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12 The heads of district administrations (CISCO and the SSD) distribute the funds across the schools and health facilities 12. Investment budgets and salaries are almost fully executed at the central level. See Chapter 3 on expenditures for the execution rates. 18 WORLD BANK COUNTRY STUDY within each district. Two thirds of these funds are assigned to the purchase of services (mainly current maintenance), while the rest (purchase of goods) is equally divided between administrative and school supplies.

Both areas will receive additional attention in the upcoming PER and a Health Sector Study. Equity of geographical allocations. 19 This implies that different jurisdictions will have different needs of public service delivery as well as different abilities to provide services and to raise own revenues to finance their expenditures. In order to measure the equity dimensions of the distribution of allocations, recurrent deconcentrated expenditures have been matched with indicators of welfare across different geographic administrative units.

Ii) The geographic allocation of nonsalary expenditures is also regressive. Nonsalary expenditures are distributed proportionately to the population across districts. Given the high variability in their poverty incidence across districts a uniform allocation to districts results in regressive expenditures. These results are in line with existing evidence from the Education Sector Study,20 which highlights the potential for important economies of scale in both primary and secondary education. However, given the sparsely dense population in Madagascar, a large fraction of public primary 19.

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