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Social Expenditure Monitor for Arab States: A Tool to Support Budgeting and Fiscal Policy Reform

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Targeting public expenditure in line with social development priorities and macro-fiscal sustainability remains a challenge for most Governments in the Arab region. Budget allocations that support multiple and overlapping social programmes and policies are often mismatched or inadequate for the realization of the Sustainable Development Goals (SDGs). Given the pressure on public budgets across Arab countries, such expenditure management is unsustainable.

Comprehensive monitoring of public social expenditure could improve the efficiency of allocations and the effectiveness of budgeting. It will enable the rationalization of expenditure components and support the achievement of various objectives, including delivering quality public services, promoting inclusive development and stability, and enhancing economic growth and revenue over time. The Economic and Social Commission for Western Asia (ESCWA) is therefore supporting member States in establishing a social expenditure monitor, viewed as an integrated framework for supporting macro-fiscal policies and the SDGs.

This paper proposes an innovative framework: the social expenditure monitor (SEM). The conceptual approach is aligned with the SDGs. The monitor will thus provide a comprehensive measure of public social expenditure in seven areas including: (1) education; (2) health and nutrition; (3) housing and community amenities; (4) labour market interventions and employment generation; (5) social protection and food security; (6) arts, culture and sports; and (7) environment protection. The indicators are mapped to key beneficiaries across individuals, households and communities. The framework is flexible and can be adapted to national specificities. Member States are invited to establish the SEM in their national contexts, as a tool to improve targeting budgets towards achieving higher economic growth and the SDGs.