of  credibility,  integrity,  and  predictability  of  the
budget.34 These  reforms  are  significant.  If  legislated  and  implemented35,  they  will  result  in  a  major
improvement in PFM systems and performance in Uganda.

34 In  particular,  the  bill  seeks  to:  introduce  a  charter  of  fiscal  responsibility;  base  commitments  on  budget
appropriations and cash flows on procurement, works, and recruitment plans approved by parliament; bring forward
the  budget  calendar to avoid parliamentary  approval  of  the  budget several  months  into  the  fiscal  year;  make  the
annual budget framework paper and the budget more consistent with the medium-term expenditure framework and
the  national  development  plan;  create  an  operational  fund  for  contingencies  to  protect  the  budget  from  cuts  to
finance  supplementary  pressures;  strengthen  the  links  between  budget  preparation,  execution,  and  oversight  by
allowing parliament to review budget submissions together with audited performance for the previous year; provide
for  the  implementation  of  a  single  treasury  account  to  improve  existing  banking  and  cash  management
arrangements; and prepare the economy for efficient oil revenue management.
35 The bill has been before parliament since 2012, and it is unclear whether there is sufficient political commitment
or parliamentary support to pass it prior to the upcoming elections in 2016.

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27

4.1.5

Evaluation question 5

EQ5 - Allocative and operational efficiency of public spending
How has the level and composition of public spending across sectors changed, and with which
consequences  in  terms  of  allocative  and  operational  efficiency,  including  at  decentralised
levels,  and  what  was  the  contribution  of  budget  support,  through  its  different  components,  to
the observed changes?

Background and context
Reflecting  a  strong  track  record  of  reform,  Uganda  was  the  first  country  to  receive  support  from  the
HIPC  initiative  in  1998  (see  also  EQ3).  The  Poverty  Action  Fund  (PAF)  was  established  in  the  same
year as a mechanism to demonstrate that savings from the debt relief programme were channelled to
poverty alleviating expenditures, a key requirement of the initiative. Expenditures classified as pro-poor
were primary education, primary health care, water and sanitation, agriculture, and rural feeder roads.
Unlike  off  budget  expenditures,  PAF  resources  were  part  of  the  consolidated  fund,  an  integral  part  of
government  expenditures  subject  to  the  regular  budgetary  processes.  PAF  resources  were  protected
from  cuts.  They  were  also  subject  to  stricter  reporting  and  monitoring  requirements  than  other
government expenditures. (GoU 2005)
Over the period of the evaluation, there was an understanding between GoU and DPs that the provision
of BS would be underpinned by a common agreement on the aggregate expenditure levels and broad
composition.  At  the  aggregate  level,  the  total  resources  available  for  financing  the  budget  were
determined  by  the  macroeconomic  targets  agreed  with  the  IMF.  Regarding  the  composition,  at  the
sector  level,  there  was  an  early  agreement  that  additional  budgetary  resources,  financed  primarily  by
BS, should be used to scale up pro-poor financing in the social service sectors in line with government’s
commitments in the PEAP.
Given  the  allocative  commitment  from  GoU  and  the  increased  scrutiny,  the  PAF  lent  itself  well  as  a
vehicle for SBS initiatives from various DPs that lasted until the mid-2000s. However, facing criticisms
that  this  would  distort  optimal  allocations  across  sectors  for  the  implementation  of  the  PEAP,  this  aid
modality evolved around 2004/05 towards GBS, which was less restrictive with regard to the level and
composition  of  specific  public  spending  categories  as  disbursements  were  made  against  the
achievement of conditions aligned with the broad objectives of the revised PEAP (see also EQ1).
Main findings36

Evolution  of  pro-poor  allocations  and  actual  disbursements  at  central  and  decentralised  level (Vol.  2:
JC5.1 and JC5.2)
GoU  used  the  PAF37 as  a  virtual  fund  to  identify  which  budget  lines  within  the  social  service  sectors
were  considered  to  be  ‘pro-poor’;  these  primarily  related  to  transfers  to  local  governments  to  finance
service delivery in education, health, and water. GoU further committed to increase budget allocations
to the PAF year-on-year, and to protect them from cuts during budget execution. DPs providing BS, in
turn, used GoU’s budget allocations to the PAF as a mechanism for demonstrating that their financing
was  supporting  increased  pro-poor  spending  in  the  budget.  Overall,  government’s  pro-poor  budget
allocations, as identified in the PAF, grew rapidly in the first years after the set-up of the PAF, more than
tripling in real terms.
However,  from  2004/05  onwards,  as  GoU  started  to  reduce  its  fiscal  deficit  without  increasing
government  revenues (see  EQ3), the  real  increases  in  allocations  to  the  PAF  were  just  a  fraction  of
what they had been in the earlier years. In per capita terms, real PAF releases declined by about one
fifth  between  the  peak  period  in  2004/05  and  2012/13  (see Figure 11).  Similarly,  the  level  of  PAF
spending as a percentage of the discretionary budget38 reached a peak of 33.2 percent in 2004/05, and
subsequently declined steadily, to 20 percent in 2012/13.

36 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.
37 The PAF definition changed over the review period, but consistently focused on key social sectors and included
a core set of decentralised grants. The definition follows Williamson 2014 and includes: decentralised grants under
agriculture,  education,  health, social  development,  water  and  environment  and  works  and  transport,  the  PAF
monitoring and accountability grant, LGDP, Dutch development grant and the hard to reach allowance.
38 Discretionary budget expenditures exclude interest payments, taxes and arrears.

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Final report - Volume 1 - 2015 - IEG and Particip GmbH

Figure 11

Real  PAF  budget  allocation  and  release  (Primary  Axis),  and  per  capita  release
(Secondary Axis)

28

h
s
U

f
o
s
n
o

i
l
l
i

B

800

700

600

500

400

300

200

24.000

22.000

20.000

18.000

16.000

14.000

12.000

10.000

h
s
U

Budget

Release

Release / capita

Source: MoFPED and World Bank BOOST data39, adjusted by GDP deflator and population.

Nonetheless,  GoU  continued  to  meet  its  formal  commitment  to  increase  pro-poor  allocations  and
protect PAF expenditure during budget execution, as targets were set in nominal terms, and not relative
to total government expenditure. Execution rates for PAF expenditures averaged 97 percent across the
period  (Williamson  et  al  2014),  which  is  significantly  different  from  the  average  budget  performance
across all government expenditures amounting to only 45 percent (WB Boost data).
After the initial surge in allocations to the PAF between 1998 and 2004, it became increasingly difficult
for  DPs  and  GoU  to  reach  a  common  agreement  on  the  detailed  budget  framework.  The  gradual
slowdown  in  PAF  allocations  has  been  precipitated  by  an  increase  in  the  allocation  for  productive
sectors  such  as  roads  and  infrastructure,  and  by  defence  expenditures  that  frequently  exceeded  the
approved budget (see Figure 12). Furthermore, a commitment to reduce the deficit without sufficiently
raising domestic revenues meant that there were relatively less funds available to finance key priorities,
and policy trade-offs between pro-poor and productive sector expenditure became more acute.

Figure 12

Trends in spending composition and defense budget and outturn

Trend in spending (Percent of the Budget) and Deficit
(Percent of GDP)

Trend of Defense Budget and Outturn (Billions of
Uganda Shillings)

45%
40%
35%
30%
25%
20%
15%
10%
5%
0%

2.000

1.600

1.200

800

400

0

Economic and productive sectors

Social Sectors

Public Administration

Deficit (as % of GDP)

Source: MoFPED and World Bank BOOST data.

Defense Budget

Defense Outturn

At  the local
level, there  has  been  a  considerable  capacity  development  effort  with  support  from  the
central government and BS DPs, especially in terms of planning and budgeting40. However, almost all
allocation decisions were made at the centre and the improved planning capacity of LGs could therefore
be used only in a limited way. Moreover, real expenditures of LG programmes have increased and the
budget performance for LG grants has been consistently good. However, the resources made available
to the LGs as a share of the total budget have declined, especially in recent years (see figure below).

39 MoFPED  MTEF  for  1997/98 – 2002/03;  Boost  Data  for  2003/04 – 2007/08; and  MoFPED  approved  estimates
and annual budget performance reports for 2008/09 – 2012/13
40 See EQ4 for further information on capacity development at local level on budgeting and planning.

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Figure 13

Trends in LG budget (Billions of Ush) and LG share of total budget envelope

29

h
s
U

f
o
s
n
o

i
l
l
i

B

5.000

4.000

3.000

2.000

1.000

0

30%

25%

20%

15%

10%

5%

0%

e
r
a
h
S

Real expenditure LG programmes

LG programmes as share of total govt budget

Source: MoFPED budget data 2014.

Finally,  although  service  delivery  expanded  during  the  period,  implementation  of  service  delivery  was
negatively affected by the reduction in the discretionary powers of Local Governments, their weakened
ability to collect local taxes and user fees, and the proliferation of districts (see also EQ8 to EQ10).

BS contributions
Overall,  BS  contributions  to  ensure  a  protection  of  the  pro-poor  expenditure  have  been  significant,
although  several  bottlenecks  did  not  allow  achieving larger  positive  effects.  All  inputs  provided  by  BS
have played an important role. The funds have provided the bulk of the resources employed in the PAF,
although  part  of it has been  used  to  reduce  the  deficit.  The  dialogue  has  been  essential  to  build  and
maintain a focus on pro-poor allocation, including monitoring. Performance matrices used considerably
improved  over  time  in  terms  of  both  their  relevance  and  precision,  and  the  data  used  for  monitoring.
More generally, BS has provided a high-level forum for policy dialogue based on considerable analytical
input41 backed by funding, capacity building and performance and results measurement. It has informed
policymaking at the highest levels on critical issues affecting public expenditure  priorities, expenditure
composition,  and  the  impact  of  expenditures  on  the  poor.  The  overall  budgeting  process  was  also
strengthened through BS (see EQ4), which helped the tracking of pro-poor expenditures.
The support provided, however, has also faced important obstacles.

 While  BS  funds  were  significant  to  increase  pro-poor  allocations,  this  contribution  substantially
declined  over  time  with  the  decrease  in  the  relative  size  of  BS  in  total  budget.  The  PAF  helped
significantly to increase allocations to pro-poor service delivery in the early 2000s. But, after a peak
in 2004/05, increased allocations were modest and insufficient to provide for expenditure pressures
arising  from  high  population  growth  (greater  than  3  percent)  and  increased  demand  from  the
abolition of user-fees in health facilities and universal education policies (see EQ8 & EQ10).





By holding GoU accountable to stable PAF allocations, BS helped protect funds from reductions,
but this has been insufficient to generate commitment for a stable share of total expenditures as
budgetary  pressures  became more  acute.  BS  partners  have  not  been  able  to  help  improve  the
efficiency  of  public  expenditure  at  sectoral  and  local  level,  despite  the  analyses  and  the  TA
provided by the WB. MoFPED, which is the institution with closer technical relations with the DPs,
is unable to control the politically driven context at local level. OPM, which chairs the JBSF after
2008, does not consider the need for political issues to be discussed under JBSF.

BS  partners  have  not  been  able  to  help  GoU  change  its  tax  policy  and  gradually  increase
revenue,  despite  specific  TA  provided  by  DFID  and  discussion  of  revenue  issues  within  policy
dialogue. The low level of tax revenue has exacerbated resource allocation trade-offs.

These  bottlenecks  have  weakened  the  positive  effects  of  BS  on  pro-poor  expenditure both
quantitatively and qualitatively. They have also hindered convergence of views among DPs. Although it
was supported by some key analytical products such as the 2007 Country Economic Memorandum and
the 2007 Public Expenditure Review, not all DPs were equally supportive of the shift in priorities from

41 For instance, the 2007 PER stressed allocative efficiency and the importance of the productive sectors vis-à-vis
the  PAF,  service  delivery  and  overall  poverty  reduction  objectives.  The  2007  Country  Economic  Memorandum
(CEM)  has  helped  GoU  to  develop  a  prioritized  set  of  policy  actions,  investments,  and  interventions  in  the
productive sectors to accelerate economic growth. Both of these were instrumental to making growth and economic
transformation  more  prominent  in  the  third  PEAP  and  the  NDP  than  had  previously  been  the  case.  A  number of
sectoral PERs that followed the CEM have also been critical inputs into GoU’s budget reforms.

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30

social  sectors  to  productive  sectors.  Several  DPs  saw  this  shift  as  potentially  undermining  the  all-
important social service delivery agenda, which remained priorities for them. As a result, the JBSF only
partially  reflects  this  shift,  putting  only  moderate  emphasis  on  sectors  such  as  transport42.  This  has
effectively  created  a  divergence  in  priorities  between  GoU  and  the  JBSF,  which  further  diluted  the
potential effects of BS.
If  the  use  of  BS  had  not  been  weakened  as  described  above,  BS  would  have  been  irreplaceable  as
shown  in the period  of the first PAF. Because of the  level and  extent of the  dialogue and  the relative
size of financial support, it is difficult to see how such level of engagement could have been achieved
with  less  encompassing  aid  modalities.  Relying  solely  on  investment  projects  would  have  not
contributed to the same extent putting in place an owned national strategy in the early 2000s, with the
important  results  obtained  in  education,  health,  water  and  PFM  reforms. Fiduciary  issues  would  have
remained and coordination and harmonization would have suffered.
In addition, the trade-off between productive/administrative and social allocations (due, in particular, to
the  inadequate  levels  of  GoU tax  revenue)  became  very  strong  in  the  mid-2000s.  If  the  framework
associated to BS had not been there, the relatively low level of advocacy of the poor would have been
inadequate  to  face  the  pressure  coming  from  greater  attention  to  infrastructure  and  public
administration.  The  present  situation  where,  according  to  many  stakeholders,  a  further  decline  of  BS
may lead to serious setbacks in service delivery tends to confirm this observation.
Indirect and less tangible, but no less real, was “learning by doing” and capacity building in MoFPED,
PFM  and  upstream  accountability  institutions, but  much  less  so  in  the  sectoral  ministries. Perhaps
greater  emphasis  on  SBS,  while  keeping  a  part  of  GBS  as  a  vehicle  for  coordination  and  high-level
dialogue focused  on  policy  areas  under  MoFPED  control,  might  have  enhanced  these  less  intangible
benefits across GoU’s agencies, contributing to results in those sectors. Given the GoU’s clear shift in
priorities  and  expenditure  allocations  from social  to  productive  sectors,  there  remains  a  question  how
much such, more sectoral approach would have contributed to better results in social sectors.
Moreover,  it  is  possible  that,  in  recent  years,  earmarked  sectoral  support  (e.g.  the  water  sector)  and
projects  would  have  contributed  better  to  pro-poor  expenditure,  although  they  would  not  have
contributed  to  build  a  financial  management  and  monitoring  system  potentially  suitable  to  ensure  the
long term sustainability of such expenditure.

Summary answer to the evaluation question
Pro-poor budget allocations, as identified in the PAF, grew rapidly in the first  years after the set-up of
the  PAF,  more  than  tripling  in  real  terms  from  1997/98  to  2002/03.  During  most  of  the  period  under
review, GoU continued to meet its formal commitment to increase pro-poor allocations and protect PAF
expenditure  during  budget  execution.  However,  targets  were  set  in  nominal  terms,  and  not  relative  to
total government expenditure. After the initial surge in allocations to the PAF until 2003/04, a slowdown
in pro-poor allocations gradually started and was then precipitated by an increase in the allocation for
productive  sectors  and  defence  expenditures  that  sometimes  exceeded  the  approved  budget.
Furthermore,  a  commitment  to  reduce  the  deficit  without  sufficiently  raising  domestic  revenues  meant
that  there  were  relatively  less  funds  available  to  finance  key  priorities,  and  policy  trade-offs  between
pro-poor and productive sector expenditure became more acute.
The  decline  in  BS  funds  in  recent  years  combined  with  the  failure  of  BS  partners  to  help  GoU  in
increasing revenue  and improving  the  efficiency of public  expenditure at sectoral and  local level  have
weakened the positive effects of BS on pro-poor expenditure, both quantitatively and qualitatively. That
said,  overall,  BS  contributions  to  allocative  and  operation  efficiency  of  public  expenditure  have  been
significant. If not weakened in the way described above, BS would have been irreplaceable as shown in
the  first  years  of  the  PAF.  Relying  solely  on  investment  projects  would  have  not  helped  to  the  same
extent  in  putting  in  place  a  national  strategy  in  the  early  2000s,  with  strong  ownership  and  important
results  obtained in  education,  health,  water  and  PFM  reforms.  In  the  last  years,  it  is  possible  that
earmarked  sectoral  support  and  projects  would  have  contributed  better  to  pro-poor  expenditure,
although  they  would  not  have  helped  in  building  a  financial  management  and  monitoring  system
suitable to ensure the long-term sustainability of such expenditures.

42 Another  area  where  DPs  failed  to  use  BS  as  an  entry  point  for  improving  pro-poor  expenditure  has  been
agriculture. As the predominant part of the population are poor rural dwellers (the 2014 WDI indicate that the share
of the population in urban agglomerations of more than one million was only 4.9 percent in 2013) and about two
thirds of small holder farmers are female, BS to agriculture has the potential to impact on gender inclusive growth
and poverty. However, while GoU has increased allocations to agriculture through agricultural grants at the district
level, policy dialogue has remained weak leading to limited positive evolutions in this area.

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4.1.6

Evaluation question 6

EQ6 - Policy formulation & implementation processes
To what extent and through which mechanisms (funds, dialogue and TA) has budget support
contributed to any improvement in the policy formulation and implementation processes and
related accountability?

Background and context
As seen under previous EQs, the evaluation period sees a shift in GoU overall development strategies
and policies. Following a third iteration of the Poverty Eradication Action Plan (PEAP) for the 2004-2008
period, the GoU launched the National Development Plan – NDP (2010-2015).
As of 2007, the lead role for national  planning  in  Uganda shifts from the MoFPED - who collaborated
closely  with  DPs  during  the  preparation  of  the  PEAP  and  its  iterations - to  the  newly  established
National Planning Authority (NPA). The NPA developed an ambitious new vision for the development of
the  country,  with  the  objective  of  achieving  middle-income  status  within  30  years  through  a  series  of
five-year  National  Development  Plans.  The  first  NDP  (2010-2015)  sees  an  important  shift  in  priorities
towards economic infrastructure, linked to the discovery of oil, gas and minerals with the social services
sectors (including education, health and water) considered as a secondary priority.
Looking at the three focal sectors (education, water and sanitation and health), the period is marked by:







The introduction of Universal Post Primary Education and Training (UPPET) in 2006 through a
Presidential Initiative.

A shift within the water and sanitation sector from a focus on increased water and sanitation for
domestic use under the PEAP to a focus on access to water for production under the NDP. The
period  also  sees  the  introduction  of  a  separate  budget  line  for  sanitation  at  district  level  to
increase  support  for  sanitation.  With  specific  reference  to  the  sub-sector explicitly supported
through SBS (i.e. increasing and sustaining  water and sanitation for domestic use), strategies
have  evolved  to  optimise  support  for  piped  water  supplies  to  rural  growth  centres  and  small
towns and a specific Water Supply Development Fund was introduced to support this evolution.

The  introduction  of  the  Health  Sector  Strategic  and  Investment  plan  (HSSIP)  2010/11-14/15
following  the  launch  of  the  NDP  and  the  end  of  the  Health  Sector  Strategic  Plan - HSSP-II
(2005-2009). The Uganda National Minimum Health Care Package (UNMHCP), defined under
HSSIP  II  continues  to  be  a  cornerstone  of  the  GoU’s/MoH’s  strategy  for  improved  access  to
basic  health  services. Despite  specific  results,  it  appears  that coherent sector-wide policy
development, planning, and implementation of programmes may have been adversely affected
by  the  large  volume  of  project  funding  from  the  health  sector  DPs,  including  USAID  and  the
Global Health Initiatives (GHI) targeting specific diseases.

Main findings43

Policy processes (Vol. 2: JC6.1)

With  the  exception  of  the  water  and  sanitation  sector,  where  policy  processes  and  quality  of  policies
have been progressively  improving as a result of a vibrant consultative process taking place at  yearly
Joint  Sector Reviews and  Joint Technical  Reviews, little  or no evidence has been found in relation to
the  strengthening  of  policy  processes  in  the  period  under  review.  Clear  weaknesses  in  the  policy
processes  are  evidenced  by  a  number  of  politically  driven  decisions  with  important  budgetary
implications,  which  were  neither  analysed  in  terms  of  feasibility  nor  discussed  with  the  DPs  who
supported  the  bulk  of  sectoral  development  expenditure.  Examples  include the  introduction  of  the
UPPET in the education sector, the abolishment of user fees in the health sector (though this happened
in the pre-evaluation period), and the abolishment of the graduation tax in 2006, all through Presidential
initiatives. Directives that appear to take precedence over some of the formal policies developed within
the sectors.  Consultative  processes  which  had  characterised  the  earlier  phases  of  the  SWAp in  the
education sector, for example, no longer work and even the interest to dialogue on both the side of the
MoES and DPs has shrunk. That said, in the education sector as in the health  sector, sector working
groups continue to function. DPs have managed to raise key issues, as evidenced by the discussions
on  human  resources,  absenteeism,  and  pharmaceutical  supply  and  distribution,  and  by  discussions
around UPPET which have subsequently led to delay the implementation  of UPPET by 1  year and to
establish an agreed pass rate to be achieved before transition to secondary level. As will be discussed
under the sector EQs, there is evidence to suggest that policies pursued – also with the support of DPs
– have not been particularly effective.

43 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.

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Public sector institutional and technical capacities (Vol. 2: JC6.2)
Evidence  collected  through  both  documentary  sources  and  interviews at  both  central  and  local  level,
indicate  that  institutional  and  technical  capacities  in  the  health  and  education  sectors  have  been
seriously  eroded  over  the  past  years,  particularly  at  decentralised  levels.  In  the  education  sector,  the
technical capacity of the MoES at central level was reported to be declining and capacity at local level
has always been weak and its strengthening has not been systematically addressed by DPs. Similarly,
in the health sector, several sector experts and DPs specifically involved in  the  sectoral support have
testified  to  the  gradual  reduction  in  the  analytical,  technical  and  managerial  capacities  of  the  MoH.
Importantly, there is strong evidence to suggest that health sector institutional and technical capacities
are particularly weak at the District and sub-district levels also as a result of the proliferation of districts,
lack  of  robust  local  tax  base,  and  lack  of  policy  focus  on  local  capacity  building (World  Bank,  2013;
EPRC,  2013;  Lutwama  et  al.,  2012).  This  was  also  confirmed  by  the  results  of  the  field  survey
undertaken in the framework of the evaluation  whereby capacity  was deemed  mostly adequate by 30
percent of respondents during the 2004-2008 period rising to 46 percent in the 2009-2013 period; also
to note that out  of the sampled health  units, only  19 percent report having been fully staffed over the
last 5 years.
Once  again,  the  water  sector  proves  to  be  an  exception.  Here,  the  policy  and  facilitating  role  of  the
centre (MWE as line ministry) has become well established over the years although improvements are
still needed in the MWE internal quality control and reporting systems. With regards to the local level,
interviews  and  reports  alike  indicate  that  the  establishment  of  Technical  Support  Units  (TSU)  which
provide  intensive  levels  of  long  term  national  technical  assistance,  proved  to  be  a valuable  tool  in
building capacity at district level.44 Conceived as temporary structures to build capacity in the districts
for rural water supply and sanitation, the TSUs are currently envisaged as a possible more permanent
element of the sector institutional framework to address capacity development issues challenged by the
increasing number of local governments.

M&E capacities and systems (Vol. 2: JC6.3)
Reasonably  good  performance  monitoring  systems  are  in  place  to  monitor  the  implementation  of
policies,  with  the  system  being  closely  linked  to  policy  dialogue  platforms  /  sector  reviews.
Shortcomings are however evident in all three sectors with regards to the reliability of data though these
appear to be more important in the education and health sectors. In the education sector, the Education
Management  Information  System  (EMIS)  on  which  performance  monitoring  is  based  is  weak:  data  is
incomplete and unreliable, with limited efforts deployed during the evaluation period to strengthen it.45 In
the health sector there is evidence to suggest that the monitoring and evaluation capacities of the MoH
and associated entities have improved with the Annual Health Sector Performance Reports describing
and  reporting  on  the  achievements  of  the  MoH  and  the  health  sector,  including  private  not-for-profit
providers. However, the quality of these reports varies and little data and information is reported on the
private  sector,  which  makes  up  a  significant  share  of  the  Ugandan  health  sector.  The  absence  of
reliable information and evidence on activities in the sector remains a major weakness.
Finally,  in  the  water  sector  M&E  capacities  have  clearly  improved  over  the  period  under  review  as
evidenced by the better quality of sector performance reports. The performance monitoring framework,
consisting of a set of golden indicators monitoring progress in all W&S sub-sectors on a yearly basis, is
concise and complete; and data produced and disseminated is widely used to underpin studies on best
practices and lessons learnt. Despite the efforts deployed to continuously improve indicator monitoring
some  doubts  on  reliability  of  figures  particularly with  reference  to data  on  gender  and equity,  which
seem to be fluctuating rather than presenting a clear increasing / decreasing trend.

Public service delivery (Vol. 2: JC6.4)
Public  service  delivery  has  not  significantly  increased  over  the  evaluation  period.  Key  factors  which
have prevented such a growth include: an overall reduction in the relative shares of the budget destined
to  the  social  sectors  (the  share  of  the  budget  declined  from  around  40%  in  2002  to  28%  in  2013,
whereas  the  economic  and  productive  sectors  see  their  allocations  increased  from  25%  to  35%),  a
deterioration in the ratio of front line service delivery allocations for each JBS focal sector versus total
sector  budget;  and  increasing  cuts  in  sector  budget  releases compared  to  allocations  in  JBS  focal
sectors. (JAF 4 Appraisal report, 2013)

44 Danida/GIZ, 2007, p. 37.
45 The  unreliability  of  administrative  data  which  is inflated  for  budget  purposes is  widely recognized  as  a  key
problem  by  most  interviewees  who  report  numerous  incidences  of  ghost  pupils,  schools  and  teachers  and
pupil/teacher absenteeism as well as falsification of records by teachers. “More students you report, more money
you get, the same holds true for payrolls”.

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Public  service  delivery/management  in  the education  sector has  not  improved  significantly  over  the
evaluation  period.  Pupil-teacher  ratios  have  not  declined,  with  only  a  very  marginal  increase  in  the
employment  of  female  teachers,  although  pupil-classroom  ratios  and  pupil-textbook  ratios  have
improved at primary level. However, these average figures mask major differences in these indicators
between the different regions. Other problems still remain related to service delivery including problems
with  pupil,  teacher  and  head  teacher  absenteeism,  limited  community  participation  as  UPE  is
considered  to  be  free,  high  dropout  rates  of  pupils  particularly  girls  and  attrition  rates  of  teachers.  At
secondary  level,  the  main  problems  relate to  a  capitation  grant  that  is  static,  inadequate  skills  and
competencies  in  managing  private  schools,  inadequate  science  and  maths  teachers  and  science
equipment/laboratories.
In the water sector, service delivery has somewhat improved in terms of access and functionality when
looking at the whole evaluation period though improvements in access have been primarily registered
during  the  first  years  with  a  subsequent  stagnation  or  partial  decline. Functionality  was  improved  by
increasing  the  focus of District  Local  Governments  on  Community-Based  Maintenance  Systems,  and
enhancing  backup  support  systems  through solutions such  as the  introduction  of  Hand  Pump
Mechanics  Associations. Data  on  water  quality  are  inconclusive  and  data  on  gender  suggest  that
representation of women in water user committees is somewhat reducing. As synthesized by the JAF 5
Appraisal Report (2014)

The sector has made a lot of progress on regulation and functionality of water sources. However, the
biggest obstacle to achieve progress in the Sector is the limited funding, which cannot cope with the
growth  rate  of  the  population,  coupled  with  the  administration  costs  associated  with  the  large
number  of  districts.  The  problem  of  limited  funding  is  further  compounded  by  poor  operation  and
maintenance,  inefficient  regulation  leading  to  reduced  life  span  of  investments,  and  high
rehabilitation costs on the one hand, and poor reliability of services on the other. (p.47)

Finally, in the health sector, the analysis has revealed that it is not clear that public (or private) health
services in Uganda have improved.46 While improvements are registered in the percentage of approved
posts filled by health workers in public facilities, achievements remain below targets and hard-to-reach
areas of the country have not benefitted from the general increases and record a deterioration. At the
same  time, data  on  absenteeism  rates  in  government  health  facilities  is  worrisome.  Trends  are  more
positive when looking at the number of health facilities without drug stock-outs for tracer drugs for which
a significant reduction has been reported though again levels remain below targets.
Evidence collected through the implementation of the field survey (see Volume 3 - Annex 7 for details)
in  relation  to  the  education  and  health  sectors  points  to  insufficient  availability  of  physical  resources
which  heavily  affects  the  provision  of  quality  services.  In  the  education  sector, this  is  deemed  to  be
insufficient  by  a  range  between  65%  and  79%  of  respondents  depending  on  the  type  of  resources
(electrification,  sanitation  facilities,  classroom  equipment,  general  status  of  classrooms,  teaching
materials, computer labs and sport facilities/equipment) although almost half of respondents indicate an
improved availability over the period covered by the evaluation. Similarly, in the health sector over 60%
of  respondents  rated  as  insufficient  the  availability  of  physical  resources  be  it  electricity,  medical
equipment and facilities, water and sanitation facilities, percentage which goes down to 44% in relation
to  the  stock  of  pharmaceuticals/drugs.  Again  almost  half  of  respondents  indicated  an  improved
availability since 2004.

Gender mainstreaming (Vol. 2: JC6.1 to JC6.4)
While  limited,  some  progress  has  been  made  with  regard  to  gender  mainstreaming,  as  evidenced  by
the introduction of the Gender in Education Policy in 2008, of the Water and Sanitation Gender Strategy
in  2010  as  well  as the  streamlining  of  gender  within  all  new  guidelines  in  the  water  and  sanitation
sector.  That  said,  while  some  efforts  to  promote  the  mainstreaming  of  gender  activities  have  been
registered  in  all  three  sectors,47 these  have  been  limited.  Overall  number  of  staff  knowledgeable  in
gender remains low, key decision makers demonstrate little interest in gender aspects and, as a result,
attitudes  and  behaviour  are  still  not  gender-oriented.  This  is  also  reflected  in  the  quasi-absence  of
gender sensitive indicators and in the limited attention - for example in the education sector - to issues
such as female drop-outs, teenage pregnancy and gender-based violence within schools.

46 Annual Health Sector Performance Reports for various years and other sector reports (see bibliography).
47 Appointment  of  a  gender  focal  point  in  the  MoH,  although  this  is  not  a  full  time  position;  establishment  of  a
gender unit with UNICEF support in the MoES with a related budget line for gender mainstreaming activities; and
increase in the number of sociologists as well as appointment of a gender officer within the MWE. Carrying out of
workshops and seminars to increase knowledge and increase capacity in all three sectors primarily through project
support.

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Contribution of BS to the observed changes
In  what  follows  the  role  played  by  BS  in  contributing  to  the  observed  changes will  be  highlighted  by
looking  at  the  different  strands  of  inputs:  funds,  policy  dialogue  and  related  performance  assessment
frameworks, and complementary measures.
Funds. While it is clear that increases in DPs BS funds do not automatically translate in corresponding
increases  in expenditures  in those sectors targeted by  BS operations, calculations made by  the team
indicate that the contribution of BS (SBS + GBS) to domestic sector expenditure has been significant in
the  three  sectors.48 Had all  funds  provided  by  DPs  in  the  form  of  BS  automatically  translated in  a
corresponding  increase  in  sector  expenditures,  BS  would  have  contributed  to  the  financing  of
approximately  30 percent of  domestic  expenditures  in  the  three  sectors  over  the  whole  period,  with
peaks of 75 percent during the pre-JBSF period. The strongest hypothetical contributions are recorded
in the W&S: almost 41 percent on average across the whole period with a peak of 94 percent in the pre-
JBSF period; followed by the health and education sector, each with an overall average of 22 percent,
again with much higher hypothetical contributions during the pre-JBSF period (respectively 72 percent
and  60 percent),  going  down  to  26 percent and  30 percent in  the  JBSF  period  before  drastically
declining to below 2 percent in the HLAM period.

Figure 14

Hypothetical BS contribution to sector expenditure (in percent)

Source: Evaluation team based on data from MoFPED.

In reality, however, it is clear that this has not happened. While BS has certainly contributed to maintain
a minimum level of sector expenditure (i.e. without BS, service delivery would have very likely declined
as highlighted in numerous interviews and shown by the data after 2010-11), the amount of resources
actually  flowing  to  the  three  sectors  has  been insufficient to  ensure  the  provision  of  improved  service
delivery. This also points to the fact that BS has also contributed to the partially unintended financing of
other GoU policies.

In the education sector, BS has underpinned the expansion of both primary and secondary  education
especially in the pre-evaluation and early periods of the evaluation. This expansion, however, has not
been accompanied by substantial changes in the quality of education. Areas in which GoU expenditure
and  hence  BS  have  led  to  positive  achievements  include:  i  )  the  set-up  of  the  School  Facility
Programme  which  has  contributed  to  increased  numbers  of  classrooms,  teacher  houses  and
washrooms  being  built;  and  ii)  the  School  Inspection  Grant  which  has  played  a  role  in  increasing  the
number of school inspections with the goal of improving quality. Similar considerations are also valid in
the  other  sectors  whereby  BS  has  definitely  contributed  to sustain  and - in  some  cases - improve
service delivery.
Policy  dialogue  and  related  performance  assessment  framework. Results  from  the  implementation  of
the  on-line  survey  indicate  that  the  great  majority  of  respondents  (fluctuating  between  a  low  of  80
percent and  a  high  of  100 percent depending  on  the  categories  and  sectors)  believe  that  BS  through
dialogue  (and  associated  performance  assessment  frameworks)  has  played  a  role  in  improving  the
policy formulation and implementation processes. An average of 25 percent of respondents believe BS

48 Figures based on data provided by the MoFPED with calculations made assuming that: i) all GBS is allocated to
the 4 JAF sectors which are a common feature throughout the whole JBSF period (i.e. education, health, water and
sanitation, and roads); and ii) the 2004 share of allocation of expenditures among the different sectors remains the
same for whole period.

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has  influenced  these  processes  to  a  great  extent.  Documentary  evidence  and  interviews, instead,
provide a slightly different picture and allow to gain a better understanding of what can be viewed as a
contribution.  It  is  clear  that  in  none  of  the  sectors,  has  BS played  a  key  role  in  the  introduction/
formulation of sector policies. That said, BS was able to support implementation not only through funds
but also through dialogue and related processes.
As anticipated in the preceding sections, while UPPET was introduced through a Presidential initiative,
DPs  did  influence  some  of  the  content  after  its  announcement.  Through  a  mix  of  policy  dialogue  and
accompanying  measures,  DPs  promoted  the  establishment  of  an  agreed  pass  rate  to  be  achieved
before  transition  to  secondary  level,  played  a  role  in  developing  the  Universal  Secondary  Education
Strategy  and  its subsequent incorporation  into a revised ESSP (interviews)  while support  provided  by
GIZ and the Embassy of Belgium supported the drafting and finalisation of the Uganda Skills Strategy
and Plan.
More  generally,  performance  assessment frameworks  and  the  associated  dialogue  are  recognised  as
important  structures  for  effective  performance  monitoring  of  the  implementation  of  policies  and
programmes and  of  achievement  of results. Frameworks that have  allowed drawing attention  to  a
number of key challenges and constraints although with mixed results.
In  the  health  sector,  while  there  is  some  evidence  that  these  platforms  and  instruments  have
contributed  to  an  improved  infrastructure  for  policy  monitoring  and  evaluation  of  results,  and  have
allowed DPs to participate with – at times – an important and constructive role, there are also signs that
the  targets  set  out  in  the  JBSF  and  associated  matrices  have  been  insufficiently  ambitious  thus
enabling  the  GoU/MoH  to  continue  implementing  policies  that  may  not  be  very  effective.  Similar
considerations are valid for the education sector, although here, it was noted that the joint performance
assessment  process  and  GAPR  process  (see  EQ  2)  which  involved  discussions  on  education  sector
issues with OPM, Heads of mission and the Ministry of Finance, allowed to put pressure on the MoES
to implement commitments.49 Examples of DPs influence is also found in the water sector through DPs
participation  to  the yearly  Joint  Sector  Reviews  and  Joint  Technical  Reviews and  monthly  water  and
sanitation development partner group meetings. Discussions within these frameworks have in fact led to
the development of new policies and approaches, and to the implementation of various undertakings on
improved  functionality,  increased  access,  and  strengthened  community  based  maintenance,  and
operation and maintenance (CBM and O&M) support structures.
Accompanying measures. In addition to the positive effects of accompanying measures detailed in the
previous  EQs (M&E,  PFM  and audit) and  paragraphs (e.g. TA and advisory services in the  education
sector), the water sector is the only one which provides some evidence of linkages between increased
institutional and technical capacities and support provided by DPs as a complement to BS. Here in fact,
a highly appreciated mix of complementary aid modalities is used to implement the sector programme
with  BS  providing  much  needed  funding  in  support  of  districts  through the  GoU  budget,  parallel  on-
budget project assistance providing TA and capacity building measures tailored through policy dialogue
to  ensure  responsiveness  to  the  sector  capacity  development  strategy.  In  the  other  two  sectors,
evidence  shows  a  gradual  reduction  in  the  analytical  and  technical  capacities  with  no  significant
measures taken by DPs as a complement to BS to counteract this process.
Finally, as seen, there  was basically no influence by  DPs on gender policies. Improvements – though
minimal – were achieved  through  GoU  action  supported  in  some  cases  by  projects  with  no  visible
contribution of BS.
Could different and better results be obtained through alternative aid modalities?
As detailed in the following EQs, overall real per capita spending has decreased in the education and
health  sectors  and  slightly  increased  in  the  water  sector. Allocations  to  the  social  sectors  have
decreased  as  a  share  of  the  budget  following  the  decrease  of  BS  flows. Qualitative  information
gathered  through  interviews  leads  to  conclude that  in  the  absence  of  budget  support,  real  per  capita
expenditure would have decreased even further and it is undoubtable that BS has contributed to sector
expenditure  in  ways  which  would  not  have  been  possible  through  other  aid  modalities, being directly
associated  to  strengthening  the  national  policy  and  institutional  framework  and  not  only  focused  on
fragmented  features  as  in  the  case  of  projects. The  experience  of  the  water  sector  and  the
considerations  on  the  low  capacity  of  BS  to  support  additional  social  investment  in health  and

49 Teacher absenteeism is an example of this. During the 2010 annual governance performance retreat chaired by
the Prime Minister (PM), the PS of MoES was challenged by the PM about low proficiency rates in numeracy and
literacy,  which  were  below  50%. As  a  result,  the  MoES  assessed  the  key  issues  related  to  this  and with  Dutch
support developed the Quality Enhancement Initiative (QEI), which focused on raising proficiency levels in the 12
worst  districts  (recruitment  of  teachers  undertaken  &  classroom  construction).  This  was  reported  to  have  been
successful,  as  75%  of the  districts  have  moved  out  of  the  bottom  of  the  district  league  table  (GoU  and  DP
interviews).

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education,  however,  suggest  that  stronger  sector  budget  supported  and  other  sector  policy  support
programmes associated  with basket funds could have better controlled the risk of insufficient sectoral
funding compared to GBS.
With  respect  to  capacity  building  and  TA,  it  is  clear  that  BS  has  not  contributed  much  to  the
strengthening of institutional and technical capacities which have in most cases declined. This however
is  a  shortcoming  which  is  not  linked  to  the  BS  modality  per  se  but  rather  to  the  quasi  absence  of
complementary  measures  especially  at  local  level,  where  the  implementation  has  shown  high
inefficiencies.  As  seen  under  previous  EQs  (especially  PFM),  where complementary measures  are
foreseen and implemented together with BS, they support and reinforce each other.
Finally,  despite  the  limited  contribution  provided  by  policy  dialogue  to  the  formulation  of  policies,  it  is
doubtful that alternative aid modalities could have done better as evidenced for example by the health
sector  where  coherent  policy  development,  planning,  and  implementation  of  GoU  sector programmes
have  been  adversely  affected  by  the  large  volume  of  project  funding  from  the  health  sector
development partners, including USAID, the Global Health Initiatives (GHI) targeting specific diseases.
What emerges from interviews and the results of the e-survey however is that in a number of instances,
SBS might have been able to  provide stronger contributions to the formulation  and implementation  of
sector  policies  in  the  country as  was  the  case  in  the  pre-evaluation  and  partly  also  in  the  pre-JBSF
period.  In  this  respect,  in  fact,  GoU  and  NSA  respondents  to  the  e-survey  rank  SBS  as  the  most
significant aid modality in terms of contribution to the formulation and implementation of policy reforms
whereas when looking at results for the DPs category, GBS is ranked higher but is closely followed by
SBS.

Summary answer to the evaluation question
Policy  implementation  processes  and  public  service  delivery  in  both  education  and  health  at  both
central  and  local  level  have  not  shown  significant  progress  over  the  evaluation  period,  due  to  the
reduction in the relative shares of the budget destined to the social sectors, the deterioration in the ratio
of front line service delivery allocations for each JBS focal sector, as well as increasing cuts in sector
budget  releases  compared  to  allocations.  There  has  also  been  a  gradual  reduction  in  the  analytical,
technical and managerial capacities at institutional level. This has not been the case of the water and
sanitation sector where policy processes and quality of policies have been progressively improving as a
result of a vibrant consultative process.
BS has had no influence on sector policy formulation although it has influenced part of the contents of
the  policies  after  their  announcement  and/  or  supported  their  implementation  through  the  provision  of
funds  as  well  as  through  a  mix  of  policy  dialogue  and  accompanying  measures.  More  specifically,
budget support has:





Strongly contributed to maintain a minimum level of sector expenditure in the social sectors. It
is  clear  that  without  BS  funds,  service  delivery  would  have  further  declined  as  highlighted  by
numerous  interviewees.  But  real  per  capita  spending  has  decreased  in  the  education  and
health sectors and slightly increased in the water sector.

Supported  the  establishment  of  performance  assessment  frameworks  which  have  contributed
to an improved system for policy monitoring and evaluation of results.

 Contributed strongly in the water sector which is characterized by a well-developed sector wide

approach, institutional and technical capacities through the use of a mix of aid modalities.

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4.1.7

Evaluation question 7

EQ7 - Governance & Accountability
To what extent has budget support contributed to improvements in the quality of governance
and accountability, particularly with regard to the roles of Parliament, Civil Society and anti-
corruption agencies as ‘watch-dogs’ of the Executive?

Background and context
The accountability “sector” as defined in the Uganda national policy framework since 200750 comprises
a  variety  of  institutions  including:  MoFPED,  the  Inspectorate  of  Government,  the  Office  of  the  Auditor
General,  the  Directorate  of  Ethics  and  Integrity  (Office of  the  President),  a  number  of  other  Ministries
(e.g. Ministry of Public service, Ministry of Local Government) and other national institutions (e.g. Public
Procurement and Disposal of Public Assets Authority, Uganda Bureau of Statistics, etc.). In addition, a
“Stakeholders  Forum”  has  been  established  for  the  dialogue  with  the  Civil  Society  (incl.  private
business, media, anti-corruption organisations, community groups, etc.).
During most of the evaluation period, the legal framework for budget formulation, execution and audit
was provided  by  the 1995  Constitution (amended in 2000  and 2005) and through an  elaborated legal
framework including a variety of legal acts.
The period has been marked by a series of corruption scandals, with by passed accountability systems.
These have included major losses incurred in procurement related to the 2007 Commonwealth Heads
of Government meeting. In 2012, the investigations by the Auditor General reported further losses in the
payroll  and  pension  systems  from  “ghosts”  and widespread  malpractice  in  the  Office  of  the  Prime
Minister involving donor funding targeting recovery in northern Uganda. This resulted in the suspension
of all budget support and the subsequent elaboration of a High Level Action Matrix (HLAM) by MoFPED
to  rebuild  confidence  in  financial  management  systems  through  the  strengthening of internal  controls
and specific actions against corrupt officials. (see also EQs 1 and 2)
Main findings51

Quality of scrutiny of budgets and expenditures at national and local levels (Vol. 2: JC7.1 and JC7.2)
Overall,  Uganda  governance  and  accountability  indicators  have  improved  across  several  areas. A
number of reviews, including the 2012 PEFA, have assessed positively the quality of external scrutiny
of national budgets and expenditures in Uganda. The quality of financial statements has improved, audit
reports  are  done in  a timely fashion using  international  standards  of  audit,  and  audit  reports  are
submitted to Parliament within 6 months. As confirmed in interviews, the Parliamentary Public Accounts
Committee, an important body involved in overseeing government expenditure, is meeting frequently to
get  up  to  date  with  the  examination  of  audit  reports.  It  receives  technical  guidance  from  the  Auditor
General’s office. The 2012 PEFA notes that this committee holds in-depth hearings with the accounting
officers and heads of finance departments of MDAs as cited in the Auditor General’s reports. Hearings
are  open  to  the  public  except  on  classified  expenditure.  At  a  more  general
level, the  2012  PEFA
Assessment considers the procedures of the legislature to be relatively well established and respected.
However,  Parliamentary  scrutiny  of  the  budget  downstream  or  ex  post  has  remained  weak.  For
instance,  Parliament  has  not  debated  or  approved  any  of  the  audit  reports  on  the  Consolidated
Accounts of the three years up to 2012. While the Public Accounts Committee is active and operational,
it is often overwhelmed with a heavy workload and there is a backlog of cases for its consideration.
Frequency  of  supplemental  budgets  and  their  justification  are  a  major issue.  Instead  of  being  an
exceptional  mechanism  to  adjust  budgets  in  response  to  extraordinary,  well  defined  circumstances,
they are a regular part of the extended budget process, often driven by political rather than economic
and  strictly  budgetary  considerations.  They  are,  in  part,  related  to  the  predictability  of BS as  the first
supplementary  budget  in  the  year  sometimes  takes  place  when  donors  confirm  financing  late  in  the
budget process.
At  the LG level, coverage  and  quality  of LG Councils’  scrutiny of  local  budgets  and  expenditures  has
improved.  Accounts  reconciliation  are  comprehensive  and  timely  submitted  to  external  audits.  In
general,  audit  standards  are  met.  There  is,  however,  poor  follow  up  on  audit  recommendations. In
addition, there are significant delays in the scrutiny of audit reports by the legislature and in the timely
reporting of their recommended actions, a function that the 2012 PEFA assesses as weak.

50 See details provided in the 2010 National Development Plan of the Republic of Uganda.
51 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.

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Policy and institutional frameworks to fight corruption (Vol. 2: JC7.3)
The  overall quality  of  policies  and  institutions  measured  by  the  CPIA  ratings  on  transparency,
accountability, and corruption in the public sector52 has deteriorated significantly.53

Figure 15

Uganda vs. Sub-Saharan Africa: CPIA scores on the quality of policies and institutions
in the areas of transparency, accountability, and corruption in the public sector

Notes: ratings range from 1=low to 6=high.
Source: World Bank’s CPIA database.

This  deterioration  contrasts  with the  remarkable progress  the  country  has  made  in  terms  of  anti-
corruption  legal  framework  and  institution  building  in  this  area.  The  main  legislative  framework
developed during the last decade is considered by many54 as extensive, sound and adequate.
While Uganda’s anti-corruption legal framework and governing legislation are assessed as strong, there
are problems in the legal framework for political party financing. The country is also still lacking effective
implementation  and  enforcement  of  the  rules  in  place.  The  increase  in  prosecutions  since  2006  is
considered  as  insufficient  to  affect  the  incentives  for  corruption  and  contribute  to  a  deterrent  effect  of
enforcement  activities.  In  general,  the  continuing  lack  of  substantial  progress  in  prosecution,  and
conviction  of  corruption  cases  at  all  levels  of  public  institutions  is  undermining  the  remarkable  gains
made in upstream legislative reform and institution building.

BS contributions
By keeping governance and accountability high in the agenda of policy dialogue, BS has contributed to
the  observed  improvements  in  governance  and  accountability.  Sustained  dialogue  between  DPs  and
GoU has accompanied the continuous strengthening of the legal framework described above.
Moreover, consistent responses given in field discussions and interviews with key stakeholders indicate
that  BS  funding  and  accompanying  capacity  development  measures  have  strongly  contributed  to  the
development  of  key  upstream  accountability  institutions.  This  is  particularly  evident at  the  level  of  the
Auditor  General’s  office  (OAG)  and  the  Inspector  General’s  office.  For  instance,  BS  matrices  and
dialogue  contributed  to  assure  a  reliable  and  adequate  budget  for  the  OAG,  allowing  it  to  hire
specialized staff needed to carry out its mandate (e.g. forensic, audit officers, sectoral experts).
Complementary support provided by BS DPs through the FINMAP has also supported the development
of the Integrated Financial Management Information System (IFMIS), which helped ensure considerable
gains in budget execution, and expenditure at central government level but also, as reported in reviews
and observed directly by the evaluation team in two districts, at the local level.

52 Transparency, accountability, and corruption in the public sector assess the extent to which the executive can be
held accountable for its use of funds and for the results of its actions by the electorate and by the legislature and
judiciary, and the extent to which public employees within the executive are required to account for administrative
decisions, use of resources, and results obtained. The three main dimensions assessed here are the accountability
of the executive to oversight institutions and of public employees for their performance, access of civil society to
information on public affairs, and state capture by narrow vested interests.
53 It should be noted that PEFA assessments are carried out every four years and, therefore, do not capture the
year-to-year  variations  in  the  quality  of  PFM  between  assessments.  By  contrast,  CPIA  ratings  on  budgetary
transparency,  financial  measurement,  and  accountability  measure  somewhat  overlapping  aspects  of  institutional
and policy performance and are carried our each year.
54 See Andrews (2013): The Limits of Institutional Reform in Development: Changing Rules for Realistic Solutions.
Chap. 6.

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The corruption scandal in 2012, arguably, was brought about by Uganda’s strong upstream governance
institutions,  which  were  consistently  supported  by  budget  support.  It  was  also  followed up by  the
government response and reengagement of some donors, resulting in further progress in strengthening
and  transparency  of  governance  and  accountability  institutions.  Performance  matrices  regarding
governance  were  also  important  in  helping  organize  the  dialogue  around  specific  indicators  and  in
monitoring implementation. The GoU’s High-level Action Matrix (HLAM) provided a useful framework for
financial management reform. Because of the HLAM, spotlight was placed and progress made in some
areas where it was lagging before.
However,  BS  and  related  conditionality  did  not  focus  sufficiently  on  the  downstream  part  of  the
accountability  chain  (enforcement,  convictions,  etc.).  As  highlighted  above,  this  is  an  area  where
implementation was lacking and is only showing some results in the most recent years.

Summary answer to the evaluation question
Overall,  budget  support  has  contributed  significantly  over  the  years  to  the  quality  of  governance
institutions  and  accountability.  Governance  indicators  have  improved  across  a  number  of  areas,
especially  in  the  earlier  years  of  the  evaluation  period  and  on  the  upstream  side  of  the  accountability
chain. Also, budget support and related policy dialogue, directly and indirectly, helped strengthen some
key  governance  and  accountability  institutions  such  as  the  Auditor  General’s  office  and  Inspector
General’s office as well as their relative importance within the government institutions.
However, progress is especially lacking regarding downstream of the accountability chain e.g., following
up on upstream decisions, enforcement of prosecution, and recovery of funds.
The  observed  gains  achieved  could  have  perhaps  also  been  achieved  by  greater  focus  on  capacity
building and TA targeting specific bottlenecks with possible quicker results (over and above of already
substantial support through these instruments provided by DPs included in the form of complementary
measures  to  BS)t.  Budget  support  however  played  a  key  role  in  ensuring  that  governance  issues
remain at the top of the national policy agenda, which would have been more difficult in an environment
of  mostly  projects  and/or  TA  support.  Broader
institution  strengthening  requires  comprehensive
initiatives since capacity issues observed in the various relevant institutions are often interrelated. It is
unlikely  that  project  support  alone  would  have  contributed  with  the  same  success  in  keeping  the
governance  and  accountability  issues  high  in  the  GoU  agenda  thus  making  BS  (with  the  appropriate
accompanying measures) a strong instrument for the provision of support in this area.

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Synthesis of Step 1 for the three focal sectors

4.1.8
The  tables  below  summarise,  for  each  focal  sector  of  the  evaluation,  the  contribution  of  BS  to  the
induced outputs. In particular, the tables allow to highlight:





the causal links between BS and government strategies / policies and policy outputs as well as
the  roles  played  by  the  various  BS  components  (funding,  policy  dialogue  and  related
performance assessment frameworks, and TA and/or other capacity building initiatives); and

other  (non-BS  related)  factors - historical,  policy,  or  other  internal  or  external  factors - which
have influenced GoU strategies / policies and policy outputs.

The three tables, one for each focal sector, all follow the same structure:







The central column ‘GoU policies’ presents key sector policies / policy outputs.

The column on the left hand side, identifies the ‘contribution of BS’ to changes in the given GoU
policy,  specifying  the  type  of  influence  (provision  of  funds,  policy  dialogue,  capacity  building)
and the degree of influence:

 weak: when  the  factor  considered  contributed negligibly  to  the  observed  change  and

this would have occurred in any case, albeit in slightly different forms,

 moderate: when  the  contributing  factor  considered  has  had  a  significant  role - along
with other factors - in supporting the observed change. And the latter – in the absence
of the factor considered – would have occurred in a reduced and / or more expensive
form); and
strong: when  the  observed  change  would  not  have  occurred  in  the  absence  of  the
contributing factor considered;



The  column  on  the right  hand  side  identifies  other  historical  and/or  internal/external  factors
which have influenced or contributed to changes in the given GoU policy.

Education sector, Step 1 – summary

Table 3

Synthesis of BS contributions to Government’s policies (Step 1) – Education

Contribution of BS programmes

GoU policies (induced outputs
level in the CEF)

 Financing: weak
 Policy dialogue: moderate
(limited attention paid to
quality issues in early years)

 Capacity building: weak
 Financing: strong, then weak

(donor shift to project
support)

 Policy dialogue: moderate
 Capacity building: weak

 Financing: moderate
 Policy dialogue: moderate
 Capacity building: weak

Sector policies (UPE, UPPET) and
strategies/plans (ESSP) elaborated
(but with limited attention paid to
quality issues)

Public funding available to support
service delivery expansion (e.g.
Capitation Grant, School Facilities
Grant)

Quality Enhancement Initiative
implemented in the 12 worst
districts

 Financing: weak
 Policy dialogue: moderate
 Capacity building: weak

UPE and UPPET incorporation of
EFA goals relating to access for
girls; and Gender in Education
Policy

Other historical and/or policy
interacting factors, and/or
internal or external factors



Long political commitment to
achieve UPE: strong

 Population growth: strong
(constraining factor)
 District division: moderate
(constraining factor)



Lack of capacity at district
level

 Patronage driven local



systems
Lack of capacity/political will
to implement gender
initiatives

 Shift in aid modality from
SBS to projects and
fragmentation of projects

Sector policies, strategies and plans (UPE and UPPET) have been developed as a result of Presidential
initiatives  with  the  main  focus  on increasing  access  to  education.  The  availability  of  BS  funds  has
underpinned such initiatives and BS related dialogue has played a moderate role in developing sector
plans  and  strategies  based  on  GoU  policies,  as  well  as  supporting  implementation.  BS  dialogue  also
played a role in focusing attention on the quality of education, although in practice this has proved much
harder to address. There has been little capacity building support in the education sector that has been
directly linked to BS.
BS  has  supported  the  expansion  of  the  education  sector  but  this  has  not  been  sufficient  to  ensure
adequate funding, given the rapid increase in student numbers that has been both policy driven and a
result of rapid population growth. Overall, funding in real terms to education from the GoU budget has
decreased and this has not been compensated for by BS. In addition,  as at the  same time education

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donors have moved  away  from BS to project modalities. There has been minimal capacity building in
this area.
Enhanced quality of education has been supported strongly through BS dialogue in the latter half of the
evaluation  period  and  various  initiatives  designed  to  improve  the  quality  of  education,  although  most
have been through project support. One more recent initiative has been the GoU Quality Enhancement
Initiative to support the 12 worst performing districts. This was a MoES initiative which was also donor
funded and monitored through the JBSF.
Gender  equality in  terms  of  access  has  been  strongly  promoted  in  MoES  policy  through  UPE  and
UPPET and there have been significant achievements in terms of gender parity in enrolment at primary
level. This has been supported by BS funds and dialogue. There has been less success in addressing
issues  such  as  the  level  of  drop-out  of  girls,  with  the  majority  of  work  on  gender  issues  being
undertaken though donor projects.

Water sector, Step 1 - summary

Table 4

Synthesis of BS contributions to Government’s policies (Step 1) - Water & Sanitation

Contribution of BS programmes

GoU policies (induced outputs
level in the CEF)

Other historical and/or policy
interacting factors, and/or internal or
external factors

 Financing: moderate
 Policy dialogue: moderate
 Capacity building: moderate

Decentralisation of governance
and service delivery

 Financing: weak
 Policy dialogue: strong
 Capacity building: weak to

moderate

National Framework for
Operation and Maintenance of
Rural Water Supplies (2004,
revised 2011)

 Financing: moderate
 Policy dialogue: strong
 Capacity building: moderate

Provision of piped water supply
and sanitation to rural growth
centres and small towns through
WSDFs

 Financing: weak
 Policy dialogue: strong
 Capacity building: weak

Memorandum of Understanding /
Budget line for sanitation by
three line ministries

 Financing: weak
 Policy dialogue: weak to

moderate

 Capacity building: absent

Water and Sanitation Gender
Strategy (2010)

 Donor projects: moderate



(supportive)
Lack of capacity at LG level:
strong (constraining factor)

 Creation of new districts:

moderate (constraining factor)

 Donor projects: moderate to
strong (supportive, but
constraining during emergency
assistance in Northern Uganda)
Lack of capacity at LG level:
moderate (constraining factor)
 Political interference: moderate



(constraining factor)
 Donor projects: strong
 Rolling out of Umbrella

Organisations: moderate

 Urbanisation: strong
 Population growth: strong
(constraining factor)
 Donor projects: strong


Lack of capacity at district level
(constraining factor)

 Poverty: moderate
(constraining)

 Donor projects: moderate
 Male-dominated sub-sector

(constraining factor)

 Software activities are given low
priority at local government level
(constraining factor)

Decentralised  implementation of  construction  and  rehabilitation  of  rural  water  sources  has  gradually
taken place. New sector strategic frameworks and financing instruments were also established over the
period such as the National Framework for Operation and Maintenance of Rural Water Supplies or the
Water Supply and Sanitation Sector Investment Plans and models, which were developed to guide the
financing of the sub-sectors towards reaching targets.
New  approaches such  as  the  Water  Supply  Development  Facilities  (WSDF)  were  rolled  out  to  the
country following successful implementation of a pilot project in South Western Uganda, in order to step
up  the  construction  of  multi-year  piped  water  supplies  in  a  rapidly  urbanising  country.  Maintenance,
rehabilitation and expansion of these schemes remains a bottleneck as tariffs are not able to cover all
related costs, although Umbrella Organisations were rolled out in a bid to address this challenge.
BS  has  substantially  contributed  to  increased sector  funding which  helped  to  implement  the  GoU
initiatives in the sector, in particular the provision of piped water supply to rural growth centres through

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WSDFs and the National Framework for Operation and Maintenance of Rural Water Supplies. DPs also
supported  decentralised  implementation  of  policies  through  SBS,  intended,  for  instance,  for  funding
through  the  District  Water  and  Sanitation  Conditional  Grant.  However,  although  new  financing
instruments were established and overall the level of funding was maintained in the sector, resources
available  at  the  local  level  remained  insufficient,  suggesting  a  moderate  effect  of  BS  on  the  actual
implementation of GoU policies and strategies in the sector.
Policy  dialogue  and  technical  support  in  the  context  of  annual  joint sector  reviews  and  joint  technical
reviews have contributed to performance monitoring which is now a standard and integral part of sector
reporting, hence improving policy implementation.
Strong  policy  dialogue  also  contributed  to  step  up decentralised  capacity  building and  was  key  to
support  the  introduction  and  rolling  out  of WSDFs  and  Umbrella  Organisations,  as  well  as  training  by
Technical  Support  Units  (TSUs)  for  rural  water  supply  implementations  at  district  level.  Capacity
development  through  TSUs  has  been  instrumental  in  optimising  decentralised  implementation.
However,  capacity  at  district  level,  especially  in  the  newly  created  districts,  remains  insufficient,  and
strict conditional grant guidelines have been used, which limits district LG responsibility for setting their
own  development and spending  priorities. Continued  fragmentation of districts has also increased the
number  of  LG  staff  that  needs  to  be  trained  and  resulted  in  an  increasing  number  of  vacant  district
water office staff.
Policy  dialogue  also  contributed  to  an  increased  focus  on  gender,  and  the monitoring of  a  gender
indicator  in  the  performance  measurement  framework. Although  gender  awareness  has  been  raised,
implementation of activities focused on enhancing gender equality is still not taking place in the sector.

Health sector, Step 1 - summary
Table 5

Synthesis of BS contributions to Government’s policies (Step 1) – Health

Contribution of BS programmes

GoU policies (induced outputs
level in the CEF)

 Financing: moderate
 Policy dialogue: weak to

moderate

 Capacity building: weak

Sector policy (NHP I and II) and
associated plans (HSSIP I and II)
elaborated (but with limited
coherence and realism in terms of
objectives and targets)

 Financing: weak
 Policy dialogue: weak to

moderate

 Capacity building: weak

Weak quality of care assurance
system and mechanisms

 Financing: absent to weak
 Policy dialogue: weak
 Capacity building: weak

Establishment of a gender focal
point at MoH, although not full-time
but generally weak gender policy
designs across sector

Other historical and/or policy
interacting factors, and/or
internal or external factors

Limited leadership and
strategic guidance in sector

 Poor governance and







capacity
Limited local level flexibility
(e.g. related to allocation of
financial resources)
Low capacity at central and
local levels
Internal factor: policy focus
on quantitative output
objectives

 Generally weak capacity



(particularly at local levels)
Incoherent implementation of
gender strengthening
initiatives

 Weak overall political

leadership

Sector policies. The GoU has developed a series of policies, strategies and plans over the past decade.
In particular, The Uganda National Minimum Health Care Package (UNMHCP), defined under HSSIP II,
has  been  a  cornerstone  of  the  GoU/MoH’s  strategies  to  improve  access  to  basic  health  services.  BS
dialogue has contributed to some extent to these policy developments.
Since the mid-2000s, BS has also played a supplementary role in terms of funding which contributed to
the implementation of ambitious strategies to expand service delivery. BS funds directly contributed to
supporting  the  expansion  of  provider  networks.  However,  the  GoU’s  reprioritization  across  its
expenditure  programme  away  from  social  sectors  towards  infrastructure  investments  minimised  this
additionality of BS funds at sectoral level. In addition, the health sector has been particularly fragmented
in  terms  of  external  funding,  with  large  off-budget,  disease  priority  programmes  only  partly  linked  to
overall sector spending frameworks.
On the other hand, sector policies, strategies and plans throughout the evaluation period had a strong
focus  on  quantitative  outputs,  such  as  the  expansion  of  provider  clinics,  supply  of  basic  drugs,  and
staffing  of  hospitals.  Some  evidence  shows  that  there  have  been  significant  weaknesses  in  terms  of
efficiency  and  procedures  to  address  the  actual  sector  challenges  by  making  the  best  use  of  the

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available financial, technical, and managerial resources. BS has only partially helped to address these
weaknesses. In particular, capacity building efforts associated to BS remained limited.
Generally, issues related to quality of health care have not been addressed in a coherent or sustained
manner by GoU. Reflecting the notion of infrastructure weaknesses and lack of access to most services
for  large  swathes  of  the  population,  quality  concerns  have  only  been  prioritized  over  the  most  recent
years.  BS  has  played  some  role  by  supporting  a  more  constructive policy  dialogue  but  no  significant
role in terms of capacity building.
There  were  relatively  weak gender policies  in  the  health  sector  over  the  evaluation  period. While  the
notion  of  gender  equality  is  present  in  the  strategies,  their  actual  implementation  has  overlooked  the
issue.  Some  gender  training  has  taken  place  at  central  and  local  levels,  although  follow-up  activities
appear wanting. These issues were not explicitly addressed in the framework of BS.

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4.2 Step 2

4.2.1

Evaluation question 8

EQ8 - Education
To what extent, in the education sector, have the development outcomes pursued through the
policies and programmes supported by BS been (or are being) achieved? And which have
been the determining factors of their achievement?

Background and context

The institutional framework for education service delivery in Uganda comprises the Ministry of Education and
Sports (MoES) at central level (13 departments and 8 affiliate organisations), the district local
government/authorities and schools and institutions (public and private).
The two most significant sector policies in education have been the introduction of:




the Universal Primary Education (UPE) in 1997; and
the Universal Post Primary Education and Training (UPPET) in 2006.

These two initiatives were both Presidential policy commitments in the 1996 and 2005 elections respectively. The
UPE abolished user fees in primary education and the UPPET aimed to expand access to secondary education.
These policies were translated into the Education Sector Strategic Plan (ESSP) 2004-2015 and the ESSP 2010-
2015. Other policies of note have been the Gender in Education Policy of 2009 and the Education Act of 2009,
which defined the roles and responsibilities of the key institutions at different levels of government and institutions.
In the 1990s, Uganda also entered in a new phase in its decentralisation process. In education, this resulted in:





the MoES being responsible for education policy and monitoring, the implementation of sector policies, as
well as teacher training;
districts and municipalities were responsible for teacher recruitment, deployment and supervision.

Districts are also responsible for disbursement and management of funds for primary education received to
implement UPE through conditional grants (UPE and USE capitation grants are now sent straight to schools), but
there are significant conditions on how these grants can be spent and the purchase of instruction materials is still
centralised. There is less decentralisation for secondary and technical/vocational education, which remains largely
centralised. The payment of salaries and supervision is decentralised, but the recruitment and deployment of
secondary teachers remain centralised.
Main source: Hedger et al (2010) - SBS in practice.

Step 2 - Main sector outcomes55
With a rapidly growing population (population growth rate remained above 3% during the past decade),
demand for basic education services  increased significantly. Access to education at both  primary and
secondary level has been the main area of success. As illustrated in Figure 16 below, evolutions in key
sector indicators sustained the positive trends initiated in the 1990s56.

Figure 16

Evolution of enrolment in primary and secondary education over the past decade

Net Enrolment Rate - Primary education

Net Enrolment Rate - Secondary education

100%

98%

96%

94%

92%

90%

88%

86%

84%

82%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

30%

25%

20%

15%

10%

5%

0%

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Boys

Girls

Boys

Girls

Source: MoES (2013).

In terms of primary school Net Enrolment Ratios (NER), indicators have increased significantly over the
evaluation  period  (from  85%-90%  in  the  years  2000-2004  to  94.3%  in  2013).  Similarly,  at  secondary
level,  there  has  been  a  significant  increase  in  enrolment  rates  since  2004,  which  have  risen  from
697,507  (male  383,652;  female  313,855)  in  2004  to  1,257,000  (male  672,820;  female  505,540).

55 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.
56 The quality of data relating to the education sector is an issue as the data used is generated through a MoES
annual survey and not all schools, particularly in the private sector complete the survey. In the public sector there is
an incentive to over report enrolment numbers as funding is allocated per pupil enrolled. As a result, the data used
is not entirely robust and while enrolment is likely to be over reported, drop out rates are likely to be underreported.

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Although  girls  still  lag  behind  boys  in  secondary  school  enrolment,  gender  equity  in  enrolment  was
achieved at primary level (NER in 2013 – boys: 93.9%; girls: 95.1%).
This  represents  a  better  performance  than  other  countries  in  East  Africa,  as  in  Tanzania  the  NER  at
primary  level  was  92%  in  2012,  although  gender  parity  in  enrolments  was  also  achieved  in  Tanzania
(ITAD 2013). In Kenya, the primary education adjusted NER was 84% in 2011, as Kenya has more out
of  school  children  than  either  Tanzania  or  Uganda,  but  gender  parity  was  almost  achieved.  The
transition rate from primary to secondary level was higher in Uganda at 57%, as compared to Tanzania
at  37%  (no  figures  were  available  for  Kenya),  while  the  percentage  of  girls  enrolled  in  secondary
education was similar with 45% for Uganda, 46% for Tanzania and 47% for Kenya in 2011 (UNESCO
2013).
However,  the  trend  of  increasing  access  to  education  is  slowing  and  Uganda  faces persisting
inequalities in  access  to  education  relating  to  gender,  income  and  location.  In  terms  of geographical
disparities, the Uwezo survey in 2012 found that the top 10 performing districts in literacy and numeracy
at  primary  level  where  predominantly  in  the  Central  region,  followed  by  the  Western  region  with  only
one district from the Eastern region. The bottom 10 performing districts where mainly in the North and
the Eastern regions.
As  highlighted in  the  5th JBSF  joint  assessment  report,  access  to  basic  services  is  unevenly  spread,
with  significantly  lower  levels  of  access  to  health  and  education  services  experienced  by  the poorest
households.  A  2012  study  by  the  MoFPED  found  that  economic  vulnerability  played  a  key  role  in
children withdrawing from primary education, as households were unlikely to bear the costs of sending
children to school in anticipation of future returns if they could not meet immediate needs. Similarly, late
enrolment in primary school – with a negative impact on completion rates and the number of years of
education  received – disproportionately  affects  the  poorest  households.  A  study  by  the  MoGLSD  in
2012  found  that  children  from  households  in  the  richest  two  deciles  were  more likely  to  start  primary
school earlier or at the correct age, than households in the three poorest deciles where children were
more  likely  to  have  delayed  entering  primary  school  by  a  year  of  more.  This  was  the  case  in  both
2005/6 and 2009/10, the two years for which a survey was undertaken.
In addition, the significant  progress in increasing access to schooling and in  decreasing some gender
disparities in terms of access, particularly at primary level, has not been matched by an equivalent rise
in the quality of education:

 Completion rates at primary 7 have risen for girls from 54% in 2004 to 67% in 2013, but there
has been a decline for boys from 72% in 2004 to 67% in 2013. These figures mask important
socio-economic  and  geographic  inequities.  The  MoFPED  2012  Poverty  Status  Report  found
that,  in 2009/10,  28% of 13-18  year olds in Uganda  had completed  primary school. However,
less  than  11%  of  13-18  year  olds  from  households  in  the  North  with  a  subsistence  farmer
heading the household had completed primary level, compared to 68% of that age group in the
central region whose household head had completed secondary level education.







There  are  very  low survival  rates to  primary  7,  indicating  that  the  majority  of  pupils  have
dropped out by this point (31% survival rate for both girls and boys in 2013). Field visits by the
evaluation  team  found  that  in  some  schools  the  drop  out  rate  was  higher  at  over  80%
suggesting significant variations in the number of dropouts. Also dropouts are highest in poorer
households. In 2009/10 dropouts were highest for girls in the poorest quintile of households and
for boys in the lowest two quintiles of households (MoGLSD, 2012).

There  has  been  an  increase  in the Primary  Leaving  Examinations  (PLE)  Performance  Index
(from 51.5% for boys and 45.6% for girls in 2004 to 65.1% for boys and 59.5% for girls in 2013),
but  a  decline  in literacy  and  numeracy  competence at  Primary  6  (e.g.  numeracy  proficiency
decreased from 54% in 2009 to 45% in 2013).

In comparison to other countries in East Africa, Uganda scores badly on learner achievement,
with  Ugandan  children  performing  less  well  than  Kenya  and  Tanzania.  This  is  the  case
particularly  on  numeracy  tests  at  grade  2  level  in  primary  (age  10+)  undertaken  by  Uwezo,
where  Uganda  performed  worse  than  both  Kenya  and  Tanzania  in  2012,  although  better  on
literacy than Tanzania, but not Kenya (Uwezo 2013).

The  considerable  growth  in  private  schools  is  reported  to  be  in  response  to  the  poor  quality  of  state
schooling (interviews & MoES 2013). In 2005/06, there were 44.5% of urban children and 15.8% of rural
children  in  private  primary  schools.  By  2009/2011, this  had  increased  to  52.1%  of  urban  children  and
19.2%  of  children  living  in  rural  areas  (MoGLSD,  2012). There  are  estimated  to  be  4,000  private
secondary schools more than double the number of public schools. Overall, 13% of primary enrolment

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in 2011 was estimated to be in private institutions, as compared to 3% in Tanzania and 11% in Kenya
(UNESCO 2013).57
The  mixed  picture  described  above  is  reflected  in  perceptions  of  the  various  stakeholders  met  and
illustrated by the scores  given by respondents to the  eSurvey on the  progress  made in the education
sector (see Figure 17 below). Scores are particularly low for aspects related to the quality of education.

Figure 17

e-Survey - Sector evolutions linked to the reforms implemented in the past decade

0,0

1,0

2,0

3,0

Progress in access to education
linked to the reforms

Progress in quality of education
linked to the reforms

Progress in gender equality
in service delivery (all sectors)

Total

Government

Development partners

Non-state actors

Source: Stakeholder survey - Particip GmbH (2014).

Step 2 - Analysis of determining factors
The  analysis  of  determining  factors  in  the  Education  sector  has  relied  on  a  wide  range  of  sources  of
information  to  understand  the  mechanisms  explaining  the  main  sector  evolutions  observed  above.
identify some of the causal determinants of educational access and achievement. The set of potential
determinants  analysed  in  those  regressions  includes  a  range  of  financial,  physical  and  human
resources provided under GoU policies and programmes.58. In addition, information collected through a
variety  of documentary  sources  (e.g.  public  expenditure  reviews,  recent  studies/evaluations,  sector
performance  reports,  field  survey  carried  out  by  the  evaluation  team  and  other  surveys  on  service
delivery, etc.) were cross-checked and enriched through interviews with national and local stakeholders,
and direct observations by the evaluation team.
The determining factors identified were classified in four broad categories: i) factors related to financial
resources; ii) policy factors; iii) institutional factors; iv) other factors.

Factors related to financial resources
The  interviews  and  survey  results  indicate  that funding (through  financing  more  schools,  classrooms,
latrines,  teaching  materials,  etc.)  has  been  important  for  increasing  access  to  both  primary  and
secondary education, although at the same time the sector remains underfunded, which has impacted
on the quality of education provided. This funding has been provided by the government budget, DPs
and parental contributions.
The  Capitation  grants  assisted  in  the  scaling  up  of  both  primary  and  secondary  education  capacity,
which allowed for an increase in enrolment at both levels. The Schools Facility Grant assisted districts
to build more teacher housing, classrooms and washrooms. GoU financing  was also used for teacher
training. The figure below depicts the increases in nominal expenditure over the evaluation period.

57 http://www.education.go.ug/data/smenu/50/Private%20Schools%20and%20Institutions.html
58 Detailed econometric results are presented in Annex 6 (Volume 3).

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Figure 18

Education expenditure, 2003-2013, billion Ush (nominal)

47

1600

1400

1200

1000

800

600

400

200

0

2003/04

2004/05

2005/06

2006/07

2007/08

2008/09

2009/10

2010/11

2011/12

2012/13

2013/14

Total domestic education spending

Salaries

Non-wage recurrent expenditures

Domestic development expenditures

Off-budget donor projects (as reported to MoFPED)

Source: 2014 MoFPED.



Several interviewees both at central and district level reported that UPPET and programmes to
expand access at both primary and secondary levels were introduced without a commensurate
increase in funding for the education sector. Real per capita spending on education has even
decreased, as shown in the figure below. In FY 2013/14, real per capita education expenditure
was 12 percent lower than in FY 2003/04.

Figure 19

Education real per capita domestic expenditure, 2003-2013, constant 2010 Ush

19.500
19.000
18.500
18.000
17.500
17.000
16.500
16.000
15.500
15.000

Real domestic education expenditure per capita

3 year moving average

Source: Own calculations based on 2014 MoFPED and World Bank national accounts data.





This resulted in funds being spread too thinly over the sector with underfunding experienced at
both primary and secondary level. In recent years, this problem was exacerbated by:

The GoU  switching  focus  to  funding  economic  infrastructure  rather  than  social  sectors.  The
2013  PER59 notes  that  central  government  expenditures  have  shifted  towards  development
expenditures with real GDP per capita development expenditures doubling between 2001/2 and
2012/12  and  development  expenditures  increasing  from  25%  to  40%  of  central  government
spending,  while recurrent  expenditures remained relatively constant (2013 PER). At the same
time,  the  education  sector,  which  accounts  for  around  50%  of  local  government  budgets,

59 World Bank (2013): Public expenditure review.

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48

experienced a reduction of 20% in real per capita transfers between 2001/2 and 2011/12 (2013
PER).



The  increase  in  the  number  of  districts. This  duplicated  administrative  structures  without
increased financing.60

 DPs moving to project support. This resulted in less overall funding for implementing education

sector plans.

In  real  per capita  terms,  intergovernmental  transfers  decreased,  particularly  the  unconditional
components, which gave the greatest fiscal flexibility. In FY 1995/6, the unconditional element of local
government funding from central government  was  35%, by FY 2012/13 this had declined  to  less than
5%  (World  Bank,  2013).  The  abolition  of  the  graduated  tax  in  2003/4,  which  allowed  districts  to  levy
taxes at local level also exacerbated the problem of a lack of funding at district level. In particular, this is
seen as having had consequent implications for staffing at district level, as vacancy rates are high (WB
PER 2013 and Williamson et al, 2014).
This has led to an important role played by parental contributions in terms of filling some of this funding
gap  in  education at  both  primary  and  secondary  level.  Despite  the  official  policy  of  primary  education
being free, parental contributions have been important in paying for additional teachers, classrooms and
teacher house construction and learning materials. Donor projects have also played a significant role in
funding the  supply  of  teaching  materials,  teacher  training,  school  construction,  construction  of
washrooms and latrines and community sensitisation work, particularly in gender.

initiatives  were reported  by 

Policy factors
There  has  been  a disconnect  between  policy  implementation  and  financing of  the  sector  which  has
impacted  on  sector  outcomes.  Education  policy  has  failed  to  deal  with  escalating  demand  by
undercutting financing of both primary and secondary education and also by eliminating the graduation
tax,  while  mandating  universal  primary  and  post-primary  education  without  adequate  financing  and
capacity  building.  The  funding  mechanisms  that  have  been  established  such  as  the  School  Facilities
Grant  and  the  School  Inspection  Grant  have  not  been  adequate  to  compensate  for  the  substantial
increase  in  enrolments,  as  a  result  of  policy  and  population  growth.  This  has  undermined  gains  in
access and, especially, quality and represents a key policy failure.
Quality  of  education has  not  been  addressed  to  any  significant  extent  through  education  policy,
although the Quality Enhancement Initiative (QEI) was introduced in 2009, but this was limited to raising
the quality of education in the 12 worst districts in Uganda.
Other  key  policy 
implemented
comprehensively,  such  as  the  Gender  in  Education  Policy  introduced  in  2009.  As  a  result,  the  main
gender  focus in  policy  terms  has  been  on  access,  rather  than  on  comprehensively  addressing  other
issues,  which  prevent  girls  dropping  out  or  completing  at  both  primary  and  secondary  level. The
econometric analysis undertaken by the evaluation team also suggests that, at the primary level, female
enrolment  responded  relatively  stronger  than  male  enrolment  to additional  classrooms  and  seating
spaces  within  classrooms,  as  well  as  to  gender-segregated  latrines  for  girls,  leading  to  a  statistically
significant reduction in the gender gap in primary enrolment. At the secondary level, provision of single-
sex  schools  for  girls  significantly  reduced  the  gender  gap  in  enrolment. (see  Volume 2 - EQ8  and
Volume 3 - Annex 6).  There  has  however  been  less  policy  focus  and  success  in  practice,  in  terms  of
reducing the drop out rate for girls (and boys). There have been initiatives in terms of the construction of
gender segregated washrooms and latrines and there has also been some attention paid to the training
of female teachers and sensitisation work in communities (source: interviews, survey and MoES 2007 &
2013). A lot of this work has been undertaken through DP funded projects.
As illustrated in the field survey, some challenges remain in terms of gender mainstreaming at school
level. Some  regions  have  been  more  successful  than  others  in  recruiting  female  teachers  at  primary
level.  In  Karamoja  in  the  North  of  Uganda  female teachers  were  only  29%  of  total  teachers  in  state
schools,  whereas  in  Buganda  in  the  Central  region  this  figure  was  53%  (MoES  2013).  At  secondary

to  have  not  been 

interviewees 

60 The 2014 IEG evaluation of decentralisation in Uganda analyzed the effects of the proliferation of districts. The
case of Bushenyi – one of the best performing districts in Uganda - both before and after the splitting is instructive.
Bushenyi was divided into five separate districts in 2010. Before this, the district was receiving government grants
of UGX 42,621 per capita. It ranked 10th in the FY09 Health District League and 11th in the FY08 Education District
League (out of 80 districts) and it had 91 percent of strategic posts filled. The splitting of the district into five in 2010
led to a dramatic reduction of per capita grants even in nominal terms for 80 percent of the combined population of
the five new districts, a reduction of staffing to 81 percent for what remained as Bushenyi and to 8 percent for the
other four districts. While Bushenyi itself improved its FY11 Health District League position from 10th to 2nd, the
remaining four new districts fell to 61st, 68th, 93rd, and 104th position out of 112 districts.

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level  there  were  23.7%  female  teachers  in  the  sector  (government  and  private  schools), with  again
Karamoja in the North having the least number of female teachers.
In interviews it  was noted that the conditional nature of grants to the districts results in little scope for
implementing activities to mainstream gender, as funds are not allocated for this.

Institutional factors
Institutional factors have also negatively impacted on sector outcomes. There has been little attention to
capacity building at either central or local level. In general, the technical capacity of the MoES at central
level was reported to be declining and capacity at local level has always been weak and has not been
addressed  by  any  DP  initiatives.  This  has  been  exacerbated  by  a  declining  interest  by  DPs  in  overall
sector performance, given the shift to  projects,  which  has led to DPs focusing on their particular sub-
sectors and investing less time and resources on overall education sector issues.
This  is  a  particular  problem  at  district  level  given  the  funding  issues  outlined  above  and  the  fact  that
District Education Offices are not funded by the GoU budget, as they are reliant on local revenues for
funding  which  have  significantly  decreased.  This  means  that  they  have  been  less  able  to  undertake
their  key  functions  of  oversight  of  primary  level  education,  particularly  since  the  graduation  tax  was
abolished, which was used to provide funding (Hedger et al, 2010). There is an Inspection Grant that is
provided  to  the  District  Education  Office  for  schools  inspection,  which  was  introduced  in  2009 at  the
time the MoES revised the Basic Requirement Minimum Standards that is used for conducting school
inspections (JICA 2012). It was highlighted in interviews that this grant is helpful, but not sufficient for
conducting  the  required  three  school  inspections  at  primary  level  per  year  and  ensuring  quality
standards are adhered to.
These  differences  in  capacity  and  funding  result  in  a  large  variation  across  districts  in spending,
performance  and  value-for  money.  An  estimated  one-third  of  expenditures  in  primary  education  has
been  wasted  or  used  inefficiently.  At  secondary  level,  the  distribution  of  secondary  education
expenditure  was  found  to  have  no  relationship  to  need,  with  inefficiencies  stemming  from  low
workloads, poor teacher deployment and low teacher salaries (World Bank, 2007, 2008 & 2013). This
has  resulted  in  significant  differences  between  districts  and  as  noted  above,  urban  and  rural  areas,
which have in turn impacted on educational results. The World Bank estimated that in terms of outcome
to spending ratios, the Central and Western regions of Uganda performed better than the Eastern and
Northern  regions.  The  best  performing  districts  had  relatively  high  incomes  and  moderate  levels  of
spending per capita, but were well managed and performed well in terms of transforming spending into
positive educational outcomes. (World Bank, 2013)



Teacher absenteeism and low level of knowledge of the curriculum has also been a recurrent
problem  affecting  the  sector  performance.  The  2013 World  Bank  study Education  and  Health
services  in  Uganda – data  for  results  and  accountability explains  that  more  than  1  out  of  4
(27%) of teachers in public schools were not at work and, of those who were in school, about 1
in  3  (30%)  were  not  teaching,  which  resulted  in  40%  of public  school  classrooms  with  no
teacher teaching.61 There were significant rural-urban differences with 19% of teachers in urban
areas absent and 31% in rural areas. The survey estimated that the average primary 4 student
in the North received only 50 actual days of teaching year, which was 90 days fewer that a pupil
in  Kampala.  Only  19%  of  teachers  at  primary  level  demonstrated  sufficient  mastery  of  the
curriculum  that  they  taught.  Interviews  and  other  anecdotal  evidence  also  indicated  that  state
school teachers often teach in private schools located within or adjacent to state schools. This
draws resources away from state schools serving mainly the poor, to the private schools, which
serve the children of wealthier households further exacerbating inequities.

Similarly,  the low  community  participation in  primary  schools  has  been  recognised  as  affecting
negatively  learning  performance  in  Uganda.  This  was  due  to  the  introduction  of  UPE,  which  was
interpreted by communities as the government providing free education, implying there was little need
for parental involvement.
Other institutional factors that influence the GER according to the econometric analysis carried out for
this evaluation (see Volume 2 - EQ8 and Volume 3 - Annex 6) confirm the observations made by other
sources  (interviews,  sector  performance  reports,  etc.)  that  specific service  delivery  inputs have  been
important determinants of improved access to education (gross enrolment ratios). These determinants
include the construction of new schools and classrooms, the number of teachers in place and adequate
seating space.62

61 The “Service Delivery Indicators for Uganda” measured in this study are based on surveys of about 400 primary
schools and 400 health facilities, and nearly 5,300 teachers and health providers.
health facilities, and nearly 5,300 teachers and health providers.
62 More specifically:

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In terms of the quality of education, the number of students per classroom influenced completion rates
at primary level, as it was found that having 1 student less per classroom increased the completion rate
by  0.2  percentage  points.  Also  funding  was  an  import  factor  in  influencing  completion  rates,  with  a
positive correlation between these two determinants. PLE pass rates have been influenced by a variety
of factors such as lower student-classroom and pupil-teacher ratios, the availability of adequate seating
and desks and higher numbers of qualified staff.63
Pupil-teacher  ratios64 have  not  substantially  improved, student-classroom  ratios  have remained  high
and  indicators  such  as  student-textbook ratio  have worsened65 (see  Figure  below). This partially
explains why quality has not improved significantly in the education sector.

Figure 20

Education sector basic service delivery indicators

Student-classroom ratio at primary level

Student-textbook ratio at primary level

70

60

50

40

30

20

10

0

3,5

3,0

2,5

2,0

1,5

1,0

0,5

0,0

2006

2007

2008

2009

2010

2011

2012

2013

2006

2007

2008

2009

2010

2011

2012

2013

Source: Own calculations based on EMIS (2014).

Other factors
Rapid population growth (estimated at 3.5% per annum) has put significant pressure on resources and
facilities available for education and as a consequence made quality improvements very challenging in
the  light  of  increasing  students  enrolments  and  the  GoU  focus  on  increasing  access. The  increase  in
total  enrolment in  primary  schools  is  the  result  of  the  growth in  the  population  of  school  going  age
children66 (MoES, 2014).
Socio-economic  and  geographic  differences  have  also  impacted on  education  outcomes.  An  Uwezo
survey  carried out  in  2012  found  that  children  from  poorer  households  consistently  achieved  lower
competency levels, on all tests and across all ages. The proportion of children in 2012 passing both the
Uwezo  literacy  and  numeracy  tests  in  non-poor  households  was  double the  pass  rate  of  children  in
ultra-poor households (Uwezo 2013). Similarly, a study undertaken by the World Bank found that there
were  large  and  persistent  differences  between  urban  and  rural  student  outcomes  in  literacy  and
numeracy  at  the  primary  level  in  favour  of  urban  students  in  P6,  the  urban-rural  gap  was  around  20
percentage  points  in  literacy  and  about  10  percentage  points  in  numeracy  (Najjumba  and  Marshall,
2013).

Summary answer to the evaluation question
Increased access to education has been the major achievement in the education sector, Achievements
in  increasing  access  are  largely  attributable  to  GoU  investment  in  infrastructure,  teachers  and  the

• Schools: 1 additional school per 10,000 children of primary school age increased the male and female GERs in
primary by 1.5 to 2 percentage points and somewhat less at secondary level.
• Teachers: 1 more teacher per 1,000 children at primary level produced an increase of 1 percentage point in male
and female GERs at primary level and 0.3 percentage points in the female GER at secondary level.
• Classrooms: 1 additional classroom for all schools led to a roughly 3 percentage point increase in the male and
female GERs at primary level and to 1 percentage point increase at secondary level.
• Adequate seating: 1 additional space in all classrooms raised the male and female GERs in primary by 0.5 to 1
percentage points and by 0.2 percentage points in secondary.
63 These findings converge with those of other studies. Using data from 2006-2010, an earlier study carried out by
the World Bank found that, at primary level, teacher attendance, school size as determined by enrolment, and the
availability  of  toilets  and  first  aid  services  at  school,  explained  13  percent  of  the  variation  in  the  proportion  of
students  who  pass  the PLE in  grades  1-3. However, key  inputs  such  as  trained  teachers  showed  no  significant
association with the percentage of students passing this exam (Mulindwa Najjumba, I. &J. H. Marshall 2013).
64 Student-teacher ratios remain close to 50. There was a marginal increase in the employment of female teachers.
65 According  to  UNESCO  (2011  UNESCO  institute  for  statistics),  Uganda  scores  worse  than  many  other  SSA
countries (incl. Tanzania – ratio of 2.9 in 2012 – and Rwanda – ratio of 1.3 in 2011).
66 Uganda has one of the highest proportion of young children (age 0-14 years) in the region.

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abolition  of  fees  at  both  primary  and  secondary  level.  However,  there  has  also  been  a  significant
contribution to funding the education sector made by parents through financing additional teaching staff,
teaching materials and infrastructure, as well as by donor projects.
The quality of education has experienced little improvement particularly in terms of results and learning
achievements. This has been due to underfunding of the sector and weak capacity particularly at local
level, combined with increases in enrolment and population growth.
Gender  equality has  been  achieved  in  rates  of  enrolment  between  boys  and  girls  at  primary  level,
although girls still lag behind boys in secondary school enrolment. Drop-out rates for girls remain high
and in some areas are also high for boys.
Uganda  still  faces  geographic  and  socio-economic inequalities in  education.  There  is  significant
variation between districts in access to education and learning achievements, with pupils in urban areas
and those from wealthier families achieving better educational outcomes.

Table 6

Synthesis of factors determining changes observed at the outcome and impact levels
(Step 2) - Education

GoU Policies (induced output level
in the IL) having contributed to

Development Results

Other historical and/or policy
interacting factors, and/or internal or
external factors

 Population growth (constraining

factor): very strong

 Poor capacity at both MoES and

local level: strong

 Donor projects: moderate
 Parental contributions:

moderate

 Population growth: very strong
 Underfunding: very strong
 GoU switching focus to funding
economic infrastructure: strong

 Poverty level: very strong

Improvement in access

Persisting issues in quality
(e.g., low learner achievement)

Gender parity at primary level
but drop out rate for girls (and
boys in some areas) remains
high at both primary and
secondary level.

Income inequalities: very strong


 Cultural issues: very strong
 Donor projects: moderate

Geographic and income
inequalities

 Conflict affected areas/Poverty
level in certain regions: very
strong.

 Government policy / strategy
(UPE & UPPET) and funding
mechanisms (e.g. Capitation
grant, School Facilities Grant):
strong

 Government policy / strategy
(UPE & UPPET): weak

 Quality Enhancement Initiative:

weak to moderate

 Government funding

mechanisms (e.g. School
Facilities Grant): moderate
 Gender in Education Policy:

weak

 UPE and UPPET gender goals:

moderate

 Government policy / strategy
(UPE & UPPET) and funding
mechanisms (e.g. School
Facilities Grant): weak to
moderate

 Quality Enhancement Initiative:

moderate

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4.2.2

Evaluation question 9

EQ9 – Water
To what extent, in the water sector, have the development outcomes pursued through the policies
and programmes supported by BS been (or are being) achieved? And which have been the
determining factors of their achievement?

Background and context

The overall responsibility for the water and sanitation sector in Uganda is shared between different ministries and
coordinated nationally by a Water and Sanitation Working Group. The Ministry of Water and Environment (MWE)67
includes the Department of Water Development (DWD), the lead sector agency for water and sanitation in rural
areas and small towns, and the Directorate of Water Resources Management.
On water and sanitation specific issues, the institutional set up is constituted by three levels: a national level with
the two main directorates at the Ministry of Water and Environment; a regional level (also referred to as the “de-
concentrated level”) with civil servants appointed from central level; and a decentralised level.
Water supply is managed and regulated through the Directorate of Water Development of the MWE, and
implemented at District Local Government level through the District Water Office (DWO) of the Department of
Works. The Directorate also plans and develops water schemes that traverse local government boundaries,
strengthens Improved Sanitation Hygiene service delivery in the District Local Governments (DLGs) through
capacity building programmes. Private contractors are hired by both the Directorate of Water Development (DWD)
and DLGs to site and construct new water supplies, as consultants and supervisors. Piped water supplies of rural
growth centres and small towns are in most cases managed by private water operators, whereas large towns are
managed by the parastatal National Water and Sewerage Corporation. Rural water point sources are managed and
maintained by their Water User Committees through the so-called Community-Based Maintenance System,
whereby only major rehabilitations are done and paid for by District Local Governments, through the District Water
Office.
The specific responsibility for sanitation and hygiene is shared by three line ministries. Domestic sanitation falls
under the Ministry of Health68, and at local level under the District Health Inspector’s office in terms of sensitisation
and mobilisation and construction of latrines in health centres; communal sanitation is implemented by DWD, and
at decentralised level by DWO. The Ministry of Education and Sports is responsible for hygiene education and
provision of sanitation facilities in schools. A sanitation MoU between the three ministries was signed in 2001.
NGOs and CBOs grouped under a national umbrella organisation (Uganda Water and Sanitation NGO Network -
UWASNET) are playing a complementary role in service delivery and advocacy work in the sector.69
Local Governments receive funding from Central Government in the form of conditional grants, mainly via the
District Water and Sanitation Development Conditional Grant (DWSDCG).
Main source: various WESPRs.

Step 2 - Main sector outcomes70
Access to  safe  water  has  gradually  improved  over  the  past  decades71.  The positive  trends  continued
during most the evaluation period but stagnation can  be observed  in recent  years. The percentage  of
rural population served with safe water raised from 57% in 2003/04 to 65 % in 2008/09.72 It should be
noted that the water is from point sources; only a small minority of households has access to network
water. Constraints hampering access to safe water include amongst others cost of the water, distances
to safe water, and perceptions that open water sources may be good enough. Factors contributing to a
lack of availability in communities include lack of functionality (facilities are not working properly), lack of
local  responsibility  and  water  scarcity  (Water  and  sanitation  in  Uganda:  households,  communities,
schools,  and  health  facilities - Uganda  service  delivery  and  poverty  studies,  volume  3,  Tsimpo  and
Wodon, 2014, p. 6). Access to network (so piped) water in Uganda is restricted to some of the towns
and rural growth centres in the country, and uneven  across geographic areas and quintiles of wealth,
with  the  better  off  being  much  more  likely  to  be  connected  to  the  water  network  than  the  poor.  In

67 Before 2006, it was the Ministry of Water, Lands and Environment.
68 Within the Ministry of Health (MoH), the Environmental Health Division is responsible for hygiene and sanitation
promotion for households and has been leading the development of the integrated sanitation strategy for Uganda.
69 NGOs and CBOs have continuously contributed to the water and sanitation subsector, e.g. by mobilising funds
for the sector, supporting water and sanitation infrastructure development, and building capacity of communities to
demand, develop and maintain water, sanitation and hygiene facilities. The national umbrella organisation of NGOs
and CBOs in the water and sanitation sector (UWASNET) has registered an increasing number of NGO and CBO
members (membership was standing at 235 in 2014).
70 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.
71 The  percentage  of  people  in  rural  areas  who  reported  using  safe  water  sources  increased  from  about  20%  in
1991 to 60% in 2002.
72 Based  on  standardised  access  rates (see  details  in Volume  2),  the  total  number  of  new  people  provided  with
safe water over the period amounts to 6,289,496.

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addition, households who are connected to the network pay a lower price per cubic meter of water or
jerry can than households relying on public taps in the towns (Tsimpo and Wodon, 2014, p 34).

Figure 21

Rural population served with safe water and with effective sanitation

75%

70%

65%

60%

55%

50%

75%

70%

65%

60%

55%

50%

Rural pop served with safe water

3 year moving average water

Rural sanitation coverage

3 year moving average sanitation

Source: MWE, 2013 WESPR.

Similarly,  there  is  an  overall  positive  trend  in  rural sanitation coverage,  defined  as  the  percentage  of
rural  households  with  access  to  improved  sanitation. After  a  slight  decrease  in  the  period  2009/10-
2011/12,  rural  household  sanitation  coverage  started  to  improve  again  in  recent  years.  It  should  be
noted  that  the  indicator  is  used  to  measure  households’  access  to  an  improved  latrine.  Applying  the
holistic  concept  of  improved  sanitation,  only  a  small  minority  of  households  has  access  to  improved
sanitation, and the availability of toilets, waste disposal mechanisms, bathroom facilities as well as hand
washing  practices  have  not  changed  fundamentally  over  the  last  decade.  Hand  washing  remains  an
exception,  largely  due  to  lack  of  knowledge.  Constraints  to  adequate  sanitation  generally  include
ignorance, negative attitudes and lack of income (Tsimpo and Wodon, 2014, p. 6). Although the sector
has done a lot to create demand for improved sanitation in the country, there is still a problem to ensure
sustained behaviour change. In addition, many rural households cannot afford the market prices of an
improved latrine and build toilets that are not durable (WESPR, 2014, p.112).
As shown in the diagrams below, some geographical disparities persist in terms of access to water and
sanitation in the country. Districts that are in the lowest categories in terms of access to water are the
districts in Karamoja in the North-East corner of the country, West-Nile in the North-West corner of the
country,  and  the  “cattle  corridor”,  which  is  an  area  running  South-West  to  North-East  over  the  central
part  of  the  country.  However,  as  highlighted  in  the  sector  performance  reports  and  confirmed  in
interviews,  improvements  in  terms  of  disparities  between  regions  have  been  achieved  along  with
increased access to water and sanitation over the past decade.73

73 For  instance, there  has  been  considerable  progress in  terms  of  sanitation in  the  Karamoja  region, with  an
average increase of 11% in the last years compared to 6% increase in the rest of the country (WESPR 2014).

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Figure 22

Situation in terms of geographical disparities

Rural safe water access

Rural latrine coverage

54

Source: MWE, 2013 WESPR.

In terms of disparities within districts, it appears that, despite difficulties in obtaining precise data on this
indicator, equity in access74 has also improved between 2007-08 and 2012/13 (see Figure 23).

Figure 23

Evolution of average equity values

Source: MWE, 2013 WESPR.

Finally,  there  is  limited  evidence  about  the  overall  evolutions  in  terms  of gender equality  and  gender
sensitive outcomes in the sector. It can be assumed that, with stagnating safe water coverage, there is
no reduction in the burden on women and girls for fetching of water. Moreover, no increased proportion
of  Water  User  committees/Water  Boards  with  women  holding  key  positions  was  observed.  This

74 Equity in rural water supply is defined as “the mean sub-county deviation from the district average in persons per
water point”. A lower numeric value indicates a more even distribution between sub-counties within a district. The
indicator  values  were  distorted  by  the  creation  of  new  districts  from  larger  districts,  resulting  in  establishment  of
new administrative units, many of which have few improved water facilities. Also, equity values for some districts
with newly created administrative units changed significantly from FY2011/12 because the available data for some
water facilities do not indicate the respective parishes.

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indicator has fluctuated around 80-85% without indicating a clear positive trend over the period. Some
positive  evolutions  can  be  observed  in  school  sanitation  for  girls.  In  primary  schools,  the number  of
separate girls' toilets with door and/or shutter per 1,000 girls has increased by 27% between 2006 and
2012 (source: EMIS 2014).

Step 2 - Analysis of determining factors
The  analysis  of  determining  factors  in  the Water  and  Sanitation  sector  has relied  on  a  wide  range  of
methods and sources of information. An econometric analysis was carried out to identify how some of
the  resources  provided  by  the  GoU  and  its  partners  have  affected  sector  outcomes during  the  period
(see Volume 3 – Annex 6). In addition, information collected through a diversity of documentary sources
(e.g.  public  expenditure  reviews,  recent  studies/evaluations,  sector  performance  reports,  surveys  on
service  delivery,  etc.)  were  cross-checked  and  enriched  through  interviews  with  national  and  local
stakeholders, and direct observations by the evaluation team.
The  determining  factors  identified  were  classified  in  three  broad  categories:  i)  Factors  related  to
financial resources; ii) Institutional and policy factors; iii) Non sector factors.

Factors related to financial resources
Since the introduction of the PEAP in 1997, the water and sanitation sector has been accorded priority
status  by  GoU,  and  consequently  the  budgetary  resources  to  the  sector  were  increased  threefold.  In
2005, WSP noted that “GoU’s rural water supply programme represents one of the largest rural water
and  sanitation  programmes  in  Africa  with  parallel  and  decentralised  implementation  in  (all)  55
districts”.75
As  illustrated  in Figure 24,  total  nominal  sector  spending  has  increased  over  the  period,  especially  in
recent years.

Figure 24

Water & Environment (nominal) expenditures, 2003-2013 (in billion Ush)

250

200

150

100

50

0

2003/04

2004/05

2005/06

2006/07

2007/08

2008/09

2009/10

2010/11

2011/12

2012/13

2013/14

Total domestic water & envir. spending

Salaries

Non-wage recurrent expenditures

Domestic development expenditures

Off-budget donor projects (as reported to MoFPED)

Source: 2014 MoFPED.

The  figure  below  shows  that,  overall,  real  per  capita  spending  has  also  slightly  increased  over  the
period, unlike other sectors such as education and health.

75 Water  and  Sanitation  Programme,  2005: Impact  of  the  Budget  Support  Instrument  on  Rural  Water  Supply  in
Uganda

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Figure 25

Water & Environment real per capita expenditure (in Ush)

56

3.000

2.500

2.000

1.500

1.000

500

0

real domestic water & envir.  expenditure per capita

3 year moving average

Source: Own calculations based on 2014 MoFPED for nominal expenditure data and 2014.
World Bank national accounts data for GDP deflator.

In  terms  of  sanitation,  the  positive  effects  of  the  funding  from  the newly  established budget  line on
sanitation76 and  the  more  important  funding  provided  through  the  Uganda  Sanitation  fund  programme
(USF)77 programme has been highlighted by several stakeholders interviewed. This increase in funding
combined with an improved support supervision and use of the implementation guidelines as well as an
increased follow up by the extension workers, clearly explained the recent positive trends in sanitation
coverage and avoided the stagnation that started around 2009.
An  econometric  analysis  of  the  water  and  sanitation  indicators  over  the  period  (see Volume 3 -
Annex 6)  confirms  the  overall  positive  effects  of increased  sector  resources on  the  main  key  sector
outcome indicators. The econometric analysis reveals in particular that central government transfers to
districts other than the DWSDCG did improve all selected outcome indicators except rural functionality,
which suggests that districts discretionally invested at least some of these funds directly or indirectly in
Water and Sanitation. The presumption that this investment was small relative to the total budget would
explain  why  an  additional  1  billion  USh  of  general  transfers per  year increased  rural  access  and
sanitation coverage by only about 0.5 percentage points each78. On the other hand, districts that were
phased into UNICEF support for Water and Sanitation at some point between 2010 and 2013 increased
their functionality rates by about 4 pct. points on average.
The stagnation in certain key outcome indicators observed in recent years can be partially explained by
the  stagnation  in  DWSDCG  expenditures.  The  reducing  of  funding  via  the  DWSDCG  is  particularly
visible when real values are considered (see Figure 26 below).

76 A separate budget line was recommended in 2009. It was eventually established under the DWSDCG, but not
funded  until  the  FY  2011/12.  During  the  FY  2011/12,  the  MWE,  through  this Sanitation  District  Grant,  allocated
UGX 2 billion  to the districts, with  each  district  receiving between  UGX 19 million to  UGX 21 million.  This funding
has been allocated since then on a yearly basis.
77 The Global Sanitation Fund in Uganda (also called the Uganda Sanitation Fund - USF), started in August 2011,
included  both disbursements  to districts  and the  support  to capacity building.  The  Executing  Agency,  the
Environmental Health Division (EHD) of the Ministry of Health (MoH) carries out technical support supervision, and
builds capacity of district staff in planning and reporting.
78 However, the econometric analysis shows no effect of the District Water and Sanitation Development Conditional
Grant  on  the  selected  outcome  indicators.  This  likely  reflects  the  econometric  identification  problem  (reverse
causality) caused by the grant allocation formula, rather than indicating that the grant is actually ineffective. Low-
performing districts (in terms of the selected outcomes) tend to receive larger funding from the DWSDCG, creating
the wrong impression that increasing the funds has a negative effect.

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Figure 26

DWSDCG budgets, releases and expenditures (in billion Ush)

57

70

60

50

40

30

20

10

0

70

60

50

40

30

20

10

0

budget

release

expenditure

nominal releases

3 year moving average

real releases

3 year moving average

Source: Own calculations based on WESPR 2006 for 02/03 - 05/06 and, after that, WESPR for that year (and 2014
World Bank national accounts data for GDP deflator).

The  phenomenon  of  limited  availability  of  new  financial  resources  is  exacerbated  by  the  population
growth but also by the increase in costs of service delivery  which results from the combination of two
factors:


The  cheap  water  supply  technologies  (e.g.  protection  of  springs  and  construction  of  shallow
boreholes  and  wells)  can  only  be  implemented in  areas  where  the  groundwater  situation  is
favourable. These locations are now well covered. Areas that still need to be served correspond
to  areas  requiring more  expensive  technologies (deep  boreholes,  domestic  rainwater
harvesting).

 Unit  cost  of  service delivery  increase  as  contracts  per  district  reduce  in  size  following  the
increase  in  the  number  of  districts.  In  addition,  the  fragmentation  of  district  has  led  to  an
increase  in  setting  up  costs  for  new  district  offices  and  logistic  support,  and  an  increase  in
recurrent  costs  for  new  district  water  officers.  Therefore,  increasingly  more  funding  at  district
level is required to increase the safe water supply coverage in rural areas.

Institutional and policy factors
As highlighted above, the  water and sanitation sector  was accorded priority status by  GoU  in the last
decades.  This  has  translated  in  a  number  of  initiatives  to  enhance  strategies  implemented  by  GoU  in
the  sector.  In  particular,  interviews  highlight  that  a  positive  contribution  has  been  made to  safe  water
access  through:  i)  improvements  in  deconcentrated  construction  of  multi-year  water  supply  projects,
ii) decentralised capacity building, and iii) sustained focus on O&M. The efforts at the three levels were
all  made  as  a  result  of  continuous monitoring  and  interaction  between  MWE,  international  technical
advisers  and  annual  joint  sector  reviews.  Other  initiatives  resulting  from  increased  monitoring  and
sector dialogue include the stricter application of DWSDCG guidelines at all levels of the sector and the
regular implementation of VfM audits79.
Another  positive  impact  on  the  increase  of  rural  water  supply  coverage  was  the  establishment  of  a
“Water  and  Sanitation  Development  Facility”  (WSDF)  as  a  means  by  which  to  channel  funding  and
technical support into the sector’s service providers (i.e. local governments in the small towns and rural
growth  centres)  in  a  way  that  reduces  transaction  costs.  GoU  with  the  support  of  DPs  launched  the
“Water  and  Sanitation  Development  Facility-South  West”  (WSDF-SW)  in  July  2006  under  the
Directorate  of  Water  Development  (as  an  arm  of  the  Ministry  of  Water  and  Environment).  It  was
established as a pilot structure responsible for supporting Small Towns (STs) and Rural Growth Centres
(RGCs) get access to piped safe water and improved sanitation. The experience gained in the WSDF-
SW was replicated in the setup of a similar WSDF in the Northern part of Uganda and subsequently in
East  and  Central  Uganda  as  well.  These  “Water  and  Sanitation  Development  Facilities”  were
established with delegated financial powers for efficient implementation at local /regional levels.80 From
the  outset,  the  goal  was  that  the  WSDF  would  ultimately  transition  into  an  autonomous  fund  with  an
expanding remit across the sector and its stakeholders.

79 The use VfM audits was enhanced by subsequent follow up through the Good Governance Action Plan (GGAP).
80 Source: http://www.mwe.go.ug/ (ministry’s website accessed on 05/12/14).

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A new formula for allocation of grants was implemented in 2008/09 considering sub-county coverage as
opposed  to  the  old  approach  of  using  district  coverage  alone.  This  has  contributed  to  even  out  the
coverage disparity within districts by focusing on the under-served sub-counties.81
A number of other relevant W&S GoU policy initiatives were launched in the last decades. They are all
listed under EQ 6 (Volume 2).
During the evaluation period, sector performance was affected by certain weaknesses in the financing
mechanisms established by GoU. Two field visits to neighbouring districts highlighted that the allocation
formula  used  in  recent  years  (the  formula  was  established in 2007) had apparently not  been  fully
implemented according to district needs. Although Mbarara received twice as much funding as Masaka
District  in  FY2013/14,  this  was  not  sufficient  to  increase  coverage  in  Mbarara,  while  it  did  increase
coverage  in  Masaka.  Mbarara  which  has  a  safe  water  coverage  of  65%  (just  above  the  country-wide
average value of 64%) and is partly water-stressed according to the District Water Officer only received
sufficient funds to implement 2-3 boreholes every 3-4 years, whereas Masaka district, with a safe water
coverage  of  83%,  receives  funding  for  new  shallow water  sources  on  a  yearly  basis.  That  said,  the
recent  evolutions  in  the  strategies  and  funding  mechanisms82 underline  GoU’s  constant  concern  to
improve its action in the sector.
Finally,  it  is  important  to  highlight  the  fact  that  the  creation  of  new  districts  from  larger  districts  (in
particular in 2011) has created some distortion in the measurement of certain indicators. The changes
in  administrative  divisions  have  resulted  in  the  establishment  of  many  new  administrative  units  which
had  few  improved  water facilities.  Equity  values  for  some  districts  with  newly  created  administrative
units changed significantly from FY2011/12 because the available data for some water facilities do not
indicate the respective parishes.83

Factors not directly related to policy and institutional factors
A  substantial  number  of  people  have  been  served  by  new  water  supplies  funded  by off-budget
resources as  implemented  by  NGOs.  This  has  ensured  that  the  safe  water  coverage  so  far  is  not
reducing. The WESPR 2011 shows that in FY2009/10, an estimate 472,894 people were newly served
in rural areas by NGOs, as compared to 670,910 people by the DWSDCG.

Table 7

New safe water sources constructed and population served in rural areas by NGOs in
FY2009/10 and FY2010/11

FY 2009/10

FY 2010/11

No.

Source

No.

374
573
155
951
479
1,216
1,437

191
553
397
605
52
3,191
1,275

Est. population served
112,200
171,900
31,000
142,650
2,874
3,648
8,622
472,894

Est. population served
57,300
165,900
79,400
90,750
312
9,573
7,650
410,885

Borehole construction
Shallow wells
Spring protection
Tapstands/Kiosks
House connections
Rainwater harvesting jars
Rainwater harvesting tanks
Total
Source: WESPR 2011, p. 187.
The water and sanitation sector is also largely affected by several non-sector specific factors. The main
one is linked to Uganda’s population growth. Increase in rural population (more than one million every
year)  requires  additional  efforts  to  improve  service  delivery  in  water  and  sanitation.  As  highlighted
above,  funding  for  new  water  sources  provided  through  the  DWSDCG  and  by  NGOs  is  since
FY2006/07 just enough to supply the rural population growth.
Access  to  sanitation  facilities  is  also  closely  related  to poverty levels. Poorer  households  lack  the
resources  to  invest  in  improved  sanitation  and,  so  far,  no  public  funds  go  directly  towards  the
development  of  household  sanitation  facilities.  In  2009,  a  study  was  done  to  provide  more  detailed
spatial data on the spread of poverty and water and sanitation services over the country. A comparison

81 Water and Environment Sector Budget Framework Paper, FY 2008/09 (p. 32).
82 During FY 2013/14, the allocation formula for the district water and sanitation development conditional grant was
reviewed  as  recommended  in  the  previous  year’s  joint  sector  review.  This  review  aimed  at  ensuring  a  more
equitable  coverage  at  sub-county  level  of  the  water  and  sanitation  development  grant  to  the  local governments,
thereby enabling underserved sub-counties to catch up with the national service average. The formula now takes
into  consideration  population,  investment  costs  of  the  appropriate  technology  and  the  water  supply  coverage  at
sub-county level within a district (WESPR 2014, p. 9).
83 Source: WESPR 2012, p. 67.

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of  poverty  rates  and  improved  sanitation  coverage  in  2002  confirms  that  the  two  variables  are
negatively correlated; that is, in broad terms, sub-counties with high poverty rates also have low levels
of improved sanitation. The North East part of the country (the Karamoja region) is also the poorest part
of the country has the poorest sanitation coverage.
Regional  differences  in  rural  safe  water  coverage  are  largely  the  result  of water  resources  availability
differences, population  density and  variances  in  cost  of  service  delivery.  In  Karamoja  as  well  as  the
“cattle  corridor”,  natural  water  resources  are  particularly  low  and  the  only  alternative  is  the  expensive
option  of  deep  boreholes;  but,  like  in  West-Nile,  the  population  pressure  is  also  much  lower  in  these
regions.
In addition, in hard-to-reach districts it is difficult to reach and retain qualified staff, which has a negative
effect on service delivery. Interviews and recent reports also show that political interference resulting in
selection of sites in other places than required for increased equity (i.e. disparities within a district) also
plays an important role.
Compared to other areas of the country, Northern Uganda presents some very specific issues related to
the conflict which affected the region. Beyond the direct impact of the war on the local population, it is
important 
targeted  emergency
interventions.84 Emergency support turned out not to be equally distributed in the region and presented
low  sustainability  levels.  A  large  part  of  the  camp  population  has  left  since  then.  The  situation  has
significantly  distorted  the  measurement  of  indicators  of  access  to basic  services  in  the  region.
Moreover,  continued  unrest  in  the  first  years  of  the  period  under  review  made  it  difficult  to  build  up
capacity in those areas.
Finally,  it  is  important  to  highlight  the  importance  of education and cultural aspects  on  the  sector
indicators.  In  particular,  the  proportion  of  women  in  water  user  committees  depends  on  the  overall
gender awareness of the rural people using the water sources, which in turn depends largely on overall
education levels and a variety of cultural factors.

the  region  received  substantial  amounts  of

to  highlight 

that 

Summary answer to the evaluation question
The decentralisation policy and related funding to all district local government has improved access and
functionality of water services and improved equity of service. However, strong geographical disparities
persist  as  a  result  of  sub-optimal  allocation  of  district  funding,  political  interference,  capacity  gaps  at
district local government level and geographical attributes that, for instance, limit the use of affordable
technologies,  or  cultural  and  educational aspects  constraining  gender  mainstreaming.  Moreover,
funding  for  new  water  points  is  not  sufficient  to  increase  water  coverage  further  in  view  of  the  high
population  growth,  the  costs  of  increasing  numbers  of  district  local  governments,  and  the  fact  that
options  for  affordable  technologies  have  run  out.  The  National  Framework  for  Operation  and
Maintenance of Rural Water Supplies promoting community-based maintenance of water sources and
availability  of  trained  hand-pump  mechanics  has  increased  the  functionality  of  water  sources.  But
functionality rates are stagnating demonstrating that more needs to be done in order to further improve
functionality.
Functionality of rural water points is impacted positively when Water User Committees have women in
key positions, as women are directly benefiting from functional water sources. However, there has been
no clear improvement in this area over the period.
In  Uganda, sanitation improvements  are  the  responsibility  of  households.  Overall,  funding  levels  for
promotion of sanitation are extremely low. Latrine coverage has gradually increased but at a very low
rate. At the same time, a noticeable jump can be seen in the trend after the commencement of a donor
funded  project,  the  Uganda  Sanitation  Fund,  suggesting  that  funding  has  a  much  bigger  impact  than
education and awareness raising. Strong geographical disparities persist as a result of cultural aspects
towards sanitation, enforcement disparities  and differences in  local capacity and awareness,  and to a
lesser extent challenges with latrine technologies in loose soils or in case of shallow water levels.

84 Mainly  via  a  UNICEF-funded initiative,  the  NUSAF  and  the  PRDP,  large  programmes were  undertaken  in IDP
camps.

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Table 8

Synthesis of factors determining changes observed at the outcome and impact levels
(Step 2) - Water & Sanitation

60

GoU Policies (induced output level
in the IL) having contributed to

Development Results

 Decentralisation of

governance and service
delivery: moderate
 National Framework for

Operation and Maintenance of
Rural Water Supplies:
moderate

 Provision of piped water

supply to rural growth centres
through WSDFs: strong
 Water and Sanitation Gender
Strategy: weak to moderate

Improved access to services /
functionality of water services
although strong geographical
disparities persist

 Water and Sanitation Gender

Strategy: weak

Number of Water User
Committees with women in
key positions remain limited

 Decentralisation of

governance and service
delivery: moderate

 Water Supply and Sanitation

Sector Investment Plans (SIP):
weak

 Budget line for sanitation by
three line ministries: weak

 Provision of piped water

supply and sanitation to rural
growth centres and small
towns through WSDFs: weak
to moderate

Improved access to sanitation
services although strong
geographical disparities
persist

Other historical and/or policy
interacting factors, and/or internal or
external factors

 Poverty level and Population

growth: strong

 Donor/NGO projects: moderate
 Rural Ugandans resist the idea of
payment for water services:
moderate

 Political interferences at local level:

strong

 Geographical specificities (natural
resource availability, population
density, conflict affected areas,
water quality): strong

 Sub-standard materials sometimes
used for installation of rural water
point sources

 Cultural factors (e.g. a male-
dominated society): strong
(constraining factor)

 Education level: moderate

(constraining factor)

 Staff contracted by Ministry of
Public Service: moderate
 MoFPED and MoGLSD also

support and implement gender
mainstreaming activities in the
sector: moderate

 Poverty level: strong (constraining

factor)

 Population growth: strong
(constraining factor)

 Donor projects: strong (although

sustainability is low)
 District division: moderate
(constraining factor)

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4.2.3

Evaluation question 10

EQ 10 - Health
To what extent, in the health sector, the development outcomes targeted by the policies and
programmes supported by BS have been or are being achieved? And which have been the
determining factors of their achievement?

Background and context

Uganda’s health system is broadly divided into national and local levels. At the local level, the district health system
consists of village health teams, health centres at three sub-levels (parish/sub-county/county, respectively level II,
III and IV) and district general hospitals. District health services are managed by the Ministry of Local Government.
At the overall level, main institutions include: the Ministry of Health (MoH), semi-autonomous institutions (e.g. the
Uganda Blood Transfusion Services, the National Medical Stores, the Uganda Public Health Laboratories and the
Uganda National Health Research Organization), the National Referral Hospitals and Regional Referral Hospitals.
The functions of the Ministry of Health (MoH) include: resource mobilisation and budgeting, policy formulation and
policy dialogue, strategic planning, regulation, advising other ministries on health and related matters; capacity
development and technical support; and monitoring and evaluation of the sector performance.
Two main sector plans cover most of the evaluation period: the Health Sector Strategic and Investment Plans
(HSSIP) I (2005/06-2009/10) and the HSSIP II (2010/11-2014/15). These sector plans set out the overall direction
of the GoU’s strategy for the health sector. They include a defined set of priorities and targets and the
achievements are being reported annually in Annual Health Sector Performance Reports (AHSPR).
Main source: MoH, 2011.

Step 2 - Main sector outcomes85
After the establishment of peace and stability in the country in the mid-1980s, the health sector, along
with  most  other  parts  of  the  economy,  saw  rapid  improvements  in  outcomes.  In  particular,  along  with
just a handful of other countries, Uganda was able to turn the tide of the HIV/AIDS epidemic with a peak
in HIV infection rate in the mid- to late-1990s at around 9% of the population. In the last decade, health
coverage has also gradually improved.
However, while Uganda is on track to meet some of the MDG targets for health (e.g. MDG 4 on child
mortality),  the  health  sector faces  several performance  challenges,  including  financial,  management,
and overall policy leadership. By the mid-2000s, signs of a flattening out of the positive trends in sector
outcomes  became  evident  and  the most  recent  years  have  seen  a  reversal  or  stagnation  of  health
outcomes,  including  mortality  rates  for  mothers  and  children,  and  HIV/AIDS  prevalence  rates.  The
country will not meet MDG 6 / Target 6.A on reversing the spread of HIV/AIDS.86
With respect to gender sensitive health sector outcomes, Uganda is not on track to achieve MDG 5 to
improve maternal health, including reducing maternal mortality (MDG, Target 5.A), which is graded as
‘Stagnant’  in  the  most  recent  update.87 In  addition,  progress  on  Target  5.B,  on  universal  access  to
reproductive health services, has been graded ‘slow’ in the same report. The proportion of deliveries in
health facilities (health centres and hospitals) has increased over the evaluation period but the increase
has  also  been  slow  for  this  indicator  and  recent  levels  were  stagnating  below  GoU  policy  targets.
Contraceptive  prevalence  rate  has  shown  a  decline  in  recent  years.  The  fourth  Joint  Assessment
Framework (based on 2012 data) indicates that none of the health sector results targets agreed upon in
the context of the JBSF were met.
There  is  also  relatively  strong  evidence  of  equity  challenges  in  health  care  utilization  in  the past
decade.88 The poor have generally lower  access to most services and the  overall system is generally
pro-rich  as  allocations  to  central  facilities  that  are  mostly  accessed  by  the  better-offs  dominate  over
lower-level  allocations  that  are  mostly  accessed  by  the  poor, near-poor,  and  households  in  remote
areas.  The  charts below  illustrate  inequalities  in  deliveries  in  health  facilities.  About  90  percent  of  the
women  in  urban  areas,  but  only  54  percent  in  rural  areas  deliver  in  health  facilities,  the  spread  being
even larger across household wealth quintiles.

85 Detailed evidence which underpins the findings presented in the section that follow can be found in volume 2.
86 After significant improvements in the 1990s and early 2000s, DHS data indicates that the situation is worsening,
HIV/AIDS prevalence having increased from 6.4 to 7.3 percent of the general population in the 2005-2011 period
(2004-05 UAIS and 2011 UDHS).
87 GoU 2013. Millennium Development Goals Report for Uganda 2013.
88 See,  for  instance: World  Bank, 2009.  A  public  expenditure  review  2008:  With  a  focus  on  affordability  of  pay
reform and health sector

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Figure 27

Deliveries in health facilities by residence and household wealth index (2011)

Deliveries in health facilities by residence

Deliveries in health facilities by household wealth

62

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

Urban

Rural

Lowest hh
wealth quintile

Second

Middle

Fourth

Highest hh
wealth quintile

Source: UDHS 2011.

The map  below  also  reveals  large  regional  differences  for  the  same  indicator89 and  indicates  that  the
situation is especially difficult in the north and northeast of the country.

Figure 28

Percentage of deliveries in Government and PNFP facilities (2013)

Source: MoH Sector Performance Report FY 2013-14.

The mixed picture described above is confirmed by the opinions expressed by the stakeholders in the
eSurvey.  As  illustrated  in Figure 29,  the  eSurvey  respondents  rated  the  evolution  of  access  to  health
services fairly positive (score 2.1)90 while being more critical with regards to the quality of primary health
care services (score 1.6). The perception of development partners is particularly negative regarding the
quality of service delivery (score 1.4) and gender equality in service delivery (score 1.3).

89 Since the indicator is not exactly defined the same way in both sources (the 2011 UDHS and the 2014 Health
Sector Performance Report), the data depicted in the chart and in the map are not entirely consistent.
90 eSurvey question 18 “To what extent has there been progress linked to the reforms implemented in the past ten
years in the following fields?”; answers are calculated on a 0-3 scale (0-not at all, 1-little extent, 2-some extent, 3-
great extent).

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Figure 29

e-Survey - Progress linked to the reforms implemented in the past decade

0,0

0,5

1,0

1,5

2,0

2,5

3,0

Access to health care

Quality of primary
 health care services

Gender equality
 in service delivery

Overall

GoU

DPs

NSAs

Source: 2014 - Stakeholder survey - Particip GmbH.
Scale: 0-not at all, 1-little extent, 2-some extent, 3-great extent.

Step 2 - Analysis of determining factors
The  analysis  of  determining  factors  in  the health sector  has  relied  on  a  wide  range  of  sources  of
information  to  understand  the  mechanisms  explaining  the  main  sector  evolutions  observed  above.
While an econometric analysis could not be performed in the health sector because of a lack of reliable
time  series,  information  collected  through  a  variety  of  documentary  sources  (e.g.  public  expenditure
reviews, recent studies/evaluations, sector performance reports, surveys on service delivery, etc.) was
cross-checked and enriched through interviews, direct observations and primary data collected through
a field survey covering eight districts in four regions of the country.
The  determining  factors  identified  were  classified  in  three  broad  categories:  i)  Factors  related  to
financial resources; ii) Institutional and policy factors; iii) Non sector factors.

Factors related to financial resources
The  field  survey  carried  out  in  this  evaluation  highlights  the  dearth  of  physical  resources, which
compounds  service  delivery. Well  over  half  of  informants  think  that  the  health  clinics  lack  a  particular
infrastructure asset that negatively affects their ability to provide adequate care. One particular piece of
infrastructure  of  critical  importance  is  access  to  clean  water.  Of  the  sampled  health  units,  40  percent
depend on rain-water as their main source of water. Moreover, almost one-third of units indicated that
their  main  source  of  water  was  not  near  the  clinic,  but  rather  some  1.4 km  away,  on  average.  More
generally, based on the health unit survey and other sources of information, it is evident that too many
Ugandan  health  units  lack  the  necessary  physical  and  human  resources  to  provide  adequate  care  of
sufficient quality.
Increased budget resources have enabled the GoU to increase health services and expand coverage of
most types of health care over the past decade. In particular, increased investments (in nominal terms)
could be observed in infrastructure, the payments of salaries, and supplying pharmaceuticals.

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Figure 30

Health expenditures, 2003-2013, billion Ush (nominal)

64

700

600

500

400

300

200

100

0

2003/04

2004/05

2005/06

2006/07

2007/08

2008/09

2009/10

2010/11

2011/12

2012/13

2013/14

Total domestic health spending

Salaries

Non-wage recurrent expenditures

Domestic development expenditures

Off-budget donor projects (as reported to MoFPED)

Source: 2014 MoFPED.

While  total  nominal  health  spending  has  increased  over  the  last  years, real  per  capita  health
expenditure has not (see Figure 31 below). This can be largely explained by the high level of population
growth and political decisions on priority allocations.

Figure 31

Health real per capita expenditure

12.000

10.000

8.000

6.000

4.000

2.000

0

real domestic health expenditure per capita

3 year moving average

Source: Own calculations based on 2014 MoFPED for nominal expenditure data and 2014
World Bank national accounts data for GDP deflator.

Moreover,  like  other  sectors  (e.g.  education),  the  funding  of  the  health  sector  has  been  spread  thin
across newly  created  districts in  recent  years  which  duplicated  administrative  structures  without
increased financing. 91 Data from the field survey corroborates the findings from other sources of limited

91 The 2014 IEG evaluation of decentralization in Uganda analyzed the effects of the proliferation of districts. The
case of Bushenyi – one of the best performing districts in Uganda - both before and after the splitting is instructive.
Bushenyi was divided into five separate districts in 2010. Before this, the district was receiving government grants
of  UGX  42,621  per  capita.  It  ranked  10th  in  the  FY09  Health  District  League  and  11th  in  the  FY08  Education
District League (out of 80 districts) and it had 91 percent of strategic posts filled. The splitting of the district into five
new districts in 2010 led to a dramatic reduction of per capita grants even in nominal terms for 80 percent of the
combined population of the five new districts, a reduction of staffing to 81 percent for what remained as Bushenyi

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financial resources at the local level. More than half of all samples local health authorities report having
a reduced or unchanged financial envelope since the start of the evaluation period.92
In  general,  the  unequal  levels  of  resource  allocations  and  spending  are  reflected  in  unequal  health
outcomes;  low spending  districts  perform  considerably  worse  than  higher  spending  districts.  The
shortage  of  financial  and  other  resources  is  an  important  determining  factor for weaknesses  in  sector
performance, which, in turn, is made worse by limited management and planning capacities at the lower
levels of government as further detailed below.

Institutional and policy factors
In terms of human resources, interviews stressed that, while many managers in public institutions are
highly  competent,  there  is  clearly  a lack of  capacity  in  health  sector  management  and  policy  analysis
(incl.  impact  evaluation  of  programmes).  In  particular,
there  is  information  from  other  central
government ministries and agencies that, despite an overall improvement, the health sector continues
to be  weak in certain areas of PFM.93 A review of the  health related developments and targets in the
draft  version  of  the  National  Development  Plan  2015/16 – 2019/20  show  some  level  of  awareness  of
the  negative  trends  in  key  health  outcomes  but  only  little analysis  of  the  reasons  for  these
developments beyond the lack of resources (GoU, 2014). The Plan sets out revised targets for maternal
and  child  health  and  for  other  key  diseases  (including  HIV/AIDS).  Critically,  the  Plan  does  not  (yet)
describe how the targets are to be achieved, illustrating the limitations in terms of strategic planning in
the sector.
The  data  from  the  field  survey  largely  corroborate  the  observations  made  in  interviews  related  to  the
lack of human resources at the local level. Of the sampled health units (Level II and III) in the survey,
less than one-third report ever having been fully staffed (see Figure 32). That only around one-third of
units  are  fully  staffed  with  nurses  or  midwives  is  a  major  source  of  concern  and  one  that  seriously
impacts  on  the  ability  of  units  to  provide  skilled  services. It  is  also  a  clear  sign  of  the  financial and
human resource challenges the Ugandan health sector is facing.

Figure 32

Field survey - % of health units fully staffed (by profession)

0%

10%

20%

30%

40%

50%

Total (across all categories)

Enrolled Nurses

Nursing Assistants

Enrolled Midwives

Health Assistants

Clinical Officers Senior*

Clinical Officers*

Nursing Officers*

Laboratory Technicians*

Note: *only applies to level III health units.
Source: 2014 - Health unit field survey - Particip GmbH.

In  general,  the  Ugandan  health  sector  is  suffering  from  both  a  lack  of  resources  and  limited  ability  to
plan,  execute,  and  sustain  interventions  and  activities  making  large  increases  in  investments  or
allocations difficult. The field survey confirms the observations about the weaknesses in the ability of LG
and local service providers to conduct financial and management planning.

and to 8 percent for the other four districts. While Bushenyi itself improved its FY11 Health District League position
from 10th to 2nd, the remaining four new districts fell to 61st, 68th, 93rd, and 104th position out of 112 districts.
92 In  addition,  these  allocations  are  largely  allocated  to  fixed  purposes  leaving  local  levels  with  little  flexibility  in
resource use.
93 These assessments are in line with those of health sector experts that maintain that the MoH and other health
sector agencies have lost much technical and managerial capacity over the past decade or so. It is also consistent
with  the  more  general  assessments  that  the  large  influx  of  financial  resources  in  the  health  sector  over  the  past
years,  not  least  to  fund  ART  treatments,  was  made  in  an  environment  of  very  weak accountability  and financial
management capacity and ability to provide necessary oversight.

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Only  eight  percent  of  respondents  to  the  field  survey  say  they  have  received  any  training  in
administration  over  the  past  year.  Although  it  is  difficult  to  interpret,  it  is  noteworthy  that  the  Health
Management  Committees  (HMC)  only  meet  on  average  four  times  per  year;  one  would  expect  these
units to meet on a more regular and frequent schedule. Likewise, there appears to be a relatively large
number of issues that are ‘informally discussed or reviewed’ at the level of the HMC at LG-level. While
this may be largely normal procedure, the fact that sometimes less than 70 percent of all key issues are
‘formally discussed or decided’  within the HMC may  be a sign of weak management at this important
level  of  the  health  system.  It  also  appears  to  be  the  case  that  the  sector,  in  many  although  not  all,
aspects is finding it increasingly more difficult to deliver quality services, not least due to shortages of
human  resources  for  health.  One  example  of  this  issue  is  the  fact  that  stock-outs  of  drugs  may  not
always be due to actual shortage of funds or drugs, but rather due to administrative regulations where a
Level II clinic should be receiving allocations similar to a Level III clinic due to patient demands.
Limited  resources  and  flexibility  on  the  use  of  funds  have  led  to  critical  challenges  for  health  service
delivery  at  district  level  with  subsequent  inadequate  achievements  in  critical  areas,  such  as  maternal
and  child  health.  While  the  lack  of  autonomy  over  the use  of  appropriations from  the  central  level  is
partly  a  result  of past leakages  of  public  funds,  it  comes  at  a  cost  in  terms  of  imbalances  between
investments and maintenance of facilities and equipment.
Uganda’s health system is providing anti-retroviral treatments for some 680,000 people94. While this is
an important achievement, it may be one that has come about at the expense of other treatments and
types of medical services, including providing effective maternal and preventive services.
The health sector in Uganda has also been the stage for several large corruption scandals over the past
few  years,  indicating  the  overall  weaknesses  in  the governance  and  accountability systems  of  the
country generally and the health sector specifically.
In terms of equitable utilisation of health services, there is evidence that public health care facilities at
lower levels in Uganda are pro-poor, but that government hospitals are not.95 This is largely due to the
fact  that  lower  level  facilities  are  used  mostly  by  the  poor  and  that  public  hospitals  are  used
predominantly by the rich. Furthermore, inequalities in health care use are also a result of the relatively
large variation in local level allocations and subsequent spending on health.96
There are also clear shortcomings when it comes to ‘gender budgeting’ at the LG-level. In particular, the
field survey highlights the low share of districts that apply gender specific analysis in financial planning.
Around two-thirds of Level III health clinics do not use gender specific data for planning.
The  current health  system  is  far  too  fragmented into  an  excessive  number  of  local/district  units  to  be
able to deliver effective and cost-effective services. Recent policy documents (e.g. NDP 2015 - 2020)
highlight the need to continue the decentralisation process while not neglecting regional implementation
mechanisms. Given the existing shortcomings, this will be challenging.
Importantly, there are signs that, in general, the country’s health system may not be fit for purpose with
several different types of service providers at various levels that fail to combine in an equitable, effective
and  efficient  whole.  This  view  has  been  confirmed  in  interviews  by  the  vast  majority  of  health  sector
stakeholders, development partners, local government and sector staff, and health sector experts alike.

Non-sector factors
Over  the  past  decade,  the  performance  of  the  Ugandan  health  sector  has  been  affected  by  several
strong non-sector factors. This suggests the need to address health in Uganda as a cross-cutting issue
involving several social, cultural and economic determinants.
In  particular, real  per  capita  income has  not  been  as  strong  as  needed  for  sustained  non-income
poverty improvements, including that related to health. Socioeconomic circumstances continue to affect
financial access to quality medical services in most parts of the country.
Related  to  this  factor  is  the  continued  high  fertility  rate  of  the  country  that  has  led  to high population
growth rates. Health facilities are frequently facing strong pressures from patients and waiting times are
often long. Moreover, the high fertility rate affects women in particular and is a strong factor explaining
the poor performance in maternal health over the period. This is, in turn, partly related to the low levels
of female education with high drop-out rates due to, among other things, teenage pregnancies.
Finally, the  generally  poor  conditions  of  roads  and  lack  of transportation means,  in  particular  in  rural
areas,  have  most  likely  had  a  strong  negative  impact  on  the  access  to  many  health  services,  in
including gender sensitive services, such as reproductive and family planning services. With respect to

94 MoH’s AHSPR of 2013/14.
95 World Bank, 2009. A public expenditure review: With a focus on affordability of pay reform and health sector
96 World Bank, 2013. Public Expenditure Review: Service Delivery with More Districts in Uganda.

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the latter, several health staff noted the insecurity of women in many parts of Uganda, limiting access
and utilization of service, in particular after dark.

Summary answer to the evaluation question
Over the evaluation period, there have been improvements in access to most medical services due to
important public investments. The Minimum Health Care Package has been instrumental in improving
access  to  basic  health  services.  Expansion  of  provider  networks  has  facilitated  geographic  access  to
care for most population groups.
However,  the  health  sector  displays  several  challenges  with  respect  to  equality  and  equity  in  health.
The  poor  are  more  vulnerable  to  catastrophic  health  payments  (and  to  become  poorer  due  to  health
care spending). Improvements have been unevenly distributed with a clear urban-rural gap in access to
inpatient  and  some  advanced  types  of  (hospital-based)  services.  Poorer  households,  in  particular in
rural  areas,  have  lower  access  to  some  types  of  medical  services  compared  with  richer  households.
Moreover,  rapid  population  growth has  exacerbated  challenges  in  achieving  uniform  access
improvements (families are larger in lower socioeconomic groups).
Although  health  related  gender  outcomes,  such  as  access  to  maternal  health  care,  have  improved
during  the  period  under  evaluation,  improvements  have  slowed  down and  levels  of  access  generally
remain  subdued.  Fertility  rates  are  high  and  maternal  mortality  rates  remain  at  a  comparatively  high
level. The health situation of women is compromised by societal factors, such as gender inequality and
the  insecurity  of  women. In general, the GoU’s commitment to gender  issues  and  to the  protection of
women’s and children’s health rights appears to remain weak, frivolous, and incoherent.
The  quality  of  care  in  Uganda  has  improved  compared  to  the  pre-2000  period.  For  example,  more
cases  of  diseases  are  detected,  patients  with  chronic  illnesses  remain  on  treatment  regiments,  and
more  women  deliver  in  clinics.  However,  various  studies  point  at  weakness  in  infrastructure,  medical
technologies, and among human resources for health. Quality issues remain and Ugandan health care
staff  compare  unfavourably  in  some  respects  compared  with  staff  in  other  SSA  countries.  The  GoU’s
approach  to  quality  assurance  and  improvements  has  been  incoherent.  Quality  concerns  have  only
been prioritized over the most recent years.
Finally, technical, analytical, and managerial capacities have been weak at all levels of the sector. This
situation has seriously hampered the implementation of GoU’s sector strategies and plans.

Table 9

Synthesis of factors determining changes observed at the outcome and impact levels
(Step 2) – Health

GoU Policies (induced
output level in the IL)
having contributed to

Development Results

Other historical and/or policy interacting factors,
and/or internal or external factors

 Sector policy (NHP

I and II) and
associated plans
(HSSIP I and II):
moderate

Some improvements in
access to health care (esp.
basic health care)

 Sector policy (NHP

I and II) and
associated plans
(HSSIP I and II):
weak

 Gender

mainstreaming
initiatives: weak

Uneven implementation of
service expansion, poor
quality of care and overall
underperformance on key
sector targets and
objectives (maternal and
child mortality, HIV/AIDS,
financial protection and
equity in health financing
and service access)

Limited evolutions in
gender sensitive outcomes
(incl. maternal mortality;
access to maternal health
care, and fertility rates)

 Poverty level (poor overall real per capita

economic growth over past four to five years and
persistent socioeconomic inequalities): very
strong (constraining)

 Weak capacity at all institutional levels: strong



(constraining factor)
Increased district/decentralisation strains
management capacities: moderate to strong
(constraining factor)

 Population growth: strong (constraining factor)


Internal factor: policy focus on quantitative output
objectives

 Poverty level: very strong (constraining factor)
 Weak governance and accountability: very strong

(constraining factor)

 Weak capacity at all institutional levels: strong



(constraining factor)
Increased district/decentralisation strains
management capacities: moderate (constraining
factor)

 Macroeconomic inefficiencies and underfunded

sector: strong (constraining factor)

 Population growth: strong (constraining factor)

Income inequalities: very strong


 Weak capacity at all institutional levels: strong
 Cultural issues: very strong

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68

4.3 Step 3
What  do  the  findings  from  Step  1  and  Step  2  tell  us  about  the  contribution of  budget  support  to  the
achievement of the targeted results  over the evaluation period? In order to  address this question, the
team has compared the summary tables of Step 1 and Step 2; comparison which allows identifying the
transitive  relationships  between  BS  and  the  development  results  through  the  assessment  of  the
significance  of  each  chain  of  influence  (BS →  Government  policies;  and  Government  policies →
Outcomes & Impacts).

Results  are  presented  separately  for  each  focal  sector  through  a  tabular  format  followed  by  a  short
descriptive synthesis. The three tables, one for each focal sector, all follow the same structure:







The column on the left hand side, identifies the ‘contribution of BS’ to changes in the given GoU
sector  policies,  specifying  the  type  and  degree  of  influence  exerted  by  the  different  sets  of
inputs (funds, policy dialogue, capacity building);

The central column presents key sector policies / policy outputs.

The column on the right hand side identifies the development results and specifies the degree
of influence  exerted by the given GoU sector  policy  /  policy  output on the achievement of the
result.

The  degree  of  influence  of  the  BS  inputs  on  the  GoU  policies  and  of  the  GoU  policies  on  the
development results is assessed on a scale of three ratings: weak, moderate or high as follows:

 weak: when  the  factor  considered  contributed  negligibly  to the  observed  change  and

this would have occurred in any case, albeit in slightly different forms,

 moderate: when  the  contributing  factor  considered  has  had  a  significant  role - along
with other factors - in supporting the observed change. And the latter – in the absence
of the factor considered – would have occurred in a reduced and / or more expensive
form); and
strong: when  the  observed  change  would  not  have  occurred  in  the  absence  of  the
contributing factor considered;



Sector-specific considerations are then followed by a visual representation of the overall contribution of
budget  support and  other  factors to the  achievement  of  the  targeted development  results (see Figure
33).

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4.3.1

Education Sector

69

Table 10

Synthesis of BS contributions to government policies (Step 1) and their contribution to
development results (Step 2) - Education

Intensity and type of budget
support’s contribution to

GoU policies (induced outputs
in the IL) having contributed
to

Development Results

 Financing: weak
 Policy dialogue: moderate
(limited attention paid to
quality issues in early
years)

 Capacity building: weak

Sector policies (UPE, UPPET)
and strategies/plans (ESSP)
elaborated (but with limited
attention paid to quality issues)

 Financing: strong, then

weak (donor shift to project
support)

 Policy dialogue: moderate
 Capacity building: weak

Public funding available to
support service delivery
expansion (e.g. Capitation
Grant, School Facilities Grant)

 Financing: moderate
 Policy dialogue: moderate
 Capacity building: weak

 Financing: weak
 Policy dialogue: moderate
 Capacity building: weak

Quality Enhancement Initiative
implemented in the 12 worst
districts

UPE and UPPET gender goals
Gender in Education Policy

















(strong) Improvement in access
(weak) Persisting issues in quality
(weak) Gender parity at primary
level but drop out rate for girls
remain high at both primary and
secondary level.
(weak to moderate) Geographic
and income inequalities
(strong) Improvement in access
(weak) Persisting issues in quality
(moderate) Gender parity at
primary level but drop out rate for
girls remain high at both primary
and secondary level.
(weak to moderate) Geographic
and socio-economic inequalities
(moderate) Geographic and socio-
economic inequalities

(weak) Gender parity at primary
level but drop out rate for girls
remain high at both primary and
secondary level.

The significant increase in access to education at both primary and secondary level, including achieving
gender equality at primary level, has been as a result of GoU education policy. The main role of BS has
been  in funding sector strategies which have resulted in significant improvements in access, although
the  reduction  of  BS  in  the  second  half  of  the  evaluation  period  has  not  been  able  to  compensate  the
decline  of  the  sector  government  expenditure.  The  contribution  of  BS  dialogue  has  been  moderate:  it
has  been  unable  to  help  protect  the  expenditure  levels,  improve  the  efficiency  of  expenditure  and
enhance  government  actions  on  quality.  Despite  the  support  provided  by  BS  dialogue  in  this  area,
particularly  in  the  second  part  of  the  considered  period,  government  actions  to  enhance  quality  in
education  and  learning  achievements  have  had  limited  effects.  BS  has  supported  gender  policies
incorporated into UPE and UPPET, with gender parity achieved at primary level, but with less attention
paid to addressing the reasons why girls drop out. Finally BS has missed the opportunity of providing
specific capacity development support – either directly or through complementarities with other actions
– to  enhance  the  efficiency  of  the  implementation  of  the  education  strategies  at  local  level,  including
both financial and human resource management.

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4.3.2 Water and Sanitation Sector

70

Table 11

Synthesis of BS contributions to government policies (Step 1) and their contribution to
development results (Step 2) - Water & Sanitation

Intensity and type of budget
support’s contribution to

GoU policies (induced outputs
in the IL) having contributed
to

Development Results

 Financing: moderate
 Policy dialogue: moderate
 Capacity building:

moderate

Decentralisation of governance
and service delivery

 Financing: weak
 Policy dialogue: strong
 Capacity building: weak to

moderate

National Framework for
Operation and Maintenance of
Rural Water Supplies (2004,
revised in 2011)

 Financing: moderate
 Policy dialogue: strong
 Capacity building:

moderate

Provision of piped water supply
to rural growth centres through
WSDFs

 Financing: moderate
 Policy dialogue: strong
 Capacity building: weak

Water Supply and Sanitation
Sector Investment Plans and
Allocation Principles - SIP
(2009)

 Financing: weak
 Policy dialogue: strong
 Capacity building: weak

Memorandum of Understanding
/ Budget line for sanitation by
three line ministries

 Financing: weak
 Policy dialogue: weak to

moderate

 Capacity building: absent

Water and Sanitation Gender
Strategy (2010)



























(moderate) Improved access to
services / functionality of water
services although strong
geographical disparities persist
(moderate) Improved access to
sanitation services although
strong geographical disparities
persist

(moderate) Improvement in
functionality of water services
(weak) Persisting geographical
disparities

(strong) Improvement in access to
water services
(moderate) Persisting
geographical disparities
(strong) Insufficient focus on
maintenance, rehabilitation and
expansion of schemes
(weak) Improvement in access to
water services
(weak) Improvement in access to
sanitation services
(weak) Persisting geographical
disparities
(weak) Improvement in access to
sanitation services, with only
funding of budget line by water
sector
(weak) Persisting geographical
disparities
(weak to moderate) Some
improvements in terms of gender
mainstreaming and reporting, but
not resulting in improvements
monitored by the gender indicator

indicators  suggests 

GoU’s  strategy  of  decentralised 
implementation  of  rural  water  supply  and  community-based
maintenance, and deconcentrated implementation of piped water supplies through WSDFs has resulted
in  an  increased  access  and  functionality  of  rural  and  small  towns’  water  supply,  and  also  in
improvements of equity. BS has contributed to these improvements through funds, policy dialogue and
capacity  building,  which  enhanced  policy  design  and  implementation.  However,  the  stagnation  in  key
performance 
targets,
notwithstanding  improvements  in  efficiency  and  maintenance.  Gender  mainstreaming  in  the  sector  is
mainly through monitoring and reporting, but does not result in the promoted increased role of women in
management of water points, nor in an increase of women in the sector.
The  urban  water  sub-sector  is  characterised  by  important  donor  project  funding,  as  evidenced  by
important  improvements  in  urban  water  coverage.  Aspects  of  maintenance,  rehabilitation  and
expansion  are  however  hardly  addressed  and  future  urban  water  coverage  may  therefore  rapidly
stagnate  and  then  decrease.  BS  was  not  intended  for  the  purpose  of  urban  water  coverage  but  may
have contributed all the same as GoU decides what to do with funds submitted to Treasury.

to  reach  sector 

that  sector 

insufficient 

funding 

is 

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4.3.3 Health Sector

71

Table 12

Synthesis of BS contributions to government policies (Step 1) and their contribution to
development results (Step 2) – Health

Intensity and type of budget
support’s contribution to

GoU policies (induced outputs
in the IL) having contributed
to

Development Results

 Financing: moderate
 Policy dialogue: weak to

moderate

 Capacity building: weak

Sector policy (NHP I and II) and
associated plans (HSSIP I and
II)

 Financing: weak
 Policy dialogue: weak to

moderate

 Capacity building: weak

 Financing: absent to weak
 Policy dialogue: weak
 Capacity building: weak

Weak quality of care assurance
system and mechanisms

Gender mainstreaming
initiatives









(weak to moderate) Some
improvement in access to health
care
(weak) Significant inequalities in
health care utilization across
population groups and in paying
for services
(weak) Uneven implementation of
service expansion, poor quality of
care and overall
underperformance on key sector
targets and objectives

(weak) Limited evolutions in terms
of gender sensitive health sector
outcomes

BS,  mainly  through  policy  dialogue,  has  contributed  to  the  development  of  a  series  of  policies,
strategies,  and  plans  over  the  past  decade,  and  BS  funds  have  made  possible  the implementation  of
some  ambitious  initiatives.  The  overall  aim  of  health  sector  policies  has  been  to  expand  services  to
enhance  geographic  and,  since  early  2000s,  financial  access  to  health  care.  Some  success  can  be
observed in these areas. From an historic perspective, the health sector has seen several quantitative
and a few qualitative improvements: expansion of provider networks; abolishment of patient user-fees;
and sustained management of HIV patients.
However,  most  policy  targets  have  been  quantitative  in  nature  and  only  more  recently  has  the  GoU
focused  on  quality  issues.  Some  important  underlying  and  inherent  inefficiencies  hampered  policy
implementation. They appear to have remained while BS has overlooked the need for a more realistic
and efficient use of resources. Likewise, gender challenges remain along with technical and managerial
capacity weaknesses.

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Final report - Volume 1 - 2015 - IEG and Particip GmbH

Figure 33

Simplified representation of the budget support contribution to the achievement of targeted development results

72

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73

5 Overall assessment
Development context. Uganda experienced robust economic growth over the last decade, resulting in
steady  gains  in  per  capita  income,  despite  rapid  population  growth.  Robust  growth  has  been
accompanied by significant poverty reduction, although poverty and vulnerability remain high. Important
gains were achieved in access to basic education, health, and water and sanitation. Uganda, however,
continues to experience very high rates of demographic growth, among the highest in the world at 3.3
percent per year which makes poverty reduction and service delivery more difficult.
In 1998, the Poverty  Eradication Action Plan (PEAP) framework was introduced as the Government’s
overarching policy planning framework until 2010. Then, the Government developed an ambitious new
vision for the development of the country, aiming to achieve middle-income status within 30 years. The
National  Development  Plan 2010-2015  entails  a  significant  shift  in  emphasis  towards  economic
infrastructure,  linked  to  the  discovery  of  oil,  gas  and  minerals.  Social  services  sectors - which  have
been  the  long-standing  focus  of  the  Government’s  policies  and  external  donor  support,  including
education, health, and water and sanitation, assume secondary priority.
Uganda  has  traditionally  received  large  amounts  of  international  aid  in  the  form  of  BS.  Total  BS
decreased  substantially 
to  well  below
USD 100 million as of FY12/13. Of the twelve BS partners, the World Bank was the biggest contributor
with USD 1.2 billion followed by the UK and the EU who provided USD 480 million and USD 290 million
respectively.
Against  this  backdrop,  the  donors  reduced  their  engagement  and  volumes  of  BS  in  recent  years  in
response to their objectives diverging from the government’s. This and the corruption episodes resulted
in the erosion of trust. In 2013, in the context of the High-Level Action Matrix (HLAM), the Government
took  important  corrective  actions  and,  on  that  basis,  some  donors  restarted  engagement  but  more
reduced  scope  and  volumes  than  before.  However,  there  remain  fundamental  questions  about  the
direction, scope and content of future BS, Government-Donors future partnership and policy dialogue,
mix of support modalities, and sectoral priorities.
This  report  evaluates  all  BS  to  Uganda  during  2004-13  period  providing  not  only  a  comprehensive
retrospective assessment but also lessons and recommendations for the future.

from  a  high  of  almost  USD 700 million 

in  FY06/07 

5.1 Relevance and design
The relevance of budget support objectives was high. Budget support in Uganda explicitly supported
the government’s PEAP97 and NDP throughout the period of review. Major sector policy areas of focus–
–education, health, and water and sanitation, as well as public financial management and governance–
–featured prominently in all budget support programmes and documents. Macroeconomic stability and
fiscal management were also part of the programmes supported in particular by the World Bank, which
were coordinated with the IMF in the context of the IMF programmes.
Overall, the objectives of budget operations  were broadly  aligned to  the government’s priorities. They
were  also  harmonized  with  development  partner  strategies  and  reflected  the  country  context.  The
strong  alignment  and  harmonization  were  an  outcome  of  an extensive  process  of consultation and
policy dialogue between the government and the development partners, which culminated in the Joint
Budget  Support  Framework  (JBSF)  in  2008. The  advent  of  JBS  raised  the  political  level  of  the  policy
dialogue  through  a more  direct  involvement  of  the  Prime  Minister’s  Office  and  enhanced  consultation
across  sectors.  Throughout  the  period,  however,  there  were  issues  of  substance  of  alignment  and  a
gradual  divergence  of  priorities and  interests between  government  on  the  one side  and  development
partners on the other.
The government’s key strategic documents (PEAP and NDP),  indeed, show a strong correspondence
between  the  stated  objectives  of  the  GoU’s  and  the  focus  and  results  outlined  in  the  budget  support
documents. Also, sector policy and investment plans and strategic documents reflect well government’s
country priorities and budget support programme objectives. However, in practice, priorities pursued by
the  GoU  on  the  one  hand  and  by  the  DPs  through  BS  on  the  other  began to  diverge  over  time.  The
GoU  gradually  shifted  national  investment  priorities  toward  productive  sectors  (e.g.,  infrastructure),
increased  the  relative  importance  of  public  administration  expenditure  in  connection  with  the  electoral
cycles  (e.g.,  via  proliferation  of  district,  reduction  of  the  local  tax  base),  and  kept  domestic  revenue

97 The PEAP had four core challenges, namely: (a) the restoration of security, dealing with  the consequences of
conflict  and  improving  regional  equity  (b)  restoring  sustainable  growth  in  the  incomes  of  the  poor  (c)  human
development (d) using public resources transparently and efficiently to eradicate poverty. The PEAP was grouped
under five ‘pillars’: (1) Economic management, (2) Production, competitiveness and incomes (3) Security, conflict-
resolution and disaster-management (4) Good governance and (5) Human development.

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mobilization low, despite the substantial service delivery needs. This shift in priorities was complete in
the second half of the decade. By contrast, DPs for their part continued to focus their BS operations on
social  sectors,  while  addressing infrastructure  and  productive  sectors  through  other  aid  modalities98.
DPs  also opened  a  wide  political/principle  area  of  discussion  with  the  government  on  issues  of
governance and public administration expenditure among others and de facto conditioned BS on those
issues. As  the  priorities  began  to  diverge and  principle  issues  became  more  binding,  the  volumes  of
budget support and the quality of the sector policy dialogue within sectors declined.
In  2004  already,  development  partners  supported  GoU’s  preference  for  general  budget  support  (as
opposed  to  sector  budget  support),  moving  away  from  explicit  notion  of  additionality  towards  a  more
flexible use of budget support modality. The establishment of a new budget support framework in 2008
(JBSF)  strengthened  DPs  coordination  and  their  high-level,  multi-sector  dialogue  with  GoU.  However,
this  happened  at  the  cost  of  increasing  distance  between  the  government’s  support  for  sector  policy
dialogue as well as the distance between the policy dialogue and the actual policy implementation and
outcomes at sectoral and local levels.
The  overall  relevance  of  objectives  was  undermined  by  diverging  objectives  as  well  as  missed
opportunities  in  several  major  policy  areas.  These  missed  opportunities  were  increasing  revenue
mobilization, controlling population growth, strengthening local government revenue base and capacity,
gender inequities, and giving greater priority to agriculture and increasing rural productivity. It was not
for  the  lack  of  foresight:  these  issues  were  largely  anticipated  in  earlier  evaluation assessments  of
budget support, and some were identified as major development risks. These issues are elaborated in
the section 0 of this report on lessons.
Relevance  of  design was  moderate  with  important  missed  opportunities  in  the  same  areas  noted
above. Relevance of design is understood as the extent to which project (or cluster of projects) design
(activities  and  policy  areas)  is  consistent  with  stated  objectives  including  assessment  of the results
framework. Results framework is the logic that links inputs and outputs to outcomes the programme is
trying to achieve. By contrast, M&E are measurable  indicators trying to measure and track all links in
the causal chain.
Specific objectives of budget support could have been clearer, fewer, and better linked to intermediate
and final  outcomes,  especially  in  the  earlier  part  of  the  period  of  review  when  World  Bank’s  PRSC
matrices were the key tools in the results and M&E framework. Many intermediate output indicators are
not made explicit. Baselines and output indicators are often unclear. And there is less than convincing
chain of logic from objectives to outputs and outcome indicators.
Reasonably  good  performance  monitoring  systems  are  in  place  to  monitor  the  implementation  of
sectoral policies,  with  the  system  being  closely  linked  to  policy  dialogue  platforms  /  sector  reviews.
Shortcomings are, however, evident in key sectors––education, health, and water and sanitation––with
regards to the reliability of data though these appear to be more important in the education and health
sectors. The  absence  of  reliable  information  and  evidence  on  activities  in  the  sector  remains  a  major
weakness of the Ugandan health sector. Despite the efforts deployed to continuously improve indicator
monitoring some doubts remain on reliability of figures particularly with reference to data on gender and
equity, which seem to be fluctuating rather than presenting a clear increasing / decreasing trend.
The  “JBSF  period”  during  2008-12 saw  a  shift  from  the  assessment  of  performance  largely  based  on
the PRSC matrix to one based on the JAF, which explicitly incorporates governance issues within the
BS framework in the form of underlying principles focused on democracy, human rights, rule of law, and
access to justice. It also saw an institutional shift in the centre of management of BS on the GoU side
from the Ministry of Finance to the Office of the Prime Minister. The latter was driven by internal GoU
processes  in  view  of  the  coordinating  role  within  GoU  held  by  the  OPM. While  the  capacity  and
technical expertise on financial and economic policy dialogue remained concentrated in MoFPED, this
shift responded  to  the  DPs  desire  for  inclusion  of  governance  issues  within  the  BS  dialogue,  issues
which fell beyond the remit of the MoFPED.
Changes in the results and M&E frameworks and the government’s coordination have addressed some
of  the  earlier  problems,  increasing  the  concreteness  and  relevance  of  the  results  and  M&E  systems,
coordination  among  DPs  and  helped  improve  the  dialogue  at  the  highest  decision  making level.  In
particular,  PRSC  matrices  for  World  Bank  budget  support  show  learning  from  the  past  and  gradual
improvements in the concreteness and quality of results framework and chains of attribution. But these
gains in relevance and design apparently have not translated well into adequate mechanisms and tools

98 The World Bank aligned its strategy to the Government and supported its objectives in financing infrastructure
through investment projects, in addition to providing reduced volumes of budget support. The EU has also provided
significant support to the productive sectors; transport and agriculture / rural development constituted key pillars of
the  intervention  strategy  over  the  whole  evaluation  period,  although  in  these  areas  support  was  provided  in  the
form of programme aid rather than budget support.

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to analyse and  support  the  actual  implementation  (including  financial  and  technical  capacities)  at
sectoral and local level.
Importantly,  the  JBSF  phase  saw  a  further divergence of  expectations  between the  government  and
development partners. Interviews and documentation reviewed record concerns from both sides. On the
one hand, the government questioned the inclusion of underlying principles within the JAF framework,
asked for clear indicators  against which performance could be clearly  assessed, and raised the issue
that the JAF did not adequately reflect GoU priorities and that it was not sufficiently aligned with annual
performance  commitments  in  Budget  Framework  Papers  (BFPs).  On  the  other  hand,  DPs expressed
concern over progress on governance and corruption (‘questionable commitment to upholding the rule
of  law  and  the  protection  of  constitutionally  defined  human  rights’,  lack  of  compliance  with  pre-
conditions on anti-corruption actions as foreseen in both JAF 1 and JAF 2), increasing expenditure on
defence (including  the  off-budget  purchase  of  fighter  jets  in  2010),  lack  of  “net  improvement  in
performance  in  the  education  and  water  and  sanitation  sector  indicators  since  JAF  1”,  and  diverging
GoU  budget  priorities  vis-à-vis  donors’  interests.  These  frictions  resulted  in  increasing  the  distance
within  the  existing  higher  level  dialogue  structures  and  show  how–despite  the  formal  convergence  of
objectives on paper–priorities pursued actually diverged.
Despite these frictions, development partners were slow to react, and to do so in a coordinated manner,
but design of budget support and its priorities remained largely unchanged. In general, the JBSF phase
is characterized by  a strong ambivalence on the DPs side  where the objectives  of supporting  poverty
reduction actions by funding the GoU budget and of sending signals by withholding aid lead to the use
of  (uncoordinated)  cuts  in  budget  support  rather  than  to  a  long-term  change  in  the  approach  to  the
provision  of  aid.  From  the  point  of  view  of  the  government,  this  introduced  additional  uncertainty  and
unpredictability in BS flows and further undermined mutual trust.
Regarding the causality chain, strengthening of the PFM and (in the second phase) the establishment
of an elaborate performance monitoring system were the areas where the articulation was clearest. In
the  PFM, this has  also  presaged significant  gains in  capacity building in some of the key governance
and accountability institutions.
Design  of BS - as  the  objectives  discussed  above - however,  have  overlooked  several  major  policy
areas  important  for  poverty  reduction  and  service  delivery: domestic revenue  mobilization,  population
control,  capacity  development especially  at  the  local  level,  local government  tax  base, and quality  of
service delivery, and gender inequities.

5.2 Achievement of budget support objectives
Overall,  achievement  of  budget  support  objectives  (efficacy)  was modest,  with  stronger
achievements in the earlier period of analysis.

5.2.1 BS flows, policy dialogue and technical assistance
While  ODA  to  Uganda  has  significantly  increased  (namely  non-government  grants)  in  the  period
considered, BS has shrunk from almost 70 percent of government development expenditure to about 4
percent,  with  significant  reductions  in  2005-06,  2009-10  and  2012-13.  This  evolution  is  linked  to  a
deterioration  of  the  trust  between  GoU  and  DPs  and  has  had  consequences  on  the  level  of  public
expenditure  and  on  the  government  discretionality  in  the  budget  allocation. Analysis  of  expenditure
evolution  in  priority  sector  compared  to  counterfactual  suggests  that  BS  has  certainly  contributed  to
maintain a minimum level of sector expenditure that would not have been achieved in the absence of
BS.  However,  with  domestic  revenue  mobilization  low  and  periodic  supplemental  budgets  distorting
original  budget  allocations,  resources  actually  flowing  to  the  three  sectors  have been  insufficient  to
ensure the provision of improved service delivery.
The dialogue framework before the JBSF was particularly focused at sectoral level and at the level of
the MoFPED. The JBSF promoted a stronger coordination of the DPs and elevated the dialogue at the
level  of  the  OPM.  This  improved  the  general  performance  monitoring  framework  and  procedures,  but
the link with the sectors was partly lost, also for a reduced interest of the sectors in GBS and the related
end of BS additionality both in theory and in practice. The dialogue overlooked the implementation and
focused more and more on general issues, principles and political disputes.
In  the  early  period,  TA  and  complementary  measures  focused  on  the  efficiency  of  public  spending.
Under the JAF, important complementary actions were carried out in the PFM, public sector reform and
performance monitoring areas. Other areas, such as support to local government were addressed but
were not adequately connected to and prioritised through the dialogue. The establishment of TASU in
2010  enhanced  the  assistance  to  the  BS  dialogue  process  and  contributed  with  some high  quality
studies  and  analyses  namely  in  the  fiscal  area,  but  was  not  able  to  improve  access  to  capacity
development resources in specific areas linked to the DPs and GoU dialogue.

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5.2.2 Macroeconomic and fiscal management
Overall, Uganda has maintained  broadly solid policy  performance over the period under evaluation. It
has also been building on the previous tradition of solid macroeconomic management. This has allowed
the country to draw on several IMF programmes, obtain huge debt reduction support through the HIPC
mechanism, and receive considerable donor BS. The government managed to control aggregate public
expenditures,  except  during  the  periods  of  elections.  This  suggests  substantial  political  cycle
component in the trajectory  of public expenditures. In the latter  part  of the  period under review, since
external resources (including budget support) and revenues remained insufficient, the government cut
current  and  development  expenditures  to  keep  the  deficits  within  manageable  levels.  However,  this
translated  into  significantly  reduced  funding  at  sectorial  and  programme levels,  which  undermined
service delivery.
BS  contributed  to  solid overall fiscal  management  during  the  early  years  under  review.  However,
Government’s revenue mobilization strategy and revenue mobilization outturns have been the Achilles
heel  of  the  overall  policy  framework  supported  by  BS.  Despite  strong  awareness  among  DPs  and
declarations of intent including within policy dialogue frameworks, this issue did not become one of the
top  priorities  and  DPs continued  to  provide  substantial  BS  during  the  first  part  of  the  period  under
review,  irrespective  of  the  repeated  slippages  in  government  revenue  performance. As  BS  declined
relative to total government expenditures it was funding, the government’s fiscal discipline weakened in
the context of low domestic revenue mobilization.

Public finance management

5.2.3
Uganda has been a strong performer in PFM matters over much of the last decade and the PFM reform
process has improved at various levels. Important achievements can be observed in terms of the quality
of budgeting and planning and the efficiency of public expenditures.
However,  despite  important  positive  evolutions  in  the  early  stages  of  the  evaluation  period,  Uganda
PFM  reform  process  falls  short  in  a  number  of  areas  and  some  key  PFM  indicators  have  even
deteriorated  in  the  last  few  years.  Areas  of  concern  include,  in  particular,  budget  credibility,  the
transparency  of  inter-governmental  fiscal  relations  and  the  quality  of  the  PFM  reform  process  at  the
decentralised level.
Budget  Support  has  contributed  in  many  ways  to  the  evolutions  observed  in  PFM  reform.  Budget
support  acted  as  a  catalyst  for  DPs  to  strengthen  government  systems,  while  at  the  same  time
providing the necessary leverage to pursue reform at the central level. Moreover, substantial technical
assistance,  capacity  building  activities,  and  analytical  services  provided  in  the  framework  of  BS  were
key  in  the  development  and  implementation  of  the reforms.  However,  BS  failed  to  enhance  domestic
revenue generation and to address the important needs in terms of capacity building at the local level.
As  of  writing,  at  end-2014,  the  government  has  pressed  ahead  further  with  important  legislative  PFM
reforms  and  the  second  phase  of  the  FINMAP  programme  covers  the  entire  financial  management
spectrum. A comprehensive PFM bill has been presented by the authorities to parliament to deal with
some of the structural weaknesses including lack of credibility, integrity, and predictability of the budget.
These reforms are significant. If legislated and implemented, they will result in a major improvement in
PFM systems and performance in Uganda.

Expenditure composition and pro-poor spending.

5.2.4
Pro-poor budget allocations, as identified in the PAF, grew rapidly in the first  years after the set-up of
the  PAF,  more  than  tripling  in  real  terms  from  1997/98  to  2002/03.  During  most  of  the  period  under
review, GoU continued to meet its formal commitment to increase pro-poor allocations and protect PAF
expenditure  during  budget  execution.  However,  targets  were  set  in  nominal  terms,  and  not  relative  to
total government expenditure. After the initial surge in allocations to the PAF until 2003/04, a slowdown
in pro-poor allocations gradually started and was then precipitated by an increase in the allocation for
productive  sectors  and  defence  expenditures  that  frequently  exceeded  the  approved  budget.
Furthermore,  a  commitment  to  reduce  the  deficit  without  sufficiently  raising  domestic  revenues  meant
that  there  were  relatively  less  funds  available  to  finance  key  priorities,  and  policy  trade-offs  between
pro-poor and productive sector expenditure became more acute.
The decline in BS funds in recent years combined with the failure of BS partners to help GoU increasing
revenue  and improving the efficiency of public  expenditure at sectoral  and  local level have  weakened
the  positive  effects  of  BS  on  pro-poor  expenditure  both  quantitatively  and  qualitatively.  That  said,
overall,  BS  contributions  to  allocative  and  operation  efficiency  of  public  expenditure  have  been
significant. If not weakened in the way described above, BS would have been irreplaceable as shown in
the  first  years  of  the  PAF.  Relying  solely  on  investment  projects  would  have not  helped  to  the  same
extent  putting  in  place  a  national  strategy  in  the  early  2000s,  with  strong  ownership  and  important
results  obtained  in  education,  health,  water  and  PFM  reforms.  In  the  last  years,  it  is  possible  that

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earmarked  sectoral  support  and  projects  would  have  contributed  better  to  pro-poor  expenditure,
although they would not have helped building a financial management and monitoring system suitable
to ensure the long term sustainability of such expenditure.

Service delivery

5.2.5
Policy  implementation  processes  and  public  service  delivery  in  both  education  and  health  at  both
central  and  local  level  have  not  shown  significant  progress  over  the  evaluation  period,  due  to  the
reduction in the relative shares of the budget destined to the social sectors, the deterioration in the ratio
of front line service delivery allocations for each JBS focal sector, as well as increasing cuts in sector
budget  releases  compared  to  allocations.  There  has  also  been  a  gradual  reduction  in  the  analytical,
technical and managerial capacities at institutional level. This has not been the case of the water and
sanitation sector where policy processes and quality of policies have been progressively improving as a
result of a vibrant consultative process.
BS has had no influence on sector policy formulation although it has influenced part of the contents of
the  policies  after  their  announcement  and/  or  supported  their  implementation  through  the  provision  of
funds  as  well  as  through  a  mix  of  policy  dialogue  and  accompanying  measures.  More  specifically,
budget support has:







Strongly contributed to maintain a minimum level of sector expenditure in the social sectors and
– although  real  per  capita  spending  has  decreased  in  the  education  and  health  sectors  and
slightly increased in the water sector – it is clear that without BS funds, service delivery would
have further declined as highlighted by numerous interviewees.

Supported  the  establishment  of  performance  assessment  frameworks  which  have  contributed
to an improved system for policy monitoring and evaluation of results.

Supported in the water sector which is characterized by a well developed sector wide approach,
institutional and technical capacities through the use of a mix of aid modalities.

5.2.6 Governance and accountability
Overall, budget  support  has  contributed  significantly  over  the  years  to  the  quality  of  governance
institutions  and  accountability.  Governance  indicators  have  improved  across  a  number  of  areas,
especially  in  the  earlier  years  of  the  evaluation  period  and  on  the  upstream  side  of  the  accountability
chain. Also, budget support and related policy dialogue, directly and indirectly, helped strengthen some
key  governance  and  accountability  institutions  such  as  the  Auditor  General’s  office  and  Inspector
General’s  office  as well  as  their  relative  importance  within  the  government  institutions.  However,
progress  is  especially  lacking  regarding  downstream  of  the  accountability  chain  e.g.,  following  up  on
upstream decisions, enforcement of prosecution, and recovery of funds.
The observed  gains  achieved  could  have  perhaps  also  been  achieved  by  greater  focus  on  capacity
building and TA targeting specific bottlenecks with possible quicker results (over and above of already
substantial support through these instruments provided by DPs included in the form of complementary
measures  to  BS)t.  Budget  support  however  played  a  key  role  in  ensuring  that  governance  issues
remain at the top of the national policy agenda, which would have been more difficult in an environment
of  mostly  projects and/or  TA  support.  Broader  institution  strengthening  requires  comprehensive
initiatives since capacity issues observed in the various relevant institutions are often interrelated and it
is  unlikely  that  project  support  alone  would  have  contributed  with  the  same  success  to  keeping  the
governance  and  accountability  issues  high  in  the  GoU  agenda  thus  making  BS  (with  the  appropriate
accompanying measures) the ideal instrument for the provision of support in this area.

Sector outcomes

5.2.7
Education
The significant increase in access to education at both primary and secondary level, including achieving
gender equality at primary level, has been as a clear result of GoU education policy. The main role of
BS  has  been  in  funding  sector  strategies  which  have  resulted  in  significant  improvements  in  access,
although  the  reduction  of  BS  in  the  second  half  of  the  evaluation  period  has  not  been  able  to
compensate  the  decline  of  the  sector  government  expenditure.  The  contribution  of  BS  dialogue  has
been  moderate.  Despite  active  policy  dialogue,  particularly  in  the  second  part  of  the  period  under
review,  government  actions  to  enhance  quality  in  education  and  learning  achievements  have  had
limited effects. BS has supported gender policies incorporated into UPE and UPPET, with gender parity
in terms of gross enrolment achieved at primary level, but with less attention paid to addressing large
dropout rates and the reasons why girls drop out. Finally,  BS has missed the opportunity  of providing
specific capacity development support to enhance the efficiency of the implementation of the education
strategies at local level, including both financial and human resource management, which was critical in
ensuring sustainability of local service delivery.

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Water and Sanitation
GoU’s strategy (based on the decentralised implementation of rural water supply and community-based
maintenance,  and  deconcentrated  implementation  of  piped  water  supplies  through  WSDFs)  has
resulted  in an increased access and functionality of rural and small towns’  water supply. It also led to
significant  improvements  in  terms  of  equity.  BS  has  contributed  to  these achievements through the
provision  of funds and  active policy  dialogue. Capacity  building was  also crucial to  enhance policy
design and implementation. However, the stagnation in key performance indicators suggests that sector
funding  is  insufficient  to  reach  sector  targets,  notwithstanding  improvements  in  efficiency  and
maintenance. Moreover,  gender  mainstreaming  in  the sector did not  result  in an increased  role  of
women in management of water points and the wider consideration of gender issues in the sector.
Health
BS,  mainly  through  policy  dialogue,  has  contributed  to  the  development  of  a  series  of  policies,
strategies,  and  plans  over  the  past  decade,  and  BS  funds  have  made  possible  the  implementation  of
some  ambitious  initiatives.  The  overall  aim  of  health  sector  policies  has  been  to  expand  services  to
enhance  geographic  and,  since  early  2000s,  financial  access  to  health  care. From  an  historic
perspective,  the  health  sector  has  seen  several  quantitative  and  a  few  qualitative  improvements:
expansion  of  provider  networks;  abolishment  of  patient  user-fees;  and  sustained  management  of  HIV
patients. However, most policy targets have been quantitative in nature and only more recently has the
GoU focused on quality issues. Some important underlying and inherent inefficiencies hampered policy
implementation. They appear to have remained while BS has overlooked the need for a more realistic
and efficient use of resources. Likewise, gender challenges remain along with technical and managerial
capacity weaknesses.
Gender
In  a  nutshell,  Uganda  has  a  substantial  legal  framework  for  greater  equality  of  women,  but  its
implementation  has  been  limited  and  there  are  major  gender  gaps  in  many  areas  of  society.  Gender
mainstreaming  in  the  government  has  remained  largely  at  the  level  of  rhetoric.  Moreover,  many  and
deep gender gaps prevent women from taking advantage of economic opportunities, such as the rights
to inheritance, treatment of married women, access to finance etc. In education, there were gains in the
enrolment rates over time, but gender gaps in literacy, dropout rates, and attainment are striking. This is
reinforced by cultural factors such as adolescent marriages and apparently no effective policy towards
birth  control  resulting  in  the  exceptionally  high  fertility  rate.  Maternal  mortality  has  declined  reflecting
some improvements in basic health services, but it remains high. Finally, regarding access to economic
opportunities in labor and finance markets, data suggest that women’s labor force participation is high,
but  this  reflects  the  prevalence  of  women  workers  in  the  informal,  rural,  subsistence  economy.
Opportunities for women are far fewer in other sectors of the economy requiring specialized skills and
higher education. Women are also clearly disadvantaged in the access to finance as reflected in access
and gender gap statistics.99

5.3 Risk to development outcomes
There  is  high  risk that even mixed  outcomes  in  education  and  relatively  poor  outcomes  in  health  and
better  outcomes  in  water  and  sanitation  will  not  be  sustained  because  of the  main  policy  risk of low
revenue  mobilization  translating  into  underfunding  for  these  key  sectors. This  is  compounded  by  very
limited capacity at the local level.
At sector levels, there are other, severe risks of many outcomes in education and health unravelling in
the  future  because  of  a  combination  of  factors  such  as  lack  of  policy  focus,  underfunding,  neglect  of
quality,  and  general  direction  of  policies  (e.g.,  extension  to  post-primary  education,  proliferation  of
districts,  lack  of  robust  local  tax  base)  running  counter  the  need  for  high  quality  service  delivery  in
education  and  health  and  water  and  sanitation.  These  risks  are  multifaceted  and  include  continued
policy  drift,  financial  (funding),  economic  (country  or  sector  level),  political,  social,  government
ownership and commitment, and governance.

5.4 Government performance
The  government  performance  in  the  areas  of  commitment,  ownership,  harmonization,  alignment  and
coordination  with  DPs  has  been  strong  in  the  first  period,  but  weakened  in  the  second,  reflecting
diverging  policy  priorities.  The  government  should  be  recognized  for  active engagement  and

99 Annex  9,  in  volume 3,  provides a  more  extensive  overview  of  some  key  constitutional,  legal,  institutional,  and
economic  factors  affecting  gender  equality  (equality  before  the  law)  and  gender  equity  (equitable  economic  and
social outcome) in Uganda. It does so by presenting an updated picture of these factors in Uganda based on the
latest data available and, in particular, by benchmarking Uganda against relevant comparators.

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participation in the dialogue and the preparation of the agreements, but compliance with agreements in
the achievement of objectives was relatively weak. Enabling environment (macro and institutional, and
legislative  policies) as  well  as  in  PFM  and  upstream  governance  institutions  were  relatively  stronger
components  of  the  overall  policy  and  institutional  environment  but  ground  was  lost  in  some  of  these
areas  in  recent  years.  Stakeholder  consultation  and  involvement was  generally strong  in  the  early
period  and weakened later  on.  Involvement  and  participation  of  the  civil  society,  however,  has  been
comparatively weak.  Readiness  for  implementation of  declared  policies  and timely  resolution  of
implementation issues and follow-ups were the weakest elements of policy making and implementation,
especially at the local levels. Fiduciary issues, even though partly addressed in the HLAM left the lack
of  trust  between  the  government  and  the  DPs. M&E framework  has  improved  over  time  but  with
remaining gaps in the quality  of data  and  indicators and their usefulness has declined in line  with the
quality  of  the  dialogue  and  BS  around  sector  groups.  Relationship  and  coordination  with  donors  and
stakeholders began as strong but remained weak and is now at a crossroads.

5.5 Donor performance
The donor performance mirrors the government performance and the evolution of the partnership over
time. In the earlier period of analysis, commitment, harmonization, alignment and coordination has been
strong. Many DPs provided important contributions to financing, dialogue, and results. But the scope of
engagement,  ambitions,  and  expectations  of  DPs  may  not  have  been  realistic  given  constraints.  The
DP  contribution  has weakened  in  the  latter  period,  reflecting  diverging  policy  priorities,  withdrawal  of
some  DPs  and  reduced  BS  volumes, and  weakening  policy  dialogue.  Given  the  extent  of  the  policy
dialogue and the importance of BS for the government budget, DPs have also missed opportunities to
adjust strategy  and  put major  issues  more  forcefully  on  the  policy  dialogue  agenda  and  earlier  in  the
process:  domestic  revenue  mobilization,  population  control,  local  government  capacity  building,  and
gender  inequity  in  particular.  Instead,  the  DP  strategy  appears  to  have  remained broadly  constant,
focused on social sector delivery, despite changing context––diverging Government-DP objectives and
unwinding of some of the gains in service delivery, directly related to the missed opportunities in policy
emphasis. The efforts in restoring trust and dialogue on both government and DP sides during the latest
HLAM period is commendable. This may presage a new period which will restore partnership based on
a  more  realistic  and  focused,  sector  oriented  BS  with  strong  emphasis  on  local  capacity  building  and
implementation.

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6 Key recommendations and detailed lessons

80

The way forward

In response to the overall assessment, the evaluation has formulated lessons from the past as well as a
set  of  comprehensive,  forward-looking  recommendations  to  help  the  stakeholders  review  the  present
GoU-DPs  partnership,  strengthen  the  dialogue  around  a shared  agenda,  and  work  together  towards
new forms of cooperation. Regarding the future directions, four areas are important in defining the way
forward:  focusing  on  the  areas  of  highest  impact  and  need,  implementing  sector-wide  approaches,
broadening the mix of support instruments, and strengthening mutual accountability and dialogue.
Focusing on areas of highest impact and need. Given the growth challenges and serious risks to the
key  social  and  economic  achievements  made  so  far,  the  future  partnership  between  GoU  and  DPs
should  consider  less  ambitious  support  programmes and  focus  on  areas  of  highest  impact  and  need,
with a view to:








increase government revenues,
reverse underfunding and serious deterioration of social service delivery,
strengthen downstream governance institutions, accountability and enforcement,
support longer term strategies for growth and poverty reduction including those focused on
infrastructure and agriculture,
integrate gender equality and equity, civil society participation, and local implementation
capacity into the top of the sectoral development agendas.

Implementing sector Wide Approaches (SWAps). The development of solid sector wide approaches
(SWAps)  seems  a  most  suitable  framework  to  enhance  sectoral  outcomes  and  ensure  effective,
implementation-driven dialogue between GoU and DPs, including their harmonisation and alignment.
Broadening the mix of external support instruments. Under solid SWAps, the use of a broader mix
of external support instruments will allow to ensure flexible responses to specific problems. In the social
sectors,  sector  budget  support  (SBS)  and  basket  funds,  for  example,  would  ensure  the  protection  of
sectoral investment, while avoiding excessive project fragmentation and weak GoU ownership. Various
accompanying  measures  including  in  the  form  of  individual  projects  should  be  considered  as  well  to
enhance implementation capacity. There should also be some scope for experimentation, for example,
with  new,  results  oriented  aid  modalities.  This  mix  of  aid  modalities  could  be  also  accompanied  by  a
limited  BS  to  support  MoFPED  and  reinforce  cross-sector  coordination.  This  should  also  be
accompanied by much stronger emphasis on local capacity building.
Strengthening  mutual  accountability,  policy,  and  political  dialogue.  A  focus  on  sectoral  and
unambiguous results will increase mutual accountability of GoU and DPs, facilitate policy dialogue, and
consolidate  the  already  important  achievements  of  the  High  Level  Action  Matrix  (HLAM).  Political
dialogue should take place in separate instances, limiting overlapping with BS dialogue while enhancing
complementarities  with  sectoral  policy  dialogue,  shared  understanding  on  principles,  and  reduction  of
political risks.

Lessons from the past and lessons for the future

The main lessons of the evaluation regarding both the experience and future prospects are summarised
in  the  table  below.  Fifteen  lessons  from  the  past  are  highlighted,  with  corresponding  lessons  and
recommendations  for  the  future.  They  are  clustered  around  cross-cutting  issues  and  those  affecting
sectors of the evaluation focus: education, health, and water and sanitation.

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No.

Lessons from the past

Lessons for the future

Cross cutting issues
 BS Effectiveness. BS has supported
macro-economic stability, PFM, and
upstream governance and accountability,
and development in key social sectors.
However, it has also shown significant
weaknesses: escalation of public
expenditure in administrative sectors
combined with low levels of government
revenue and inadequate funding for basic
services. BS targeted results––compared to
performance matrices and to past trends
and regional standards––have been below
the expectations.

 Partnership. Partner relations between

GoU and BS DPs have gradually
deteriorated in terms of divergence of
priorities, interests, and trust. The decision
to strengthen GBS at the beginning of the
evaluation period overlooked the risks
linked to such a divergence of interests.
GBS and its comprehensive dialogue
framework have become increasingly
ineffective. It gradually lost touch with policy
implementation in the key sectors and
pursued overambitious objectives spread
over too many policy areas. Only in the very
last phase of the evaluation period, the
HLAM managed to restore a framework of
mutual accountability, potentially creating
the basis for renewed trust and
cooperation.

 Polarization of GBS and project-led

strategies. The two strategies were often
viewed as mutually exclusive. GBS has
built a high-level consultation framework
and tried to embrace from the top a very
wide and ambitious range of issues. But as
GBS declined, on-budget investment
projects have multiplied resulting in
fragmentation, and SBS declined sharply.
Apart from the water sector, the polarization
and lack of coordination between BS and
projects has been a factor of inefficiency
and ineffectiveness.

 Capacity building. With the exceptions of
PFM, and upstream governance institutions
––policy areas and institutions showing
most improvement–– capacity
development, be it in the form of
accompanying measure to BS or specific
project support, has been generally
overlooked, especially at the local
government level, and in health and
education (a shortcoming which was not
addressed through the introduction of
TASU in 2010).

1

2

3

4

Cross cutting issues (DP, GoU, Civil Society)

 Ensuring a more selective focus on the key

challenges. Going forward, DPs and GoU should
consider less ambitious and more selective programmes
and focus on areas of highest impact and need, e.g.,
downstream accountability and enforcement, budget
credibility and transparency, very few priority sectors, to
reverse underfunding and serious deterioration of social
service delivery, backed by local government capacity
building and a forceful emphasis on increasing
government revenues.

 Reinforcing the practical foundations of the

partnership between GoU and DPs. This will help
rebuild trust around more focused but genuinely shared
agenda. A more pragmatic approach will help address
the complex challenges and risks linked to the potential
transition of Uganda toward a middle-income oil
exporting economy. Moving policy dialogue nearer to the
practical/technical problems and the local
implementation level would help find a new convergence
of interests on a more realistic set of objectives. Solid
sector-wide approaches (SWAps) in the key areas
should help re-launch the effectiveness of the
partnership.

 Broadening of the mix of modalities, while ensuring

sector coherence, coordination and
complementarities. A flexible and coordinated mix of
financing modalities and instruments should be adopted
to address specific sector objectives at central and local
level and adapt to the specific constraints. This may
include SBS and/or basket funds, which are able to
protect sector investment while avoiding excessive
project fragmentation and weakening of government
ownership. Various accompanying measures even in the
form of individual projects should be considered to
enhance implementation capacity. There should be
scope for some experimentation, for example, with
results oriented instruments. Such mix could be
accompanied by limited GBS to support MoFPED and
reinforce cross-sector coordination.
Innovative forms of partnership (e.g. PPP) should be
identified and supported in infrastructure, science and
technology, and other growth-related areas. In the short-
medium term, the priority should be on reversing the
negative trends in the social sectors and on
strengthening resource mobilisation and coordination at
MoFPED level.



Increasing capacity building, with an emphasis on
the local level. The delivery of funds, under different
modalities, should be complemented with coordinated
and significant institutional building and capacity
development measures at all levels. Local capacity
building should be considered a high priority and a key
component of the sectoral programmes in order to
enhance their effectiveness.

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No.

Lessons from the past

Lessons for the future

 Dialogue. Many DPs contributed to a wide
range of policy areas. But focus—needed
for implementation and results––was lost.
In the JBSF period, previously close links
with sectoral priorities and implementation
weakened. In addition, there has been an
increasing overlap of political, human rights,
and economic elements in the overall policy
dialogue – without the necessary clarity,
distinctions, and complementarities – which
has affected its strength and mutual trust.

 DPs coordination. This has shown various
weaknesses, even in the JBSF period and it
has been affected by the lack of focus on
sectoral implementation. Despite a joint
PAF, each DP has pushed somewhat
different priorities within the overall donor
frameworks. DPs were also taking
independent and, at times, uncoordinated
disbursement decisions, undermining BS
predictability and credibility of the joint
framework, and complicating the
government’s budget management.
 Civil society. The level of civil society

participation in policy implementation and
as a watchdog has been generally low in
the areas focused by BS, particularly in
PFM and education. This lack of effective
participation of the civil society has
contributed to the mixed performance in the
sectors. BS dialogue has not included any
specific focus and target in this area.

 Gender. Gender equality and equity

principles have been often declared in BS
performance assessment frameworks and
in government sectoral policies. But they
have almost never been effectively
implemented through specific policies and
measures, while BS dialogue has been
unable to support their prioritisation. Below
the surface of some basic indicators of
gender parity, major gender inequities
remain.

 Data availability / reliability. The
availability and reliability of data
represented a major challenge in the
evaluation. After more than a decade of BS
data collection and processing on service
delivery and results in the targeted social
sectors, there remain serious gaps in the
quality and reliability of data on priority
sectors.

5

6

7

8

9

 Restoring sector dialogue and SWAps. Dialogue

between GoU and DPs should remain firmly anchored in
the realities of the sectoral and local performance.
SWAps seem the most suitable framework to develop
an open and constructive dialogue to improve policy
formulation and implementation, identify capacity gaps,
and ensure the complementarity of the different aid
modalities and programmes. Political dialogue should be
separated from the sectoral policy dialogue. Political
dialogue could aim at improving political understanding,
limiting political risks, and possibly enhancing technical
and financial cooperation.

 Shifting DPs coordination mainly towards sectors

but with important role for MoFPED. DP coordination
should be mainly based on sector wide approaches and
strengthening of the cross-sector coordination of the
MoFPED, with a close link to the actual programme
implementation. More general and principle issues
should be addressed through political dialogue in the
specific instances where this takes place.

 Enhancing civil society participation to complement
government action, especially in education and other
social sectors, and to control public expenditure
transparency and effectiveness should be put at the
centre of the sector policy dialogue to enhance policy
outcomes.

 Gender equality before the law and institutions and
gender equity in terms of economic and social
opportunities and outcomes should be included
much more forcefully in all sectoral programmes to
ensure their implementation through specific measures
and monitoring indicators, including funds (for the
establishment of gender focused services) and capacity
development support at national and local levels. Given
the critical role of women in household welfare, child
health, and the rural economy, greater gender equity
would directly support poverty reduction and sector
outcomes.

 Data collection and processing in the targeted

sectors should be considered a key priority of the policy
dialogue and should be addressed during the
formulation of future BS and other policy support
programmes. Possible joint programmes financed by
different DPs should be included in the relevant
financing agreements or added as complementary,
accompanying measures either at sectoral or general
level. Equally important, better sector data should be
made widely available, to the government, the civil
society, and the DPs for monitoring and policymaking
purposes.

Joint Evaluation of Budget Support to Uganda
Final report - Volume 1 - 2015 - IEG and Particip GmbH

No.

Lessons from the past

Lessons for the future

83

Sectoral and thematic issues
 The shift of JBSF dialogue at the OPM level

has overlooked the importance of
MoFPED, which remains a key technical
agency and an actor for policy
development, coordination and
implementation. This is in particular in view
of the critical need to increase domestic
revenue and expand local revenue base,
and improve expenditure efficiency and
effectiveness at national, sector and local
level.

 Fiscal Management. Persistent, low

revenue mobilization has undermined
sustainability of social sector outcomes.
Frequent, poorly justified supplemental
budgets undermined budgetary credibility
and worsened the composition of public
expenditures.

 Sector wide approaches in Education
and Health have deteriorated. The
institutional and technical capacities have
progressively eroded over the past years,
particularly at decentralised levels. A
sector wide approach in water and
sanitation has been preserved, thanks to a
stronger sectoral leadership supported by
some SBS programmes and a coordinated
mix of other aid modalities. It could be a
model to resuscitate dialogue in other
sectors, although some specific features of
the water sector (namely the predominance
of capital intensive interventions) may have
played a facilitating role.

10

11

12

Sectoral and thematic issues (GoU and DPs)
 GoU. Enhance the role of MoFPED to strengthen the
credibility and sustainability of the budget and improve
expenditure efficiency.

 DPs. Priority actions should include:

 BS of limited size to be agreed upon with MoFPED,

with a focus on revenue mobilisation and PFM
(namely Local finance), and efficiency for poverty
reduction and sustainable growth.

 Capacity development (complementary to BS) on

revenue and local finance.

 GoU. Make annual increases in domestic revenues in
terms of revenue-to-GDP ratio a top fiscal priority and
ensure accountability of relevant agencies. In addition to
the new budgetary contingencies, consider stricter legal
limits and criteria on the passage, size and structure of
supplemental budgets.

 DPs. Future BS should be conditional on the achieved
improvements in domestic revenue mobilization.

 GoU. Strengthen SWAps in the social sectors to help

recover a path of quality improvement.

 Education

 GoU. Strengthen sectoral policy implementation

(SWAp) to reactivate sectoral dialogue and strengthen
capacity.

 DPs. SBS and/or Basket funds100, combined with

capacity development support. Such modalities would
allow to: i) re-launch in-depth sector policy dialogue by
providing stronger incentives for sector participation
and involvement, and ii) strengthen linkages between
measures foreseen and complementary capacity
building. They would also allow the possibility of
protecting given levels / categories of sector / sub-
sector expenditures through the inclusion of specific
conditionalities.

 Health

 GoU. Strengthen sectoral policy coordination and
implementation (SWAp) to overcome the sectoral
fragmentation, reactivate sectoral dialogue and
strengthen capacity.

 DPs. SBS and/or Basket funds, combined with

capacity development support (see remarks made
under the education sector.)

 Water and sanitation (and environment)
 GoU. Continue the SWAp in the sector.
 DPs. Mix of aid modalities as currently envisaged by

the latest sector program.



In the area of Law & Justice the strong
progress registered in the upstream side of
the accountability chain (e.g. anti-corruption
legal framework and governing legislation
and OAG and IGG) has not been met by
equal progress on the downstream side
(e.g. enforcement of prosecution and
recovery of funds).

 GoU. Strengthen training, capacity and incentives
for law enforcement against petty and economic
crime and corruption. Require high government
officials to lead by example by publicly and transparently
and routinely disclosing assets and incomes and paying
taxes on farm and non-salary incomes. Use the
experience of countries that successfully made
concerted improvements in the fight against corruption.

13

 DPs. Sector programmes with a strong capacity
development component, monitoring and results
indicators.

100 Pooled funds or Basket funds refer to a form of aid where donor resources are pooled but kept separate from
other (government) resources intended for the same purpose. The water and health sectors provide two different
examples  of  the  use  of  pooled  funding  in  Uganda.  Here, it  is  recommended  that  the modality  with  which  pooled
funds are used in the water sector be extended to the health and education sectors.

Joint Evaluation of Budget Support to Uganda
Final report - Volume 1 - 2015 - IEG and Particip GmbH

84

No.

Lessons from the past

Lessons for the future

 BS DPs have had a relatively ambiguous
attitude toward the country challenges in
energy and infrastructure that are
affecting growth and social development as
well. Despite the comprehensive nature of
GBS and the specific sectoral involvement
of the World Bank and the EU, such sectors
have been only marginally addressed in the
JBSF.

 Policy implementation at the local levels
shows heavy capacity gaps and low levels
of expenditure efficiency. The multiplication
of the districts and the low level of financing
create unsustainable pressures on the local
capacities. BS has not addressed directly
these issues, although the World Bank has
implemented a specific programme at the
beginning of the period.

 Policy dialogue and support to agricultural
productivity and rural development has
been a major missed opportunity in support
of growth, poverty reduction and reducing
gender inequities.

14

15

16

 DPs. Recognize that there is a role for public

infrastructure in development and consider supporting
it through highly selective, coordinated sector
programmes investment strategies in energy and
infrastructure, to sustain rapid growth and limit negative
feedbacks on poverty and equity.

 GoU. Put local implementation capacities on

national policy priority agenda, through increasing
local financial resources, improving local PFM and
strengthening local capacities and systems.
DPs. Consider improvements of local implementation as
a key priority. Support local component of PFM at
MoFPED level. Support programmes focused on local
institutional strengthening and capacity development.
Build on the experience of previous support.

 GoU. Put agricultural productivity at the top of the
policy agenda and engage DPs in a reinvigorated
sector dialogue with stepped up funding and capacity
building.

 DPs. Consider reviving agricultural policy dialogue using
alternative support modalities and lessons from the
sector dialogue in water and sanitation.

Joint Evaluation of Budget Support to Uganda
Final report - Volume 1 - 2015 - IEG and Particip GmbH

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