Notes for KwaZulu-Natal Finance MEC Ina Cronjé, Contribution of Performance Monitoring and Evaluation to Good Governance Performance Monitoring and Evaluation Conference in Government and State Owned Enterprises
25 Nov 2010
Formulating the problem
The great scientist Albert Einstein stated a truism when he said that the "formulation of the problem is often more essential than its solution."
This immediately brings to mind the anecdote of another scientist who was doing experiments on a grasshopper to see what would happen to it if it loses its legs. He started by removing one leg and told the grasshopper, “Jump!” The grasshopper jumped. He then removed a second leg and repeated the instruction to jump. Again the grasshopper jumped. He continued amputating the grasshopper’s legs and commanded it to jump until only one leg remained. The grasshopper again jumped, albeit with great difficulty. However, when the last leg was removed, the grasshopper did not respond to the instruction to jump. “Eureka!” the excited scientist shouted, rushing to write down his conclusion: When a grasshopper’s legs are all removed, it loses its hearing.
This tale is a warning against senseless Performance Monitoring and Evaluation and the conclusions that we draw from it. We can monitor and we can evaluate, but is it contributing to Good Governance? How many legless grasshoppers have unnecessarily received hearing aids at great cost because the “problem” or goal was not formulated properly, resulting in the wrong conclusions being drawn, and in inadequate and generally poor outcomes?
Monitoring and evaluation can only contribute to good governance if we know what we want to measure and evaluate and what we want to achieve by measuring and evaluating.
While process is relevant, it has to produce tangible business results. Most employees will respond to whatever measurements they are given to perform against. If the measurements are related to process activity, people will confine their actions within that narrow domain; and stay away from exploring different ways of doing things. In the end, a great many possibilities for better bottom-line results will be lost.
Purpose of monitoring and evaluation in government
There is a saying that if it does not get measured, it does not get done!
There is therefore tremendous power in measuring performance. The ancient Egyptians regularly monitored their country’s outputs in grain and livestock production more than 5,000 years ago. In this sense, monitoring and evaluation is certainly not a new phenomenon.
Kusek & Rist describe the Power of Measuring Results in “Ten Steps to a Results-Based Monitoring and Evaluation System” as follows:
- If you do not measure results, you cannot tell success from failure
- If you cannot see success, you cannot reward it
- If you cannot reward success, you are probably rewarding failure
- If you cannot see success, you cannot learn from it
- If you cannot recognize failure, you cannot correct it
- If you can demonstrate results, you can win public support.
To governments globally, the bottom line of Monitoring and Evaluation Systems should be to improve service delivery to their citizens.
Improving service delivery in South Africa
James W Frick said, “Don’t tell me where your priorities are. Show me where you spend your money and I’ll tell you what they are.”
The South African government’s budget, the most important economic policy instrument, is without doubt pro-poor. For the poor the budget can be the difference between life and death, between going hungry or having a meal, between having access to medicines or being held hostage to their health issues, and between being able to send their children to school or being forced to leave their children to face a future in which they are likely to have limited opportunities.
The budget decisions are no longer the purview of a select few officials in the Ministry of Finance or Treasury. Through an inclusive approach people at all levels are consulted about their needs. In addition access to budget information is also no longer a secret. In fact the South African Treasury has just taken top honours in the world for the amount of information it gives on the national budget. The Washington-based International Budget Partnership moved South Africa from second place two years ago to the top of the list of 94 countries ranked in its open budget index with 92 points out of a possible 100.
In terms of budgetary requirements the South African government has delivered:
- We have more than doubled the infrastructure budget from R410 billion in the 2006/07 MTEF to R846 billion in the 2009/10 MTEF.
- The number of support grants grew from 12. 3 million in December 2007 to 14.3 million in June 2010
- South Africa maintained an annual average growth rate of 4 percent to 5 percent between 2002 and 2008.
Doing more with less
Governments are increasingly being called upon to demonstrate results. It is expected of them to demonstrate that they are making a real difference to the lives of their people and that value for money has been achieved. Citizens are no longer solely interested in the administration of laws but also in the services that are rendered and the outcomes.
As a nation we have come a long way since achieving democracy, but we are still confronted by massive challenges. Unemployment remains very high, poverty and inequality and access to better education, healthcare, public transport and basic household amenities remain a problem for many.
Over the next few years, government must deliver more services more efficiently with less money.
Opening our books to our citizens is a very important element of good governance. But that in itself does not provide all the answers: Are we doing enough? Have we truly delivered on all the promises made to our stakeholders? Have we changed the lives of enough people? Are we receiving value for our money?
When a provincial department pays R25 million more for a school of the same size and same specifications than what another province pays, can we say that we are efficient, effective and economical? Yes, we have done what we promised: we built a school. But we could have built two schools for the price of one!
This is a clear illustration that merely throwing money at a problem is not the only solution, and sometimes it is not a solution at all. Money is not an outcome. Although it enables one to perform certain functions it does not necessarily ensure the desired outcomes, or value for money. We must learn to do more with less.
Managing for results
We have now reached an era where evaluation is results-driven. If the grasshopper still hears after all its legs have been removed, what have we proven?If the “patient” dies after all the correct procedures have been followed, can we say that the operation has been successful?
Instilling a culture of monitoring and performance
The new way of working was announced by President Jacob Zuma in his State of the Nation Address. In line with global trends government is moving from endless debate to effective implementation and decisive action, holding public office bearers and public servants accountable.
The phasing in of performance auditing by the Auditor-General has certainly been adding more value by shifting the focus to results-oriented auditing. Better definitions of expected financial performance, quality of service, efficiency, output, outcomes and impact will significantly improve the base of auditable evidence, thereby vastly expanding the range of auditable activities.
Government adopted the Medium Term Strategic Framework (MTSF) for 2009-2014 which is translated into 12 outcomes backed by measurable outputs and key activities. These measurable outputs and deliverable integrated action plans have been aligned with the Millennium Development Goals:
- Improved quality of basic education
- A long and healthy life for all South Africans
- All people in South Africa are and feel safe
- Decent employment through inclusive economic growth
- A skilled and capable workforce to support an inclusive growth path
- An efficient, competitive and responsive economic infrastructure network
- Vibrant, equitable and sustainable rural communities with food security for all
- Sustainable human settlements and improved quality of household life
- A responsive, accountable, effective and efficient local government system
- Environmental assets and natural resources that are well protected and continually enhanced
- A better South Africa and (contribute to) a better and safer Africa and World
- An efficient, effective and development oriented public service and an empowered, fair and inclusive citizenship.
The establishment of the Department of Performance Monitoring and Evaluation on 1 January 2010 is a clear demonstration of government's commitment to ensure that our performance makes a meaningful impact on the lives of our citizens. The result-oriented approach is being driven across the three spheres of government and organs of state.
Value of outcomes based approach
The Outcomes Based Approach should ensure:
- A Strategic Focus of Government on a comprehensive integrated approach, creating a Better Life for All
- More efficient and effective use of limited resources through more systematic monitoring and evaluation and an analysis of the results of monitoring and evaluation.
Performance monitoring and evaluation are essential aspects of good governance aimed at efficiency and effectiveness, transparency, accountability, informed decision-making and above all sound financial management.
Good governance includes the strengthening of public institutions:
Good governance is also about addressing poor information flows, bad communication and inadequate understanding of risk, as well as dealing with fraud and deliberate wrongdoing.It is also about improving the quality of management at all levels.
Procurement reforms and accountability
Corruption is part of a broader problem associated with a narrow view of empowerment. It has never been government’s intention to enrich only a few people and leave the majority of people to live in poverty.
It is critical for any country to tackle fraud and corruption, as it distorts economic and social development by engendering wrong choices and by encouraging competition in bribery rather than in the quality and price of goods and services. Moreover, it is the poor who can least afford the price of fraud and corruption.
In strengthening departments the National Treasury and KwaZulu-Natal Treasury are continuously taking steps to improve financial management and detect and eliminate fraud and corruption. For example:
Review of supply chain management
One of the areas highly susceptible to fraud and corruption in government is supply chain management (SCM) or procurement. We are therefore:
- Addressing loopholes in the PFMA, to stop abuse of deviations from normal procedures intended to be used only in emergencies
- Dealing with inflated prices. The KZN Treasury is developing a daily updated price-list of all goods and services that government normally procures. Officials who procure goods above the going prices will have to account for their decisions
- Enforcing the use of transversal or general period contracts. These contracts are normally negotiated by relevant treasuries and are usually cheaper.This is provided for in Section 16A.6.5 of the Treasury Regulations.Extending the compulsory declaration of interest in companies that benefit from government from senior management level to all public servants.
- Assigning SCM delegations to the correct level of responsibilities
- Reviewing and strengthening contract management
- Implementing Tender Appeals Tribunals now also in municipalities Cleaning up our suppliers’ database to promote accountability and compliance, as well as identifying service providers with poor track records and those who are under investigation.
- Linking the suppliers’ database with external organisations (SARS, CIPRO and CIDB)
Initiatives to reduce risk:
- Enhanced risk management processes now include fraud risk assessments as pro-active measure to identify potential loopholes leading to fraud and corruption.
- Implementing systems to prevent cyber fraud, e.g. Project Unembeza and the installation of A Biometric Access Control System (logging onto BAS and PERSAL with finger prints instead of passwords).
Initiatives to improve accountability and efficiency:
- Close relationships with law enforcement agencies (HAWKS, SAPS, SIU AND NIA) to ensure that criminal investigations are conducted where necessary.
- Working jointly with the Office of the Premier to deal with most critical criminal cases
- Establishing Disciplinary tribunals to deal with existing backlogs of disciplinary matters in all departments
- Following up on irregular and unauthorised expenditure reported in financial statements.
Spending on budget
- Implementing the first charge rule for departments that overspend by reducing their budgets by the overspent amounts in order to pay back the over-expenditure they incurred in the previous financial years
- Clean Audits campaign: Audits are widely accepted as a way to curb corruption and act as a potent deterrent to waste and abuse of public funds by, e.g. helping restrain any tendency to divert public resources for private gain and exposing non-transparent decision making which is clearly not in the public interest. To this end we have launched the 2014 Clean Audits campaign to obtain unqualified audit reports for public institutions in KwaZulu-Natal. All municipalities and provincial departments, as well as all public entities must achieve unqualified audit opinion reports from the Auditor General by 2014. By setting that target we do not say that a clean audit necessarily implies real service delivery but it is a crucial step in the promotion of a culture of accountability and responsibility.
- Cost cutting measures: The KZN Cabinet adopted 21 cost-cutting measures to eliminate wasteful and unnecessary spending, such as business class flights for officials, unnecessary travelling and overnight stays in hotels, catering and a whole host of other things.
Information management, using the provincial nerve centre
The Provincial Nerve Centre is a web designed tool tracking the province's development trajectory.This centre uses Business Intelligence software to track development information on a multilevel basis across all spheres of government.
This project is being developed in phases and currently a performance management solution is being initiated which will be fully functional by March 2011.
While the most sophisticated software and other systems are valuable tools to improve service delivery, it will remain a fruitless exercise if the culture of monitoring and evaluation is not established at all levels of government.
Monitoring, which includes collecting, analysing and reporting data on inputs, activities, outcomes and impact, seems to be a weak spot, for the following reasons:
- Unlike developed countries South Africa is generally a data-poor country, especially at provincial and local levels. This often results in poor planning and monitoring. It is crucial that a system is developed to improve our data gathering on a continuous basis.
- The most sophisticated software cannot ensure that the provided data that is fed into the system is credible, accurate and complete. E.g. information collected and collated from the Quarterly Performance Reporting Model for a particular department reflected the following:
Only 51 of the 217 indicators were met. Seventy six percent of the information needed was left blank. The reason for the incomplete reporting, could be:
- Simply laziness from officials to provide the information
- Incompetence of officials to provide and collect the information
- The M & E unit is understaffed
- Information not available
- Some indicators are no longer valid or changed
Moving towards concrete reforms:
Addressing challenges in monitoring and evaluation units
It is crucial to get our Monitoring and Evaluation houses in order by addressing:
- Undertrained staff: Officials need to be trained in modern data collection, monitoring methods, and analysis
- Underfunded units
- Unmotivated staff
- Using one standard reporting method instead of different methods
- Strengthening verification: by dealing with discrepancies in the numbers provided on paper and the reality.
We must also create a conducive organisational culture by:
- Sharing data
- Showing appreciation for managing results
- Prioritising measurement
- Breaking down operational silos
- Maintaining institutional memory (data management and validity)
- Dealing with cover-ups
- Ensuring that M & E is part of the design of a programme
At the Second Latin American Network of Evaluation, Systematization and Monitoring Conference in Colombia (2007), Pablo Rodríguez-Bilella highlighted the implications of the lack of a results-driven monitoring and evaluation culture:
- Institutional and political constraints are more difficult to overcome
- The struggle for adequate budgets demands extra energy
- The evaluator is closer to or resemblesthe image of a detective or spy rather than a critical ally
- The evaluation does not always reflect local, regional and national priorities.
Creating an M & E database that runs parallel to the quarterly progress review system
The Provincial Treasury’s IGR unit has submitted a preliminary proposal to the Provincial Monitoring and Evaluation Forum. It is based on targets set and activities planned during the planning phases of work. The reliability and credibility of the input will be evaluated and tested on a quarterly basis.
Starting with only the core functions of departments (and extending it over time) the database can help to keep the work on track and alert management (HODs and MECs) when activities are derailing. We cannot evaluate everything and it may force departments to concentrate on their core functions.
If conducted properly, the electronic database can be an invaluable tool for good management, and a useful base for evaluation. It will answer all the results-based questions, i.e. the availability of resources, the effective and efficient use of resources; whether capacity is sufficient and appropriate and the bottom line: is the state body doing what it planned to do and therefore improving service delivery to the people?
The Performance Monitoring and Evaluation lens has been adjusted. It is now up to each and every citizen of our country to ensure that the outcomes are met. Like Mohatma Gandhi said, “All our philosophy is dry as dust if it is not immediately translated into some act of living service.” Let us always behave as if our actions will be preserved for all to see because they will – in the legacy of improved services delivered to the people of South Africa.
Issued by: KwaZulu-Natal Provincial Treasury
25 Nov 2010
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