Conclusion

The two main speakers offered closing remarks at the end of the roundtable:

Dr. Alaa Ghanaam

This was a fruitful discussion from which we will benefit greatly. The fact of the matter is that studies of the burden of disease are essential to the process of strategic health-care planning; without them, all our efforts are useless.

The distribution of limited resources, or what is termed allocative efficiency, depends on research into the disease burden, which allows us to identify society’s real needs in health services. Health outcomes in any society are the basic scientific measure for identifying what kind of spending increases on health care we really need, and how to manage that spending efficiently, based on priorities that are consistent with society’s needs.

Mr. Abd al-Fattah al-Gebali

I’m very pleased with all the comments; despite disagreeing with many, I have benefited and learned from them. I think that as Mr. Hossam Bahgat said, the first objective of the discussion is to open up all the points of debate around the topic. In fact, government discussions of the budget are not as complicated as my friend, Dr. Mohamed Nur al-Din, suggests. Rather, it is simply a matter of sufficient awareness, information and seriousness. One of the most important foundations for drafting a government budget is transparency, which means it should be disseminated widely with all the relevant data and information, and civil society should participate in the discussions. Transparency is one of the indicators used by the World Bank to evaluate state budgets. In the end, a debate about the public budget is a priority for society.

Yes, the budget is a political document. The legislature must examine and discuss the budget item by item because it, along with civil society, is a basic component of the power structure, and it is very important to create a balance in society, as Dr. Samer Suleiman said. Nevertheless, I disagree with Dr. Suleiman in his focus on doctors as the strongest lobby for increased health spending, because it is not they, but citizens, who are the primary recipients of health services. As Dr. Mohamed Hassan Khalil said, all of society must be involved in the two issues of education and health, in one form or another.

This is where an organization such as the EIPR plays an important role, initiating discussions on an issue like the health or education budget in an academic or technical way, as Dr. Alaa Ghanaam said, rather than simply using political statements, which can often conceal important truths.

The budget always has some aspect of subjective estimation open to interpretation and difference, but the state closing accounts and the monetary data issued by the Central Auditing Organization do not contain any misguiding information or data, and the numbers are not manipulated as some have said. What is important is how we read and interpret these numbers.

Regarding my point of disagreement with Dr. Khalil about budget divisions, there is a functional division, there are financial asset holdings, there is loan servicing and there is the total deficit. Regarding the functional division, which many do not read, there is the division of the World Bank, which involves ten major divisions, each with several subdivisions. Within this functional division, we find the details of expenditure. So, for example, in the ophthalmology hospital, there are allocations for medication, academic research, wages and more.

Here the dispute  on the issue becomes clear. If we look for social health insurance, we will find it in a certain line in the budget. I would give Egypt a transparency rating on the public budget of 54 out of 59.

Another important principle is that of the unified budget, which means that one cannot allocate a resource for a particular type of spending—I cannot, for example, impose a sales tax for health spending or a general tax for health expenditure. Rather, all state resources are collected in one vessel that enters the state treasury; resources then leave the state treasury in accordance with public spending priorities determined by society, among them, of course, health services.

This is why I wrote an article in al-Ahram about the subsidy debate. Some were talking about funding for subsidies, and I cautioned against this narrow perspective because it undermines the principle of a unified budget.

So, there are basic principles of the budget: first of all, comprehensiveness; secondly, a unified budget. In this context, I disagreed with some ministers who were saying, “We sold this so we could fund that,” because it is more proper to say that resources enter the state treasury and then are spent as prioritized according to importance.

The state budget is formulated in parliament, with its existing political alignments and through various tools of pressure, as well as in the various parliamentary committees, including the Budget and Planning Committee. But this is an incomplete picture given the absence of advocacy groups, particularly from civil society and human rights groups. As a result, the budget is only amended according to the efforts of a few experts, who simply increase public expenditure by LE3 or 4 billion annually. This point in particular, and the role of civil society in impacting the budget drafting process, is what I came to this roundtable to discuss.

Regarding Dr. Mahmoud Khayyal’s comment, there is, in fact, support within the government to amend the basis on which the budget is drafted, using a program and performance budget. But four years have passed, and we have not yet begun to work on a program and performance budget. With what we have now, we can evaluate spending effectiveness in the sense that we can determine if we spend X pounds, we can renovate X hospitals, but we do not yet know if and how this improves health outcomes, and we need to know.

A program and performance budget is very complex, and we need a capable system to administer it. We did start this, but stopped for several reasons. A program and performance budget will achieve efficient expenditure, which I believe is an important future challenge that could fulfill what you discussed in your comments.

These are some of the primary issues. There is another major issue, that of wages, which is multifaceted and complex. Expenditure on wages is very high. In the current year, it comes to LE76 billion of a total of LE343 billion, which is enormous. At the same time, wages are still low despite budget increases. We also have 6.5 million government employees, and we have inflation. It is a problem with dimensions that must be examined and compared based on current prices or fixed prices and against growth rates. In any comparison, current prices must be set against current prices or fixed prices against fixed prices.

Speaking of the distribution of public expenditure, a functional division of the budget shows that the Ministry of Interior receives only LE9 billion. Meanwhile, LE126 billion goes to subsidies, and LE35 billion to education.

Regarding the gap between the lowest and highest wages, the difference is attributable to funds from sources other than the budget, such as private funds and distribution of incentives and profits, all of which are set according to the various laws regulating them. This is the reason for wage gaps, not monies from the public budget. Thus, the most positive recent step has been a move toward a unified treasury with financial oversight of all expected resources by the Central Auditing Organization, which itself did not know the number of private funds and accounts. This new system has two advantages:

1. It creates what is known as state liquid funds (flat money).

2. It places all resources in private funds at the Central Bank, which allows borrowing for current expenses like wages. This reduces borrowing and realizes some revenue for the state.

Regarding Mohamed Hassanein Heikal’s remarks about the public budget and statements from others in the press that expenditure on the Ministry of Interior is greater than expenditure on the armed forces—this is false. The Ministry of Interior receives LE9 billion while the Defense Ministry receives LE21 billion. This is what I wrote in al-Ahram a short time ago. It is important to verify information before publication and dissemination, and it is important to read it as well. This is what I was saying to Mr. Bahgat and Dr. Ghanaam—that it is important to base an analysis on accurate information.  Of course, this is not the end of the debate.