Establishing efficient, stable governance in an emerging, post-conflict nation presents many challenges. A lack of basic education is one of the main barriers. An AusAID programme, the Ministry of Planning and Finance Capacity Building Program (MPFCBP), has worked to help address this issue for the Government of Timor-Leste. Despite civil unrest and changes of government, significant progress has been made since the program began in mid-2003.
The objective of the programme was to enable the Government of Timor-Leste to sustainably generate and manage public funds and thus contribute to improved service delivery and poverty reduction. An important element of the first phase was to build local capacity through education, coaching and mentoring.
SKM took on the role of managing contractor with a team of advisers, in association, at that time, with the Department of Treasury and Finance, Victoria, and the Victoria University of Technology. Advisers were partnered with civil servants at various levels, from the National Director of Budget to operational staff. The team also played a strong advisory role with the Minister of Finance and the Council of Ministers during times when budget and other reforms were being expedited.
Prior to the work of the MPFCBP, Timorese civil servants had little capacity for the kind of critical thinking necessary for analysis, budget construction and provision of ministerial advice. In fact a major problem for the Timorese in the Ministry of Finance was numeracy levels. Unfortunately for these civil servants the average level was equivalent to mid primary school. The government also had difficulty organising delivery of goods and services once funds were budgeted.
To address these issues an incremental approach was taken by MPFCBP consultants. They took on operational support roles for the budget and revenue offices within the Ministry of Planning and Finance while their Timorese counterparts were up-skilled through training and, in some cases, scholarships for further study.
The process of support and guidance led the Timorese to progressively assume a level of independence and responsibility for planning, delivery and quality assurance. From a budgetary perspective tremendous results have been achieved.
When the program began the Timor-Leste government achieved no more than a 25 per cent budget expenditure. Assets were not constructed, bought or implemented and services were not delivered. In effect the money just sat in its account.
Reports from a small village three hours drive from Dili were indicative of the lack of government service. The villagers only had vague recollections of having seen anyone from government, such as an agriculture extension officer, health worker or teacher. This was a poverty stricken community of 27 families with a cash income of less than $10 a week for the whole village. They lived on subsistence farming.
The stark contrast of the 2008 budget, where an 80 per cent spend rate is anticipated should assist communities like this to progress because of the prospect of improvements in government services.
East Timor’s largest sources of revenue are offshore gas and oil reserves. The need to tighten up the government’s petroleum taxation administration was critical and impressively it now makes up about 93 per cent of the total revenue.
The government also needed to make significant taxation legislation reforms and change the administration processes so it operated more effectively. Since 2003 the amount of domestic taxes collected has increased annually.
Alongside all that has been achieved throughout this program, one of the most important changes has been from the numeracy programme. A coordinator and two teachers were engaged to provide training. A surprising outcome is that education in this area not only improved number handling, general work performance has increased enormously too. The training seemed to unlock people’s ability to think more critically about a whole range of issues. Efforts to ensure the continuance of numeracy training have been successful as there will be a follow-on World Bank multi-donor funded programme on planning and financial management for the ministry.
In 2006 the large scale civil disturbance disrupted government activities and delayed the program agenda. Most of the international community were evacuated. However, while some of the achievements leading up to that time were set back, teams worked hard to re-impose the disciplines that were originally built during the program’s early stages.
December 2008 saw the program come to a close. Although great progress has been made, there are still challenges ahead. On a positive note, the change of government in 2007 brought more ministerial pressure for improvements in government performance. The civil servants are now much more capable of performing their roles independently; however they still need guidance.
Although the Timorese Prime Minister and Minister of Finance have expressed their appreciation for this support, not surprisingly, any further assistance will need to be balanced with the government’s clear desire for East Timor to maintain ownership and run things independently.
One thing is clear; socially sustainable programmes such as the MPFCBP play a great role in fostering growth and stabilising emerging nations such as East Timor.
© Sinclair Knight Merz
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Author: Steve Gurr
Steve Gurr worked in senior management positions in Departments of Management and Budget/Treasury in Tasmania, Queensland and Victoria before joining SKM’s International Development team in 2003. He acted as Team Coordinator and Management Adviser for the East Timor MPFCBP.
© Sinclair Knight Merz
Requests to re-publish achieve articles should be made here