Budget

May 20, 2014

Budget Institutions Matter

Posted by Holger van Eden
G20 pix blog post
Most economists would agree that institutions help shape economic and fiscal outcomes. But which institutions really matter, and to what extent, is less clear. A recent IMF Board Paper and annex featuring country evaluations produced by the Fiscal Affairs Department, which was presented today here in Washington, shines a light on the G-20 countries’ efforts to strengthen their budget institutions in the wake of the global financial crisis, and evaluates their impact on fiscal policy. In particular, it asks whether strong budget institutions helped these countries during the 2010–13 period to cope with the substantial fiscal consolidation needs that arose after the Great Recession. The evidence suggests that these institutions have indeed been important.

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April 15, 2014

PEMPAL Meeting on Results-Based Monitoring and Evaluation

New Picture (7)
 Posted by Gelardina Prodani and Hakan Ay1

Image1

From March 3-6, 2014, 20 countries representing the PEMPAL Budget Community of Practice (BCOP) in cooperation with the Ministry of Finance of Turkey gathered in Antalya, Turkey for BCOP’s annual plenary meeting.2 The agenda focused on country experiences with results-based monitoring and evaluation (RBME). David Shand, an international expert in this area, acted as the facilitator for the meeting.

The meeting was formally opened by Mr. Ilhan Hatipoglu, the Director General of Budget and Fiscal Control in the Ministry of Finance of Turkey, and Mr. Martin Raiser, Director of the World Bank in Turkey.

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October 21, 2013

How to Decide on the Budget: Set Menu or à la Carte?

Posted by Renaud Duplay

The recent debate over the United States federal budget, which led to a partial government shutdown, was at times hard to follow. Behind the debate over health care reform, lay also a more procedural struggle over the way to prepare the budget on Capitol Hill. Indeed, part of the butting of heads has resulted from a disagreement over what to negotiate on, in the first place. The US Constitution is relatively light on how the budget should be passed, so many legal options were considered in recent weeks, including: passing a continuing resolution to fund federal services and agencies; passing a continuing resolution linked with a defunding of the Affordable Care Act – Obamacare; funding individual federal agencies on a vote by vote basis; funding individual programs of federal agencies given expected adverse impacts of the shutdown, such as on cancer research trials. These options were, to make it even more complicated, linked to various stances on the federal government debt ceiling: separate decision-making, a linked agreed increase, or what resulted, a temporary suspension. In all this a new federal budget for the new budget year was not on the table. This is now on Congress’ to do list for the next three months.  

All of this is possible because the US federal budget works a little bit like ordering à la carte in a restaurant: you can skip the main course if you don’t feel like it and still end up enjoying the meal (or, more often, not really). Indeed, implementing a deal over the US federal budget requires selecting from a different menu of votes depending on the content of the deal. In addition, authority to spend can be given in various ways: either by appropriations bills – for federal agencies’ operating costs for instance – or by specific legislation that grants authority to spend on entitlement programs until this very legislation is modified or repealed. Those programs are called “mandatory” which by the way sets the tone for any future discussion on them.

Continue reading "How to Decide on the Budget: Set Menu or à la Carte?" »

October 15, 2013

A PFM View of the New French “Loi Organique”

Posted by Benoit Chevauchez[1]

France is now equipped with a fiscal rule. The organic budget law adopted last December[2] was the French government’s response to the obligations set out in the European Treaty on Stability, Coordination and Governance (TSCG) signed in March 2012. The Treaty resulted from a process initiated in December 2011 by the European Council, in the wake of the euro crisis. The basic idea of the Treaty is that “Euro zone countries” should adopt national fiscal rules in order to integrate in their own legislation the Maastricht principles of fiscal discipline that are set out in the European treaties.

Before the new treaty was ratified, the French national budget law did not address issues of fiscal sustainability. The French Constitution of 1958 was silent in this regard, even if an amendment adopted in 2008 had introduced the concept of “budget balance over the medium term”, but only as a theoretical principle without any operational impact. Similarly, the 2001 LOLF (loi organique relative aux lois de finances), and its predecessor the 1959 Organic Ordinance, wholly ignored sustainability issues.

In practice, France has had a rather modest record in terms of fiscal sustainability: its EU stability programs have seldom been respected, its macroeconomic assumptions have been frequently optimistic, and its debt level has steadily increased up to 90 percent of GDP. Thus, for France, the adoption of the new organic law (OL) is an important initiative, that might also mark a turning point in its fiscal tradition.

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May 13, 2013

Twenty-one Countries Meet in Albania to Discuss Program Budgeting Reforms

Posted by Gelardina Prodani, Ministry of Finance, Albania and Konstantin Krityan, Ministry of Finance Armenia

Albania
As Chair and Deputy Chair of the Public Expenditure Management Peer Assisted Learning (PEMPAL)[1] Budget Community of Practice (BCOP), we would like to inform you about an exciting meeting that was held recently in Tirana, Albania on program budgeting.

From February 25th to 28th 2013, the Ministry of Finance of Albania hosted 81 participants from 21 PEMPAL member countries from across Europe and Central Asia (ECA). As suggested by our BCOP members from last year’s plenary meeting,[2] the agenda focused on technical aspects of program budgeting and performance measurement. The three main sessions of the meeting covered international approaches and country cases in (i) design of programs and performance measures, (ii) budget documentation, and (iii) performance monitoring and evaluation.

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Представители двадцати одной страны встретились в Албании, чтобы обсудить переход на программное бюджетирование

Авторы: Джеральдина Продани, Министерство финансов, Албания, и Константин Критян, Министерство финансов, Армения

Albania
В качестве председателя и заместителя председателя Практикующего сообщества по бюджету (В СоР) Сети по взаимному обучению и обмену опытом в управлении государственными финансами (PEMPAL)[1] мы хотели бы проинформировать вас о встрече, которая недавно состоялась в Тиране, (Албания), по теме программного бюджетирования.

С 25 по 28 февраля 2013 года Министерство финансов Албании приняло в общей сложности 81 участника из 21 страны-члена PEMPAL из Европы и Центральной Азии (ЕЦА).  Как и было предложено членами нашего Практикующего сообщества по бюджету (BCOP) на пленарном заседании в прошлом году,[2] повестка дня фокусировалась на технических аспектах бюджетного финансирования программ и на оценке эффективности работы.  Три основных сессии заседания были посвящены международным подходам и практическим примерам стран в следующих областях: (i) дизайн программ и критерии эффективности работы, (ii) бюджетная документация, и (iii) мониторинг и оценка эффективности программ.

Continue reading "Представители двадцати одной страны встретились в Албании, чтобы обсудить переход на программное бюджетирование" »

January 17, 2013

How Can the Pace of Budget Transparency Be Increased? Examining the Results of the Open Budget Survey 2012

Posted by Vivek Ramkumar

IBP WB medium


The International Budget Partnership (IBP) and the World Bank Institute (WBI) are pleased to invite you to join practitioners in the fields of development and fiscal management in a discussion on how to increase budget transparency and participation around the world. The discussion will include a presentation of the results of the IBP’s latest round of the Open Budget Survey and then focus on indentifying innovative and practical suggestions for rapidly improving country performance on the Survey.

Date: 5 February 2013
Time: 9.30-11 am (Breakfast will be served from 9 am)
Venue: IFC Auditorium, 2121 Pennsylvania Avenue, Washington D.C.

There is growing interest in the role of open budgeting systems in development. An increasing body of evidence shows that the best way to manage public funds efficiently and equitably is through budget systems that are transparent, inclusive, and monitored through independent oversight institutions. Recent research studies also show that transparency can help to attract easier and cheaper international credit and thereby increase public revenues. On the other hand, lack of fiscal transparency can undermine fiscal discipline,increase borrowing costs, and promote opportunities for corruption and other leakages.

Continue reading "How Can the Pace of Budget Transparency Be Increased? Examining the Results of the Open Budget Survey 2012 " »

January 03, 2013

Simplifying Budget Documents – Time for an International Standard?

Posted by Camille Karamaga

Improving the quality of budget documentation lies at the heart of many reforms aimed at enhancing understanding of the content of the budget estimates as well as fostering transparency and accountability. Some budget laws prescribe a minimum set of documents to accompany the budget estimates. These may include, for example, reports on: (i) the medium-term macroeconomic forecast; (ii) fiscal policies and public expenditure trends; (ii) medium-term forecasts of government revenues, expenditures, debt, and the fiscal balance; (iii) medium-term resource ceilings; (iv) government guarantees, contingent liabilities and other fiscal risks; (v) spending on expenditure programs and projects by sector; and (vi) projections of donor aid flows. In countries with a Westminster tradition, the budget speech includes much of this information, but additional documents may be presented to the parliament.

Improving the content and quantity of fiscal information is not the same, however, as improving its quality or transparency. More does not always mean better or clearer. Indeed, it often means the reverse. Governments tend to respond to demands for information from the parliament, financial markets, NGOs and ordinary citizens by producing more and more data, often in unprocessed form. This may get them off the hook of public “accountability”, but places them squarely on another hook, accusations of information overload and obfuscation.

The design of a strategic planning framework, medium-term budget frameworks and program budgets has led to a proliferation of detailed information, performance indicators, and monitoring and evaluation reports. Mountains of annual budget books are produced with separate estimates volumes being prepared by each line ministry. The excessive detail contained in the budget estimates weakens their usefulness as raw material for discussion by parliamentary committees. Nor are they meaningful to the general public. In short, much of the  information produced by the government easily becomes a “data cemetery” which contributes little to the decision-making process or enlightened public debate.

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December 20, 2012

Following the Money: Examining the Evidence on Pro-poor Budgeting

Posted by Rebecca Simson[1]

ODI logo
ODI’s Centre for Aid and Public Expenditure has recently initiated a work stream on pro-poor budgeting to investigate how governments choose to spend public funds and what this tells us about allocative efficiency.  In 2001 Adrian Fozzard published a paper on this topic, which presented approaches to resource allocation in the public sector and their implications for pro-poor budgeting. A decade on, and after billions of dollars spent to further pro-poor priorities in developing countries, have we learnt anything new about how to allocate public funds?

Our first background paper, Following the money: examining the evidence on pro-poor budgeting, explores what we do know about the influence of the poverty reduction agenda on resource allocation in developing countries. The paper goes on to propose some possible research topics that could begin to evaluate whether spending patterns have in fact changed in systematic ways in response to the high growth and falling poverty experienced over the past 15 years.

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December 07, 2012

What if… Legislators Approve—and Execute—the Budget?

Posted by Greg Horman

A practice more or less universal across all legislative assemblies is to provide members—MPs, for short—with allowances to enable them to represent their constituents effectively. Typical allowances cover expenses associated with staying in close contact with voters, such as travel to MPs’ constituencies, operating local offices, and communicating through mailings and various media. Although they are the cause of the occasional scandal, debate about these allowances is more over the scope of costs that they cover and up to what ceiling, than over the principle that they are necessary in the first instance. Frequently, these allowances—representing spending by the legislature, not the executive—are outside the government’s budget.

What is uncommon, however, is the situation where MPs themselves administer and distribute funds from the government’s budget.

The Solomon Islands is a case in point and an example of this modality of budget execution taken to an extreme. Depending on the calculation, perhaps 30 percent to 50 percent of the development budget in the Solomon Islands is represented by “constituent development funds.” These are appropriated funds that are directly allocated to and held by MPs for distribution to their constituents. In practice, the funds are deposited into MPs’ own bank accounts, and there is little transparency or accountability for how MPs manage or distribute this money from the public purse. Nor is there any analysis of the impact or effectiveness of the use of the funds. Moreover, expenditure in the development-budget that was originally appropriated to ministries is occasionally re-programmed into constituent development funds. Staff of the Ministry of Finance and donors—grants account for around two fifths of total revenue—agree that this practice undermines sound public financial management.

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September 14, 2012

Recent Meetings of the PEMPAL Network in Europe and Central Asia

Posted by Deanna Aubrey, PEMPAL PFM Adviser

The three ‘communities of practice’ of budget, treasury, and internal audit of the Public Expenditure Management Peer Assisted Learning (PEMPAL) network had a series of meetings in the first six months of 2012. PEMPAL covers up to 22 governments in the Europe and Central Asia region and brings practitioners together regularly to discuss common priority issues in PFM reform. PEMPAL is supported by the World Bank, Switzerland’s State Secretariat for Economic Affairs (SECO), the Russian Federation, and OECD SIGMA.

Members of Treasury Community of Practice (TCoP) gathered in Tbilisi, Georgia from February 27-29. Treasury experts from 10 countries met to learn more about Georgia’s PFM reforms implemented by the State Treasury Service, who co-hosted the meeting. The workshop was an opportunity to exchange experiences in modernizing national treasury systems particularly related to issues of integration of external financing. Participants also had the opportunity to visit the customs clearance zone of the Ministry of Finance in Lilo district in Tbilisi as an example of modernization public services through information technology. More information can be found at http://www.pempal.org/event/read/55 and in IMF’s PFM blog at http://blog-pfm.imf.org/pfmblog/2012/04/georgian-state-treasury-hosts-workshop-on-treasury-and-external-financing-reforms.html

Fifty-seven participants from Ministries of Finance from 18 ECA countries from Budget Community of Practice (BCOP) met in Bohinj, Slovenia on March 27-29 to exchange experiences in program budgeting as part of the Budget Community of Practice (BCOP) work program. Country cases of France, Australia, Poland, and Slovenia were showcased and reform progress shared by Kazakhstan, Russian Federation, Armenia, Croatia, and Bosnia and Herzegovina. Most PEMPAL member countries have implemented elements of program budgeting including defining and identifying programs, formulating program objectives, and selecting performance information. However, the quality of performance information remains generally poor, is in many cases not systematically monitored, and has limited influence on budget decision making. Countries acknowledge that the reform process is long and ongoing and are planning on exchanging information and meeting more on this topic in the future. More information can be found at http://www.pempal.org/event/read/58 and in IMF’s PFM blog at http://blog-pfm.imf.org/pfmblog/2012/05/program-budgeting-is-on-the-reform-agenda-across-europe-and-central-asia.html

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July 26, 2012

Australia’s Changing Budgeting Framework – Accrual or Cash?

Posted by Tim Youngberry[i]

There have been a number of articles on this blog that pose a question on whether the Australian Government has a cash-based budgeting framework or an accrual-based budgeting framework, or some sort of hybrid mix.  Hopefully, this contribution will provide a degree of clarification.

In the 1999-2000 Budget, the Australian Government moved to a full accrual accounting and budgeting framework.  The key features of the framework when implemented included:

  • A shift to an outcomes/outputs framework;
  • Introducing accrual concepts into the Budget, often referred to as accrual budgeting;
  • Applying a capital use charge on line ministries to reflect the cost of the use of “capital assets” and to provide an incentive for improved asset management;
  • Introducing devolved banking arrangements so that each agency had its own transactional banker and paying interest to agencies on accumulated cash balances to encourage better cash flow management; and
  • Funding agencies on the basis of full accrual expenses (including depreciation) – otherwise known as accrual appropriations.

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July 04, 2012

Budget Reform: Borrowing a Leaf from the Accounting Profession’s Book

Posted by Florence Kuteesa

 Since the 19th century, there has been a sustained effort to develop and disseminate professional standards and qualifications in accounting. In stark contrast, there are currently no internationally accepted standards for budget preparation. Could this absence of a professional foundation for budget preparation  help explain the short lifespan of many reforms that have failed to take root in budget departments and bear fruit in the form of more credible and predictable budgets, especially in low income countries (LICs)? Is it time for the budget reformers to borrow a leaf from the accounting profession’s book?

It is of concern that national budget preparation reforms in many LICs have failed to deliver intended objectives. Budget practices continue to be based on a patchwork of traditions and procedures that have evolved slowly. There are marked disparities between the principles and practices of budgeting within countries, as well as large variations across countries. New ideas and techniques of planning and budgeting are tried but, all too frequently, are abandoned or overtaken by some other initiative making it even more difficult to build strong foundation for budgeting. Short-lived budget reforms have lead to poor outcomes and dissatisfaction among staff. The continuous search for more appropriate budgeting structures and procedures is demonstrated by recent debates among the senior budget officers’ networks, in Asia, Middle East and North Africa, and Africa.

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June 27, 2012

Burundi – L’expérience positive du nouveau dispositif de gestion des ressources extérieures

Posté par Jean Pierre Nguenang[1]

A la faveur de la rénovation récente du cadre juridique des finances publiques (FP), le pays a mis en place un nouveau dispositif de gestion des ressources extérieures, le budget d’affectation spéciale (BAS). S’inscrivant dans le cadre de la déclaration de Paris 2005 sur l’efficacité de l’aide, ce dispositif concilie l’utilisation des nouvelles procédures nationales, tant en budgétisation qu’en exécution, avec les besoins des bailleurs. Avec la mise en place d’un fonds commun de l’éducation (FCE) doté de financements de certains bailleurs de fond pour les budgets 2011 et 2012, une première expérience du BAS s’avère positive. Cette mise en œuvre du premier BAS préfigure l’introduction progressive pour le budget général des dispositions de modernisation adoptées dans le cadre rénové des FP.

Une budgétisation du BAS qui améliore l’exhaustivité et la transparence du budget de l’Etat

Les fonds des bailleurs accordés à l’Etat, à l’exception des appuis budgétaires directs, sont intégrés si les bailleurs le souhaitent en recettes et en dépenses au budget général de l’Etat. Une annexe aux lois de finances donne le détail de l’origine et de l’emploi de ces fonds. Toutefois, un BAS peut être créé par groupes de projet ou groupes de programmes d’investissement, réunissant les financements d’un ou de plusieurs bailleurs de fonds. Rattaché au ministère sectoriel principalement responsable de sa mise en œuvre, le BAS peut être abondé par un crédit budgétaire au titre de la contrepartie nationale.

Continue reading "Burundi – L’expérience positive du nouveau dispositif de gestion des ressources extérieures" »

Burundi – Success with the New Mechanism for Managing External Resources

Posted by Jean Pierre Nguenang[1]

As part of the recent reform of the legal framework governing public finances, Burundi has introduced a new mechanism for managing external resources, a special earmarks budget (BAS). This mechanism, which is in line with the 2005 Paris Declaration on Aid Effectiveness, balances the use of the national procedures, both in budgeting and execution, with the needs of donors. The initial experience with a BAS - in the form of the establishment of an Education Funding Pool (FCE) financed by certain donors for the 2011 and 2012 budgets – has been encouraging and marks the first step in the gradual introduction for the general budget of the modernization measures included in the updated public finance framework.

Inclusion of the BAS in the budget improves the coverage and transparency of the government budget

The funds granted by donors to the government, with the exception of direct budgetary assistance, are included under revenue and expenditure in the general budget of the government if the donors so wish. An annex to the budget law provides a breakdown of the origin and use of the funds. However, a BAS may be created for a group of projects or group of investment programs, combining the financing from one or more donors. The BAS may be supplemented by a budgetary allocation, which constitutes the national counterpart. The BAS comes under the sectoral ministry, which has primary responsibility for its implementation.

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June 08, 2012

Accounting and the Budget Framework

Posted by Julie Cooper

For decades the debate has raged on about the applicability for government of what is often referred to as private sector accounting methodology.  Those who argue against its use in government offer up the differences in management focus between the private and public sectors to support their position. They argue that because the private sector is focused on profit generation the underlying concepts of accounting are not valid for government purposes. This argument is simplistic and fails to recognize the overarching purpose of all accounting systems.

Accounting is an information and measurement system that identifies, records, and communicates relevant, reliable, and comparable information about an organization’s activities. Providing information about how an organization performs is an important aim of accounting. This is true for both private and public sectors. Another similarity between the two sectors is that they both focus on the efficient allocation of resources to realize their goals. The difference between these two sectors lay in how that information is reported and used not the accounting per se.

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June 01, 2012

Les budgets nationaux au service du développement et de la réduction de la pauvreté

Posté par Mohamed Moindze

Se voulant résolument pragmatique et orienté vers les nouvelles finances publiques, l’ouvrage «Les budgets nationaux au service du développement et de la réduction de la pauvreté »  édité, en janvier 2012, est centré sur la budgétisation des politiques de développement et de réduction de la pauvreté dans les pays en développement de tradition francophone.

L’ouvrage se veut également exhaustif en proposant une vision d’ensemble des questions relatives à l’élaboration des budgets nationaux basés sur les politiques publiques. Il est composé de deux parties. La première traite des stratégies globales et sectorielles dans leurs différents aspects de diagnostic, d’élaboration, de costing et de suivi en se basant sur les stratégies de croissance et  de réduction de la pauvreté développées par les pays en développant.

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National Budgets that Meet the Needs of Development and Poverty Reduction

Posted by Mohamed Moindze

With its resolutely pragmatic focus on the latest developments in public finance, Les budgets nationaux au service du développement et de la réduction de la pauvreté [National budgets that meet the needs of development and poverty reduction] (published in January 2012) addresses the budgeting of development and poverty-reduction policies in developing Francophone countries.

This publication also provides a comprehensive overview of issues relevant to preparing national budgets based on public policies. The text comes in two parts. The first part deals with the various aspects of global and sectoral strategies (diagnostic assessment, preparation, costing, and monitoring), predicated on the growth and poverty-reduction strategies formulated by developing countries.

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May 18, 2012

Program Budgeting Is on the Reform Agenda Across Europe and Central Asia

Posted by Deanna Aubrey, PEMPAL PFM Adviser

Ministries of Finance from 18 Europe and Central Asia (ECA) countries met from March 27-29, 2012 at Lake Bohinj, in Slovenia, [1] to exchange experiences in program budgeting. The meeting was attended by 57 members of the Budget Community of Practice (BCOP) of the Public Expenditure Management Peer Assisted Learning (PEMPAL) network.[2] Presentations were delivered by the World Bank, IMF, and GIZ with reforms showcased from guest speakers from France, Australia, Slovenia, and Poland.

The World Bank clarified the terminology given the wide variety of terms in use (e.g., program budgeting, performance budgeting, results-based budgeting). Program budgeting applies to cases where expenditure is classified in the budget by objectives (outcomes and outputs) rather than solely by economic categories (i.e., inputs such as salaries) and organizational category. Performance budgeting (or performance-informed budgeting) refers to a wider set of initiatives intended to strengthen the links between the funds provided and the results achieved through ensuring performance information is used in resource allocation decision making. Program and performance budgeting reforms should, therefore, provide information in a way that informs choices about spending alternatives and should improve transparency and accountability of government.[3]

Continue reading "Program Budgeting Is on the Reform Agenda Across Europe and Central Asia" »

May 04, 2012

Budgetary Reforms in South Asia

Extracts from a Project Report by Author on ‘Budgetary Reforms in South Asia’ Sponsored by the Indian Council of Social Science Research

Posted by Udaya Pant

Afghanistan

As a result of the Making Budget Work (MBW) and Making Budget and Air Work (MBAW) projects, budgets are now prepared on time and increasingly reflect the priorities of the Afghan National Development Strategy (ANDS) and the provincial needs. Budget officers from the project assist the line ministries in formulating and submitting the budget proposals on time and in accordance with national and ministerial policies and priorities.

Program and provincial budgeting were introduced in Afghanistan from fiscal year 2007. Progress on these has been slow, yet steady. The provincial budgeting pilot was to cover all 34 provinces by 2011. The program budgeting pilot covered 17 ministries by 2011. Each Ministry has formed a Program Budget Implementation Team, and training sessions on program budgeting have been delivered to all of these teams. The program and provincial budgeting pilots have improved budget formulation processes, increased transparency in government expenditures and ensured the foundation for increased inclusion of the provinces in the national budget formulation and implementation process, increasing equity in the distribution of resources across the country.

Continue reading "Budgetary Reforms in South Asia" »

October 18, 2007

Shedding light on fiscal transparency

Ft_cover All the do’s and don’ts for governments keen to let in the light on their management of the nation’s books. That's the motivation for the revised edition of the Fiscal Transparency Manual, published in hard print on October 18 by the Fiscal Affairs Department. It's more than just a guidebook for countries undertaking a voluntary assessment of fiscal transparency by the IMF under the Reports on Standards and Codes initiative. Inside the revised Manual are detailed explanations and country examples for all 44 good practices of the revised Fiscal Transparency Code. Like its predecessor, published in 2001, the Manual is set to be a major source book for PFM practitioners, academics, parliamentarians and civil society.

Four guiding principles of fiscal transparency shape both the Code and Manual: clarity of roles and responsibilities; open budget processes; public availability of information; and assurances of integrity. In delving into these requirements, the Manual also reveals many crucial aspects of good financial stewardship including public financial management, classification of the public sector, accounting issues, poverty impact assessments, approaches to freedom of information, and ethical standards. The Manual is published on (www.imf.org).

A factsheet: how does the IMF encourage greater fiscal transparency?

Posted by Jon Shields

October 17, 2007

Program and Performance Budgeting Enthusiasm in India -- IMF Training Course

Pune_2_4  An IMF training course in Pune for senior civil servants from India and around the region went into the varied experiences with this “second generation” budget reform. Making program and performance budgeting (PPB) work in the context of capacity constraints and politicians familiar only with traditional line item budgeting led to lively discussions with the 29 participants from India’s central and state governments, and invited representatives of other countries' ministries of finance.

Continue reading "Program and Performance Budgeting Enthusiasm in India -- IMF Training Course" »

October 12, 2007

Sweden’s New Fiscal Council – helping assure credible fiscal policy

Swedenflag_3 A lively debate about the government’s fiscal policies and the state of public finances puts pressure on transparency and the credibility of budget documents. On August 1, 2007, the Swedish Government set up a Fiscal Council (Finanspolitiska rådet) to provide an independent scrutiny of fiscal policy, promote active public debate, and strengthen the credibility of fiscal policy. The case for strengthening independent review of economic forecasts and fiscal policy has received increasing attention in the past years, and the Swedish initiative may with time provide valuable insight to the effectiveness of such institutions.

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October 11, 2007

Public Investment: Good Project Management is an Issue of ...Capital Importance

"Unexpected changes to payment schedules related to capital projects can create significant difficulties for finance officers responsible for cash management" remarks Steven R. Kreklow (*) in his short article ("Capital Project Cash Flow Management") of the August 2007 issue of the Government Finance Review, the membership magazine of the US-based Government Finance Officers Association.

This adverse impact on cash management and more generally budget execution can be mitigated by good budget and project management techniques described in Steven R. Krelow's article.

Continue reading "Public Investment: Good Project Management is an Issue of ...Capital Importance" »

October 10, 2007

Global Public Goods (and PFM?) ---- August International Institute of Public Finance Conference

The International Institute of Public Finance's 63rd annual congress, held Aug 27-30, 2007 in Warwick, UK, was themed “Global Public Goods and Commons: Theoretical and Policy Challenges for a Changing World.” A number of sessions at the conference focused on expenditure policy and management-related issues, including corruption and global public goods.

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October 05, 2007

Good Financial Governance in Africa - Insights into G-8 GTZ Effort

The G-8 Action Plan for Good Financial Governance in Africa was adopted by the G-8 earlier this year in Potsdam (Germany), and was one of the signature German efforts during their G-8 presidency.  GTZ, one of the German Development Agencies, in their latest Newsletter (September 2007, No. 9), focuses on the origins of the Action Plan concept.

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October 04, 2007

Making Performance Budgeting Work: New IMF Book

41m8or4rrxl_ss260_ Member countries will find valuable advice on how to reform their budgeting practices to improve the effectiveness and efficiency of public expenditure in a major new work on performance budgeting produced by the Fiscal Affairs Department. The book, Performance Budgeting: Linking Funding and Results (500pp), came off the presses of the top UK publisher Palgrave Macmillan in September.

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September 27, 2007

New Pacific Assistance Center Publication on Medium-Term Public Finance Frameworks

The IMF-managed Pacific Finance Technical Assistance Center  (PFTAC) recently released a publication on Medium-Term Public Finance Frameworks  (MTF). This is the first in a new series of Handbooks with the purpose to help  building capacity in the public sector for Pacific Island States.

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