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November 2015

November 30, 2015

Understanding PFM—New Online Course

 

SOAS

Posted by Dr. Alberto Asquer[1]

The capacity to understand how public finances are managed is much needed nowadays, with more and more citizens in a growing number of countries demanding greater accountability in the use of public monies. No longer is public financial management (PFM) only confined to the expertise of accounting professionals.  As the media increasingly report on how mismanagement of public monies impacts on the lives of individuals, it has become more apparent that some basic notions of PFM should be part of everyone’s core knowledge about how the public sector works.

In this spirit, the Centre for Financial and Management Studies of the School of Oriental and African Studies (SOAS), University of London, has produced a MOOC (Massive Online Open Course) on “Understanding Public Financial Management: How is Your Money Spent?”. The project was realized in collaboration with FutureLearn, a UK provider of online courses with more than 70 partners around the world. You can visit the course at www.futurelearn.com/courses/public-financial-management and register for the first run, expected in January 2016.

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November 20, 2015

Sector Ministries: As Important as the Finance Ministry for Good PFM!

GIZ_logo

Posted by Lena de Stigter[1] and Jennifer Moreau[2]

Post Addis Ababa, the debate on development finance focuses in large part on the generation of the necessary additional resources to support the Sustainable Development Goals (SDGs). Improving tax systems and compliance is an important element in this regard and strongly supported by the German Development Cooperation agency GIZ. Yet, taxation is only one side of the coin. Sound public financial management (PFM), especially at the level of sector ministries, should be the other. The generation of savings through more effective and efficient budgeting and expenditure policies in sectors may be as important for countries as resource mobilization through taxes. For instance, the IMF has recently shown that there is much to gain by reducing the inefficiencies around public investment management (IMF, 06/2015, Making Public Investment more Efficient). Moreover, the Collaborative Budget Reform Initiative (CABRI), through its sector dialogues, has done important work on highlighting the possible gains of improving value-for-money in program expenditure in key parts of the public sector. Sound investment policies and development-oriented public expenditure will enhance trust of citizens in their government and increase their willingness to pay taxes. Moreover, it will have a positive impact on the socio-economic environment of a country and generally, serve as a catalyst for development. 

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November 18, 2015

IDB and IMF Launch a New Book on PFM Reforms in Latin America

Pages from Public Financial Management in Latin America_ The Key to Efficiency and Transparency,Gestion financiera publica en America

Posted by Carlos Pimenta and Mario Pessoa[1] 

The International Monetary Fund (IMF) and the Inter-American Development Bank (IDB) launched today the English version of the book “Public Financial Management in Latin America: the key to Efficiency and Transparency”. The volume, which was edited by Carlos Pimenta and Mario Pessoa, is a joint work based on extensive technical assistance provided by both institutions. 

The areas covered in the book include treasury single accounts, performance indicators for treasury management, financial management information systems, accrual accounting, cash and debt management, public procurement, and cost accounting. These topics were selected to bridge the gap in the literature about the results achieved in the region. 

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November 09, 2015

The Functions and Organization of Ministries of Finance

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Posted by Richard Allen, Yasemin Hurcan, and Maximilien Queyranne[1]

There is surprisingly little literature on the functions and organization of modern ministries of finance. Yet some critically important questions arise. What are the core finance functions that a state needs to carry out? What resources—financial, human and IT—are required to carry out these functions efficiently and effectively? Where should the functions be located—in a department or directorate of the finance ministry, in another ministry, or in a specialized agency? Are there any “good practice” models or approaches that can be identified looking across a range of countries, advanced, emerging and developing? What principles should developing countries follow in reorganizing their finance ministries? 

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November 06, 2015

Trapping the White Elephants: Can the Latest Public Investment Boom Avoid the Mistakes of the Past?

ODI logo_Pantone 329 RGB
By Richard Hughes[1]

On November 11 and 12, the Overseas Development Institute’s Centre for Aid and Public Expenditure (CAPE) in London will be dedicating its annual conference to the question of how developing countries can get a bigger “bang” for their public investment “buck”. The conference takes place against the backdrop of a surge in public (and private) investment in infrastructure in developing countries in recent years. However, the impact of this latest investment boom on economic and social development will depend crucially on the way in which that investment is managed. Past public investment booms in the developing world have often been associated with “white elephant” projects, time delays, cost overruns, inadequate maintenance, illusive returns, and ultimately fiscal instability and retrenchment.  

Will this time be different? On the eve of the 2015 CAPE conference, Richard Hughes, Division Chief in the IMF’s Fiscal Affairs Department and co-author of the Fund’s new policy paper “Making Public Investment More Efficient” explores these issues below.

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