Senior Management

In implementing the MTEF ministries/departments are required to focus on the expected outcomes of their expenditures and programmes. The annual budget and the (3-year) rolling MTEF provides a way to evaluate the realization of the outputs and outcomes and their contribution to the overall economic growth of the economy. The first step is the establishment of national priorities which become the basis for the claim of resources, and a consistent macro-forecast of key parameters such as desired growth targets, inflation rate, exchange rate, interest rate and other macro economic parameters.

The Macroeconomic Working Group analyses the macro economic situation, forecast a realistic level of available resources and determine the overall expenditures as well as other macro and sectoral parameters; This is reflected in a Fiscal Strategy Paper that is discussed with Ministries and is taken to cabinet for approval.

The Ministries participate through the Sector working Groups where through the Ministerial Public Expenditure Reviews they are able to review their past performance, cost and prioritize their programmes. The Ministerial reports are consolidated into a sector report that is subjected to public consultation through a process known as sector hearings. Thereafter the sector reports are finalized and a criteria is developed for sharing out the resources among various Ministries

The ministries engage in a negotiation process through a process known as sector bidding where the Ministries are allocated funds according to priorities as well as available resources. Thereafter the Ministries then consolidated their resources to form the Ministerial ceiling which they use to prepare their itemized budget. The Ministries submit their itemized budget which Treasury reviews and finalizes for submission to parliament.

One major departure of MTEF from the previous process is the issue of political buy in. At almost every other stage the budget is submitted to the cabinet for briefing and for approval. There has also been substantial engagement with the parliament at the departmental committees. The annex III attached gives a pictorial presentation of the MTEF process and the annual budget.