World Bank

November 21, 2013

Budgeting in the Real World - What Do We Know? What Should We Do?

This is the keynote speech given last week, November 13th, by Antoinette Sayeh, Director of the IMF’s African Department at the UK’s Overseas Development Institute’s annual CAPE Conference in London on why PFM matters, why reforms are difficult, and what we know to make them successful…..

Sayeh

I am delighted to have the opportunity to deliver this keynote address and would like to thank Messrs. Ed Hedger, Kevin Watkins, and Philip Krause for inviting me to this important conference and for that generous introduction.

Let me start by saying that from the IMF’s perspective, good governance is important for countries at all stages of development. Transparent government accounts and effective public resource management are preconditions for sustained economic growth and prosperity. Indeed, budget formulation, implementation, and oversight lie at the core of good economic governance. Strong budget institutions are essential for countries to achieve sound fiscal policies and effective expenditure programs. Budgets can only be spent once. Getting the priorities right all the way from formulation to execution, and being efficient at it, is all the more important. Transparency and fairness are most important in ensuring that expenditures are aligned with broadly agreed priorities, and in securing society’s buy-in. While most can agree to the underlying principles, the hard part is to have systems and capacity in place that actually ensure that they are respected all along the process chain. As so often, the devil is in the detail. 

Continue reading "Budgeting in the Real World - What Do We Know? What Should We Do?" »

November 04, 2013

The FMIS Community of Practice Moves On

Posted by Cem Dener[1]

FMIS CoP banner
September 2013 marked the 3rd anniversary of the Financial Management Information Systems (FMIS) Community of Practice (CoP). Thanks to the continued support and participation of a diverse group of practitioners, the FMIS CoP has become an increasingly relevant and steadily growing community.

Etienne Wenger[2] summarizes Communities of Practice (CoP) as “groups of people who share a concern or a passion for something they do and learn how to do it better as they interact regularly.” Three components are required in order to be a CoP: (i) the domain, (ii) the community, and (iii) the practice. The FMIS “domain” is an integral part of e-Government initiatives. The FMIS “community” benefits from a website to share knowledge and enable members to learn from each other. FMIS “practitioners” interact through CoP events and the website to improve the quality and performance of their activities by exchanging information on good practices, and experiences gained in the design and implementation of FMIS solutions. The FMIS CoP is also focused on the development and dissemination of leading-edge knowledge products. All three components are essential to ensure the sustainability of the CoP platform.

Continue reading "The FMIS Community of Practice Moves On" »

October 10, 2013

Annual Meetings Kicks Off with Talks on Fiscal Transparency

Posted by Rachel F. Wang

Many of the key players committed to promoting greater fiscal transparency met on Tuesday for one of the first events of the 2013 IMF-World Bank Annual Meetings.

The Joint IMF-World Bank Seminar entitled “Strengthening Fiscal Transparency and Government Accounting” brought together representatives from international organizations, national governments, think tanks, professional organizations, and civil society to discuss how to promote greater fiscal openness and improve the information base for fiscal decision-making.

The event was kicked off with a welcome address from Bertrand Badré, Managing Director and World Bank Group Chief Financial Officer, and included two panel discussions on

  • Strengthening fiscal transparency standards and practices chaired by Richard Hughes, Division Chief in the IMF’s Fiscal Affairs Department), and
  • Improving government accounting chaired by Chuck McDonough, Vice President and Controller at the World Bank). 

Panelists included Moritz Kramer from Standard & Poor’s, Phil Sinnett from the PEFA Secretariat, Vivek Ramkumar from the International Budget Partnership, Jo Marie Griesgraber from New Rules for Global Finance Coalition, Devantri Kaur Santa Sigh from the Malaysian Ministry of Finance, Gerhard Steger from the Austrian Ministry of Finance, Fayez Choudhury from IFAC, and Ron Salole from IPSAS board.

Discussions ranged over a variety of areas, including the revision of the IMF’s fiscal transparency code and new fiscal transparency assessment; how fiscal transparency feeds into credit ratings and vice versa; the harmonization of different transparency-related norms and standards; the role that civil society has played in promoting greater fiscal openness by governments; and the opportunities and challenges in moving from cash to accrual accounting.

The keynote address, given by Gerd Schwartz, Deputy Director of the IMF Fiscal Affairs Department set the tone for the morning’s discussion.  The text of his speech is provided below:

I would like to use this opportunity to talk about the importance of fiscal transparency for fiscal sustainability and discuss the work underway to improve both standards and practices.  More specifically, there are four issues I would like to cover:

  • First, I would like to highlight the progress made in promoting greater fiscal transparency over the past decade, thanks to collective efforts of many of the organizations represented in this room.
  • Second, I would like to discuss some of the lessons of the economic crisis regarding the adequacy of existing fiscal transparency standards and practices.
  • Third,  I would like to provide you with an update of the IMF’s ongoing work on strengthening its evaluation tools in the fiscal transparency area; and
  • Finally, I would like to review the broader agenda on fiscal transparency and government financial disclosure.

Continue reading "Annual Meetings Kicks Off with Talks on Fiscal Transparency" »

September 17, 2013

FOTEGAL: Sharing Experiences of Treasury Management in Latin America

Posted by Israel Fainboim

Latin American budget officials are members of an association (Asociacion Internacional de Presupuesto Público—ASIP) which delivers an annual international seminar and regional seminars and publishes its own journal. Recently, the countries of the region together with two multilateral donors (the Inter American Development Bank and the World Bank) joined forces with the Fiscal Affairs Department (FAD) of the IMF to set up a similar organization for state treasurers.

That is how the Government Treasury Forum of Latin American (FOTEGAL) was born in 2010. The organization was formalized in a document named the Lima Declaration and through the approval of its own statutes. A total of 16 countries are currently members of FOTEGAL (Argentina, Bolivia, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, and Uruguay) and an invitation has been extended to Brazil to join (this country has participated in several of the annual seminars). The Government of Japan (JSA) has also been a key financial supporter of the activities of FOTEGAL. In addition, the IDB is supporting the development of FOTEGAL’s website. A link to this network and many of the documents and presentations made for FOTEGAL already exists within the website of one of the government treasuries, and a separate web page is under construction.

Continue reading "FOTEGAL: Sharing Experiences of Treasury Management in Latin America" »

September 06, 2013

PFM Innovations: ICGFM Issues Call for Speakers at its Upcoming Conferences

Posted by David Nummy, ICGFM Vice-President for Programs

ICGFM
One outcome of the global financial crisis has been recognition that Public Financial Management is critical to management of the fallout as well as to prevent future crises.   With greater attention, new approaches to the core elements of the PFM cycle have been employed and interest has grown in the experience of countries around the world in meeting the challenges of effectively managing resources in a manner that is transparent.   ICGFM will explore the innovations in PFM that have emerged as well as practices that are recognized as effective.

The International Consortium on Governmental Financial Management (ICGFM) has issued a call for speakers, panels, and presentations that address good practices in public financial management. As this topic will cover both of its upcoming conferences, proposals are solicited for both the winter conference in Washington, DC from December 9-11, 2013, and the 28th Annual International Training Conference in Miami in May 2014.  The Winter Conference will be held at the International Monetary Fund and is conducted in partnership with the Fiscal Affairs Department (FAD).

Continue reading "PFM Innovations: ICGFM Issues Call for Speakers at its Upcoming Conferences" »

August 15, 2013

The Long and Winding……..Fight Against Corruption

Posted by Chris Iles

Corruption is a global scourge.  In the public sector it can be defined as the diversion of public resources or the misuse of public authority for personal gain. It threatens political, social and economic stability, and undermines economic growth and development by distorting the delivery of public goods and services. Transparency International calls it one of the major threats facing society and has worked hard to focus international attention on reducing corruption in the public sphere. Preventing corruption has become a key policy priority for donors, especially in fragile or conflict-affected countries.

A recent paper[1] by Norway’s U4 Anti-corruption Resource Centre reviews how much we know about the effectiveness of different anti-corruption interventions.  The answer seems to be “not much”.  The paper reviews the fairly scant literature on the impact on corruption of various reforms such as direct budgetary support, PFM technical assistance, using donor systems and applying international norms. Evidence presented by the reviewed literature suggests that most anti-corruption measures are of disputable benefit.

The notable outlier seems to be PFM reform; there is, according to the study, (relatively) strong evidence that PFM reforms have a substantial anti-corruption impact. This is gratifying for PFM practitioners but also somewhat surprising since reducing corruption is not the explicit goal of PFM reform.

Continue reading "The Long and Winding……..Fight Against Corruption" »

August 03, 2013

PPPs on the Balance Sheet, Please!

Posted by Tim Irwin

Public-private partnerships create a practical problem for public financial management, because their fiscal costs are deferred. Instead of paying for a project during its construction, the government starts to pay only when construction is complete, which may be four or five years after any deal is signed. That means that the main tool of public financial management—budget scrutiny—can’t be used to ensure that PPPs are affordable and a better use of public money than the alternatives. For PPPs with long construction periods, even the analysis of medium-term spending plans doesn’t help.

So what can be done to ensure that the budgetary implications of PPPs are properly considered?

The World Bank Group has just published an Operational Note on managing fiscal commitments from PPPs that helps answer this question. It looks at how these fiscal commitments can be assessed and monitored, whether they are commitments to pay for the availability of a service or to protect a PPP company from certain risks. The Note gives examples of the tasks that can be carried out by different government agencies, such as budget departments, debt-management offices, and PPP units. And it considers the kinds of rules that can be put in legislation to help ensure that the right assessment and monitoring occurs.

However, the Operational Note does not take a position on whether or not PPPs should be put on the government’s balance sheet. Budgeting and Reporting for Public-Private Partnerships by Katja Funke, Isabel Rial, and me argues that they typically should be.

Continue reading "PPPs on the Balance Sheet, Please!" »

July 23, 2013

Now You See It, Now You Don’t...

Posted by Cem Dener and Saw Young (Sandy) Min [1]

Cem dener
The World Bank Study “Financial Management Information Systems and Open Budget Data: Do governments report on where the money goes?” (completed in June 2013) and new data set are now publicly available from the FMIS Community of Practice or the World Bank PRMPS Public Finance web site.

Within the last decade, FMIS has become a critical part of improving budget transparency. Disclosure of public finance information to citizens through FMIS platforms can improve transparency, if the published budget data are accurate, easily accessible and meaningful. Fiscal transparency can in turn improve trust in government, if the public interpret the motives for publishing the information positively, and an open budget data policy is sustained for long periods. Despite all efforts, designing robust FMIS solutions to capture all financial activities and publish open budget data, and measuring the effects of FMIS on budget transparency continue to be major challenges.

Continue reading "Now You See It, Now You Don’t..." »

June 24, 2013

Successful International PFM Workshop for IFMIS Coordinators at IDB

Posted by Carlos Pimenta[1]

This event, which took place in Washington, DC from May 15-17, discussed the PFM challenges faced in modernizing Integrated Financial Management Information Systems (IFMIS), as they relate to technology, public accounting, treasury and budget. The workshop was attended by about 120 participants, including IFMIS coordinators from 17 countries in Latin America and the Caribbean, private consulting firms, international experts and staff from IDB, IMF and World Bank.

The agenda of the event included topics such as: (1) How to measure progress in efficiency and quality of PFM reforms and systems? (2) The role of IFMIS in cost systems and result-based management, (3) Technological advances in IFMIS development, (4) Budget transparency and accountability, (5) Definitions, techniques and regulatory framework for interoperability and its impact on IFMIS context, (6) Change management and IFMIS implementation, and (7) Service management, maintenance and support for IFMIS.

All presentations, speakers and other information can be reached using the links in the Final Report attached below (in English and Spanish) or here

Continue reading "Successful International PFM Workshop for IFMIS Coordinators at IDB" »

May 15, 2013

FMIS Choice: the Dangers of In-House Development in Low-Capacity Countries

Posted by Lewis Murara and Christopher Iles[i]

A major decision faced by many countries is what sort of Financial Management Information System (FMIS) they should develop to support their PFM reform efforts. The decision is more difficult in low-capacity countries where implementing an FMIS can have a disproportionate impact on management, operations, and operating costs.

There are three general FMIS options that governments can consider:

  • Bespoke, i.e. own developed software solutions
  • Customized “enterprise resource planning” (ERP) systems
  • Non-customized COTS systems

In making the decision, recent studies[1] have demonstrated that there is no single best solution. Over a decade or so, the tendency in many Latin American countries has been for in-house development of their FMIS, while Africa has preferred commercial off-the-shelf solutions (COTS) and developed countries have tended to favor customized ERPs.

Continue reading "FMIS Choice: the Dangers of In-House Development in Low-Capacity Countries" »

May 08, 2013

Upcoming Event: International Workshop on Government Performance Management, July 1-12, 2013, New Delhi

Posted by Bill Dorotinsky, The World Bank

Indialogo
The Institute of Public Enterprise (IPE), Hyderabad, and the Performance Management Division (PMD), Cabinet Secretariat, Government of India, are collaborating to organize the ‘International Workshop on Government Performance Management’ from July 1-12, 2013. The enclosed brochure gives the details of this workshop.

This workshop is a unique training program that will cover a wide range of issues that concern the design and implementation of effective performance management in government. As part of its administrative reforms, India has implemented one of the most far reaching systems called the ‘Performance Monitoring and Evaluation System (PMES)’ for government departments.

This training program will compare and contrast this experience with similar experiences in developed and developing countries. It will discuss the entire eco-system that is required for designing and implementing an effective performance management system in Government. We believe that a training program of this caliber and quality has never been organized on this subject anywhere in the world.  As you can see from the enclosed brochure, we have carefully chosen the topics and invited some of the leading theoreticians and practitioners to share their experience with workshop participants.

Continue reading "Upcoming Event: International Workshop on Government Performance Management, July 1-12, 2013, New Delhi" »

April 03, 2013

Make Way for the Hybrids

Posted by Matt Andrews. This article was originally published by Foreign Policy on April 2, 2013.

Development experts are often quick to focus on the role of institutions. They are, simply put, the "rules of the game" derived over time that drive politics, economics, and other social interactions. Social scientists like Douglass North, Daron Acemoglu, and Jim Robinson have shown that these rules strongly influence how countries grow and develop. Over decades, theorists and development practitioners have compiled what one might consider a script of the "right" rules and institutions needed to foster economic growth and open societies with good governments that advance the needs of their citizens. But despite all the good intentions, this western-created game plan hasn't quite worked out as expected. 

Organizations like the World Bank have supported institutional reforms in developing countries for more than two decades now, often making it the backbone of their development agendas. Such work accounts for billions of dollars of development spending each year, devoted to creating democratic electoral processes, robust public financial management systems, effective anticorruption regimes, and other new rules of the game in countries ranging from Afghanistan to Uganda. 

At first glance, many of these reforms seem to have yielded success. In Afghanistan, for example, new laws adopted after 2003 have modernized the government's budgeting and financial management system. The system's quality was ranked "higher than a middle-income country" in a 2008 assessment using the multi-donor Public Expenditure and Financial Accountability (PEFA) framework, which compares countries' governance systems with what is considered "international good practice." Similarly, Uganda's anticorruption reforms have produced new laws that donors tout as world-class. The think-tank Global Integrity rated these laws as best in the world in 2008, giving them a perfect 100 score. Canada scored 90; Italy got 82. 

Continue reading "Make Way for the Hybrids" »

March 25, 2013

Is Europe Ready for EPSAS?

Posted by Franck Bessette[1]

The sovereign debt crisis has underlined the need for governments of the European Union (EU) to clearly demonstrate their financial stability and for more rigorous and more transparent reporting of fiscal data. The EU promotes a system of harmonized accruals-based accounting standards for all entities of the government sector. IPSAS is currently the only internationally recognized set of standards. It is founded on the international financial reporting standards (IFRS), widely applied by the private sector, and at present comprises 32 accrual-based accounting standards, plus one cash-based standard. A recent report by the European Commission assesses the suitability of IPSAS for the Member States.  

The report notes that 15 out of 27 EU Member States already make some link to IPSAS. Of these countries, nine have national standards based on or in line with IPSAS, five make some references to it, and one country uses IPSAS in accounting at the local government level. However, despite recognition of the high value of IPSAS, no Member State has implemented the standards in full. Fully harmonized accrual-based public-sector accounting would provide a firmer basis for evaluating the financial position and performance of government activities at all levels.

Continue reading "Is Europe Ready for EPSAS?" »

January 24, 2013

Job Offer: Financial Management ETC Based in San Salvador, El Salvador (World Bank Job # 130174)

Posted by T.K. Balakrishnan, Manager, Financial Management, Latin America and Caribbean Region, World Bank

WB1
The World Bank has an opening for a Financial Management Extended Term Consultant (FM-ETC) based in San Salvador, El Salvador. Job description and qualifications are detailed in the job announcement, posted on the World Bank's website: Financial Management ETC based in San Salvador, El Salvador --  Job # 130174

The Closing Date is February 17, 2013.

For convenience, we provide the PFM Blog readers with excerpts from the Job Announcement.

Continue reading "Job Offer: Financial Management ETC Based in San Salvador, El Salvador (World Bank Job # 130174)" »

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 14, 2013

Job Offer: Financial Management Analyst Based in Buenos Aires, Argentina (World Bank Job # 130068)

Posted by T.K. Balakrishnan, Manager, Financial Management, Latin America and Caribbean Region, World Bank

World bank
The World Bank has an opening for a Financial Management Analyst (FMA) based in Buenos Aires, Argentina. Job description and qualifications are detailed in the job announcement, posted on the World Bank's website (click on this link): Financial Management Analyst based in Buenos Aires, Argentina --  Job # 130068

The Closing Date is January 29, 2013.

For convenience, we provide the PFM Blog readers with excerpts from the Job Announcement.

Continue reading "Job Offer: Financial Management Analyst Based in Buenos Aires, Argentina (World Bank Job # 130068)" »

December 17, 2012

Towards Better Public Expenditure Management: Experience Across Asia

Posted by Suhas Joshi  and Greg Smith

Despite heavy snowfall, government officials from mostly warm countries landed in Seoul for a high-level conference on how to improve public expenditure management (PEM) in the region. The event convened member nations of the Public Expenditure Management Network in Asia (PEMNA). The network, launched in June 2012 in Bangkok, provides opportunities for practitioners across the region to share knowledge and experiences in implementing PEM reforms. PEMNA is modeled on the PEMPAL network that has been operating successfully in central and eastern Europe for several years.

PEMNA comprises two communities of practice (CoPs). The budget CoP is managed by the World Bank, and the Treasury CoP by the IMF. PEMNA’s Steering Committee provides strategic oversight and governance. The Korea Institute of Public Finance (KIPF), a research and training institute associated with the Korean Ministry of Strategy and Finance, provides the secretariat for PEMNA and the two CoPs, and is supported in its work by development partners including the World Bank, AusAID, the IMF, and the OECD.

The demand-driven nature of the network allows members to focus dialogue on solving practical implementation issues.  By sharing common experiences and benchmarking performance with peers, members are able to deepen their understanding of the reform process. Across the budget and treasury areas members recognize that they cannot rely on theory alone and that the cross-fertilization of ideas is essential for the successful design and implementation of reform.

Continue reading "Towards Better Public Expenditure Management: Experience Across Asia" »

December 12, 2012

MTEF: Better Than Sliced Bread?

Posted by Richard Allen

Richard Hemming is a co-author of the World Bank’s recently published Beyond the Annual Budget: Global Experience with Medium-Term Expenditure Frameworks. In this conversation with Richard Allen, he talks about the book, the analytical work carried out, and the policy implications.

RA: You are one of the authors of this book. What was your specific role in preparing it?

RH: The team that worked on the book was large. Jim Brumby was the team leader and I was the lead consultant. We were the only people involved in all aspects of the work for the duration of the project. My main roles were to provide guidance on the overall approaches to the book’s analysis, to contribute to some of the analysis, to coordinate the drafting of the book, and to write a significant part of it. The only two areas in which I was not extensively involved were the detailed econometric analysis, for which we put together a really accomplished team, and the assessment of Bank advice on MTEFs. Overall, the book should be viewed very much as a team effort.

Continue reading "MTEF: Better Than Sliced Bread?" »

September 06, 2012

Has Global PFM Improved in the Last Decade?

Posted by Sanjay Vani

It is relatively easy to spot the trajectory of Public Financial Management (PFM) progress in any given country but how do we get a sense of the global trend during the last decade? A very useful and reliable source of information is provided by the World Bank’s Country Policy and Institutional Assessment (CPIA)[1] database. CPIA data offers a more complete source of comparative information than Public Expenditure and Financial Accountability (PEFA) assessments, data on which began to be collected only in 2005. 

The CPIA exercise is conducted annually for all the Bank’s borrowing countries. It has evolved into a set of criteria which are grouped in four clusters: (a) economic management; (b) structural policies; (c) policies for social inclusion and equity; and (d) public sector management and institutions. Ratings for each of the criteria focus on the quality of each country’s current policies and institutions. CPIA is the only measurement tool that provides an annual numerical rating for the quality of PFM and other aspects. The annual CPIA exercise is informed by various available diagnostics including PEFA assessments and, as such, provides a good basis for analyzing trends in PFM.

Continue reading "Has Global PFM Improved in the Last Decade?" »

June 29, 2012

Public Financial Management Information System in Georgia

Posted by Nino Tchelishvili, Deputy Head of State Treasury, Ministry of Finance, Georgia  

After the Rose Revolution (2003) the new government of Georgia undertook a large number of reform initiatives targeted at strengthening PFM. MoF focused on further developing the institutional framework of the budget process in order to improve its credibility and the effective allocation of public resources. An FAD mission visited Georgia twice in 2004 and assisted the MoF in formulating its strategy for treasury reforms. An FAD technical expert was assigned to help implement the reform measures in the areas of: Treasury Single Account, Budget Classification, Commitment Control, Accounting Reforms, and Cash Planning and Management.

In parallel with developing the PFM institutional framework, including basic components of a modern treasury system, MoF and the State Treasury started considering measures for reforming the then rudimentary and fragmented treasury information system. The decision to introduce integrated information systems was taken in 2006. Development Partners (WB, SIDA, Netherlands and DFID) provided funds for the Public Finance Management Information System (PFMS) implementation project and MoF embarked on this long and exciting journey in 2007. External technical experts recommended procuring commercial off-the-shelf (COTS) packages and customizing them to local context.

Continue reading "Public Financial Management Information System in Georgia " »

June 15, 2012

PEFA NewsFlash No. 19 - PEFA Steering Committee launching Phase IV of the Program

PEFA Steering Committee launching Phase IV of the Program

The PEFA Steering Committee met for its ordinary six-monthly meeting on June 11-12, hosted and chaired by the World Bank. The meeting confirmed that all arrangements are in place for the transition to Phase IV of the Program, which will commence on July 1, including:

  • Approval of the publication of the PEFA Phase IV Program Document;  click on the link to access the [program document]
  • Confirmation of the establishment of the new trust fund to finance Phase IV;
  • Signing of the first agreement for contribution to the trust fund with SECO Switzerland to the tune of USD 3,588,000 for the five years of Phase IV;
  • Change of PEFA Secretariat management – Frans Ronsholt is leaving after more than six years as Head of Secretariat. Phil Sinnett has been appointed to succeed Frans as Head; he is well known to most PEFA Stakeholders, having joined the Secretariat in September 2009.  

The Steering Committee also took stock of the achievements during Phase III and discussed the work plan and budget for fiscal year FY13 (July-June) including a number of ongoing activities which will be carried over from Phase III.

The meeting ended with a toast of thanks to Frans for his vision for the Program, the tremendous contribution he has made to the success of Phases II and III, and his effective leadership of the Secretariat over the past six years: the Steering Committee also wished him every success in his future endeavors.

April 20, 2012

Georgian State Treasury Hosts Workshop on Treasury and External Financing Reforms

Posted by Ion Chicu, World Bank, and David Tsekvava, Deputy Head of State Treasury, Ministry of Finance, Georgia 

A three-day PEMPAL [1] Treasury Community of Practice (TCOP) workshop was held in Tbilisi, Georgia on February 27-29, 2012 on public finance reform progress related to Treasury systems and external financing.  Fifty participants from ten countries attended (Albania, Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan and Ukraine).  Experts from the World Bank provided information on regional and international developments and technical support to the discussions.  The meeting was hosted by the State Treasury of the Ministry of Finance of Georgia who proved to be warm and wonderful hosts.

The meeting followed from an earlier meeting in Astana, Kazakhstan on September 27-29, 2011 whereby more than 80 participants from 17 countries from the Bank’s Europe and Central Asia (ECA) region met to discuss progress in implementing integrated financial management information systems across the region. Many TCOP member countries are the recipients of external financing in various forms and a need was identified for a smaller group meeting to address the issues associated with the effective management of external financing.  The practical problems faced in the process of integrating external financing into national budget systems are widely known. In many cases the challenges are related to the fiduciary requirements of the donor organizations. National systems do not always fully fit those requirements, which leads to the use of parallel mechanisms, such as those often established to implement donor-funded investment projects.  Within the framework of public financial management (PFM) reforms, and consistent with the principles espoused by the Paris Declaration of Aid Effectiveness, PEMPAL member countries have been pursuing the objective of integrating external financing into all stages of the budget process. 

Continue reading "Georgian State Treasury Hosts Workshop on Treasury and External Financing Reforms" »

February 22, 2012

Accrual Accounting Essential for Government Transparency and Accountability!

Posted by Ian Ball [1]

In this post Ian Ball, CEO, International Federation of Accountants, argues that it is time for governments to take their accounting responsibilities seriously and to modernise their financial management practices. The eurozone debt crisis has highlighted widespread financial reporting failures and must lead to extensive reform, including adoption of accrual accounting and budgeting practices. Politicians and Ministries of Finance must be pressured to implement these reforms before the next crisis hits.  

The sovereign debt crisis has emphasised the seriousness of the results of poor financial management and financial reporting. Obviously, government actions to limit the impact of the global crisis have exacerbated their financial positions, as many governments acquired significant assets and liabilities, gave guarantees of various kinds, and engaged in massive fiscal stimulus programmes. But the situation now would not be as dire if so many governments had not already made commitments that they did not account for properly, and may not be able to meet.

Governments in general are clearly accounting very poorly for their financial performance and position. This could, and should, lead to significant reform. We saw how financial reporting failure in the private sector a decade or so earlier led to dramatic action, including the passage of the Sarbanes-Oxley Act 2002 in the United States, and the creation of regulatory bodies for private sector audits in most major countries.

Continue reading "Accrual Accounting Essential for Government Transparency and Accountability!" »

February 09, 2012

Job Offer: Lead Financial Management Specialist Based in Dakar, Senegal (World Bank Job Number 120145)

Posted by Renaud Seligmann

Worldbank
Background/General Description

The Financial Management unit (AFTFM) is a part of the Africa Region’s Operation Services Department (AFTOS). It advises and supports Regional Management and Task Team Leaders on financial management in operations, and works on public financial management (PFM). Specifically, AFTFM is responsible for: (i) operational financial management support to the Region’s portfolio; (ii) policy advice to Government on PFM and private sector accounting and auditing; and (iii) capacity building activities to improve borrowers' financial management systems, including support for designing lending operations that focus on PFM and private sector accounting and auditing reform or capacity development. 

The Lead FMS will report to the Regional Manager for Financial Management (RMFM) and will be part of the regional financial management team. She/he will work with AFR FM Team and country teams, including Task Team Leaders and Administrative and Client Service (ACS) staff. AFTFM is highly decentralized (about 90 percent of staff is located in Country Offices). The Lead FM Specialist will have Unit/Regional and specific country-level duties and accountabilities. At the Unit/Regional level, the Lead FM Specialist is accountable for the quality of PFM work in Francophone AFR as well as compliance with the guidelines issued by the FM Sector Board (FMSB) with a special focus on Francophone countries. In that capacity, she/he (i) supports the RMFM in meeting the work program objectives and coaching CO and HQ FM staff; and (ii) contributes to the development of the overall financial management strategy and work program of the Region and oversees its implementation.  Specific country-level responsibilities include: (i) coordination and quality assurance of PFM work in Francophone countries; (ii) lead PFM expert for certain Francophone countries, providing TA to Government, leading tasks and assisting task teams on PFM issues, and supporting the preparation and supervision of PRSCs and DPOs; and (iii) mentoring Francophone FMS on PFM.

Continue reading "Job Offer: Lead Financial Management Specialist Based in Dakar, Senegal (World Bank Job Number 120145)" »

January 24, 2012

Job Offer: World Bank Seeking Financial Management Extended Term Consultant - Kingston, Jamaica (Job #120128)

Posted by T.K. Balakrishnan, Manager, Financial Management, Latin America and Caribbean Region, World Bank

The World Bank has an opening for a Financial Management Extended Term Consultant (ETC) based in Kingston, Jamaica. Job description and qualifications are detailed in job announcement #120128, posted on the World Bank's website. The Closing Date is February 13, 2012. For convenience, we provide the PFM Blog readers with excerpts from the Job Announcement.

Duties and Accountabilities:

The World Bank is strongly committed to support improvement of performance and capacity of FM institutions and systems, advance the use of country FM systems, and monitor and improve the fiduciary aspects of the Portfolio.   The Financial Management Extended Term Consultant (FM-ETC) is expected to be fully dedicated to these objectives.  The FM-ETC will be based in the World Bank’s office in Kingston, Jamaica and work on all financial management (FM) aspects related to the World Bank’s operations in selected Caribbean countries. This will include, but is not limited to: assessing the adequacy of project financial management arrangements, providing implementation support and supervising projects financed by grants and credits; ensuring compliance with the Bank’s audit and other fiduciary requirements, ensuring that the project operations are carried out in accordance with sound financial management practices, performing analytical work on financial management and accountability issues, and carrying out capacity building activities. 

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January 23, 2012

Enhancing the Capability of Central Finance Agencies

Posted by Richard Allen and Francesco Grigoli

A recent World Bank study investigated the factors that make a ministry of finance (MoF)—or more broadly defined the finance agencies at the center of government—an effective and crucial instrument for economic development.[1] One of the key findings is that an effective finance function is less about capacities, the number and quality of staff and systems, and more about the capabilities to use these capacities in the political and bureaucratic environment. Politics often gets in the way of the effective management of government resources. Another interesting finding is that centralization of powers in the MoF is important in less developed countries, to control expenditure and assure the strategic direction of government expenditures. For middle-income countries, however, decentralization of operations to line ministries is desirable to ensure effective implementation of government programs and avoid inefficient and unnecessary input-based controls.   

The study affirms that a well-organized and effective finance ministry and its associated central finance agencies (CFAs) are essential to good fiscal outcomes. CFAs are not a single organization or entity of government but a group of ministries and agencies, of which the MoF is usually the most prominent, with collective responsibility for the design and execution of a country’s wide array of financial and fiscal functions. CFAs deliver central finance functions that can be divided for convenience into the 16 categories shown below.

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January 20, 2012

Job Offer: Head of PEFA Secretariat (World Bank Job #120119)

Posted by the PEFA Secretariat

Background/General Description

PEFA is a partnership program that commenced in December 2001, with the aim to assess the condition of country public financial management systems and develop a practical sequence for reform and capacity-building actions.  It has successfully seen a decade of increasing international recognition. The PEFA Secretariat is responsible to the Steering Committee  for preparing and implementing the PEFA work plan. The Secretariat is located in and formally administered by the World Bank in Washington, DC.

The PEFA partners are planning to extend the PEFA program by five years starting July 2012. During this phase (Phase IV) the program will continue its current core activities and user services.. The next phase will see substantive revisions to strengthen the PEFA performance measurement framework and to broaden the overarching governance arrangements, in particular through formal consultations with a wider group of stakeholders such as partner countries and donors. These measures are designed to ensure that the PEFA framework and its overarching governance arrangements remain relevant, and consolidates more than 10 years of progress.

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January 16, 2012

PEFA Steering Committee Plans the PEFA Program’s Fourth Phase - Newsflash!

Posted by the PEFA Secretariat

The seven PEFA partners met for their regular six-monthly Steering Committee meeting on December 11th and 12th. The meeting was hosted and chaired by the European Commission and held in Brussels.

The main item on the agenda was the preparation of the PEFA Program’s fourth phase. It was agreed that the fourth phase will cover a five year period starting July 1, 2012. Whilst the current activities of the program will continue - especially the services provided to users of the PEFA Framework - a number of new initiatives were also agreed to form part of Phase IV.

  • An enhanced mechanism for confirming adequate quality assurance processes of the individual PEFA assessments will be introduced. This will address the issue of occasional emergence of assessments of doubtful quality. This new quality assurance process will be launched in the first half of 2012 and be referred to as ‘PEFA CHECK’.
  • A comprehensive review of the PEFA Framework and subsequent updating of its content will take place during the initial years of Phase IV – starting later in 2012. This initiative will ensure that the PEFA Framework remains relevant to its users, whilst maintaining the features that have made it widely adopted across the world since its launch in 2005.
  • Several initiatives were also agreed to broaden the interaction with the wide group of users of the PEFA Framework and the PEFA assessment reports in response to the Framework becoming a global public good. One such initiative is arrangement of an annual ‘Open Forum on PEFA’. The first one will mark the celebration of the 10th anniversary of the Program and the launch of Phase IV. It is scheduled to take place in Miami, USA on May 3rd in connection with the ICGFM Conference on “PFM in the 21st century”. The event will provide an opportunity for the Program to provide a discussion forum for all interested parties on its current activities and services as well the future directions of the PEFA Program.

During the coming months, we will communicate further on each of these three developments.

The Steering Committee also prepared for the succession of the management of the PEFA Secretariat in connection with the transition to Phase IV. Frans Ronsholt, who has been the Head of Secretariat since April 2006, will retire in 2012. A vacancy announcement will be posted shortly by the World Bank.

The next ordinary meeting of the Steering Committee will take place in Washington DC in June 2012, hosted and chaired by the World Bank.

Note: The posts on the IMF PFM Blog should not be reported as representing the views of the IMF. The views expressed are those of the authors and do not necessarily represent those of the IMF or IMF policy.

January 04, 2012

Why a Reform-minded Minister of Finance Needs a Strategic PFM Advisor as Gatekeeper

Posted by Sailendra Pattanayak

Many countries that lack both capacity and infrastructure in the area of public financial management (PFM), particularly the post-conflict ones, have to undertake comprehensive  reforms to establish sound and robust fiscal institutions. Most of these countries usually embark on a multi-pronged reform strategy and receive support—both financial support and technical assistance (TA)—from various international institutions and development partners to build PFM institutional capacity. A key aspect of such support is the funding of a large number of advisors/consultants to assist the ministry of finance in specific PFM areas, e.g., budget planning and preparation, expenditure control and treasury management, accounting/fiscal reporting, auditing, and development and implementation of financial management information systems. These advisors play a crucial role in building the fiscal institutions as the authorities draw upon their specialized expertise in the respective PFM areas. However, as the scope and complexity of TA received from such advisors increase, the strategic coordination of TA and the integrity/coherence of the PFM reform process become all the more critical.

Effective coordination and strategic management of TA from various development partners is essential to identify, monitor and manage potential risks of overlap, inconsistent advice and sub-optimal allocation and use of TA. The TA strategy should also be guided by an overarching PFM reform plan. This process should be led by the authorities, with support, if necessary, from an advisor with skills to provide such strategic advice. This strategic PFM advisor should also act as a gatekeeper between top management (usually the minister or deputy minister of finance) leading the PFM reform agenda and other advisors assisting the ministry technical staff in respective areas to ensure, inter alia, alignment of reform priorities and TA inputs. This will also improve engagement with TA providers and alignment of their support with any future reform plan.

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November 21, 2011

Parliamentary Powers and Capacities

Posted by Mohamed Moindze, international consultant

The budget is the instrument used to implement the most important public policies. It affects the lives of all citizens. However, the budgetary process has for many years been under the exclusive control of government. Yet there is no way to achieve good governance of public finances (needed to implement public policies) without effective external control of public finances. In the past, the public’s involvement in the budgetary process (as well as the involvement of parliaments) was not considered useful. Some suggested that such participation could be dangerous since it might undermine a country’s budgetary stability by sacrificing the macroeconomic equilibria.

Increasingly over the last twenty years or so, the developing countries have been undertaking courageous reforms to allow national parliaments to play the eminent role that constitutions grant them in the management of public affairs. This transition is occurring in the context of a general trend toward democratization and good governance. This increased role of parliaments consists of debating the broad outlines of the course that countries wish to take, thus helping to define them, to enact laws, to allocate resources to government for implementing policies, and to control their application.

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Note de présentation du document sur le contrôle parlementaire

Affiché par Mohamed Moindze, consultant international

Le budget est l’instrument de mise en œuvre des politiques publiques le plus important. Il affecte la vie de tous les citoyens. Pourtant, le processus budgétaire a été, pendant très longtemps, sous le contrôle exclusif du gouvernement. Or, il ne saurait y avoir de bonne gouvernance des finances publiques (qui est nécessaire pour la mise en œuvre des politiques publiques) sans contrôle externe efficace des finances publiques. L’implication du public dans le processus budgétaire (et même des parlements) n’était, dans le passé, pas considérée comme utile. Certains avançaient qu’une telle participation pouvait être dangereuse puisqu’elle pouvait saper la stabilité budgétaire d’un pays en sacrifiant les équilibres macroéconomiques.

Depuis près de vingt ans, et de façon croissante, les pays en voie de développement engagent des réformes courageuses pour permettre aux parlements nationaux de jouer le rôle éminent que les constitutions leur accordent dans la gestion des affaires publiques. Ce mouvement se place dans le cadre d’une tendance générale à la démocratisation et à la bonne gouvernance. Ce rôle accrû des parlements consiste à débattre des grandes orientations des pays et à contribuer ainsi à les définir, à adopter les lois, à allouer des ressources aux gouvernements pour la mise en œuvre des politiques, et en contrôler l’application.

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October 31, 2011

PEMPAL Treasury Community of Practice Workshop on Use of Information Technologies in Treasury Systems

Posted by Deanna Aubrey, PEMPAL Community Facilitator

On September 27-29, 2011, PEMPAL[1] Treasury Community of Practice (TCOP) held a workshop in Astana, Kazakhstan. Astana provided a spectacular backdrop for the meeting with the modern capital, only established some 14 years ago, preparing for events to celebrate Kazakhstan’s 20 years of independence.

Most countries participating in the TCOP from the Europe and Central Asia (ECA) region are in the process of modernizing or developing their Treasury information systems and many of them are either considering or already moving towards expanding system functionality and creating integrated Financial Management Information Systems (FMIS).  Given the importance of this theme to TCOP PEMPAL members, PEMPAL already organized previous meetings, including on the use of digital signatures in treasury operations, and more are planned for the future. The Astana meeting focused on the development and application of FMIS solutions, as well as the effective utilization of such web-based platforms for the public financial management needs of decentralized budget institutions and their spending units, in support of various reforms such as improvements in accounting and reporting and strengthening internal control frameworks.

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October 12, 2011

Transparency and Participation in Public Financial Management: What Do Budget Laws Say?

Posted by Paolo de Renzio, International Budget Partnership, and Verena Kroth, London School of Economics

An increasing number of governments, as well as international and civil society organizations, are promoting the public disclosure of budgetary information, and calling for greater citizen involvement in budget processes. Most agree that fiscal transparency generates significant benefits, as it is an important precondition for better governance, improved economic performance and prudent fiscal policy, resulting in lower deficits and debt accumulation. Moreover, transparency functions as a political expression of democratic governance, giving citizens and taxpayers information that they are entitled to, and that they can use to hold their governments accountable.

Given its increasing importance, how can transparency and participation in public financial management be promoted or improved? As a possible avenue, it is interesting to look at the role of legislation in promoting both disclosure of budgetary information and opportunities for citizen engagement in the budget process. Key questions then are: (a) to what extent does budget legislation in different countries cover issues related to budget transparency and participation, and in what level of detail? and (b) does the degree to which legislation covers issues related to public disclosure of budget information seem to affect the actual level of budget transparency in different countries?

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September 19, 2011

Mauritius: Publication of the PEFA 2010 Report

Posted by Peter Murphy

Pefa logo 
In 2010, the Ministry of Finance and Economic Development, Government of Mauritius (MoFED) requested the Fiscal Affairs Department (FAD) of the International Monetary Fund (IMF) to assist in carrying out a Public Expenditure and Financial Accountability (PEFA) assessment for Mauritius. The IMF, with support from the World Bank (WB) and the European Union (EU), agreed to assist the government in an external validation of a PEFA self-assessment and a formal agreement was signed in September 2010. This report, which has now been published, represents a good example of successful cooperation between a national government and multilateral institutions in leveraging the possibilities of a self assessment approach.

The 2010 PEFA report shows Mauritius continues to perform well against the PEFA benchmarks. The dimension scores show progress compared to the 2007 PEFA assessment, with 27 out of the 31 reported ratings, higher or equal to those obtained in 2007. Of these 24 criteria are rated at the A or B level. These positive results have been achieved despite the challenges faced in the wake of the recent global financial crisis. Further work is required in a few areas related to expenditure composition variances, coverage of extra budgetary unit transactions and legislative scrutiny. The results of this diagnostic will be used as an input to future PFM reform.

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September 06, 2011

Lao PDR: Better Accounting to Help Growth

Posted by Suhas Joshi

The desire to sustain its recently achieved strong growth performance[1] by developing confidence in investors and making Lao a more attractive investment destination has motivated the government’s intention to move towards an international accounting standard that is recognized and accepted worldwide.

Recently, at the government’s request, I, working along with the World Bank, conducted a workshop in Vientiane on "Accounting Reform: International Experience and Implications for Laos”. The workshop, aimed at fostering the acceptance of IPSAS-based accounting standards[2] as a basis for developing Laos accounting standards. The move towards modern accounting standards had been initiated sometime back in Lao PDR and received a new impetus with the conduct of this workshop which was attended by nearly 50 decision-makers in the government, public, and private sectors. The workshop was inaugurated by Dr. Viengthong Siphandone, Vice Minister for Finance, and was closed by the Director General of the Accounting Department. At the close of the workshop the Director General announced that the government has decided to move towards IPSAS cash basis of accounting, as a first step.

The workshop comprised four sessions, the first was on the implications of adopting international accounting standards in the public sector and the second on the ongoing accounting and auditing reforms in Laos. These were followed by a session on cash basis IPSAS and drew upon international experiences in this area. Lastly the workshop discussed the Laos road map to accounting reform.

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August 18, 2011

Certifying PFM Systems for Donor Budget Support to Fragile States – Professor Collier’s Proposal

Posted by Tej Prakash

In a recent op-ed (later also presented at an Overseas Development Institute (ODI) meeting), Prof. Paul Collier has put forward the argument that where donor aid is allowed to flow through the budget system of a fragile state, it has largely failed to deliver the results promised. The reasons given for this failure, range from incompetence to corruption. And, it is suggested that in the near future, there seems to be little chance of any meaningful improvement in these outcomes. He argues that the governance system in many of these countries is broken, and its focus is by no means primarily to provide services to the citizens. It is suggested that budget systems of these countries are extremely ‘leaky’ (‘looting of the public purse”) and that donors do not have, by and large, either the information or the technical expertise, to prevent misuse of aid money.

Collier makes a distinction between aid given for critical operations and for more general budget support operations. For critical operations he recommends using ‘imported administrative capacity’ to manage all spending, including donor funds through specific project support arrangements. His proposal relates only to donor budget support and does not address existing parallel project based arrangements operated by many donors. He does suggest that it is possible to improve the ‘technical’ aspects of donor flows. The focus of technical improvements would not be to introduce policy ‘conditionalities’ through a back door, but to enforce the country’s own laws. He cites the insight of Tinbergen that to implement any objective, there should be a distinct instrument with its distinct effect. Hence, the two main objectives: meeting the need for funds (how much) and ensuring their effective use (on what), should be managed by two different instruments.

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July 20, 2011

Program or Performance: What Comes First?

Posted by Holger van Eden

Inspired by the success of the PEFA diagnostic tool, staff from the Fiscal Affairs Department (FAD) and their counterparts from World Bank and EC, have been having a creative debate/not seeing eye-to eye/duking it out (all depending on one’s perspective of course) on how PEFA indicator scores should impact PFM reform programs in countries. Is there a one on one relationship between PEFA score and design of reform programs? This interesting question is not the topic of this post, however. The answer on how best to integrate PEFA in reform design is still pending. Interesting work has been done recently by Jack Diamond, Daniel Tomassi, and Ron Quist on the issue, and there seems to be some consensus at least that PEFA scores can help identify which of the “basic” PFM capacities in a country need upgrading. But this still leaves questions on optimal strategy and sequencing unanswered.

PEFA in any case says very little about the sequencing of advanced budget reforms such as MTEF and performance budgeting, as the indicators deal mostly with the basic functionality of PFM systems. One of the interesting questions in sequencing of advanced reforms is how the introduction of performance oriented budgeting should be handled. In recent years, the standard answer by many in the profession has been that program budgeting, including a fully defined program classification, has to be introduced first. Once program budgeting has become the core of the budget management system, then gradually performance indicators, first output and then outcome indicators, can be attached to the program structure. At that point, voila, one has performance budgeting.  How effective the program is in achieving policy objectives can be measured by setting targets for outcomes, and the efficiency of programs can be assessed by measuring costs of outputs relative to, for example, some benchmark, or over time.

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July 11, 2011

Kazakhstan Hosts a Regional Workshop on Macro-Fiscal Forecasting and Medium-Term Budgeting

Posted by John Zohrab, FAD regional PFM advisor for Central Asia

The IMF’s Fiscal Affairs Department (FAD) and the Kazakhstan Ministry of Economic Development and Trade (MEDT) recently jointly hosted a regional workshop on macro-fiscal forecasting and medium-term budgeting issues. It was co-financed by the Government of Japan, through its technical assistance program Safeguarding Financial Resources in Central Asian Countries (JSA Program), and the MEDT.

The workshop took place in Almaty May 26-27, 2011. Representatives from Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyz Republic, Russia, Tajikistan, Turkmenistan and Uzbekistan participated in the workshop. They were mainly department and division chiefs from ministries of finance, ministries of economy, and economic research institutes under the ministries.

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July 04, 2011

METAC Workshop on Expenditures Control and Internal Audit: A Good Example of Donor Coordination

Posted by Pierre Messali

As part of its work program in the area of public financial management, METAC organized a regional workshop in Cairo, Egypt from May 30 to June 1. The objectives of the workshop were to review the systems of expenditure control and internal audit in the Middle East and North Africa (MENA) region and to come up with reasonable and practical recommendations for reform and modernization. The event was very successful and gathered a large number of officials from the METAC and Gulf Cooperation Council (GCC) countries (some 50 participants).

This was a collaborative effort of METAC[1], the Ministry of Finance of Egypt, and donors. These included the European Union (EU), jointly with the SIGMA-OECD program[2], the USAID, jointly with the Egypt Competitiveness Project (ECP) program[3], the World Bank[4]  (HQ and Cairo and Beirut offices), and ADETEF[5], affiliated to the Ministry of Finance of France. 

The workshop exemplified a high degree of collaboration between donors and it should set a precedent for future activities. Such cooperation: (i) avoids duplication of efforts and waste of resources; (ii) gives more consistent messages to recipient countries; and (iii) benefits   participants from exchanging experiences with donors and making full use of respective comparative advantages. This is also in line with the Paris Declaration on aid effectiveness which calls for donors to harmonize their actions and to work together to reduce duplication of work and promote joint training to share lessons learnt and build a community of practice.

Following the workshop, USAID issued a newsletter highlighting the success of the workshop (attached). Other collaborators, the EU and the WB and ADETEF have also expressed a great deal of satisfaction with the workshop and agreed on further cooperation.

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July 01, 2011

PEFA: Le Rapport de suivi 2010 et l’analyse des évaluations répétées

Affiché par Frans Ronsholt et Phil Sinnett

Pefa logo 
Le quatrième rapport de suivi du déploiement du Cadre PEFA a été préparé par le Secrétariat. Le Rapport de suivi 2010 analyse les évaluations répétées et notamment l’évolution de la performance des systèmes de GFP mesurée au moyen des indicateurs PEFA.

Le Rapport de suivi 2010 avait pour principal objectif de déterminer si le Cadre PEFA permet d'obtenir des mesures fiables de l'évolution de la performance depuis les évaluations précédentes ; une évaluation répétée examine les changements particuliers intervenus dans la performance d'un système en vérifiant ce qui a changé et dans quelle mesure. Le nombre d’évaluations répétées s’accroît nettement car beaucoup d’évaluations de référence ont été menées il y a trois à six ans. Entre le lancement du Cadre PEFA en juin 2005 et le bilan des évaluations effectué en octobre 2010, 45 évaluations répétées ont été menées dans 38 pays. 

Le Rapport de suivi 2010 cherche des réponses aux questions suivantes : i) quelle est la fréquence des évaluations répétées et pour quelles raisons sont-elles réalisées ? ii) le Cadre permet-il réellement de mesurer les changements intervenus et serait-il possible de mesurer ces changements par des méthodes plus valides et plus fiables ? et iii) quelles sont les évolutions de la performance de la GFP qui ressortent des évaluations répétées ?

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PEFA: Monitoring Report 2010 on Repeat Assessments

Posted by Frans Ronsholt and Phil Sinnett

Pefa logo 
The fourth monitoring report on the roll-out of the PEFA Framework has been prepared by the Secretariat. The Monitoring Report 2010 (MR 10) analyzed repeat assessments including changes in PFM systems performance measured by means of PEFA indicators.

The main purpose of the MR10 was to assess if the PEFA framework is able to provide reliable measurement of performance changes over time. One of the objectives of a repeat assessment (RA) is to measure performance since the previous assessment (PA); a RA looks at the specific changes in system performance by verifying what has changed and by how much. RAs are emerging in significant numbers as many baseline assessments took place 3-6 years ago. Between the launch of the PEFA Framework in June 2005 and a stocktake in October 2010, forty five RAs have been carried out in 38 countries.

The MR10 seek answers to the following questions: (i) what are the frequency of and drivers behind the repeat assessments, (ii) does the Framework effectively enable measuring changes and could changes be measured with better validity and reliability and (iii) what trends in PFM Performance do repeat assessments reveal?

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June 28, 2011

Job Offer: Lead Public Sector Management Specialist, World Bank, Jakarta

Worldbank Title: Lead Public Sector Management Specialist
Grade: GH
Department/Division: PREM East Asia Sector Department (EASPR)
Location: Jakarta
Appointment Type: Co-terminus (International)
Duration: Twelve (12) months initially
Funding: PFM Multi-Donor Trust Fund (MDTF)

 Background

The ongoing reorganization of the Ministry of Finance (MOF) in Indonesia is expected to herald the emergence of a radically transformed entity for the management of public finances that will be in line with modern international practices. However, major challenges in sustaining and managing fundamental changes in organizational structure, processes and systems will continue to confront the leadership over the medium term. Managing institutional and technical change of this magnitude will require intensive support as well as dedicated human and financial resources for the duration of program implementation. Change management and communications strategies are also envisioned as key program components.

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May 31, 2011

Conference on Fiscal Consolidation and Budget Institutions in South Asian Countries

Posted by Tej Prakash

The IMF’s Fiscal Affairs Department (FAD) and the Indian National Institute of Public Finance and Policy (NIPFP) recently hosted a joint conference on fiscal consolidation and strengthening of budget institutions in South Asian countries. The main “institutions” discussed were fiscal responsibility frameworks, fiscal councils, and medium term budget frameworks.

The conference took place in New Delhi from April 21-22, 2011. Apart from senior budget officials and policy makers from the central and state governments of India, representatives from Bangladesh, Sri Lanka, Nepal, Bhutan, Afghanistan and Maldives participated in the conference.

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May 13, 2011

Financial Management Information Systems: 25 Years of World Bank Experience on What Works and What Doesn’t

Posted by Cem Dener, Joanna Watkins, and Bill Dorotinsky

The World Bank Study "Financial Management Information Systems: 25 Years of World Bank Experience on What Works and What Doesn’t" (completed in December 2010) is now publicly available from the World Bank external web site.

The study seeks to identify trends in the design and implementation of Financial Management Information Systems (FMIS) solutions in World Bank funded projects in 51 countries since 1984, and share observed/reported achievements, challenges, and lessons learned with interested parties to assist in improving the performance of related Public Financial Management (PFM) programs. The study includes an analysis of project scope, cost, duration, design, objectives, and solutions. It also examines how such projects have performed over time and considers the key factors that contribute to the success and failure of projects. This study also suggests a methodology for the design and implementation of future FMIS projects, following a systematic approach to problem solving. This approach is expected to help clarify key ‘design parameters’ through a simple questionnaire and identify ‘which solution fits which problem in what situation’ during project design. If applied, such an approach may improve the quality and reliability of next generation FMIS solutions.

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April 29, 2011

The World Bank and Public Sector Management: Where Do You Come Out?

Posted by Nick Manning

The World Bank is reviewing its approach to Public Sector Management. Please take a look at our thinking to date: http://go.worldbank.org/BQGJN2KA30

The purpose of the approach is to make the World Bank a more effective partner to client governments in improving their ability to deliver public sector results. By results we mean those that are needed by citizens' today in sectors such as health, education, agriculture and transport – as well as results such as fiscal stability which maximize the prospects that those sector improvements will still be delivered tomorrow. This is an opportunity to reflect on some broad themes concerning the field of “public management” or “public administration” - and the specific question of what the Bank can do, particularly in environments of generally weak governance, and how progress can be ascertained.

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March 28, 2011

2nd Annual Regional Seminar of the Latin American Treasurers Held in Mexico City (March 16-18, 2011)

Posted by Israel Fainboim

An initiative launched by the Fiscal Affairs Department (FAD) of the IMF two years ago and supported by the Inter American Development Bank and the World Bank, to create a forum for the Latin American Treasurers to discuss treasury management issues on a regular basis, organize an annual seminar, and create a web page for exchanging ideas and materials, has been a success.

In April 2010 the Peruvian Treasury, under the direction of Mr. Carlos Diaz, did an excellent job in hosting the first seminar on treasury management. The 2010 seminar discussed cash planning, cash balance targeting, the adoption of a treasury single account (TSA), and the use of information systems for treasury and cash management. During that seminar the treasurers agreed to get organized, to propose an action plan, and to develop a web page. These and other objectives were included in a document signed by all of them, which was called the “Lima Declaration.”

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March 10, 2011

Duke University and the IMF Support PFM Capacity Building in Liberia

Richard Hemming and Roy Kelly

A group of government officials from Liberia have just completed a two-week workshop arranged by the Duke Center for International Development (DCID). The purpose of the workshop, which was requested by the PFM Reforms Coordination Unit of the Ministry of Finance, was to develop capacity of officials from key economic and spending ministries most closely involved with the ongoing PFM reform program. This PFM program in Liberia has attracted broad donor and IFI support and achieved major successes since its inception in 2007, anchored by the passing of a new PFM Act in 2009. The government is now preparing a PFM Reform Strategy and Action Plan for 2011-14, the main objectives of which influenced the design of the workshop program (see below).

The IMF’s Fiscal Affairs Department (FAD) has played a lead role in advising Liberia on PFM reform, and DCID was able to team up with two IMF staff closely involved with FAD’s technical assistance program in Liberia. Florence Kuteesa’s early contribution to the workshop set the scene by providing an African perspective on PFM reform and drawing lessons from the Ugandan experience, while Duncan Last brought deliberations to an end by focusing on reform priorities, and especially the importance of putting in place an appropriate PFM legal framework. In between, the workshop addressed a wide range of PFM topics, with contributions from DCID faculty at Duke and from IMF and World Bank staff during a two-day visit to Washington. 

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February 25, 2011

International Advisory Group for Government Payments

Posted by Rahul Kitchlu

Government payments play a critical role in the development of a national payment system given their scale and volume and the positive role they play in facilitating economic growth and innovation in the underlying retail payments infrastructure. The Payment Systems Development Group (PSDG) of the World Bank has convened an International Advisory Group (IAG) with a central mandate of supporting member governments improve efficiency of their national payment systems.

The objective of the IAG is to lead the development of an evidence based guidance framework for government payments that would provide guidelines on the design and implementation of such programs including the respective roles of public authorities and the private sector entities. The core members of the IAG comprise of representatives from the World Bank Group, other multilateral agencies and interested governmental authorities from member countries as well as other nongovernmental and private sector agencies. 

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January 31, 2011

Planning and Budgeting in Developing Countries – “Shrinking the P”

Posted by Richard Allen[1]

In most advanced western countries, the use of a national development plan as the primary tool of policy-making died out two generations ago, as it largely did in countries of the former Soviet Union in the early 1990s. However, national development planning continues to be a dominant policy instrument in many low-income and emerging market economies. Similarly, public investment plans (PIPs), which were in vogue in the 1970s, then fell from grace as theories of economic development based on capital accumulation lost influence, are now fashionable once more. What explains these developments? Why is planning deemed useful and relevant for developing countries, but has become outmoded in more advanced countries?

It should be clarified that the planning functions and instruments have not truly disappeared in advanced countries; rather, they have been replaced by other processes and instruments of policy that are judged superior in terms of their flexibility and usefulness. In particular, in the last fifty years, developed countries have developed a broad-based approach to policy analysis and review that is based upon a medium-term expenditure framework (MTEF), program budgets, and performance evaluations. These tools are combined with regular discussion by ministers, often through the cabinet mechanism, of priorities for defense, education and health, social security, agriculture, and other key sector policies and programs.

Continue reading "Planning and Budgeting in Developing Countries – “Shrinking the P” " »

December 01, 2010

What Do Public Financial Management Assessments Tell Us About PFM Reform?

Posted by Ian Lienert

What do we know about the factors affecting the quality of PFM reforms? Is it possible to measure the quality of the PFM system as a whole? If these questions can be answered, what are the implications for the design of a country-specific PFM reform? And how would donors that support PFM reforms benefit from such knowledge?

In a Background Note of the Overseas Development Institute (ODI), authors Edward Hedger and Paolo de Renzio grapple with these questions by analyzing PFM assessments. Although the available data do not yet allow unambiguous operational guidance for the design and implementation of PFM reform programs, existing evidence confirms the validity of certain approaches and measures.

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