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January 2014

January 30, 2014

Effective Cash Management in East Africa

Posted by Guy Anderson and Yasemin Hurcan1

  AFRITAC E logo

The East AFRITAC member countries (Eritrea, Ethiopia, Kenya, Malawi, Rwanda, Tanzania and Uganda) have been progressively rationalizing their banking arrangements and strengthening their cash management techniques. These improvements have been enabled by the wider use of financial management information systems (FMIS), improved banking systems and increased connectivity. However, despite some notable successes, the banking and cash management regimes in many of the countries continue to underperform. Problems include: significant government-controlled bank balances outside of the computed cash position; unreliable cash forecasting; and the passive use of cash management instruments. The result has been higher borrowing costs, a reliance on cash rationing techniques to determine budget releases, difficulties in planning and implementing the approved budget, and an increased risk of accumulating payment arrears.

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January 28, 2014

Towards a PFM Taxonomy?

Posted by Benoit Chevauchez


PFM experts will be familiar with the “anglo-franco derby” of budget systems. Many countries follow the so-called anglo-saxon model – as termed by the French - while others follow the francophone model. Most PFM experts have some implicit preference for one or other of these models, which more broadly reflect the British/Westiminster and French traditions of public administration. What are the realities at stake behind this friendly competition?

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January 24, 2014

Public consultation on the future governance of the IPSASB

IPSASB logo 

The recent financial crisis revealed substantial shortcomings in financial reporting practices in the public sector underscoring the importance of comprehensive, reliable, and timely financial reporting by governments. There is currently an urgent need to improve governments’ understanding of their fiscal position and prospects, and to provide legislators, markets, and citizens with the information they need to make efficient financial decisions and to hold governments accountable for their performance. Establishing and disseminating high quality accounting standards for the public sector are critical to bringing about this change towards more fiscal transparency.

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January 16, 2014

Politics Matter…But PFM Reforms Do Too.

Posted by Carlos Scartascini*

The recent CAPE 2013 conference organized by ODI provided a forum for discussing where PFM is and where it is going. While many interesting issues arose from the discussions, one theme was ever present: namely, the importance of considering PFM as much more than a purely technocratic process. Politics matter, and they tend to determine the way reforms are implemented, and their probability of success. In this note, I highlight the reasons why politics matter for the budget process and how this issue can be dealt with.

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January 14, 2014

Barcelona Promotes Fiscal Health and Strong Economic Performance

Posted by Jordi Baños-Rovira[1]

Barcelona City Council has shown what can be done in turning around a huge fiscal imbalances in 2009-11 into a moderate level of debt and a fiscal surplus in 2013. The budget for the fiscal year 2014 shows an 11% increase in expenditures (22% for capital expenditures), prioritizing programs that contribute to the protection of the most vulnerable people and reinforce economic growth, while maintaining a fiscal surplus, freezing tax rates and maintaining a moderate level of debt.

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January 10, 2014

Reducing Tax Evasion in Developing Countries 1/

Posted by Carlos Scartascini 

Tax evasion
Tax evasion is endemic in many countries. In particular, some developing countries do not collect even half of what they should if taxpayers complied with the written letter of the law.2/ In these countries, enforcement mechanisms are weak, tax-collecting authorities are held in low esteem, and courts may not enforce the rules. This problem is sometimes compounded at the local level because the capacity to enforce the law is even lower. As local governments are given more and more expenditure responsibilities and central governments struggle to finance the budget, the need to increase revenues becomes more pressing for subnational authorities.

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January 02, 2014

Top Ten Posts for 2013

Posted by Richard Allen, Holger van Eden, and Sasha Pitrof

The Top Ten posts for 2013 listed below display the continued diversity and versatility of the blog. The number of “hits” passed the one million mark during the year, and readership has maintained its high level. Readers clearly value the blog for keeping them up to date with new publications and events, as well as challenging them with original ideas and perspectives on PFM. Half of the Top Ten features reviews of two important new handbooks on PFM published in 2013, new technical notes on cash management and treasury issues, and the results of the Open Budget Survey for 2013. Other articles focus on keynote topics such as fiscal transparency, budget documentation, performance budgeting, and the challenges of reforming PFM in developing countries. Top author is Maarten de Jong of the Netherlands Ministry of Finance. Congratulations to him and all others who contributed excellent material to the blog in 2013! Looking forward to the New Year, the editors would welcome contributions from authors old and new, on topics both familiar and off-beat.

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