Project Case Study
Conducting an expenditure review for the government of Andhra Pradesh
Reviewing the public services expenditure for the government of Andhra Pradesh
At the turn of the millennium, the government of Andhra Pradesh in India had been following a programme of reform for some time, which included divesting itself of expensive and inefficient state-owned enterprises in order to promote a sustainable and cost-effective mode of governance. The state was acknowledged to be in the forefront of state-level reforms, and had outlined an ambitious plan (Vision 2020) to take the state out of poverty and underdevelopment.
It had declared that it would “pursue a fiscal adjustment programme with the following components: Restructuring expenditure, improving expenditure management, augmenting revenue, and framing growth enhancing policies.”
To assist the government, in 2001 we were asked by the Department for International Development to conduct an impact and expenditure review for the government. The project aimed to assist the government in restructuring expenditure, improving expenditure management and generating resources for the alleviation of poverty.
Twenty percent of the programmes that consume 80% of the allocated resources in key sectors were reviewed to evaluate impact against objectives including those stated in the Vision 2020 statement, output measures, and cost analysis.
In order to complete the review, the team examined both the activity and the design of ongoing public services against their long-term objectives, in order to evaluate their relevance. The team identified key plan and non-plan expenditure objectives and whether the relevant funds were used optimally.
This led to the establishment of programme and public service priorities, which entailed an assessment of how far plan and non-plan funds were optimally used, in order to ensure the most effective use of public money in the best interests of the people of Andhra Pradesh.
