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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.

The Open Budget Survey 2012 is the only independent, comparative and regular measure of budget transparency around the world. The survey measures public access to national budget information and opportunities to participate in the budget process. It also examines the strength of legislators and auditors in the budget process. The Survey is implemented by independent budget experts in each country and rigorously vetted. The 2012 Survey is the fourth round of the Survey, and it covers 100 countries, home to 89 percent of the world’s population.

The results of the Survey highlight a critical development challenge for all of our work. While budget transparency has improved over the past eight years of the Survey, the state of budget transparency around the world is dismal. At the current pace of improvement, significant levels of budget transparency around the world will not be reached until 2030, after the next round of MDGs. Yet many countries — in Africa, Asia, and Latin America — have managed to substantially increase budget transparency in a relatively short period of time. How do we learn from these experiences and encourage many more countries to follow suit? This discussion will focus on this challenging topic. The meeting will include a panel discussion involving officials from government, the World Bank, and the IBP. Following the panel discussion, members of the audience will be invited to present their comments and perspectives on the key issues addressed by the panelistsand make suggestions for potential solutions to these issues. Critical questions to be addressed include:

· What lessons can be learned from the experiences of countries that have improved budget transparency within a short period of time on the factors that influenced their decisions to institute such improvements?
· What are the incentives for governments to increase budget transparency now, and how could these be influenced by domestic stakeholders, development partners, global efforts and other factors?
· What are the implications of the state of budget transparency for the United Nations’ post-2015 development framework?
· What practical mechanisms can and should governments use to enable their citizens to participate effectively in budget decision making?     

We invite you to attend and challenge you to bring practical ideas to the table on how to incentivize rapid improvements in budget transparency around the world.

To RSVP, please send your full name, organization, and email address to calderon@cbpp.org before 31 January 2013.
The IBP collaborates with civil society organizations in developing countries to analyze, monitor, and influence government budget processes, institutions, and outcomes. The aim of the IBP is to make budget systems more responsive to the needs of poor and low-income people in society and, accordingly, to make these systems more transparent and accountable to the public. Information on the International Budget Partnership and the Open Budget Survey is available at www.internationalbudget.org.

The World Bank Institute (WBI) is a global connector of knowledge, learning and innovation for poverty reduction. It supports the World Bank’s operational work and its developing country clients by forging new dynamic approaches to capacity development and finding suitable solutions for pressing challenges. WBI offers three areas of support: Open Knowledge - connecting them to global knowledge and learning on the “how” of reform; Collaborative Governance - helping stakeholders to mobilize for collective action, and Innovative Solutions – scanning, incubating and surfacing innovations to tackle key
development challenges.

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. 


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One of the core points in this topic in helping to accelerate budget transparency is how monitoring can be more effective through citizen participation. In this regard I would propose two key but linked issues for discussion:
i) better disclosure standards to support ease of understanding, comparability and relevance; and
ii) exploiting mobile phone technology support more effective monitoring and budget transparency.

Firstly, disclosure standards need further review. For example, the presentation of the budget statements and end-of-year budget statements need to be in the same format and in accordance with an international standard for classification, accounting and presentation. Historical data for budgets, budget reviews and end-of year accounts as well as functional and economic reporting at public sector, general government and sub-national government levels also need to be elaborated – including consolidation and elimination standards for functional reporting. Data on macro-economic and service delivery performance also need to be included. Requirements for all this data to be included in a single database for a country and be easily accessible and useable (i.e. not pdf reports) also need to be spelled out.

The second key initiative that needs to be explored in more detail is the use of citizen engagement apps to: the budget strategy, budget, in year performance and end-of-year results. The first app for development would be the citizen engagement app to a country's budget. It would essentially cover three key areas:
i) Classic citizen's guide to the budget, but with more easy to use navigation and relevant menus and data;
ii) Citizen polling, to get citizens views on the budget (and the budget strategy if released early as part of the budget calendar; and
iii) Simplified multi-dimensional budget simulation model - to allow users to see what happens to budget aggregates if fiscal policy is changed (e.g. more funds to primary schools in a particular district/state, less to defence, savings made on public service salaries and pensions, tighter deficit rules, faster debt reduction adjustment paths etc).

Then there’s the need to better engage citizens on economic governance and public financial management. This would need to be a comprehensive communicational strategy, involving traditional and new media – including documentary and non-documentary style mini-series, placement of issues in contemporary movies and TV series etc. Increasing access to PFM undergraduate courses would also be an important step.

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