Planning and Budgeting in Health in Nepal.pptx

Planning and Budgeting in Health Sector in Nepal

1. Planning and Budgeting Annual Work Plan and Budget (AWPB) Sudip Ale Magar

2. Comparison of National and Health Budget Over Years Source: Redbook, LMBIS

3. Formulation of Budget and Programme Each level of government and its subordinate offices must formulate a budget and programme for the next year in order to obtain resources. The budget should be divided under economic expenditure heads, based on the approved “Integrated code for revenue and expenditure for all three tiers of governments”, 2074.

4. Formulation of Budget and Programme The budget and programme proposals shall be based on the objectives and targets of the periodic plan, Medium-term Expenditure Framework (MTEF) and the international commitments and annual plans and policies of the GoN . Budget proposals shall be based on the long-term vision, mission, target and objectives and expected outputs.

5. Formulation of Budget and Programme The budget proposal for the following year should track the progress of current year budget implementation. In formulating the health budget, intensity of disease, priority-based programmes , Basic Health Services, previous-year budget progress, demand from the field office, and local context must be included. Business Plans (BPs) are a helpful tool to ensure realistic budget formulation.

6. Guiding principles of planning Constitution of Nepal National Health Policy 2076 Public Health Service Act 2075, Regulation 2076 Safemotherhood and Reproductive Health right Act 2075 Health Insurance Act and bylaws Nepal Health Sector Strategy 2015-2020 Fifteenth Periodic Plan 2076/77-2081/82 Sustainable Development Goals 2030 Gender Equality and Social Inclusion strategy Policy Decision from cabinet Annual policy and Program and Budget

7. Relation between Annual work plan and budget and Plan

8. मध्यमकालीन खर्च संरचना (MTEF) Interrelationship between Plans

9. Seven Steps of Formulating AWPB

10. Process of Budget Formulation Macro Economic Framework Preparation Preliminary estimation of resource and expenditure Determination of Sectoral Ceiling Budget Ceiling Circular for line ministries Budget Ceiling Circular for departments under the ministry Budget Ceiling Circular for entities under the departments Present in cabinet for approval Draft Budget preparation Budget discussion at MoF Budget discussion at NPC Budget proposal at NPC and MoF Budget proposal from ministry Budget proposal from the departments and entities

11. Budget and programme formulation at federal level The budget formulation process begins from the second-third week of Magh each year and is completed in the fourth week of Baishak . The MoHP receives the budget ceiling and budget formulation guidelines from the Ministry of Finance ( MoF ) and National Planning Commission.

12. Budget and programme formulation at federal level The Policy, Planning and Monitoring Division (PPMD) of MoHP sends budget ceilings and budget formulation guidelines to the subordinate departments, central-level offices, national and specialised hospitals and other health entities. The MoHP finalises the budget proposals from subordinate offices through discussion of the rationale of activities with departments.

13. Budget and programme formulation at federal level The PPMD enters the activities with their proposed budgets into the Electronic Annual Work Plan and Budget (e-AWPB) and Line Ministries Budget Information System (LMBIS). The budget proposal of the MoHP is submitted to the MoF and NPC for discussion and finalisation of the ministerial budget.

14. Budget and programme formulation at federal level Before presenting the budget estimation to parliament, the Minister of Finance submits next year’s budget policy to the Finance Committee and seeks suggestions. The Finance Minister presents progress on the current year’s budget and the status report of public enterprises along with the budget estimation.

15. Timeframe for Federal Budget and Programme Formulation S.N Details of process Responsibility Timeframe 1. Preparation of annual programme and budget formulation Ministry Magh 2 nd –3 rd week 2. Receipt of budget ceiling from NPC and distribution of guidelines on budget formulation along with budget ceiling Ministry Magh 3 rd week 3. Review of budget formulation preparations and revision of budget ceiling as needed Ministry Falgun 1 st week 4. Entry of proposed budget and programme details in e-AWPB Departments and centres Falgun 2 nd week 5. Discussion of proposed divisional budget in the ministry Ministry Falgun 2 nd –3 rd week 6. Entry of proposed programme and budget in e-AWPB Departments and centres Falgun 4 th week

16. Timeframe for Federal Budget and Programme Formulation S.N Details of process Responsibility Timeframe 7. Verification that the whole budget and programme under the ministry is in line with the budget formulation guidelines, budget ceiling and procurement plan Ministry Chaitra 1 st week 8. Entry of finalised proposed budget and programmes of MoHP in e-AWPB and LMBIS Departments and centres Chaitra 2 nd –3 rd week 9. Migration of proposed budget and programme of LMBIS to NPC and MoF Ministry Chaitra 4 th week 10. Policy-focused discussion on proposed annual programmes and federal- and local-level budgets in NPC NPC Chaitra 4 th week 11. Revision of LMBIS in line with the agreed discussion held in NPC Departments and centres Baisakh 1 st week 12. Policy-focused discussion on programmes and budget with MoF MoF Baisakh 2 nd –4 th week

17. Timeframe for Federal Budget and Programme Formulation S.N Details of process Responsibility Timeframe 13. Forwarding of statements of transfer through conditional grants with detailed programmes and activities to MoF Ministry Baisakh 3 rd week 14. Entry of agreed proposed programmes and budget with MoF in LMBIS and e-AWPB Ministry Baisakh 4 th week 15. Submission of budget estimates to the joint session of federal parliament MoF Jesth 15 16. Revision of LMBIS and e-AWPB in accordance with the approved budget from parliament Ministry Ashad 2 nd week 17. Approval of the office-wise allocation in LMBIS from MoF Ministry Shrawan 1 st week 18. Issue of budget implanting authorisation with details of programmes for each office Ministry Shrawan 1 st –2 nd week

18. Types of Budget Balanced budget Surplus budget and Deficit budget

19. Types of Expenditure Current expenditure: Administrative and Programmatic budget Capital expenditure: Budget for acquisition of assets like land, buildings, machinery, and equipment

20. Types of grant The Government provides four types of grant, namely, Fiscal equalization grant, Conditional grant, Complementary grant and Special grants. These grants are given to the state and the local governments on the basis of either their need or implementation of any specific project operated by them.

21. Types of grant Fiscal equalization grant: grant on the basis of the need for expenditures and revenue capacity. Conditional grant: grant specified with necessary terms and conditions in relation to the implementation of the project

22. Types of grant Complementary grant: grants provided to the State and Local Level to implement any project related to infrastructure development. Special grants: Special grants for any specific project to be operated by the State or Local Level

23. Issues and Challenges Weak organizational culture not taking evidence informed planning and decision making Planning done in traditional way (just adding 10% budget to old program and budget) Highly centralized process

24. Issues and Challenges Planning, programs and target not aligned with national commitments , policies and priorities Weak prioritization mechanism to improve allocative efficiency

25. Way forward Technical expertise and capacity enhancement Innovation in planning approach Stakeholder involvement and participation Result oriented target setting, programming and realistic budgeting

26. Way forward Prioritization of programs and projects Proper allocation of budget and program according to the time line Research and studies

27. Thank you