© UNICEF Tanzania/Kate Holt
Zanzibar budget brief
FY 2011/12–FY 2015/16
Focus on health, nutrition and education
INTRODUCTION
September and October mark the beginning of
the budget cycle in Zanzibar, with the preparation
and release of macroeconomic projections. Budget
guidelines (BGs) are issued in March to guide ministries,
departments and agencies (MDAs) in their submissions
towards the Medium Term Expenditure Framework (MTEF).
Deliberations on sectoral budgets by parliamentary
committees and the House of Representatives (HoR),
including their final approval, take place between April
and June (Figure 1). This brief intends to provide a rapid
analysis of the key trends in public budget allocations and
expenditure in Zanzibar, with a focus on health, nutrition
and education.1
Figure 1 The budget cycle in zanzibar
Sector dialogues with
development partners
Sept/Oct
Projections for
macroeconomic indicators
and quarterly sector
performance
November
Discussion on new revenue
measures, preparation of BGs and
discussion with stakeholders
Dec/Feb
Budget training
to MDA’s
Feb/March
Preparation of MTEF:
budget submissions from
MDAs to MoFP
March
Finalisation and
issuing of BGs
April
Submission of sectoral budgets to
HoR’s committees. Presentation of
sector and overall budget to the
HoR and approval
May
Cabinet approval and
printing of budget books
May/June
July
The budget comes into
effect on 1st July
The traditional budgeting structure of presenting
expenditures by line item has been formally replaced by
programme-based budgeting (PBB) during FY 2015/16.
The advantages of PBB include, among others, the ability to
lay out government spending according to programmes
being implemented, shifting emphasis from inputs
(activities) and outputs to outcomes, service delivery
and results. In brief, the PBB framework ties objectives,
programmes and budgets together. In FY 2016/17, the
PBB structure will be enhanced with the introduction of
the UN COFOG2 budget classification codes. The codes
will allow classification of the national budget by sectors
(i.e. general public services, defence, social and economic
services).
Government income
Key messages
»» The government’s overall income3 has been
growing at an average annual rate of 21 per cent
since FY 2011/12.
»» Rising levels of borrowing, foreign grants and
domestic revenue are behind this growth.
»» Domestic revenue has been bolstered by improved
tax collection; VAT accounts for more than a third of
total tax collection.
Tax revenue4 in Zanzibar is growing at an average
annual rate of 21 per cent, far ahead of most East African
Community (EAC) members. Zanzibar has outperformed
its neighbours by collecting on average (over FY 2010/11
- 2013/14) TShs 16 out of every TShs 100 generated in
»» Zanzibar outperforms its neighbours in the East
African Community by collecting on average TShs
16 in tax out of every TShs 100 generated in the
economy.
»» Increasing domestic revenue, together with
foreign grants, are critical in the wake of declining
resources from general budget support.
the economy. The tax revenue to gross domestic product
(GDP) ratio in Tanzania Mainland and Uganda only stands
at 12 per cent and 11 per cent, respectively. Nevertheless
more efforts are needed, as the norm in OECD economies
is a tax-GDP ratio of around 30 per cent.
Zanzibar outperforms its
neighbours in the East African
Community by collecting on
© UNICEF Tanzania/Kate
Holt
average TShs 16 in tax out of
2 | Zanzibar Budget Brief
every TShs 100 generated in
the economy.
Figure 2 shows that the annual average growth rate of tax agencies and the Arab Bank for Economic Development
revenue in Zanzibar (FYs 2011/12–2013/14) is higher than in Africa (BADEA) (Figure 4). Finland, Denmark, China, USA
neighbouring countries. This is an outcome of expanding and Japan are Zanzibar’s leading bilateral donors.
economic activities, reduced exemptions and tax evasion,
and tax amendments (e.g. raising the threshold for
Figure 3 Composition of tax revenue
VAT). However, the decline in the importation of goods,
(FY 2013/14)
especially motor vehicles, and in the number of tourist
inflows has prevented further increases in tax revenue
collection.5 The newly introduced infrastructure tax is
expected to improve resources available for infrastructure
Excise duty
development in Zanzibar.
10%
Figure 2 Regional comparison of ANNUAL
AVERAGE GROWTH rates of tax revenue
(FYs 2011/12–2013/14)
Import duty
12%
VAT
35%
Others
12%
21%
18%
17%
15%
15%
Levies
15%
Income tax
17%
Source: CAG report (FY 2013/14)
Zanzibar
Tanzania
Uganda
Kenya
Rwanda
Source: Zanzibar CAG report (FY 2013/14), World Bank World Development Indicators
(http://data.worldbank.org/country/tanzania)
VAT remains the largest source of revenue, accounting
for more than one third of total tax collection (Figure
3). The fastest growing sources of revenue (increasing at
more than 30 per cent per annum) include the stamp duty,
hotel levies, excise duty, import tax, and restaurant levies,
with the local excise duty at the forefront.
Non-tax revenue is growing annually at an average rate
of 6 per cent. Most of the non-tax revenue is collected by
the Immigration Department, the Zanzibar Commission
for Tourism, the Ministries of Land, Labour, Finance and
Health, the Controller and Auditor General (CAG), and
Livestock and Fisheries Departments.
Increasing tax collection and foreign grants are vital in
the wake of declining general budget support (GBS)6
resources. GBS inflows declined from TShs 51.4 billion (FY
2009/10) to TShs 36.5 billion (FY 2013/14). Apart from GBS
resources whose share for Zanzibar comes from donors’
GBS disbursements to the Union’s government, several
donors support Zanzibar’s development initiatives through
direct financing of projects (project-based aid modality).
Figure 4 Leading multilaterials
supporting the government development
budget (FY 2013/14)
ICAP/CDC/CHAI/GF/GPE
5%
BADEA
5%
WSPA
0.2%
UN Agencies
12%
WB
41%
AfDB
38%
Source: CAG report (FY 2013/14)
Over the past five years, the largest multilaterals providing
on-budget support to Zanzibar’s development projects
include the World Bank (leading with 41 per cent of
total support), the African Development Bank (AfDB), UN
Zanzibar Budget Brief | 3
The government budget has
© UNICEF Tanzania/Kate
Holt
increased at an annual real
The government’s overall income has been growing at
an average annual rate of 21 per cent since FY 2010/11.
This has been spearheaded by domestic borrowing and
foreign contributions, with average annual growth rates of
87 per cent and 53 per cent respectively (Figure 5). Treasury
bonds account for the largest share of domestic debt. The
annual average growth of domestic borrowing is largely
the result of a significant increase in FY 2012/13, when
TShs 39 billion was borrowed, as compared to TShs 10
billion in the previous financial year. Foreign contributions
support around 35 per cent of the total budget with the
remaining proportion coming from domestic resources
(Figure 6).
The total national debt (foreign and domestic) is
growing at an annual rate of 27 per cent with external
debt growing at 41 per cent and domestic debt at 21 per
cent. By 2014, the total national debt was TShs 300 billion,
a sharp increase from TShs 118 billion in 2010. Around 88
per cent of the debt is guaranteed by the Government of
the United Republic of Tanzania.
The increase in national debt is due to increased
new loans, arrears on gratuity and supplies, and the
weakening of the Tanzanian Shilling. Despite the increase
in the national debt, the debt sustainability criteria, i.e. the
debt-GDP ratio, is only 17.3 per cent, leaving significant
borrowing space.7 To strengthen its debt management
system, the government in Zanzibar intends to introduce
a framework that will rationalise loan contracting.
The increased borrowing caters for a number of needs,
including increased investment in social sectors, such as
the provision of free primary education, the adjustment
of salaries for civil servants (e.g. teachers with diplomas
and those with more than 15 years of experience) and
infrastructure development (e.g. upgrading of the Abeid
Amani Karume Airport, clean and safe water, and road
projects).
growth rate of 16 per cent and
absorbs 27 per cent of GDP.
Figure 5 Average annual growth rate
of sources of government income
(FYs 2010/11–2013/14)
Domestic borrowing
87%
53%
Foreign contribution
24%
Taxation (TRA)
20%
Taxation (ZRB)
Non-transfer/Non tax
6%
Source: CAG reports (FYs 2010/11–2013/14)
Figure 6 Sources of government income
(FY 2013/14)
Non-transfer/Non tax
3%
Domestic
borrowing
10%
Foreign
contribution
35%
Taxation
(TRA)
24%
Taxation (ZRB)
28%
Source: CAG report (FY 2013/14)
4 | Zanzibar Budget Brief
Overview of government allocations and expenditure
Key messages
»» The overall budget has almost tripled in nominal
terms, from TShs 303 billion (FY 2011/12) to TShs
830 billion (FY 2015/16). Adjusted for inflation, the
annual growth rate is 16 per cent.
»» The Ministries of Infrastructure and Communication,
Education and Vocational Training and Health take up
the largest share of the national budget (23, 15 and 10
per cent respectively).
»» The Government of Zanzibar spends considerably
more as a percentage of its GDP (27 per cent) than
Tanzania Mainland (16.3 per cent), Kenya (14.2 per
cent) and Uganda (8 per cent).
»» MoEVT and MoH have outperformed the overall
budget in executing their recurrent portions but
have lagged behind in executing their development
budgets, largely due to delays in completion of
infrastructure projects, procurement issues and
irregularity of aid inflows.
»» Loan and interest repayments are the fastest
growing expenditure items, followed by personal
emoluments. Salary costs have increased as the
government workforce has been expanded.
»» Zanzibar’s economic expansion is mostly sustained
by public consumption. To ensure sustainability
of growth, it is essential that Zanzibar focuses on
strengthening investments, easing the business
and investment environment, as well as improving
competitiveness.
Key government budget
trends
Mkakati wa Kukuza Uchumi (MKUZA), alongside its
three clusters of social well-being, growth and poverty
reduction, and good governance, reigned as the
primary development framework over the period 2010–
2015. This reflects the commitment of the government
to prioritise investments in Zanzibar’s long-term future.
Government budgetary allocations are classified as either
recurrent (i.e. salaries, allowances and other charges) or
development (i.e. internal or external).8
Overall, the fiscal policy in Zanzibar has been
expansionary with a public spending to GDP ratio
standing at 27 per cent, far higher than Tanzania
Mainland (16.3 per cent), Kenya (14.2 per cent) and
Uganda (8 per cent). The overall budget, in nominal
terms, has almost tripled from TShs 303 billion in FY
2011/12 to TShs 830 billion in FY 2015/16 (Figure 7). The
nominal annual growth rate of the budget averaged 23
per cent, versus 16 per cent in real terms. The recurrent
expenditure grew at an average rate of 19.2 per cent
per annum, consistent with the annual growth rate of
domestic revenue of 21 per cent.
»» Fiscal decentralisation is deepening in Zanzibar.
Sub-national transfers having nearly doubled
between FY 2009/10 and FY 2015/16. But further
analysis is needed to determine what these
transfers are being used for, and to what extent
they impact the lives of the rural poor in tangible
ways.
Figure 7 Trends in approved
budget estimates for FYs 2011/12–2015/16
(TShs billion)
830
651
303
38
424
71
356
48
399
275
265
308
353
376
431
2011/12
2012/13
2013/14
2014/15
2015/16
Recurrent
Development
Source: CAG reports and MoFP budget books (FYs 2011/12 – 2015/16)
Zanzibar’s significant economic expansion rate of 7 per cent
per annum is mostly sustained by public consumption.
As such, Zanzibar has to focus on strengthening the
role of investment in the growth process, without
which sustained long-run growth rates and productivity
cannot be achieved. Easing the business and investment
environment, as well as improving competitiveness, are all
prerequisites for higher investment rates.
Zanzibar Budget Brief | 5
The Ministries of Infrastructure and Communication,
Education and Vocational Training and Health enjoyed
the largest budget shares in FY 2015/16 (Figure 8). The
share of the Ministry of Empowerment, Social Welfare,
Youth, Women and Children (now called Ministry of
Labour, Empowerment, Elders, Youth, Women and
Children) was merely 1 per cent.
in the health sector, the salary bill increased from TShs 11.2
billion in FY 2011/12 to TShs 13.7 billion in FY 2014/15). By
FY 2014/15, 4,686 staff was working in the health sector,
meeting 87.3 per cent of the minimum staff requirements
set by the Essential Health Care Package (EHCP)10. Despite
these improvements, health facilities face severe staff
shortages and low motivation as many staff are absent
from work for various reasons.
Figure 8 Budgetary shares of Ministries,
Departments and Agencies (FY 2015/16)
The increasing personnel cost is leaving limited resources
for development projects, although absorption issues
exist. If aid flows slow down, in line with the achievement
of middle income status, the government may be forced
to streamline the large employment costs and seek greater
efficiency, which involves doing more with less.
Ministry of Livestock
Ministry of Empowerment,
and Fisheries
Social Welfare, Youth,
President's Office
2%
Women & Children
Planning Commission
1%
Ministry of Land, Housing,
2%
Water and Energy
4%
Ministry of Infrastructure
and Communication
Ministry of Agriculture
23%
and Natural Resources
6%
Ministry of Finance
and Planning
9%
Consolidated
Fund Service
10%
Budget execution
This section compares approved estimates with actual
spending for the three years where expenditure data
are available (FYs 2011/12–2013/14). A ratio of the two
categories gives the budget execution rate. Overall
trends are indicated in Figure 9, which shows low levels
of execution for the development budget, largely
due to delays in completion of infrastructure projects,
procurement issues and irregularity of aid inflows.
The Ministry of Health (MoH) and MoEVT outperformed
most other ministries in executing their recurrent
portion of the budget. On average, the two ministries
Other MDAs with
less than 2% each
19%
Ministry of Health
10%
Ministry of Education and
Vocational Training
14%
Source: MoFP budget book (FY 2015/16)
Figure 9 Trends in the overall budget
execution rate
88%
90%
Fastest growing expenditure
items
Increased public debt has resulted in loan and interest
payments being the fastest growing expenditure items,
with an annual average growth rate of 62 per cent.
Personal emoluments (salaries, wages and allowances)
and transfers come second and third, respectively.
Population growth, coupled with the government’s
commitment to improve social well-being, has created
the need for an expanding workforce to deliver social
services, which in turn increases salary costs. Personal
emoluments are increasing at a higher pace (25 per cent
per year) than the overall annual increase in recurrent
expenditure (19 per cent).
In the Ministry of Education and Vocational Training
(MoEVT), the salary bill has increased from TShs 36.7 billion
in FY 2011/12 to TShs 69.7 billion in FY 2014/159. Similarly
6 | Zanzibar Budget Brief
94%
93%
57%
60%
2012/13
2011/12
Recurrent
2013/14
Development
Source: CAG reports (FYs 2011/12–2013/14)
have executed, respectively, 97 per cent and 107 per cent
of their recurrent budgets (Figure 10).
However, both ministries underperformed in executing
their development budgets. MoH, for instance, spent only
an average of 54 per cent of its development budget over
FYs 2011/12–2013/14 (Figure 10). Weak budget execution
hampers efforts to expand service coverage and quality,
thereby negatively affecting child wellbeing.
Figure 10 Average budget execution rateS (FYs 2011/12–2013/14)
107%
97%
92%
69%
Overall budget
execution rate
88%
60%
54%
Ministry of Education
and Vocational Training
Recurrent
Ministry of Health
66%
Ministry of Infrastructure
and Communication
Development
Source: CAG reports (FY 2011/12 – FY 2013/14)
About three quarters of the overall development budget
is foreign financed (73 per cent in 2012/13—the most
recently available financial year). Aid resources tend to
be characterised by fluctuations and some degree of
unpredictability11, which increase the risk of derailing
performance against established expenditure targets. In
this context, periodic reconciliation of aid data between
sector ministries and the Ministry of Finance needs to be
enhanced. Development partners also have a critical role
to play by ensuring timely release of accurate aid estimates
when BGs are prepared.
Over the three years where data are available, execution
rates for both ministries declined. In FY 2011/12, MoH
and MoEVT executed 98 per cent and 90 per cent of their
budgets, but the rates declined to 78 per cent and 68
per cent, respectively, by FY 2013/14. This was largely the
result of weak execution of the development budget.
limited effectiveness of the health sector. Disbursements
of resources from the District Health Services Basket Fund
is based on agreed indicators which include population,
the number of primary health care units, the poverty level
and the disease burden.
A decentralisation policy and two bills have been
approved in 2014 and 2015 and will further enhance
resource allocations to lower levels. However, a roadmap
for implementing the policy is yet to be released. At
the local level, insufficient administrative and managerial
skills needed to perform new responsibilities that come
with decentralisation are common challenges for many
developing countries engaging in decentralisation, and
Zanzibar is no exception.
Fiscal decentralisation and
equity
The establishment of the District Health Services Basket
Fund in 2012 aims at enhancing equity in the distribution
of resources and addressing the under-funding and
© UNICEF Tanzania/Kate
Sub-national transfers have nearly doubled from the actual
transfers of TShs 3.54 billion in FY 2009/10 to TShs 5.69
billion in FY 2013/14 (to approved estimates of TShs 7.66
billion in FY 2015/16), with Urban/West being the leading
beneficiary (45 per cent of the entire Zanzibar population
resides in this region, which is also the most affected by
cholera). Further analysis is needed to understand what
these transfers are used for and assess to what extent they
impact the quality of life of the rural poor.
Holt
Fiscal decentralisation is deepening in Zanzibar. It is
closely linked to the population size, as evidenced by
the positive correlation between regional variations in
population size and the size of fiscal transfers.
Zanzibar Budget Brief | 7
Health and nutrition sector financing
Key messages
»» The portion of the state budget that is allocated
to the health sector in Zanzibar grew from 6.4 per
cent in FY 2011/12 to 10.2 per cent in FY 2015/16.
»» Health spending has increased over five years from
TShs 1.5 to 4.2 of each TShs 100 generated in the
economy.
»» Curative health services take up the bulk of
the health budget in Zanzibar (45 per cent).
Preventative services, which are heavily donordependant, account for 39 per cent.
»» Malaria reduction is a top government priority and
gets more than half of the prevention budget and
Introduction
Stable and sustainable health financing is an essential
ingredient to enhance health outcomes. The health
sector is one of the priority sectors under MKUZA cluster
II (i.e. social well-being and equitable access to social
services), as well as the Successor Strategy for FYs 2016/17–
2020/21. For the purpose of this analysis, the MoH budget
is taken as an approximation of the public financing of the
health sector.
Over the medium term, government policy priorities
for health are spread over a number of areas. They
include: reducing the maternal mortality rate; sustaining
a low prevalence rate for malaria; increasing monitoring
of health services at the local level; mobilising alternative
financial resources (such as donor funding and exploring
the possibility of introducing health insurance);
strengthening the capacity of health boards; improving
human resource utilisation in the sector, coupled with
improving the quality of health services and prevention of
non-communicable diseases.
three quarters of development resources: malaria
prevalence has been below 1 per cent since 2007.
»» However, child and maternal health and nutrition
only receive 6 and 0.3 per cent of prevention
budget, respectively. A quarter of all children
under 5 are stunted and pneumonia, diarrohea and
septicaemia are leading child killers.
»» Key
financing
priorities
should
include
interventions to further reduce maternal, neonatal
and child mortality and morbidity, as well as
malnutrition.
Curative services are followed by preventive services (39
per cent) with administration absorbing the remaining
17 per cent (Figure 11). Preventive and curative services
together comprise 97 per cent of the development part
of the health budget, as shown by Figure 12.
Figure 11 Composition of the MoH budget
(FY 2015/16)
45%
17%
Snapshot of the MoH budget
for FY 2015/16
Of the three programmes under MoH, curative services
(i.e. costs associated with hospital services) take up
the largest portion of the health budget (45 per cent).
Curative health services are rendered through public
and private facilities while preventive interventions are
conducted largely through partnerships between the
government, faith-based organisations and civil society
organisations.
8 | Zanzibar Budget Brief
39%
Curative services
Prevention services
Source: MoFP budget books for FY 2015/16
Administration
Figure 12 Composition of the MoH
development budget (FY 2015/16)
Figure 14 Composition of the
development budget under the
prevention programme (FY 2015/16)
3%
7%
46%
51%
23%
Curative services
Prevention and health education services
Administration and policy management
Malaria
Source: MoFP budget books (FY 2015/16)
Figure 13 Composition of the overall
prevention programme budget
Health centre
construction
4.5%
HIV and AIDS, tubercolosis
Child and maternal health
Source: MoFP budget books (FY 2015/16)
Malaria receives more than half of all resources
allocated to the prevention programme (54 per cent12
Figure 13) and 70 per cent of the development budget
under the same programme. The remaining 30 per cent
goes to child and maternal health, and HIV and AIDS and
tuberculosis (Figure 14).
Child and
maternal health
5.6%
70%
Nutrition
0.3%
Others*
0.1%
HIV and AIDS
tubercolosis
17.7%
As a result of these high investments, malaria prevalence
has been below 1 per cent since 2007 among children
under the age of 5. The leading causes of child mortality
in Zanzibar are currently pneumonia (31 per cent),
diarrhoea (14 per cent) and septicaemia (13 per cent), with
malnutrition an underlying contributor in over 50 per cent
of cases.
Though a significant reduction has been achieved in
child mortality within the last decade, most of the decline
has occurred after the first month of life with minimal
changes in the rates of neonatal mortality and stillbirths.
Training of health workers on the Essential Newborn Care
package, Help Baby Breathe and Kangaroo Mother Care,
and provision of newborn and young child life-saving
commodities, are ongoing activities to address neonatal
mortality. Strong and continued advocacy to promote
attention to newborn survival is needed at all levels.
Health promotion and disease prevention, as well as HIV
and AIDS and tuberculosis, constitute the second and
third largest priorities. They each absorb about 18 per cent
of prevention resources (both recurrent and development).
HIV and AIDS funding focuses on, among other things,
prevention of mother-to-child HIV transmission.
Health promotion and
disease prevention
18.1%
Source: MoFP budget books (FY 2015/16)
Malaria
53.7%
Child and maternal health and nutrition lag far behind,
receiving 6 and 0.3 per cent of the total resources under
the prevention programme, respectively. This is despite
the MoH 2014 Health Bulletin showing that respiratory
tract infections, pneumonia and diarrhoeal diseases are the
leading diagnosed cases in outpatient health services for
children under 5 (55 per cent). The same diseases (with the
exception of pneumonia) are leading for outpatients aged
over 5 years. Capital spending on child and maternal health
Zanzibar Budget Brief | 9
accounts for 7 per cent of the prevention budget (Figure
14), with emphasis put on the Expanded Programme on
Immunisation (EPI). Vaccines consume a large share of the
child and maternal health development programme (TShs
223 million out of TShs 1.8 billion).
4.5 per cent to 1.5 per cent over the same period, the
absolute number of stunted children remains high, with
more than 50,000 children stunted in Zanzibar. Only 20
per cent of children are exclusively breastfed and a mere
12 per cent of children (6–23 months) meet the minimum
acceptable diet.
Nutrition is cross-sectoral, with spending being scattered
across a number of other ministries (agriculture, livestock
and fisheries and social welfare) as well as across various
activities under MoH (e.g. integrated child reproductive
health services). This means that the figure of 0.3 per cent of
prevention resources allocated to nutrition is likely to be an
underestimation of total resources allocated to nutrition. It
will be important to refine the PBB approach to be able to
capture nutrition spending in its entirety.
Preventive services are donor-dependent and this
raises sustainability issues. Leading financers of related
development activities in Zanzibar include UNICEF, the
Global Fund to Fight AIDS, Tuberculosis and Malaria, the
Netherlands’ Facility for Infrastructure Development (ORIO),
the World Bank, UNFPA, USAID and DANIDA. The USA
President’s Malaria Initiative (PMI) and the Global Fund are
major funders of malaria prevention.
Persisting challenges remain in areas such as weak
coordination of nutrition activities which span several
MDAs, timely release of budgeted funds, the predominance
of food security issues and inadequate human resources
to deliver nutrition services (e.g. none of the districts have
qualified nutritionists).
Key budget trends for MoH
Resource allocation to the MoH as a percentage of the
total budget has consistently maintained an upward
trend. Specifically, the budgetary share of MoH grew from
6.4 per cent in FY 2011/12 to 10.2 per cent in FY 2015/16
(Figure 15). This reflects the government’s willingness to
prioritise the sector. In terms of the relative importance of
public resources allocated to health within the economy,
over the past five years, Zanzibar has raised its spending
from TShs 1.5 to 4.2 of each TShs 100 generated in the
economy to finance activities mandated to MoH.
Additional challenges include a weak nutrition information
system which contributes to a lack of quality data on
nutrition; poor management of nutrition supplies,
especially storage and distribution; and inadequate social
and behaviour change communication activities. Effective
coverage of treatment for severe acute malnutrition (SAM) is
still low, reaching only 25 per cent of acutely malnourished
children in 2015. Key bottlenecks include inconsistent
provision of supplies; insufficiently trained health staff; and
limited outreach activities to detect children with SAM.
Most of the increase in the allocated budget is on account
of the sharp rise in development resources, whose share
rose from 3 to 21 per cent over the same period. The
substantial increase in the development budget, which
largely relies on foreign inflows, creates concerns given its
low rate of execution.
Overall, despite a reduction in stunting prevalence from
30 per cent in 2010 to 24 per cent in 2014, and SAM from
Figure 15 Trends in budget weighting OF KEY MINISTRIES
30.5%
30.4%
21.6%
22.8%
21.2%
13.1%
6.4%
2011/12
6%
13.8%
7.6%
3.5%
2012/13
Ministry of Education
2013/14
Ministry of Health
Source: UNICEF calculations based on CAG reports and MoFP budget books (FYs 2011/12 – 2015/16).
*Approved estimates
10 | Zanzibar Budget Brief
14.5%
10.2%
7.8%
3.2%
2014/15*
2015/16*
Ministry of Infrastructure
Stable and sustainable
health financing is an essential
Holt
© UNICEF Tanzania/Kate
ingredient to enhance health
outcomes.
In absolute terms, the entire MoH budget has increased
over four times, from TShs 17.3 billion (FY 2011/12) to
TShs 85 billion (FY 2015/16), confirming the commitment
of the government to improve health outcomes (Figure
16).
The availability of medicines has improved, with the
needed stock level increasing from 50 per cent in FY
2013/14 to 67 per cent in FY 2014/15. During this period,
financial resources for the supply of drugs increased from
TShs 3 billion to TShs 4.6 billion. The distribution system
was also improved with the introduction of the Electronic
Logistic Management Information System (eLMIS).
The ratio of salaries in recurrent expenditure declined
from 79 per cent in FY 2011/12 to 58 per cent in FY
2015/16, implying that most of the increase in recurrent
expenditure is attributable to other charges (OC). OC
refers to non-salary related expenditures, such as fuel, office
running expenses etc. This is a positive development as it
implies that much of the increase in recurrent expenditure
benefits service delivery-related expenses.
Increased resources for health interventions could
partially explain the advances made in health outcomes.
Deliveries attended by skilled personnel increased
from 59.4 per cent in 2013 to 71.2 per cent in 2014;
infant and under-five mortality rates declined between
2002 and 2012, from 89/1,000 live births to 46.4/1,000,
and 141/1,000 to 67.4/1,000, respectively. Maternal
mortality, which was accorded its own roadmap, is also
on the decline from 221/100,000 live births in 2012 to
187/100,000 live births two years later (2014), surpassing
the Health Sector Strategic Plan’s (HSSP III) target of 270
maternal deaths/100,000 live births13. Deliveries at home
have declined to 32 per cent (2014) from as high as 73 per
cent in Pemba and 52 per cent in Unguja in 2010.
Figure 16 TRENDS IN MoH budgetary and actual spending (TShs billion)
85
51
27.7
17.3
2011/12
17.2
21
28.1
20
2012/13
2013/14
Approved estimates
2014/15*
2015/16*
Actual spending
Source: CAG reports and MoFP budget books (FYs 2011/12–2015/16)
* Approved estimates
Zanzibar Budget Brief | 11
Over the same period, the proportion of births attended
by skilled personnel reached 71 per cent from 45 per
cent14. The proportion of pregnant women attending the
first antenatal care (ANC) visit recommended within 16
weeks of pregnancy has also increased from 11 per cent to
18.9 per cent in Unguja, and from 8.6 per cent to 26.5 per
cent in Pemba over the period 2010–2014. ANC is one of
the focus areas of the government roadmap to accelerate
the reduction of maternal mortality rate.
Increasing donor attention to vertical programmes
in the health sector (focusing on a limited number of
health problems) raises concerns as to whether such
initiatives give sufficient attention to the general
health system. Concerns also relate to the sustainability
of vertical programmes after donor support comes to an
end. Efficiency gains and sustainability will be enhanced if
aid resources are prioritised for strengthening the existing
general health system.
Furthermore, household use of iodated salt has increased
from 70 per cent in 2010 to 77 per cent in 2015. Targets for
immunisation have been achieved for measles (97.7 per
cent) and Penta 3 (93.3 per cent), with the availability of
vaccines and enhanced skills (through staff training) being
the primary contributory factors.
Overall, key financing priorities should include
interventions to further reduce maternal, neonatal and
child mortality and morbidity as well as reduce stunting.
This can be realised through the following: health system
strengthening, particularly at the district level; improving
the quality of care (e.g. enhancing the skills of service
providers and addressing the shortage of essential
supplies); and linking families to facilities through health
promotion at community level. Community-level health
promotion is important, for instance, to improve early
postnatal care, as some community members perceive
health services to be necessary only when obstetric
complications occur.
However, challenges remain across a number of areas
as previously highlighted, including the high proportion
of stunted children related, among other factors, to
the decline in outreach initiatives on Vitamin A and deworming. Between 2014 and 2015, the coverage of deworming declined from 104.6 per cent to 76 per cent and
for Vitamin A from 107.7 per cent to 76 per cent (i.e. below
the target of reaching more than 90 per cent children).
Moreover, 69 per cent of children are anaemic, 58 per cent
of women have anaemia with iron folic supplementation
during pregnancy still very low at 9.7 per cent.
Education sector financing
Key messages
»» The education budget in Zanzibar increased from
TShs 90 billion to TShs 120.7 billion between FY
2014/15 and FY 2015/16.
»» But as a share of the national budget, education
spending declined from 30.5 per cent in FY 2011/12
to 14.5 per cent in FY 2015/16. This suggests
reduced prioritisation.
»» Pre-primary and primary education take up the
largest share of the MoEVT budget (28 per cent).
Alternative education is the largest beneficiary
of the MoEVT development budget (75 per cent).
Introduction
The MoEVT budget is taken as an approximation of
public financing of the education sector in Zanzibar.
Similarly to health, education is among the priority sectors
under MKUZA’s cluster II (and Successor Strategy) and is
therefore expected to be prioritised in resource allocation.
12 | Zanzibar Budget Brief
Infrastructure development has remained a top
priority.
»» The education development budget is heavily
reliant on external resources (80 per cent in FY
2015/16).
»» Increased investments are urgently needed to
improve access to quality pre-primary education,
reduce the number of children out of school,
further develop school infrastructure and enhance
quality, availability and equitable distribution of
teachers.
The sector can have a direct impact on the future prospects
of children and human capital development in Zanzibar,
provided that adequate levels of quality are ensured.
Currently the Government of Zanzibar provides free
education for primary grades only (Standard I to VI).
In accordance with the 2006 Education Policy, the
government is moving towards a system of compulsory
education from pre-primary until Form IV. Except for
the pre-primary level, the government is the dominant
education provider.
Over the medium term, the government education
policy priorities include a vast array of activities. They
include the preparation of a new education development
strategy (2015–2020), strengthening primary school
infrastructure to make schools more child friendly and
investing in alternative education and the quality of
teachers’ education (e.g. inspections, textbooks). The
MoEVT budget comprises six programmes (pre-primary
and primary education, secondary, higher education,
alternative education, quality aspects and administration).
The 2006 Education Policy has changed the education
structure, by declaring pre-primary education as part
of compulsory basic education, as well as changing the
structure of the formal education system to two years of
pre-primary education, six years of primary education, four
years of secondary education at ordinary level, two years
of secondary education at advanced level and a minimum
of three years of higher education.
Snapshot of the MoEVT
budget for FY 2015/16
The combined pre-primary and primary education
budget enjoys the largest share of MoEVT financial
resources (28 per cent), as indicated by Figure 17. Of that
allocation, 75 per cent is directed to the provision of preprimary and primary education, and the remaining 25 per
cent is used for strengthening delivery systems.
The relatively high allocation for pre-primary and primary
education is in line with the 2006 Education Policy. At
the primary education level, the government intends
to ensure not only that all eligible primary school-aged
children are enroled, but also that the primary school
completion rate improves.
Alternative education absorbs the largest share of
MoEVT development resources at 75 per cent (Figure 18)
and is largely financed by AfDB. The AfDB’s project involves
construction of vocational and skills development centres
and rehabilitation of existing workshops. It also has a
soft component, which consists in the development of a
vocational teaching curriculum for certificate and diploma
courses in vocational training. Besides the (significant)
AfDB resources to finance infrastructure associated with
alternative education, the overall development spending
in the education sector is mostly reliant on foreign
contributions (Figure 19).
Figure 17 Composition of the MoEVT
budget (FY 2015/16)
Quality of education
2%
Higher
education
13%
Pre-primary
and primary
28%
Alternative
education
17%
Administration
22%
Secondary
education
17%
Source: MoFP budget books for FY 2015/16
Figure 18 Distribution of the MoEVT
development budget (FY 2015/16)
4%
20%
75%
Alternative education
Pre-primary & primary
Secondary education
Source: MoFP budget books (FY 2015/16)
Pre-primary and primary education follow alternative
education with 20 per cent of the MoEVT development
resources.
School
infrastructure
development,
procurement of desks and books and teacher training
are the primary targets of resources. The high population
growth rate in Zanzibar (2.8 per cent which is higher
Zanzibar Budget Brief | 13
Figure 19 Government and development
partner (DP) share of the development
budget (FYs 2011/12–2015/16)
Figure 20 Distribution of the MoEVT
recurrent budget (FY 2015/16)
Higher education
3%
2015/16
80%
20%
2014/15
85%
15%
2013/14
89%
11%
2012/13
73%
27%
79%
2011/12
0%
20%
40%
DPs
21%
60%
80%
Quality of
education
16%
Alternative
education
17%
Pre-primary
and primary
23%
Administration
21%
100%
Secondary
education
21%
Government
Source: MoPM using data from MoEVT IFMS
Source: MoFP budget books (FY 2015/16)
than global and African averages, at 1.2 per cent and 2.5
per cent, respectively) has raised demand for education
infrastructure and facilities. Roughly half of the population
in Zanzibar (49 per cent) is children (aged 0–17 years)
(URT, 2012).
It is therefore not surprising that in FY 2015/16, out of
TShs 2.3 billion of the development resources under the
sub-programme of strengthening primary schooling, TShs
1.4 billion (60 per cent) will finance the construction and
rehabilitation of primary school infrastructure. The balance
is reserved for procuring textbooks.
The rise in resources for FY 2015/16 signals the
commitment of the government to enhance the
education sector. Allocations to pre-primary and primary
education show the largest increase (and enjoy the largest
share of recurrent resources—Figure 20), in line with the
government objective of ensuring free pre-primary and
primary education. Since July 2015 parents are no longer
requested to give contributions to schools for operational
costs.
The entire development budget under secondary
education is directed towards infrastructure
development (TShs 1 billion). Major donors for the
education sector in Zanzibar include AfDB and the
Global Partnership for Education (GPE15). In addition to
infrastructure development, a portion of the resources
for the current five-year GPE supports capacity building
(teacher and counsellor training) and textbook distribution.
14 | Zanzibar Budget Brief
Key budget trends for
MoEVT
Resources for MoEVT have significantly increased over
time, as shown by Figure 21. The significant increase
in budgetary allocation in FY 2015/16 is attributable to
the doubling of approved estimates for development
resources from TShs 11.6 billion (FY 2014/15) to TShs 23.9
billion (FY 2015/16). Prior to FY 2015/16, the proportion
of spending given to development projects showed a
declining trend, mostly reflecting the reduction in donor
funding16.
However, as a share of the national budget, MoEVT
spending has declined from 30.5 per cent in FY 2011/12
to 14.5 per cent in FY 2015/16 (Figure 15), just below the
international benchmark for education spending (15–20
per cent). MoEVT budgetary shares for some years have
been above SADC averages (i.e. between 16 per cent and
18 per cent).
Over the past four years, the largest amount of MoEVT
spending went to the combined pre-primary and
primary sub-sector. Secondary and tertiary education
follow suit (Figure 22). In terms of weights, Figure 23
shows a declining spending proportion for pre-primary
and primary education from 53 per cent of MoEVT
resources in 2011/12 to 43 per cent in FY 2014/15. As
a result, despite increasing resources to the education
sector, the proportion of spending for primary education
is falling away from the international benchmark of 50 per
cent17.
Figure 21 TREND IN MoEVT actual spending
(TShs billion)
120.7
96.3
81.7
Figure 22 TREND IN Spending by education
sub-sector (TShs billion)
2010/11
2011/12
90
78.6
2012/13
2013/14
2014/15
0
2011/12
2012/13
2013/14
2014/15*
20
40
Pre-primary & primary
Secondary
Tertiary
2015/16*
60
80
100
Adult
TVET
MoEVT overhead
Source: MoETV IFMS19
Source: MoFP budget books (FYs 2011/12–2015/16)
* Approved estimates
Secondary education enjoys the next largest amount of
spending, which increased over recent years, reflecting
a commitment to include lower secondary (Forms I–
IV) in compulsory basic education. Prior to FY 2015/16,
technical and vocational education and training (TVET)
and adult and alternative sub-sectors received a very
small proportion of total expenditure, despite the policy
emphasis on investing in them18.
Expenditure on salaries dominates total MoEVT
recurrent resources, growing from 63 per cent in FY
2011/12 to 77 per cent in FY 2014/15. About 38 per cent
of the total government spending on ministry salaries
in FY 2014/15 (excluding subvention salaries), went to
education alone. Overall, MoEVT spends twice as much as
MoH to pay for a relatively larger workforce (i.e. teachers
across the entire network of 407 public primary and
secondary schools).
Improvements in education outcomes can at least
partly be attributed to increased resources for the
sector. Enrolment in primary education increased from
226,812 students (2010) to 253,152 students (2014). Over
the period 2010–2014, the number of schools increased
from 238 to 279 (pre-schools), 185 to 250 (primary
schools), and113 to 147 (secondary schools), while for
basic schools, there was a decline from 114 to 109 (due to
the completion of the school reform initiated by the new
Education Policy in 2006).
attending pre-primary education and only 8.2 per cent of
children start primary school at the right age of 6 years.
The repetition rate is 3.3 per cent for primary level and 1.8
per cent for secondary level and the dropout rate remains
at 15 per cent for the primary level.
Figure 23 Share of education spending by
sub-sector (FYs 2010/11–2014/15)
2010/11
2011/12
2012/13
2013/14
2014/15
0
20
40
Pre-primary & primary
Secondary
Tertiary
60
80
100
Adult
TVET
MoEVT overhead
Source: MoETV IFMS20
However, several challenges persist, including stagnant
enrolment at the ordinary secondary level (Form I–IV)
which declined by 0.4 per cent over the period 2010–
2014. Four out of five children aged 4–5 years are not
Zanzibar Budget Brief | 15
Despite a good transition rate of 96 per cent from primary
school to lower secondary, only 81.2 per cent of Standard
VII students have the required pass rates, which means the
remaining ones enter secondary not well prepared. Both
the pass rate and the transition rate at secondary Form II
and Form IV levels are low.
Other challenges include: inadequate equipment for
laboratories and libraries, and the general unfriendly
learning environment in schools such as overcrowded
classes, poor school hygiene and sanitation services, and
inadequate desks and other furniture.
As in the health sector, significant donor resources for
education are spent “off-budget”. These resources must be
included in the budget as there are several advantages:
(1) it would allow for parliamentary supervision of
development aid as recommended by the Paris, Accra,
and Busan declarations; (2) it would increase transparency
in funds utilisation; and (3) it would give the government
a clearer vision of the volume of resources needed to
maintain a certain level of social services.
Lastly, the following priorities should guide the allocation
of government spending to education:
»» Invest in improving access to quality pre-primary
education, including the development of costeffective models for pre-primary expansion.
»»
»»
»»
»»
»»
»»
Reduce the number of children out of school
through a comprehensive multi-sectoral programme.
Further invest in infrastructure development,
ensuring construction designs that take into account
severe land shortages; and completing and equipping
the large number of schools built by communities
that remain unfinished.
Invest in teachers (their availability, quality training,
equitable distribution and motivation), especially
for schools in remote areas, to improve learning
outcomes and reduce the number of out-of-school
children and adolescents.
Improve school environments, especially access to
water, sanitation and hygiene facilities and school
meals and prevent corporal punishment.
Invest in parenting education and raising awareness
among caregivers of family practices that develop
young children’s readiness for school and increase
every child’s chance of success.
Complementary programmes in family planning
and other reproductive health services, as well as
environmental awareness.
Investing in the availability,
quality and equitable
Holt
© UNICEF Tanzania/Kate
distribution of teachers
16 | Zanzibar Budget Brief
is essential to enhance
education outcomes.
Acronyms
AfDB
Africa Development Bank
ANC
Antenatal Care
BADEA
Arab Bank for Economic Development in Africa
BGs
Budget Guidelines
CAG
Controller and Auditor General
CFS
Consolidated Fund Service
DFID
Department for International Development (UK)
EAC
East African Community
EHCP
Essential Health Care Package
eLMIS
Electronic Logistic Management Information System
FY
Financial Year
GBS
General Budget Support
GDP
Gross Domestic Product
GPE
Global Partnership for Education
HoR
House of Representatives
HSSP
Health Sector Strategic Plan
IFMS
Integrated Financial Management System
MDAs
Ministries Departments and Agencies
MKUZA
Mkakati wa Kukuza Uchumi
MoEVT
Ministry of Education and Vocational Training
MoFP
Ministry of Finance and Planning
MoH
Ministry of Health
MoIC
Ministry of Infrastructure and Communication
MTEF
Medium Term Expenditure Framework
OC
Other Charges
OECD
Organisation for Economic Cooperation and Development
PBB
Programme-Based Budgeting
PMI
President’s Malaria Initiative (USA)
ROSC
Reports on the Observance of Standards and Codes initiative (World Bank)
SAM
Severe Acute Malnutrition
SADC
Southern African Development Community
SBCC
Social and Behaviour Change Communication
Sida
Swedish International Development Agency
TRA
Tanzanian Revenue Authority
TShs
Tanzanian Shillings
TVET
Technical and Vocational Education and Training
VAT
Value Added Tax
ZRB
Zanzibar Revenue Authority
Zanzibar Budget Brief | 17
Glossary of budget terms
Budget execution: The ratio of actual spending over approved estimates.
Consolidated Fund Service: Government resources to pay for debt servicing and state house expenses.
Development budget: Government resources that are intended for investment purposes.
Expenditure (actual figures): Allocated funds spent on investment and recurrent costs (versus budgeted figures,
which refer to allocation of funds, approved by Parliament).
Fiscal decentralisation: The devolution of financial resources by the central government to sub-national governments
for financing specific functions.
Foreign grants: Financial aid from foreign countries and aid agencies that the recipients do not need to pay back.
Nominal values: Numbers not corrected for the effect of inflation over time.
Non-tax revenue: Income earned by the government from sources other than taxes.
Other charges: Non-salary expenses (excluding investment).
Per capita: Per person.
Real values: Numbers corrected for inflation.
Recurrent budget: Government resources that are intended for salaries and wages, and non-salary expenses
(excluding investment related expenses).
Tax revenue: Income earned by the government from taxes.
Treasury bonds: Debt instruments issued by the government in exchange for money borrowed from the public.
18 | Zanzibar Budget Brief
END NOTES
The budget analysis within this budget brief covers a five-year period from FY 2011/12 to FY 2015/16. The latter two
years (FY 2014/15 and FY 2015/16) are approved estimates, while the former three years (FY 2011/12 to FY 2013/14)
reflect actual spending.
1
2
UN COFOG refers to the United Nations Classification of the Functions of Government.
Sources of government income are primarily tax and non-tax revenue, borrowing (domestic and foreign), foreign
grants (including 4.5 per cent of the GBS, which is remitted from the United Republic of Tanzania) and dividends from
the Bank of Tanzania.
3
Tax collection in Zanzibar is administered by the Tanzania Revenue Authority (TRA) and the Zanzibar Revenue Board
(ZRB) with minimal differences in the actual value of the collected amount. TRA is an entity of the United Republic of
Tanzania administering federal taxes (income tax and customs duties), while ZRB is mandated to oversee all internal
taxes (VAT, stamp duty, hotel levies, petroleum tax and port fees).
4
5
Government budget speech to HoR, FY 2016/17.
6
GBS is non-targeted budget aid on the condition that funds are used for poverty reduction in priority sectors.
7
Government budget speech to HoR, FY 2016/17.
8
Unlike internal resources that are strictly investment, not all external resources are investment.
9
Zanzibar Education Sector Analysis, Oxford Policy Management (OPM), 2015.
All graduates from the Mbweni Science College find government employment each year (e.g. as environmental
health officers and clinical officers). In FY 2014/15, the pool of new recruits was further expanded with 36 medical
graduates trained by Matansas University of Cuba through a partnership with the Government of Zanzibar.
10
Further, due to incomplete information on foreign resources, the level of expenditure needs to be interpreted carefully as a high probability exists of understating the actual flow of such resources (Source: Report of the Controller and
Auditor General).
11
Strategic government interventions to sustain a low prevalence rate of malaria include distribution of nets, indoor
residual spraying, and mapping and treating of breeding sites.
12
13
MoH’s Health Bulletin, 2014.
14
Ibid.
15
A consortium comprising the World Bank, DFID, and Sida.
16
Zanzibar Education Sector Analysis, Oxford Policy Management (OPM), 2015.
17
Given that limited pre-primary services exist, we can assume that most of the resources finance primary education.
18
Zanzibar Education Sector Analysis, Oxford Policy Management (OPM), 2015.
19
Ibid.
20
Ibid.
Zanzibar Budget Brief | 19
unite for children