Senegal - Enhancing the Efficiency of Public Investment : Public Expenditure Review

Abstract

This Public Expenditure Review (PER) identifies four major challenges that the Senegalese authorities must meet in order to optimize their investment policy. The first challenge is to optimize the strategic choices underlying an optimal investment policy. To this end, the authorities should improve their capacity to assess the sectoral allocation of their investment projects. They should also accord greater importance to infrastructure - the share of which is still less than optimal by international standards - because of its unquestionably positive impact on growth. It is recommended to program the recurrent costs associated with public investment projects, i.e., that the consolidated investment budget - BCI - be provided with an economic classification clearly distinguishing between the two forms of expenditure, so as to subsequently harmonize them with recurrent costs included in the current budget, and to plan them more effectively over time, both globally and by sector. The second challenge involves improving the alignment of budgetary instruments. To improve the extent to which budgetary instruments are matched with the strategic objectives of the Poverty Reduction strategy Paper (PRSP), this PER proposes two complementary approaches. The first stresses the missing link in the Senegalese planning system, namely the Three-Year Public Investment Program (PTIP). The second approach is aimed at systematizing the link between the Priority Action Plan (PAP) and the approved and implemented BCI, using a monitoring system described herewith. The third challenge: ensuring the proper execution and substance of the investment program, needs to improve the availability of information, which is not necessarily reliable, and tends to become available belatedly. It is also suggested the authorities devote particular attention to the ongoing projects in the infrastructure, and social services sectors, which report implementation rates routinely lower than the average observed in Senegal. Finally, the fourth challenge: establishing an efficient and transparent management system, suggest the Government continue improvements to the public expenditure management system, especially as regards investment expenditure.