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My PDIA journey: Deviations between planned and actual capital expenditure in the Central African Republic

18 February 2019
Thierry Lobaka

Thierry Lobaka is a Macro-fiscal expert at Directorate-General for Budget in the Central African Republic. He is part of the Central African Republic team that participated to the Building PFM Capabilities in Africa programme in 2018.

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Since the re-establishment of constitutional rule in 2016, the Central African Republic (CAR) has committed itself to the reconstruction of its economy, including several economic and financial reform initiatives. In fact, like many other African countries, the CAR suffers from pressing public finance management problems that it needs to solve to find suitable and lasting solutions to better combat poverty and ensure the well-being of its population.

An analysis of the national budget execution over the past five years revealed a major structural weakness regarding capital expenditure from State resources. For a country that experienced several military and political crises, with most of its basic infrastructure (roads, hospitals, schools, etc.) being completely destroyed as a consequence, this situation is unacceptable. Hence, driven by our new authorities, the CAR is committing itself to recovery and reconstruction. However, there remains a very significant under-spending of the meagre State resources allocated to capital expenditure by the Ministries, Departments and Agencies (MDAs). For example, only 2% and 6% of the resources respectively allocated to investments in health and rural development were spent in 2017.

When our team, the “Fauves de Bas-Oubangui” (“The Beasts of Lower-Oubangui”), decided to work on resolving the problem of the under-spending of capital expenditure, it would have never imagined how complex it would turn out to be. CABRI’s Building PFM Capabilities (BPFMC) programme, through on-line courses, individual and team assignments as well as coaching, has provided us with tools to deconstruct the problem and find solutions. Numerous line ministries and agents in the investment expenditure chain were consulted to identify the root causes of this problem, resulting in relevant data collection. The latter revealed multiple roots of the problem and greatly enriched our initial assessment of its causes. For example, we learned that the Directorate General for Public Procurement (Direction Générale des Marchés Publics: DGMP) and the MDAs did not communicate as much as necessary, that the appropriations administrators did not have either the qualifications nor the experience necessary to ensure the proper implementation of their capital budgets; and also, that the lack of feasibility studies was the primary reason for the rejection of procurement files.

This new information has made it possible for us to identify promising entry points on which we have focused our efforts, ensuring that we had the required authority, ability and acceptance: (1) the procedures for public procurement are not mastered, (2) there is a lack of communication in the relationship between the Ministry of Finance and the MDAs, (3) the MDAs are not accountable for implementing their capital budgets, and, (4) the MDAs do not carry out feasibility studies. The extent of the problem and the motivation of our team have allowed our work to be fully accepted by the MDAs.

In this enormous task, the “Fauves de Bas-Oubangui” team remained unified and a good team spirit always prevailed, quickly ending any occasional tensions during our numerous working sessions. Each member always kept in mind that we are working towards a tangible objective. We have an obligation to achieve results and the Minister of Finance and Budget, our authorizer, takes a close interest in our work through the Inspectorate General of Finance which he has tasked with regularly monitoring and reporting on our activities. In addition, CABRI’s coaching always provided us with the right kind of support to push us to do better.

Progress made between May and December 2018 encouraged us to carry on and allowed us to understand that with local capabilities one can find lasting solutions to many local problems. In this way, the PDIA approach is very distinct from other approaches and encourages us to take real action and make the most of our own capabilities. It may be unproductive to import off-the-shelf solutions and impose them without taking into account our country’s context.

The initial results of our work are encouraging, and for the first time, all 33 MDAs submitted their procurement plans as they continue to identify solutions to better execute their capital budgets. Nevertheless, much remains to be done. For 2019, we are targeting an execution rate of capital expenditure from the budget of at least 50%. Our team has been expanded with other DGMP experts and we believe that we will achieve our goal thanks to continuous work with the MDAs and the authorisation of our supervising Minister.

I remain convinced that we will be able to meet this challenge. The PDIA approach has allowed me to make the best use of my expertise and capabilities to the benefit of my country. From now on, I will feel great pride every time that I see any infrastructure that has been rebuilt or renovated from the State budget. I pray that this approach may become the norm for the management of public finances in our countries.

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