Evaluating public funds management in Myanmar

Myanmar is currently undergoing several large-scale transformations after nearly 50 years of military rule and ethnic conflict. With the election of the military-backed Union Solidarity and Development Party, power was transferred to a civilian Government for the first time in 2011. Initial reform measures undertaken by the Government focused on institutionalising democracy, opening economy, and making ceasefire agreements with ethnic armed organisations.

Since then, attention has moved to a wide-ranging economic and social reform programme, with the focus now on macro-economic management, central and state sector policies, and institutional arrangements between the Union Government, state and regions. In 2015, the National League for Democracy won a landslide victory in the general election.

Challenges

Although Myanmar today is one of the largest recipients of international development assistance, the limited capacity of political, economic, and administrative institutions in the country has led to continued debate about the substance of reform and its trajectory.

Prior to 2012, decades of Government underspending had led to decline in education and health outcomes, with only one-third of school going students completing school education. Similarly, Government spending on public health was as low as $1.6 per capita in 2012. Improving public financial management (PFM) is fundamental to increasing service delivery, growth, and poverty reduction; a strong budget with minimum leakage, spent on the right economic development priorities is crucial to meet the needs of vulnerable groups, and to continue effective democratic reforms.

In April 2014, DFID launched the ‘Improving the management of public funds for the people of Burma’ programme (MPFMP), which included three core components:

• Public financial management modernisation: increasing revenue and implementing improvements in budgeting, expenditure management, fiscal transparency and institutional capacity building in PFM.
• Social accountability: supporting improvements in fiscal transparency at the Union level and improving citizen engagement in select state and region Governments and parliaments.
• Management of natural resources: supporting the implementation of Myanmar’s Extractive Industries Transparency initiative process.

Our approach

We conducted a full performance evaluation of the MPFMP with the aim of determining whether the programme was designed and implemented in a way to deliver sustainable, long-term impact, and to provide guidance to DFID on the design of future public financial management programmes in Myanmar.

Our evaluation is based on the following methods and primary sources of information:

• A review of design documentation and implementing partner reports relevant to the programme for each of the three components;
• A review of recent academic literature on the factors which underpin successful PFM reforms and publicly available reports on the political economy of reforms in Myanmar; and
• Key informant interviews, with a focus on the Union Ministry of Planning and Finance and other implementing agencies, implementing partners and other key informants involved in governance reform in Myanmar.

Fieldwork for the evaluation took place in Yangon and Nai Pyi Taw in March 2018.

Outcomes

Our evaluation highlights that the MPFMP remains relevant to the needs of the Government of Myanmar’s central agencies of finance and to the Government’s stated policy priorities.

Throughout the evaluation, emphasis was placed on the theory of change and ensuring the programme remains effective against changing political contexts in Myanmar, and provided recommendations for the remaining lifetime of the programme, as well as for future programmes.