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Stefan Leiderer et al. interviewed had received training, but felt insufficiently prepared to actually produce and submit ABB budgets on time. The quality of capacity development measures is furthermore compromised by the fact that many capacitybuilding measures are primarily aimed at training individuals instead of building sustainable capacity of public institutions. In addition, training content is sometimes poorly adapted to practical working situations most civil servants face. The same applies to elected councillors, who frequently have low levels of academic attainments and cannot provide policy direction. Training programmes for elected assembly members on PFM issues are thus often inadequate (GFA 2005, 33). The described shortcomings in professional training and capacity development for key PFM processes and tools complicate the implementation of reforms, new policies, and innovative PFM tools. Long and unpredictable recruitment process Not only is the recruitment process of senior staff both in central and local government institutions in Malawi not strictly based on merit criteria, but it is also often long and unpredictable. Although there are plans to decentralise some of the recruitment procedures, 27 the recruitment system is still very centralised and bureaucratic. Central government entities hire key executive staff for local government. Different service commissions are in charge of recruiting candidates for vacancies. Lower level staff are employed directly at the local entities, for example, district secretariats. Many interview partners, especially at district level, claim that they do not know when key positions are going to be filled. The mechanisms and progress of ongoing recruitment processes do not seem to be well communicated and transparent to local staff and assembly members. The lack of communication combined with the limited supply of qualified candidates for key administrative functions on the labour market, leads to uncertainty regarding human resource planning. It also makes the distribution of tasks and respon- 27 It remains to be seen whether this still holds true in view of recent institutional changes, in particular with regard to the role of district commissioners having been made controlling officers. 94 German Development Institute
Public Financial Management for PRSP Implementation in Malawi sibilities among civil servants difficult and existing staff have to assume additional responsibilities and workload. Disturbance of regular working procedures and additional workload through donor-related activities and workshops Donor-related activities and workshops (see Chapter 6.3. and 6.2.) regularly disturb working procedures at central and local government level. There are many different donors in Malawi and their activities are not always well harmonised and aligned to Malawian procedures. In addition, hey frequently absorb public employees for meetings, workshops or administrative work. Different application, implementation and monitoring procedures and requirements for donor funds and projects cause additional workload for civil servants. This leads to time constraints for PFM related activities. 6.2 Resources for PFM processes In a poverty-stricken country like Malawi, resource constraints are an omnipresent problem. The following section deals with different dimensions of resource constraints in the administrative bodies of Malawian government institutions and analyses their impact on PFM. As described in Section 5.1.2, Malawi operates a dual budgeting system with the national budget divided into a development budget and a recurrent budget. The civil service has to be financed out of the recurrent budget. While the development budget is about 80 % donor-financed, the recurrent budget incorporates much smaller proportions of donor funding and relies more heavily on national revenue. This implies serious problems at the level of financial management, as Malawi’s revenue base is extremely thin (significantly below 20 % of GDP). The economy relies heavily on agriculture, which accounts for 35 % of GDP and constitutes over 90 % of its exports. Export earning rely are dominated by one single commodity, tobacco, which accounts for 65 % of total exports. This makes Malawi’s export earnings and public revenue highly vulnerable to external shocks (IDD and Associates 2005, 8). Together with extremely unpredictable donor funding as illustrated in Figure 7, this makes intra-year monetary planning extremely difficult (see Section 6.3.1). German Development Institute 95
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Studies Deutsches Institut für Ent
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Preface The present study on ‘Pub
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4 The Case of Malawi 44 4.1 Why Mal
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Bibliography 151 Annexes 157 Tables
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Boxes and Tables in the Annexes Box
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DS EHP ESAF EU GBS GDP GoM GRF GTZ
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TOR UDF UNCDF UNDP UNV USAID VAP VD
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Discussion Paper 16/2007 Schirm, St
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