PUBLIC SPENDING IN FAVOUR OF THE FORESTRY SECTOR

The forestry sector is financed by current spending and state capital expenditure, spending by communities, spending from the management fund collected from the harvesting of forest resources and the spending of Non-Governmental Organisations (NGO) and Local Management Structures (LMS). In Niger, there are not any public enterprises involved in forestry.

Expenditure from the national state budget

Spending allocated by the state for forestry development is in two areas: current spending (or operating expenditure) and capital expenditure.

Operating expenditure

This is made up of the regular expenditure that covers the current activities of the Water and Forestry Service. This is purely administrative expenditure and includes the following:

personnel costs (wages and salaries of forestry staff) - the calculation and payment of salaries is effectuated by services responsible for finance; and

operating expenditure (purchase of materials, transport costs and expenses and other public interventions).

The Administrative and Financial Affairs Office (AFAO) of the ministry responsible for forestry prepares the budget. This preparation is done by going through the following stages:

estimating revenue according to the regulations;

estimating expenditure for budget proposals submitted by each ministry;

organising budgetary meetings at all levels; and

drafting a finance bill by the budget management team on the basis of the results of budgetary negotiations.

State sources of budget funds essentially undertake spending on current activities. Indeed, compared with neighbouring countries, Niger has the lowest tax burden (UNDP, 2000), which is 8% of GDP compared with 13% and 18% respectively for Burkina Faso and Chad in 1998. Table 21 below provides an indication of current budget spending on the water and environment sectors (at the time, the Ministry for Hydrology and the Environment, MH/E) compared to the general budget. The forestry and wildlife sections were integral parts of the water and environment sectors up until 1999; therefore, it is difficult to identify expenditure on forestry separately because the AFAO does not disaggregate the accounts.

In analysing Table 21, it is notable that the MH/E budget scarcely goes beyond 1% of the general state operating budget, whereas the water and environment sectors or more particularly the forestry sector are always among those requiring priority. This shows the paradox between political speeches and concrete acts in terms of the allocation of resources to forestry. The table also illustrates that current government spending on the water and environment sectors increased significantly between 1991 and 1996. From 1997 onwards, it began to decrease. The clear rise noticed between 1991 and 1996 can be explained by the relative political stability restored in Niger after the 1993 democratic elections.

The investment budget

This is made up of resources from non-reimbursable aid and the contribution of the general state budget. Capital expenditure includes study, research and the production of economic, social and administrative infrastructures.

In contrast to the operating budget, the investment budget is prepared by the Ministry of Planning in close collaboration with the Studies and Programming Offices of the Ministries and follows the same process of adoption as the operating expenditure budget.

Analysis of the efficiency of capital expenditure in forestry enables us to make a certain number of observations in relation to the amount of money allocated to this sector by the national treasury, non-reimbursable aid and loans.

The money allocated over the past eight years is 29,122,386,000 FCFA, that is an average of 3,640,298,000 FCFA per year (see Table 22). This allocation of funds changed widely and irregularly between 1991 and 1998. The annual average realisation of investment expenditure amounted to 2,231,416,000 FCFA, or an average of 64% of the allocation.

This variability in investment was due to the situation of government finances in Niger, which were in a very worrying state during this period. The country experienced huge difficulties in honouring commitments both nationally and internationally. This deterioration in government finances was due to widespread economic recession, but also to political factors that brought about the suspension of certain programmes and aid to Niger. It is clear that the consequences were felt in forestry, which was one of the major beneficiaries of this aid. Tension in the public revenue department, because of the poor performance in tax collection and the lack of spending control and management, was also a limiting factor.

Aid and foreign bilateral and multilateral loans

From foreign aid and bilateral and multilateral loans, the total money for investment programmes in forestry is estimated at 28,792,977,000 FCFA for the period 1999 to 2004 (see Table 23). This figure is equal to an average annual funding of 4,798,829,000 FCFA. Of the fifteen foreign sources of money that forestry benefits from, two programmes are loans from multilateral financing organisations, namely the World Bank and the African Development Bank. The total for these two loans alone amounts to 16,783,296,000 FCFA, or 58% of the total foreign assistance to the sector.

2000-2004

Communities’ expenditure

Communities’ expenditure includes the expenditure undertaken by the different territorial communities in the forestry sector. The spending is authorised by completing operations sheets drawn up by the decentralised technical services of the water and forestry sectors.

The amount allocated by the territorial communities for the development of forestry varies from one year to the next. It was 30 million FCFA in 1991, 1992, 1994 and 1998 and exceptionally reached 130 million FCFA in 1993. The availability of funds encounters the same difficulties as for the state budget. This spending depends particularly on the goodwill of local authorities in the operation and on the disposition of the agricultural community, on whom the possibilities of resource mobilisation also depend.

Forestry management funds at different levels

Monitoring funds – Account 3001

The high rate of financial commitments for the 1998 tax year was due to the payment of outstanding bills. Money in Account 3001 was spent on establishment of forest plantations, fire fighting in the bush and the purchase of fuel for forest monitoring.

From Table 24, it can be seen that there are still significant differences between revenue collection and expenditure. The latter is very variable and depends on the revenue collected in each year. However, the average rate of disbursement is considerable at 88%.

Monitoring funds – Account 3002

Financial commitments from Account 3002 (see Table 25) are not affected by the revenue collected in each year. Money is spent when revenue has not been collected. This fact is due to the absence of inspection in the different regions. The account generates very little revenue whilst the spending requirements are very great.

Communities’ management funds

The trends in revenue in the communities’ management funds are set out in Table 16. Communities that have rural markets are supposed to set aside an average sum of approximately four million FCFA per year on investment in forestry. However, up until now, these funds exist in name only. The allocation of expenditure is approved every year, but the mobilisation of money is very difficult and depends on the disposition of the heads of local administration. The ministry responsible for forestry must carry out the task of making local authorities aware, at their own level, of the existence of management funds and their use.

Therefore, it is necessary to follow up closely with communities to inform them about the revenue available in their forestry management funds. Any time now, the DES should provide information on the use and the balance of these funds. An organised and structured system should also be instituted for drawing up work plans and an annual budget for the use of these funds in harvesting zones. These plans and budgets should be co-ordinated by departmental offices.

LMS management funds

From 1992 until 2001, the money put into the management funds held by the LMS was 44,409,113 FCFA. Certain villages use this fund for the production of seedlings in village nurseries or for the funding of monitoring activity by water and forestry personnel. There are no exact procedures or rules for expenditure from this account. Except in the case of misappropriation of funds, this fund is always available to villages.

NGO intervention in the forestry sector is influenced by the priorities of foreign financing. When sponsors give priority to forestry, all the NGOs observe this fact and their actions are directed towards this as a result. There are approximately 70 NGOs who contribute to forestry. The main sponsors who finance the NGOs are bilateral donors from France, Canada, Switzerland, Belgium, Germany, Denmark and The Netherlands, the European Union, USAid, UNDP and the World Bank.

It should be noted that there is a great allocation of resources to international NGOs, because sponsors consider that locally based NGOs are not yet mature enough to fully ensure the completion of development projects. It should also be noted that, most often, the sponsor finances the international NGO, which then, in turn, grants resources to local NGOs. In this way, the international NGO acts as a monitoring, follow-up and evaluation agent. Under these conditions, it is difficult to estimate the amount of money allocated to NGOs for the development of the forestry sector.

The improvement in forestry’s contribution to GNP is mainly due to the value of forestry products and by-products from natural tree plantations and other types of plantations. This contribution will be upheld by strategic measures to modify the institutional and legal framework and the production of a series of appropriate studies to highlight this contribution. Concerning the institutional and legal framework, since 1999, with FAO’s technical and financial support, Niger has completed its revision of the forestry code.

One of the aims now assigned to the state is to implement a 2000-2004 action plan so that it continues to improve the forestry sector’s contribution to GNP. It is in this framework that action will be taken notably for the organisation of networks for forestry products and by-products such as gum arabic.

The cost of intervention planned for forestry is estimated at 191,880,000,000 FCFA (see Table 26). These costs should be met through the efforts of territorial communities, the state, project structures, NGOs and the private sector. For its part, the state has already set the tone by allocating 850 million FCFA of its own funds for the budget in 2000, and 500 million FCFA for the budget in 2001.