Senior Management

The annual budget process previously followed was coordinated by the Ministry of Finance which issued budget ceilings for recurrent budget every year. The Ministries then prepared their itemized budget and submitted it to Treasury for review and approval. This process had several shortcomings which included:
(i) None adherence to the ceilings given,
(ii) None prioritization of programmes and activities,
(iii) A lack of future considerations of the recurrent costs generated by capital outlays.
(iii) This budget process laid more emphasis on item level allocation and failed to link the budget to the development plan. At Ministry of Planning was charged with the responsibility of planning whereas the Ministry of Finance coordinated the budget. The development plan did focus on the expected outcomes and failed to capture the overall objectives of the plan. Entry of the programme review and Forward budget was an attempt to link development plans with the budget.

The first major reform was the Programme Review and Forward budget which was adopted in the 1970s. The rationale behind this reform was to provide a mechanism that would link the annual budgets to the development plans.

The main objectives of the programme review and forward budget was:
(i) To provide Ministries and other spending agencies with three year ceilings on expenditures
(ii) To establish the cost of programmes particularly the future costs of presents created facilities
(iii) To establish a process of reviewing priorities and linkage to available resources
(iv) To provide for identification of future requirements generated by present policies
(v) To provide a criterion for reviewing the performance of ongoing as well as future programmes ( The forward budget was assumed to be the only mechanism for introduction of new programmes)
(vi) Finally to provide a linkage between planning and budgeting.

The Programme Review and Forward Budget continued till the time when Medium Term Expenditure framework was introduced. However several other process were adopted with an aim of improving the process and this included the introduction of the Budget Rationalization Programme as well as the introduction of the Public Investment Programme.