Introduction

5

Uganda Case Study

ALASDAIR FRASER1 AND MARLAINE LOCKHEED

INTRODUCTION

Uganda was an early leader in expanding primary school enrollment, supported by “unusually authentic and powerful” fiscal decentralization reforms in the 1990s (World Bank 2013). However, improvements in learning and retention2 have not followed. In part, this is due to Uganda’s high poverty rates, low revenue generation, and the low share of government financing devoted to education.3 However, the government’s de-emphasis of local government support since 2006 and the increasing number of local governments are also responsible. Despite recent funding increases, local governments lack the resources and capacity to carry out their responsibilities, which include monitoring and inspecting primary schools, and there are many opportunities for political patronage.

As in many countries, the education decentralization process has not proceeded uniformly. Prior to Uganda’s independence in 1962, a local government structure was introduced, but this structure was abolished under the second president. Since the adoption of the 1995 Constitution, Uganda has implemented extensive political and fiscal decentralization, with many responsibilities for the delivery of primary, secondary, and some postsecondary education devolved to local governments (LGs). This chapter focuses on primary and secondary education, which are delivered through LGs and account for the vast majority of students. LG education provision is accompanied by firm fiscal oversight from the central government’s ministry of Finance, Planning and Economic Development (moFPED) and by budget limits on personnel costs set by the ministry of Education and Sports (moES) and the ministry of Public Service (moPS). Since 2002, the central government has increasingly intervened in, while reducing its real-terms fiscal contribution to, primary and secondary education. This has resulted in such anomalies as teaching personnel policies not being funded in the budget. Also, over the past two decades, the central government has curtailed the ability of LGs to generate their own revenue.

The vast majority of the central government’s financial support to local governments has been earmarked for specific purposes, including universal primary education (UPE) and universal secondary education (USE). Conditional grants,

which included formula-based allocations and, later, performance-based allocations, were introduced in 1997. These systems and practices have been eroded since the mid-2000s. Efforts to reestablish a rules-based transfer system started in 2016–17. Decades of experience with decentralization in education and a relatively strong public financial management system position Uganda as a good case study to examine the relationship between funding mechanisms and education outcomes.

The education sector has in recent years struggled to improve the quality of teaching and learning. The 2016–21 manifesto of the ruling party4 emphasizes improving quality, raising teacher salaries, and strengthening infrastructure. The government’s National Development Plan 2015–16 to 2020–21 also emphasizes improving quality along with supporting early childhood development (ECD) and strengthening school inspections. However, the reforms that have been implemented have generally not been focused on quality improvements. In contrast, donors have supported interventions aimed at improving quality, particularly in early grade reading, but the coverage and durability of the gains made under these projects remain to be seen.5 Overall, Uganda’s learning assessments indicate that quality has deteriorated since 2011, in marked contrast to what has happened in Kenya and Tanzania.6

The current education finance system is based on the intergovernmental transfers architecture introduced after 1995. Funding from the central government to LGs takes the form of multisectoral unconditional grants, and sectoral conditional grants. Outside the transfer system, there are subventions from the central government (Williamson 2010). Grants to LGs for education are ringfenced through the annual budget process, whereas subventions, which consist mostly of donor project resources, are sent to LGs at the discretion of the central government.

Transfers have been provided to LGs for the purpose of providing UPE since 1996 and USE since 2007.7 Since 2012, the Inter-Governmental Fiscal Transfer (IGFT) Reform Program8 has aimed to (1) increase the adequacy of LG budgets; (2) ensure greater equity between LGs by reimposing and revising objective allocation formulas; and (3) increase the efficiency of local service delivery through an annual performance assessment and targeted assistance and reforms based on its results. The moFPED has been a lead actor in implementing these reforms since 2015–16, and thus Uganda provides an interesting recent example of both the opportunities and limits of finance-led improvements to primary and secondary education.

Currently, Uganda faces four major education challenges. First and most important is to improve the quality of learning, particularly at the primary education level.9 This involves ensuring that all primary schools meet at least the minimum conditions for teaching and learning.10 Second is to increase the efficiency of the system so that teachers attend school and teach more often, more students progress through grades on time,11 and a higher share of students transitions from primary to secondary school. Third is to increase access to secondary education, while maintaining quality. In 2019–20, the gross enrollment rate for secondary education was only 21 percent (moES 2019a). The fourth challenge is to increase children’s readiness for primary school by expanding preprimary education, particularly in underserved areas. In 2016–17, fewer than 15 percent of children in Uganda were enrolled in preprimary education.12 meeting these four education challenges has implications for a fifth challenge: meeting the recurrent and development costs for improved access, equity, efficiency, and learning.