The budget process whether national budgets or otherwise, needs much reforming. Therefore, it will be good if the UNICEF training course also looks at better budgeting. Part of the problem is that the budget process is complex, so political and takes so long that by the time the budget is complete a large segment of it is already out-of-date. So goes the saying that the budget is out-of-date before the ink dries on the print.
Budget managers among other things should have authority to transfer funds within appropriations to meet changing program and operational needs. In addition, managers need freedom to make personnel changes throughout the year to meet program and operational needs as long as these do not exceed staffing numbers and levels. These simple acts of freedom would quicken the pace of social development. How much of social development delays because an approval requests waits? As an analogy, what could happen if business waits on budget decisions to bring goods and services to market?
I learned good concepts from the Beyond Budgeting Roundtable, which related to the private sector. The world is constantly changing; thus, it is too hard to detail the distant future. Perhaps, one can know about 80% of what may happen going forward one year, and 50% of the next year and perhaps 20% or less of future years. These estimates are just a random pick to convey the realism of the budget process. Detailed estimates for shorter durations and higher level (less detailed estimates) estimates for future years will make the budget process shorter and more meaningful. Most important is to have a rolling budget period (3 – 5 year for social development) so that each year the budget could adjust one year out for the year just past. In that way the budget, intentions are always under review. Even quarterly budget overviews may prove beneficial. The budget process ought to be more interactive, an ongoing journey without rest stops. Most important the budget process should aim for goals but change those goals as new information arrives.
UNICEF can also use the 200 or so participants in the course to brainstorm on integration of country office budgets. Realistically speaking, a UNICEF office and UNICEF program(s) is part of a national budget of the country. If that country were well off, they would not need a UNICEF and would thus provide the same services that UNICEF provides through their national budgets. The UNICEF office and programs are the shortfall of services that the government cannot provide (for lack of resources). Management of a country office, staff relations, office automation, technology and personnel planning are critical for the country program, thus integration is invaluable. I wish UNICEF invited the current Budget Chief and some Budget and Operations Officers to attend this course.
My view of budgeting for development programs is that these cannot be budgeted. UNICEF does a great job in country programming - a needs analysis, et al, and pricing those needs as best as they can. The needs priced make up the allocations for programs/projects A to Z. Therefore, I would say they are program financial grants to governments rather than a UNICEF program budget. Of course, the government of the country can have a social development budget just like any other operational budget. Because when you speak of a budget, you also have to talk about comparison with actual expenditure and computing variances. This would be impossible to do in a UNICEF/UNDP type (other UN agencies included) program development when ownership of goods passes to the government at the shippers tackle; ditto for other services.
In Bangladesh, I once undertook several field visits to see first hand how government utilized UNICEF supplies. That visit brought the realization that UNICEF aid to Bangladesh was just a small component of total aid to that country, almost unrecognizable and indistinguishable among the mass of goodies from a mass of donors. I saw first hand the horror of overstocking and wastage, because if organizations (international or bilateral) did not spend their money then the budget for the next year would reduce comparatively. Developed country bilateral donors are equally guilty of this budget dilemma, spend it or lose it.
The bigger question though is how much of the program money reaches the target group and what is the lowest cost of delivering program services. A senior UNICEF director and economist once asked me whether there was anyway that we could figure out how much of every dollar spent goes to the women and children of the developing world. No one could come up with an answer, unless there is one now. I doubt though it is worth sweating over this answer because program advocacy, a powerful motivator of change that affect millions of people is hard to cost. However, some smart economist may be able to offer a theoretical costing at least. One could visualize, some dollars go for staff salaries, some for travel and occupancy costs, some for having meetings and seminars with government officers and the rest for equipment and cash to the beneficiary. The question is whether the rich and middle class are getting richer from aid money when too much of it flows through government bureaucracies?
One thing at issue with the UN agencies (social sector at large) is that they always talk and write about what they plan to do in the future and make big waves about it. However, nothing much says about how well the past plans are going and what went wrong and how problems rectify. It is also baffling sometimes that with so much of history behind these programs/projects, is there a need to spend so much time in planning when there is already a platform from which to start? That is why I profess rolling forecasts of plans so that plans change course when circumstances change. Sometimes, you intend to follow a certain path, but then you hit a fork along the way and then detour, at least this is the analogy. The revised budgeting framework, did not even make it to the doorstep of the Executive Board when UNICEF was engulfed with having to cave in to harmonization pressures.
When Fred Smith, the founder of Federal Express, wrote on his college term paper (in economics) at Yale University about his idea of an overnight-delivery service for mailing letters and packages, the professor thought that he was crazy. The economics professor thought he was so crazy and graded him a ‘C’ (failure). However, when he graduated from college, he made his idea work, and today Federal Express is an international company, which has grown into a $32-billion network of companies. Some times, it takes a long time for some folks to have their day in the sun, even when they are right.
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