Question 46

Does the Executive’s Budget Proposal or any supporting budget documentation present estimates of earmarked revenues for at least the budget year?
 * a. Yes, estimates of all earmarked revenues are presented, along with a narrative discussion.
 * b. Yes, estimates of all earmarked revenues are presented, but a narrative discussion is not included.
 * c. Yes, estimates of some but not all earmarked revenues are presented.
 * d. No, estimates of earmarked revenues are not presented.
 * e. Not applicable/other (please comment).

OBS Guidelines
Question 46 asks about estimates of earmarked revenues, which are revenues that may only be used for a specific purpose (for example, revenues from a tax on fuel that can only be used for building roads). This information is important in determining which revenues are available to fund the government’s general expenses, and which revenues are reserved for particular purposes.

To answer “a,” the Executive’s Budget Proposal or supporting documentation must present for at least the budget year both estimates covering all earmarked revenues and a narrative discussing the earmarks. If a narrative discussion is not included, but estimates for all earmarked revenues are presented, then a “b” answer is appropriate. A “c” response applies if the presentation includes estimates covering only some, but not all, earmarked revenues (regardless of whether it also includes a narrative discussion). Answer “d” applies if no estimates of earmarked revenues are presented. An “e” response applies if revenue is not earmarked or the practice is disallowed by law or regulation.

1) Foreign grants
Grants from foreign donors does not qualify as earmarked revenue. See, PR comment in Malawi OBS 2017 Questionnaire, Q46.

2) Non-binding earmarked revenue
We will accept non-binding earmarked revenue for this question. For example, "earmarked" revenues are not allowed by German budgetary legislation (Non-Affektationsprinzip = Principle of universality). However, non-binding political direction of income into certain spending (Haushaltsvermerke) is possible and has been documented. See, discussion in Germany OBS 2017 Questionnaire, Q46.

3) The case of Azerbaijan in OBS 2019
In Azerbaijan in OBS 2019, the researcher cited a single row in an EBP table labeled “A targeted budget fund determined by the relevant executive authority” for this question. While a “c” response requires no narrative discussion and only partial estimates of earmarked revenues, this line is extremely vague. Also, given the description, this item seems more like an item on the expenditure side rather than on the revenue side of the budget, and could be funded from a number of sources, including but not necessarily only from earmarked revenues. So in this case, answer "d" is most appropriate.

4) What if a country only has narratives for some of the earmarked revenues?
This is okay. A country can score an "a" even if it only has narratives for some of the earmarked revenues, as was the case of Costa Rica in OBS 2019.

External references

 * The Earmarking of Government Revenue: A Review of Some World Bank Experience
 * Earmarking for Health: From Theory to Practice