114 | The Role of Intergovernmental Fiscal Transfers in Improving Education Outcomes
process and the publicity around it contributed strong incentives to improve management performance. More fundamentally, there is need to strengthen the links between measured LG management performance and the obstacles to student learning examined earlier in this chapter. This has been acknowledged by the government, and a refocus of the performance indicators, combined with the introduction of a school-level performance improvement framework, was underway in late 2020. Notwithstanding the need to improve the measures in the performance assessment and the importance of maintaining a credible assessment, the Uganda case points to the potential for a combination of nonfinancial and financial incentives delivered through performance grants to play a positive role in improving results. Central government systems to support local service delivery
The MoFPED is a key actor in the current round of IGFT reforms. These reforms include shifting financing toward critical service delivery areas, including primary education, which has been deemphasized in recent years. An important question is the extent to which increasing formula-based financing and providing performance incentives can improve learning. It is likely that significant learning gains will require the full attention of the MoES, particularly regarding teacher management and training. A principle underlying the current round of reforms is that the formulas are based on objective and independent data that cannot be directly influenced by LGs, including survey data from the Uganda Bureau of Statistics. Although the Bureau is the source of the majority of data for LG grant formula allocations in other sectors, in the education sector, the most valuable information on enrollment counts, which determine the lion’s share of formula-allocated spending, is collected by the LGs with MoES oversight. Uganda’s current education management information system (EMIS) is not regularly updated. Primary school enrollment data is collected by MoES for calculating grant allocations, but not by the EMIS section.
EFFECTS OF THE DECENTRALIZED FINANCE SYSTEM ON SUBNATIONAL SPENDING AND EDUCATION OUTCOMES How has Uganda’s lengthy experience with education decentralization affected the sector? Has it changed spending, increased access, reduced inequity, or improved quality over time? Clearly, the central government’s provision of fiscal transfers to LGs to support their provision of basic education has contributed to high if not universal enrollment. However, Uganda’s population is growing rapidly, and this will require more classrooms and more teachers, particularly in urban areas (World Bank 2020). Such an expansion in enrollment has yet to be achieved in lower secondary education. Evidence regarding improved learning outcomes or conditions for learning is less clear. What is clear is that, throughout Uganda, students start and exit primary school late, and many do not complete it. In this section, we review the available evidence and report the findings of our analysis of decentralized financing on education spending and outcomes. We focus on primary education
