Contents -- Acknowledgments -- Abbreviations and Acronyms -- Executive Summary -- PART I. INTRODUCTION AND CONTEXT -- 1. Introduction -- 2. The Macroeconomic Context for Public Expenditure Reform in Zambia -- Progress in Macroeconomic and Poverty Indicators -- Public Expenditure, Poverty and Social Outcomes -- The Scope for Increasing Government Revenue -- Key Areas for Maximizing Impact of Public Expenditure -- Summary and Conclusions -- 3. Governance and Accountability in Zambia -- Trends in Governance Indicators -- Underlying Factors for Trends in Governance -- The Accountability Framework in Zambia -- Enhancing the Oversight Role of Parliament -- PART II. PUBLIC EXPENDITURE MANAGEMENT AND FINANCIAL ACCOUNTABILITY -- 4. Budget Preparation -- Credibility of the Budget -- Comprehensiveness of the Budget -- Budget Classification -- Links Between Budgeting and Planning -- Presentation of the Budget -- 5. Budget Execution and Control -- Cash Rationing -- Revenue Controls -- Expenditure Control -- Commitment Control and the Arrears Problem -- Payroll Controls -- Capital Expenditure Controls -- Public Procurement -- 6. Accounting,Reporting,and Audit -- Legal Basis for Accounting and Reporting -- The Current System for Financial Management and Reporting -- Moving Towards Integrated Financial Management Information System (IFMIS) -- Internal Audit -- Effectiveness of External Audit -- PART III.COMPLEMENTARY POLICY MEASURES AND ISSUES -- 7. The Human Resource Challenges for Effective Budget Management -- The Problem of Low Overall Pay -- The Fragmented Salary Structure and Overuse of Allowance -- The Impact on Quality of Services -- The Link to Corruption -- Recommendations -- 8. Service Delivery in Practice:Leakages and Equity in The Flow of Funding to Education in Zambia -- Study Methodology -- Expenditure Tracking -- Leakages -- Equity.

Private Expenditures -- Discussion and Conclusions. -- PART IV.SUMMARY AND A PROGRAM OF PRIORITY ACTIONS -- 9. A Program of Priority Actions -- Medium-Term Vision For Zambia -- The Three-Year Program -- Progress Monitoring -- Costing and Support by Development Partners -- ANNEXES -- Annex A: Comparative Review of the Role of Parliament in Budget Passage -- Annex B: Government Banking Arrangements -- Annex C: Areas for Improving the Cash Release System -- Annex D: Procurement:Short-term Sequenced Actions -- Annex E: Procurement:Medium to Long-term Sequenced Actions. -- Annex F: Key Issues in IFMIS Development -- Annex G: Description of a Selected Salary Enhancement Scheme (SASE) -- References -- LIST OF TABLES -- Table 1: Zambia:Structure of Output and Real GDP Growth,1970s -2000 -- Table 2: Zambia:Macroeconomic Indicators,1970s -1990s -- Table 3: Zambia:Poverty and Social Indicators -- Table 4: Zambia:Share of Social Expenditures,1996 -2001 -- Table 5: Zambia:Central Government Revenue,1990 -2000 -- Table 6: Zambia Governance Trends -- Table 7: Public Perception about Government Performance -- Table 8: Illustrative Examples of Use of Supplementary Appropriations (Year 2000 budget) -- Table 9: A Comparison of Historical Spending with Approved Budget Estimates for Selected Line Items -- Table 10: Ministry of Health (billions of Kwacha):Budget Line Items Through Which Personnel Costs Are Paid -- Table 11: Cash Releases to Select Ministries for Key Expenditure Categories during 1998 -- Table 12: Comparison of Budget Releases and Actual Expenditures -- Table 13: Staf .ng of the OAG -- Table 14: Funding of the OAG for the Period 1998 -2001 -- Table 15: Scenarios Assumptions Matrix -- Table 16: Enrollment,Urbanization,Wealth,and Distance -- Table 17: First-Year Priority Actions -- Table 18: Second-Year Priority Actions.

Table 19: Third-Year Priority Actions -- LIST OF FIGURES -- Figure 1: Zambia: Trends in Health and Education Indicators,1990 -2000 -- Figure 2: Index of Zambia 's Real Per Capita GDP,1975 -2000 -- Figure 3: Indices of Real Minimum Salaries for Various Civil Services Salary Grades,1975 -2000 -- Figure 4: Public Service Employment Trends,1978 -2001 -- Figure 5: Funding Flows Diagram -- Figure 6: Funding Disbursement in Zambian Education -- Figure 7: Inequalities in Public Funding in Zambian Education -- Figure 8: Equity in Public and Private Funding -- Figure 9: Lorenz Curves of Public and Private Funding.