Approved Budget Tables Fiscal Year 2017/18

524 Pages·2017·2.75 MB·English

by  Alasdair Fraser

Approved Budget Tables
Fiscal Year 2017/18
Ministry of Finance and Planning
Republic of South Sudan
September 2017
grss-mof.org
TABLE OF CONTENTS
FOREWORD i
NATIONAL BUDGET PLAN
I. Macroeconomic Environment iii
II. 2016/17 Budget Execution xi
III. 2017/18 Revenue Plan xv
IV. 2017/18 Expenditure Plan xvii
V. Financing Plan and Debt Position xx
2017/18 Resource Envelope xxiii
REVENUE AND EXPENDITURE SUMMARY TABLES
2016/17 Approved Budget 1
2016/17 Actuals 4
2017/18 Draft Budget (by fund) 7
2017/18 Expenditure Estimates by Item (by fund) 10
STAFFING LEVELS, SALARY SCALES AND ALLOWANCES
Staffing Structure 12
Salary and allowances scales 19
TRANSFERS TO STATES AND COUNTIES
RSS Transfers by Sector and Programme 23
RSS Transfers by Location and Chapter 24
RSS Transfers totals for all locations 29
DETAILED EXPENDITURE TABLES
ACCOUNTABILITY SECTOR
Audit Chamber 30
Finance and Planning 34
National Bureau of Statistics 49
Anti-Corruption Commission 55
Reconstruction & Development Fund 59
Fiscal & Financial Allocation & Monitoring 63
National Revenue Authority 68
ECONOMIC SECTOR
Access to Information Commission 71
East African Community 75
Energy & Dams 79
Petroleum & Gas Commission 83
Investment Authority 87
Media Authority 91
Ministry of Information, Telecomm. & Postal Services 95
Ministry of Mining 101
Ministry of Petroleum 105
National Communications Authority 109
South Sudan Broadcasting Commission 113
Ministry of Trade, Investment & Industry 117
Urban Water Corporation 123
Electricity Corporation 127
National Bureau of Standards 131
Irrigation & Water Resources 135
EDUCATION SECTOR 157
Higher Education, Science & Technology 147
General Education & Instruction 153
HEALTH SECTOR 179
Health 168
HIV/Aids Commission 186
Drug and Food Control Authority 190
INFRASTRUCTURE SECTOR 203
Transport 194
Lands, Housing and Urban Development 198
South Sudan Roads Authority 204
South Sudan Civil Aviation 208
Roads & Bridges 214
NATURAL RESOURCES AND RURAL SECTOR 226
Livestock & Fisheries Industry 219
Ministry of Agriculture & Food Security 227
Ministry of Wildlife Conservation and Tourism 234
Ministry of Environment and Forestry 246
Land Commission 253
PUBLIC ADMINISTRATION SECTOR 258
Ministry of Cabinet Affairs 257
Parliamentary Affairs 263
Civil Service Commission 267
Ministry of Federal Affairs 271
Ministry of Foreign Affairs 277
Office of the President 285
Ministry of Labour, Public Service & Human Resource Developm 290
National Legislative Assembly 297
Local Government Board 301
Employees Justice Chamber 305
Public Grievances Chamber 310
National Elections Commission 314
Council of States 318
National Constitution Review Commission 322
Parliamentary Service Commission 326
Northern Corridor Implementation Authority 330
RULE OF LAW SECTOR 321
Ministry of Justice 334
Interior Headquarters 340
Police Service 344
Prisons Service 351
Fire Brigade 360
Judiciary of South Sudan 366
Law Review Commission 370
Bureau of Community Security & Small Arms 374
Human Rights Commission 378
Commission for Refugees Affairs 382
SECURITY SECTOR 363
Ministry of Defence & Veteran Affairs 386
De-Mining Authority 402
Disarmament, Demobilization & Reintegration 406
National Security Service 410
SOCIAL AND HUMANITARIAN AFFAIRS SECTOR
Ministry of Gender, Child & Social Welfare 415
Ministry of Culture, Youth & Sports 421
Ministry of Humanitarian Affairs & Disaster Management 427
Relief & Rehabilitation Commission 431
Peace Commission 437
War Disabled, Widows & Orphans Commission 441
ANNEX
Draft proposed chart of accounts for 2017/18 A1
Foreword
This document provides the technical background and context for the 2017/18 Budget. The
Budget is a function of macroeconomic parameters and politically determined priorities. It is
a policy document which affects the lives and interests of people. Our macroeconomic and
political problems require sound sustainable economic policies, which move us towards
stability and economic recovery. This Plan is based on analysis from the Budget Department,
Macroeconomic Department, the National Bureau of Statistics, as well as from development
partners.
It is of fundamental importance to demonstrate how previous fiscal year 2016/17 has
performed, to inform us, as well as to help prepare future fiscal responses. Budget execution
in 2016/17 has had many challenges and some successes, including the cessation of
borrowing from the Bank of South Sudan from January 2017 to May 2017, and higher-than-
forecast gross oil revenues. However, the pressure of uncontrolled spending in selected
ministries, and runaway spending on Nilepet and refined oil products has meant that civil
service salaries have been delayed for several months.
Rising global oil prices did not make substantial additional resources available, given the
increasing costs of the fuel subsidy. As expected in the budget process, we did not have
sufficient revenues to execute all our budgeted expenditures. For the first half of the fiscal
year, under pressure to pay salaries, we continued to contract loans from the Bank of South
Sudan, albeit at a reduced amount relative to the end of 2015/16, and took advances from
oil companies in order to guarantee payment of salaries and state transfers. Revenue raising
measures in the 2016 Acts have started to bear fruit. From January, following the passage of
the final budget, macroeconomic discipline improved, with no new lending from the Bank of
South Sudan, but extraordinarily tight conditions for most Government staff, suppliers, and
service users prevailed.
The 2017/18 Budget is part of a process towards achieving macroeconomic stability, raising
revenue compliance, and spending the Budget as planned. This Budget contains further
significant real reductions in government expenditure, and continuing measures to reduce
inflation and restore confidence in the ability of the Government to execute its budget.
We must strive to do the best with what we have. To stem further deterioration and
hopefully enhance service delivery, the Budget also contains more than two billion Pounds
in additional allocations for vulnerable groups. The Budget must be accompanied by stringent
cash management procedures, to ensure that we do not spend beyond our means, and that
we prioritise available resources for paying salaries, while minimising the amount spent by
selected agencies on travel and benefits. We recognise that the Nilepet reform is required to
i
finance much of planned expenditure. In the event that there are insufficient funds to
execute all budgeted expenditures, we will prioritise our payments to ensure that salaries
are paid, states receive their transfers, and that the Government services our outstanding
debts.
Peace is of paramount importance, but the continued decline in the spending power of the
Government means that less has been set aside than last year. However, the three billion
pound allocation, at close to 7% of planned expenditure, will go some way to supporting
efforts to secure a return to peace and National Dialogue.
Alongside this Budget, I will be taking steps to continue to implement the Government’s
Fiscal Stabilisation Measures Action Plan, in conjunction with key recommendations from
international partners. This includes various measures that will reduce government
expenditure, increase government revenues, and improve cash management. Some of these
measures are included in the Financial Bill 2017/18, which proposes to correct some of the
issues which emerged in the 2016/17 Act.
It is important that we, as a Government, continue the work to regain our fiscal credibility
and steer our finances onto a sustainable path. I call on all of my colleagues in Government
and the Assembly to join the struggle to stabilise our economy, to support the Government
in ending the ruin that BoSS borrowing and the resulting runaway inflation has brought to
our country, to ensure that budget resources reach the budget, and to lay the foundations
for a sustainable recovery in South Sudan. Only through sustained peace and growth, will we
be able to provide the services and livelihoods that our people deserve. And I hope that the
Budget that I present to you here will be another step in the direction of restarting that
process.

Stephen Dhieu Dau
Minister
Ministry of Finance and Planning

ii
National Budget Plan
Macro-Fiscal Developments
The current macroeconomic environment in South Sudan continues to pose enormous
difficulties. The continuing conflict has resulted in a further decline in South Sudan’s Gross
National Income (GNI) this year. The IMF in March 2017 estimated that non-oil real GDP has
declined by around a quarter over the period 2013/14 to 2016/17; total GDP has declined by
about the same percentage 2014/15-2016/17. Year-on-year consumer price inflation was
334% to May 2017, and the pound has lost more than 97% of its value against the US dollar
over the last two years. However, there are some indications (Chart 1) that inflation is
beginning to abate, and we have not seen a repeat of July 2016, where price increases
reached hyperinflationary levels.

Chart 1: South Sudan Inflation

Inflation, CPI, year-on-year, July Inflation, CPI, month-on-month,
2015 to April 2017 July 2015 to April 2017
500 90
450 80
400 70
350
60
300
50
250
40
200
150 30
100 20
50 10
0 0
Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 --1200 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17

iii
Table 1: Macroeconomic trends, Q1-Q3

Table 1: Key Macroeconomic
indicators, first nine months
of fiscal year 2016/17 Q1 Q2 Q3
CPI Inflation
425% 423% 354%
(annual, average)
CPI inflation (monthly, end
26% 9% -12%
of period)
Parallel Exchange Rate
68 84 117
(average)
Official Exchange Rate
55 74 98
(average)
Average Price of Brent
46.99 51.24 52.50
Blend (USD/b)

To give a recap of post-Independence economic milestones: oil production was shut down in
2012. At the end of 2013, civil war broke out, disrupting oil and agricultural production. To
cope with these two crises and maintain expenditure levels, government savings and
reserves were exhausted, and substantial loans were incurred. This left the country with a
diminished ability to withstand further negative shocks. When the oil price fell further from
July 2015 onwards, the country was already experiencing high inflation and currency
depreciation. This meant the fixed exchange rate regime became increasingly untenable, and
so the currency was floated in December 2015. No alternative policy could be supported,
given the lack of reserves and savings. Inflation continues to closely track the decline in the
pound. It is worsened by the ongoing conflict, which is causing a large economic contraction,
and by borrowing from the Bank of South Sudan. In short, this inflation is a South Sudan-
driven problem.

These events and actions have resulted in an extremely difficult macroeconomic
environment and hugely diminished Government spending power, which for 2017/18 in USD
terms is projected at around 2% - around one-fiftieth - of what it was in 2011/12 (using official
rates). However, these factors should not distract from the fact that uncontrolled
expenditure, once again, was a significant negative factor that undermined budget execution
and service delivery. In the first six months of 2016/17, uncontrolled expenditure contributed
further to the inflation through borrowing from the Bank of South Sudan. The long-run trend
of overspending by a small number of spending agencies continued, despite the worsening
macroeconomic environment. In the first nine months of the year, four agencies spent over
77% of total operating expenditure. While dollar spending on these activities dropped, they
increased their share, as the value of total expenditure fell even faster. Dollar expenditure
accounted for 46% of Q3 2016/17 spending, against 24% over the previous fiscal year.
iv
However, in Q3 and Q4 (to the end of May), borrowing from BoSS has (according to BoSS
data) been reduced, which is a significant achievement and the first step - if discipline can be
sustained - towards economic stabilization.
The headline figures for the 2016-17 Budget Execution to the end of Q3 are presented in
Table 2. Key points concerning revenues are:
• Gross oil revenues in USD terms were above budgeted levels, at 116% of the annual
budget in the first nine months. The oil price was above the Budget forecast of $30 per
barrel projected for fiscal year 2016/17, averaging $42 in the year to March. Production
was slightly below target over the first ten months of the fiscal the year to April, averaging
slightly lower than the 2016/17 budget projection of 130,000 barrels per day.
• Net oil revenues were above projections. Despite this, in-kind transfers and payments
were not made in full to Sudan and oil producing states and communities. Sudan
payments and cargoes totalled SSP 28,352 million to end of March, 75% of the budget.
• In SSP terms, Nilepet subsidies and Addax purchases are projected to be over 1000% of
the budgeted subsidy this year. The expenditure budget has been dramatically squeezed
by this set of priorities; the two main causes are poor expenditure control in several
ministries and Nilepet subsidies. Several months’ more salary could have been paid, if
either or both reforms could be put in place.
• Non-oil revenue collection stabilised in USD terms during the year, but is a lot lower
than levels at the beginning of 2015/16. Overall, performance against the annual budget
was good (78% in SSP terms to the end of March, and over SSP 10 billion raised to the end
of May 2017, well above the annual budget).
•
• Table 2: 2016/17 Budget execution, 2017/18 Budget and USD comparison
Table 2: Budget Execution 2016/17 2016/17 2017/18 Bud.
Bud.
2017 /18
2017/18 2017/18
Q3 YTD % less Bud.
Q3 YTD less Budget,
(millions of SSP) Budget execution Budget 2016
outturns Bud.201 USD m
/17, USD
6/17
m*
127,23
Gross Oil Revenue 46,833 54,231 116% 80,399 821 152
2
Total outflows to Sudan 37,623 28,352 75% 70,308 32,685 454 -84
Nile Petroleum payments 1,512 11,707 774% 28,307 26,795 183 161
2/3% to oil producing
461 19 4% 2,846 2,385 18 12
states & com’ties
v
Table 2: Budget Execution 2016/17 2016/17 2017/18 Bud.
Bud.
2017 /18
2017/18 2017/18
Q3 YTD % less Bud.
Q3 YTD less Budget,
(millions of SSP) Budget execution Budget 2016
outturns Bud.201 USD m
/17, USD
6/17
m*
Net Oil Revenue 7,238 14,153 196% 25,771 18,533 166 63
Personal Income Tax 2,483 2,036 82% 5,147 2,664 33 -2
Sales Tax/VAT 2,630 1,035 39% 1,843 -787 12 -26
Excise 1,034 624 60% 1,153 119 7 -7
Business Profit Tax 1,295 701 54% 1,753 458 11 -7
Customs 1,170 726 62% 1,284 114 8 -8
Other Revenue (fees,
644 2,137 332% 2,865 2221 18 9
licenses)
Non-oil Revenues 9,256 7,258 78% 14,046 4,790 91 -42
Grants from Donors 2,041 8 0% 414 -1,627 3 -26
Total Resources 18,535 21,419 116% 40,231 21,696 260 -5
Salaries 14,358 9,083 63% 22,405 8,047 145 -61
Operating 5,096 8,021 157% 5,898 802 38 -35
Capital 1,588 958 60% 3,232 1,643 21 -2
Transfers 6,321 2,482 39% 8,216 1,895 53 -37
Other 38 14 38% 238 200 2 1
Peace 4,500 132 3% 3,000 -1,500 19 -45
Interest 155 358 231% 702 547 5 2
Contingency 1333 377 28% 0 -1333 0 -19
Total Government
33,389 21,425 64% 43,691 10,302 282 -195
Spending
Externally funded spending 4,685 96 2% 2,586 -2,099 17 -50
Total Spending 35,429 21,521 61% 46,277 10,848 299 -208
Overall balance -16,894 -103 1% -6,046 10,848 -39 202
New Borrowing 11,644 7,930 68% 3,007 -8,637 19 -147
Repayments 7,875 8,428 107% 11,093 3,218 72 -41
Net Financing 3,769 -511 -14% -8,086 -11,855 -52 -106
Financing gap** -13,125 -614 -14,132 -1,007 -91

* 70SSP/USD for 2016/17, 155SSP/USD for 2017/18

** for actuals, this is a reporting gap
Expenditure and inflation performed as follows:
vi