TERMS OF REFERENCE FOR CONDUCTING A BUDGET ANALYSES

1. Background and Justification                                                                              

To address the challenges of sustainable development financing, the Government of the Republic of Namibia (GRN) will need to develop new, more effective and integrated approaches to mobilizing and managing public and private finance. Under the leadership of the Government of the Republic of Namibia, with the support of United Nations Namibia (UNN), the joint program “Strengthening Namibia’s Financing Architecture for Enhanced Quality & Scale of Financing for SDGs,” will be implemented to create the right conditions and capacities for the alignment of public and private capital to the SDGs and the longer-term enhancement of the quality and scale of financing.

The participating UN organizations (PUNOs) (comprised of UNDP, UNICEF, UNFPA and ILO), will support the Government in the operationalization of the Joint Programme through evidence generation, advocacy and policy advice, technical assistance, capacity development, partnerships and systems strengthening. The range of activities will include: development of Integrated National Financing Frameworks (INFFs); holding multi-stakeholder dialogues, alliances and networks with the Government, development banks, financial sector and investors; strengthening of capacities of public authorities and the ecosystem that can lead to a pipeline of impact-driven investments; conducting feasibility studies required to design gender-sensitive innovative solutions and products that can unlock public and private capital for the SDGs.

Towards this end, UNN seeks to collaborate with GRN’s implementing counterparts to undertake a detailed analysis of the 2021/22 National Budget to assess the extent to which it is gender and employment responsive while maximising investments in key social sectors most notably health (including sexual and reproductive health and rights), WASH, education, and sustainable development considerations including poverty and inequality alleviation. Findings from the analysis will be developed in a main analytical report and then packaged in the form of dedicated budget briefs, which will be used as advocacy tools to influence future spending patterns. The analysis will offer insights about adequacy, efficiency, equity and transparency of spending. The main objective of producing budget briefs is to synthesize complex budget information so that it is easily understood by stakeholders and to put forth practical recommendations that can inform and make financial decision-making processes better respond to the needs / targets as outlined in relevant national policy frameworks.

Within this context, and building on the implementation experience in the region, the budget analysis serves three main purposes:

• Analyse and monitor budget allocations to sectors and key strategic areas that are important for sustainable development and fast recovery from COVID-19 in the current fiscal year;
• Assess the adequacy and efficiency of past spending to the extent possible, and
• Identify concrete gaps, needs and opportunities for improving social, economic and environmental spending to achieve Sustainable Development Goals (SDGs) and ultimately the national development priorities.

The budget analysis will cover seven thematic areas:

1. Gender (standalone brief, scope of which to be agreed upon by the PUNOs; gender  perspectives will also be mainstreamed in the other analyses to the extent possible)
2. Employment
3. Health
4. Sexual Reproductive Health and Rights (SRHR)
5. Education (pre-primary to tertiary)
6. Water, sanitation and hygiene (WASH)
7. Poverty and inequality alleviation outcomes

In addition to the analysis on gender as a standalone theme, the inception report should include the indicators against which the gender responsiveness of each of the sectors/areas will be assessed.

The SRHR analysis will review expenditure contained within the Health and Education sectors, and other relevant sectors and programmes. Making use of demography data, a demographic lens should be applied to all SRHR expenditure, measuring how people-centered the expenditure is; capturing any considerations on age structure, sex and spatial dimensions.

Due to the multi-sectoral nature of employment creation programs, the proposed analysis will focus on sectors and interventions that are of particular relevance for employment creation to be agreed upon with the GRN and the relevant PUNOs. These should be guided by national plans and strategies such as NEP2, NDP5 and HPP2. The programs should be selected from the following sectors:

• Agriculture
• Industry and manufacturing
• Tourism
• Natural resources & (renewable) energy
• Public works
• Infrastructure development
• Education and skills development

The analysis will also consider the extent to which the fiscal budget is responsive to addressing poverty and inequality in a drive to ensure that no one is left behind.

The scope of analysis under each sector should be agreed to following a consultative process involving relevant government departments and stakeholders.

2. Objectives, Deliverables and Work Plan                                                                                     

Objectives

The main objective of the exercise is to analyse spending patterns on key social, economic, and environmental sectors to achieve SDGs, ultimately the national development priorities. The main focus will be on size, composition, equity, efficiency and financing of select sectors and programs. The analysis will be based on data from annual expenditure reports and approved national budgets. The analysis should cover the latest available 5-year period where data are available.

Deliverables

The consultant team will be required to deliver the following:

1. Inception report on the assignment which provides an interpretation of the TOR, a proposed methodology and workplan, as well as an annotated outline for each of the seven thematic budget       analyses.
2. An overall draft analytical report and seven draft budget briefs (maximum 20 pages, font 11) on the below themes, with the other six including a section on gender responsiveness.

1. 1. Gender
   2. Employment
   3. Health
   4. SRHR
   5. Education
   6. WASH
   7. Poverty and inequality alleviation outcomes

3. Final analytical report and seven budget briefs that include inputs and feedback by the respective lead agency as well as their respective Namibian government partners;
4. Excel workbook with cleaned background data for each budget brief.
5. Seven advocacy plans for each brief that summarises the recommendations of the budget analysis, and sets forth a plan for their implementation and advocacy. These should be based on this template

The analytical report should spell out all the budget analysis’ findings in detail, ensuring that each focus area is covered. An appropriate structure for the analytical report is to be provided as part of the inception report which should also propose the final selection of focus sectors to be assessed as part of the employment analysis.

Below is a suggested structure for each budget brief

Key messages and recommendations (1/2 page)

• Summarise key findings and recommendations in order of priority.

Introduction (1/2 page)

• Highlight the rationale of the budget brief, methodology for the budget analysis, caveats and limitations.

Section 1. Overview (2 page max)

• Provide an overview of relevant national policies, strategies, and plans on the select thematic issue, key statistics/ indicators, and institutional framework, including coordination mechanisms.

Section 2. Size and Trends in Spending (2-3 pages max)

• Present total spending in nominal and real terms in a fiscal year for the thematic issue and as a percentage of GDP and of annual government budget and trends over time. Also provide per capita spending and spending in relation to other areas and countries.

Section 3. Composition of Spending (2-3 pages max)

• Disaggregate total spending according to program, theme, institution and economic classification.

Section 4. Financing (2 pages max)

• Provide an overview of sources of financing, key donors, and additional financing options.

Section 5. Budget Credibility and Execution (2 pages max)

• Discuss any budget credibility, and budget execution issues depending on availability of data

Section 6. Equity and Decentralisation of Spending (2 pages max)

• Discuss equity and decentralization, focusing on challenges and opportunities for improved financing.

Section 7. Policy and Other Structural Issues (1 page)

• Highlight key policy and PFM issues and other challenges to increase volume and improve quality of spending.

The briefs should also reflect information and analyses provided in the set of budget brief guidelines.

3. Recommended Steps in conducting a thematic budget analysis                                                                                

Step 1: Initiate the process and define the scope

Step 2: Identify finance laws, policies, strategies/plans and interventions

Step 3: Map relevant Offices, Ministries and Agencies (OMAs) and budget documents Step 4: Collect budget data and other information

Step 5: Organize and analyze the data, and develop preliminary findings

Step 6: Organize and conduct a consultative workshop to solicit feedback on the preliminary findings

Step 7: Compile the budget analysis, and developing the report and budget briefs Step 8: Organize and participate in the validation of the above outputs

Step 9: Finalize the report, action/advocacy plan, and budget briefs

Steps 1-3 are the foundational preparatory steps for each budget brief. The order in which they are applied is flexible and the steps tend to overlap. If a comprehensive PFM forum is in place, and stakeholders have an existing working relationship, agreeing on a scope of analysis and setting up management arrangements should be the Step 1. However, if these are not in place, the relevant agency/ies may want to begin by mapping OMAs budget, planning and policy documents and discussing the scope at a later stage.

4. Payment Schedule                                                                              

The Consulting firm will be paid upon receipt of satisfactory deliverables as outlined above in meeting the PUNOs’ quality standards and according to the following schedule:

1. 1. First payment (30%) upon delivery and acceptance of the inception report.
   2. Second payment (30%) upon delivery and acceptance of the first draft budget analysis and briefs.
   3. Third payment (20%) upon delivery and acceptance of the final budget analysis and budget briefs, suitably incorporating all feedback received.
   4. Final payment (20%) upon delivery of Excel Workbook and Seven Advocacy Plans

5. Conditions                                                                           

The contract will be established for 60 working days over a period of five (3) months. The consultancy is open to both local and international consultancy firms and must comprise a consortium of experts with a clear appointed team leader. The consultancy firm must be registered, and its banking details reflecting the firm’s name. In the case of international consultancy firms and consortium of experts, demonstrated involvement of local expertise is expected as part of the Budget  Analysis Team.

As per broader UN financial and administrative policies, payment is made against approved deliverables. No advance payment is allowed unless in exceptional circumstances against bank guarantee, subject to a maximum of 30 per cent of the total contract value in cases where advance purchases, for example for supplies or travel, may be necessary. The service provider selected will be governed by and subject to UNFPA’s procurement terms and conditions.

6. Desired competencies, technical background and experience                                                                            

The nature of budget analyses requires expert skills and understanding of economics, social development, social policy, gender and budgeting. Members of the Budget Analysis team need to be able to locate, identify, interpret and analyse a broad range of policy, statistical and budget data. The primary skills, knowledge and experience required range from understanding of the PFM landscape to social sector budget analysis to measure size, composition, and equity of spending. The team is also expected to have expertise in health, gender labour economics, employment promotion, education, WASH and poverty and inequality issues. PFM knowledge and experience includes a working knowledge of the mechanisms of local and national budgeting systems.

7. Selection Criteria                                                                                  

The Consulting team will be evaluated based on a cumulative analysis:

When using this weighted scoring method, the award of the contract will be made to the Service Provider whose offer has been evaluated and determined as:

1. Responsive/compliant/acceptable, and
2. Having received the highest score out of a pre-determined set of weighted technical and financial criteria specific to the solicitation.

• Technical Criteria weighting: 70%
• Financial criteria weighting: 30%

Only candidates obtaining a minimum of 50 points in the technical evaluation would be considered for the Financial Evaluation

8. Supervision                                                                          

The Program Officer will coordinate reporting and progress updates and will provide the necessary support to achieve the objectives of the work, as well as remain aware of any upcoming issues related to the performance and quality of the work.

The Service Provider(s) will be jointly supervised across the thematic areas under analysis as follows:

• Health, Education and WASH – Social Policy Manager (UNICEF)
• SRHR – Health Economics Specialist (UNFPA)
• Gender responsiveness – Gender Specialist (UNFPA)
• Employment responsiveness – Employment Specialist, as well as an international expert (ILO)
• Poverty and inequality alleviation outcomes (UNDP)

9. Institutional Arrangement