1 / 14

Restructuring Intergovernmental Transfers and Educational Finance in Bulgaria James S. McCullough

Restructuring Intergovernmental Transfers and Educational Finance in Bulgaria James S. McCullough. CONTEXT: GDP/CAPITA. SITUATION IN 1998. MUNICIPAL BUDGETS DECREASED BY HALF HIGHLY DEPENDENT ON SHARED TAXES AND SUBSIDIES LARGE HORIZONTAL INEQUITIES IN MUNICIPAL REVENUES

ashton
Télécharger la présentation

Restructuring Intergovernmental Transfers and Educational Finance in Bulgaria James S. McCullough

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Restructuring Intergovernmental Transfers and Educational Finance in Bulgaria James S. McCullough

  2. CONTEXT: GDP/CAPITA

  3. SITUATION IN 1998 • MUNICIPAL BUDGETS DECREASED BY HALF • HIGHLY DEPENDENT ON SHARED TAXES AND SUBSIDIES • LARGE HORIZONTAL INEQUITIES IN MUNICIPAL REVENUES • COMPLEX AND UNSTABLE SUBSIDY FORMULA • SOCIAL SECTOR EXPENDITURES DOMINATE MUNICIPAL BUDGETS • NO LOCAL CONTROL OVER MUNICIPAL OWN SOURCE REVENUES • NO REAL POLICY ANALYSIS & DEBATE OVER MUNICIPAL FINANCE SYSTEM

  4. MUNICIPAL TRANSFERS PER CAPITA 1998

  5. COMPOSITION OF MUNICIPAL REVENUES 1997

  6. THE PRECIPITATING CRISIS 1999-2000 • RAMPANT MUNICIPAL BUDGET DEFICITS • AD HOC BAILOUTS OF MUNICIPAL DEFICITS • COST FACTORS BEYOND MUNICIPAL CONTROL • PIECEMEAL REFORMS TO SUBSIDY SYSTEM • INEFFECTIVE EXPENDITURE CONTROLS BY MOF • ACCELERATED DECLINE IN MUNICIPAL CAPITAL INVESTMENT • BREAKDOWN IN CENTRAL-LOCAL MEDIATION ATTEMPTS

  7. SETTING THE STAGE FOR REFORM 1999-2001 • LOCAL GOVERNMENT INITIATIVE POLICY WORK • ANALYTICAL STUDIES & POLICY DEBATE • EMERGING CONSENSUS ON NATURE OF PROBLEM • POLITICAL CAMPAIGN & ELECTION OF 2001 • KNOWLEDGEABLE ACTORS GAINING INFLUENCE • POLICY AGENDA IDENTIFIED

  8. MUNICIPAL FINANCE REFORM 2001 • NEW GOVERNMENT • HIGHLY PLACED CHAMPION IN NEW ADMINISTRATION • FORUM OF KEY STAKEHOLDERS SETS UP WORKING GROUP • FORMAL WORKING GROUP EMPOWERED BY COUNCIL OF MINISTERS • GUIDING DOCUMENTS: • “CONCEPT”: COMPREHENSIVE REFORM STRATEGY • “PROGRAM”: MULTIYEAR DETAILED PLAN

  9. MATCHING FINANCING TO SERVICE ASSIGNMENT • CLEAR DEFINITION OF MANDATED SERVICES • REDUCTION OF HEALTH SERVICE ASSIGNMENT • ELIMINATION OF SOCIAL WELFARE ASSIGNMENT • ADOPTION OF COSTING STANDARDS FOR FUNDING ALL OPERATING COSTS OF MANDATED SERVICES • FULLY FUNDING ALL MANDATED SERVICES WITH TRANSFERS • BLOCK SUBSIDY + SHARED TAXES = MANDATED SERVICE FUNDING • PERSONAL INCOME TAX BECOMES 100% DEDICATED AS MUNICIPAL SHARED TAX

  10. LOCAL OPTION SERVICES FUNDED BY OWN SOURCE REVENUES • LOCAL FEES AND CHARGES UNDER LOCAL CONTROL • LOCAL TAX AUTONOMY REQUIRES CONSTITUTIONAL AMENDMENT • FOR POOR MUNICIPALITIES, SPECIAL SUBSIDY POOL CREATED TO PROVIDE BASE LEVEL OF OWN SOURCE REVENUES • MUNICIPALITIES CAN USE OWN REVENUES TO “TOP UP” MANDATED SERVICE FUNDING • VERY BOUYANT LOCAL REVENUE GROWTH DUE TO AGGRESSIVE LOCAL RATE INCREASES

  11. EDUCATION FUNDING • PRIMARY & SECONDARY SCHOOLS FUNDED THROUGH MUNICIPAL BUDGETS • USE AGGREGATE LEVEL OF EDUCATION FUNDING IN 2001 AS BENCHMARK • MUNICIPALITIES STILL DO NOT CONTROL TEACHER COSTS • HORIZONTAL INEQUALITY GREATLY REDUCED • COSTING STANDARDS HASTILY DESIGNED AND NEW STANDARDS FORMULATED BUT NOT APPROVED • COSTING STANDARDS COVER OPERATING COSTS ONLY

  12. EDUCATION COSTING STANDARDS PER STUDENT ALLOCATION = 1. TEACHER SALARY COSTS (normed on actual average class size) 2. “MAINTENANCE” (NON-SALARY) COSTS (biased adjustment for actual class size) NOTE: DIFFERENT TYPES OF SCHOOLS HAVE DIFFERING SETS OF STANDARDS

  13. DELEGATED BUDGETS EXPERIMENT • EXPERIMENTAL REFORM UNDER WORLD BANK LOAN • FORMULA-BASED ALLOCATION FROM MUNICIPALITY TO SCHOOLS • GIVES LOCAL SCHOOL ADMINISTRATORS PARTIAL CONTROL OVER BUDGETS • UNSPENT FUNDS CAN BE CARRIED OVER • SCHOOLS CAN ENGAGE IN REVENUE RAISING ACTIVITIES • SUCCESSFUL RESULTS SO FAR BUT LIMITED SPREAD EFFECT

  14. LESSONS LEARNED • LENGTHY PERIOD OF FAMILIARIZATION, ANALYSIS, DEBATE AND EXPERIMENTATION REQUIRED TO GET FUNCTIONING FISCAL DECENTRALIZATION SYSTEM IN PLACE • CONTINUOUS MONITORING AND ADJUSTMENT REQUIRED TO MAKE FISCAL DECENTRALIZATION WORK • MINISTRY OF EDUCATION HAD LIMITED INVOLVEMENT IN OVERALL FISCAL DECENTRALIZATION DEBATE & CAPACITY BUILDING • AGGREGATE LEVEL OF PUBLIC EDUCATION FUNDING STILL UNRESOLVED IN BULGARIA • SHOULD EDUCATION TRANSFERS BE EARMARKED OR PART OF BLOCK GRANT? • COSTING STANDARDS INCREASE TRANSPARENCY & PREDICTABILITY BUT, ONCE ADOPTED, TEND TO PERSIST EVEN IF BADLY DESIGNED • EMPHASIS ON FISCAL DECENTRALIZATION HAS SO FAR IGNORED ISSUES OF SCHOOL GOVERNANCE

More Related