Transcript Third International Roundtable on Managing Results for

Third International Roundtable
on Managing Results for
Development
Building Public Finance Systems to
Achieve Planned Results – Building
Capacity and Measuring Change
Increasing Recognition
• Importance of a Government owned and led
strategy to reform planning and budgeting in an
integrated way.
– But must be genuine
– Realistic timescales
– Politically feasible
• Fragmented donor support can be part of the
problem.
–
–
–
–
Fragmented
Unsequenced
No buy-in
Unrealistic politically
The ‘Strengthened Approach’ to supporting PFM
reforms
1. A country-led reform program – including a PFM reform
strategy and action plan
2. A donor coordinated program of support (emerging use
of multi-donor funds)
3. A common framework for measuring and monitoring
results over time – The PFM Performance Measurement
Framework
1. A country-led PFM reform program
The government-led reform
program
No blueprint for the government
reform program, but some
common defining features:
•
The government reform
program reflects country
priorities, and is not driven
by the donors’ agenda.
•
The overall direction and
responsibility for the
reform program is
integrated within the
government structures.
Planning and undertaking
diagnostic work over time.
Designing reform measures
and integrating them in the
reform program.
Implementing reforms
Monitoring of progress over
time.
But What Sort of Strategy Is Necessary to
bring Planning and Budgeting Together?
• Trying to blue print reform from beginning to end
is not ‘real world’ or sustainable.
• Distinguish between:
– A broad overarching framework
– More detailed planning on ‘the next step’
• Target and measure progress in terms of what
the integrated planning and public finance
system can achieve, not its technical detail.
• Deal with the whole of the planning/public
financial management cycle.
Example of an Overarching Strategy - Cambodia
SEQUENCE OF PLATFORMS
Rewarding performance as well as discipline
Basis for stronger deconcentration
Greater external transparency
PLATFORM 4
Integration of accountability and
review processes for both finance
and performance.
ENABLES
Accountability
for performance
Opportunities for efficiency
Re-alignment of resources with priorities
Scope for in-depth review
PLATFORM 3
Improved linkage of priorities
and service targets to budget
planning and implementation.
ENABLES
Focus on what is
done with money
PLATFORM 2
Initial improvements in internal
control and holding managers
accountable.
Around here that:
*Regional standards start to be beaten
*Donors consider more budget support
Credible common data
Effective discipline
Basis for reward and sanction
Greater internal transparency
ENABLES
Basis for
accountability.
PLATFORM 1
Budget is credible because
delivers reliable and predictable
resource to budget managers
Matching of resources used to period in which consummed.
Control over arrears
Better basis for procurement efficiency.
Pillars To Support Stages in Bringing Planning and
Budgeting Together- Russian Example
EACH AND EVERY STAGE
( PLATFORM)
Process
Measures
Capacity
Measures
Institutional
Measures
Motivational
Measures
Both:
Politicians
Public Servants
Building Capacity
• Build for capacity rather than simply train.
• Address immediate tasks while also
building for the future.
• Create the demand rather than push the
supply
• Avoid change overload
Aligning Technical and Capacity Development –
Cambodian Example
PLATFORM 1
PLATFORM 2
PLATFORM 3
Budget is credible because
delivers reliable and
predictable resource
to budget managers
Initial improvements in
internal control and holding
managers accountable
Improved linkage of
priorities and service
targets to planning
and implementation.
Effective budget delegation
Interpreting accounting reports
Use of chart of accounts
Analysing budget/actual variations
Responding to those variations
Audit plan development
Risk analysis as a basis for audit
FMIS implementation
Use of FMIS systems
Preparing multi-year budgets
Programme analysis/service planning
Option identification
Specifying target results
Lessons from budget implementation
Linking recurrent and capital budgets
Looking for budget efficiency savings
Costing analysis
SKILL DEVELOPMENT
TECHNICAL SKILLS
Cash flow planning
Cash flow management
Chart of accounts design
Debt strategy
Debt management
Forecasting
Revenue policy development
IT procurement
Business process design
FOUNDATION SKILLS
Understanding of reform programme
Intellectual and managerial development
Underlyining professional skills
Leadership skills
Organisational Change – Some Country
Based Examples of Issues that Arise
• Face up to the barriers (Kyrgizstan and
Russia)
• Create new units where necessary
(Vietnam and Ghana)
• But don’t build reform outside operational
management (Cambodia and Indonesia)
• Address the need to manage cross cutting
issues (All)
Motivation - Winning Support
All the experience is that broadly based support is essential.
From politicians
– Get them involved in the Steering arrangements
– Let them know what is in it for them
From other central Ministries
– Seek to align and support strategies that they may have
– Neutralise any threats (for example for any MOE’s)
From those who must work within the PFM system
– Use the measures of change to help them to understand what
MOF is trying to do and what it will do to help them
– Make it clear what they may gain, but that they will be dependent
on their response to reform and their performance
From the public
– Develop media campaigns
– Shout the successes
Some Different Types of
Motivational Measures
Managerial freedoms
and flexibility
Personal
recognition and
reward
Providing
additional
resources
Some Examples of Counties that have
Experimented with Motivational Measures in
their PFM Reforms
• Consolidate donor related pay supplements
( Cambodia and Tanzania)
• Give access to management freedoms and
flexibilities based on proven performance (Many)
• Reward spending bodies who respond to
reforms with additional resources (Russia)
• Anticipate potential perverse incentives to resist
reform and develop counter measures
(Cambodia)
3. The PFM Performance Measurement
Framework
A standard set of high
level indicators
• Widely accepted but
limited in number
• Broad measures of
performance relative to
key PFM system
characteristics
• Enabling credible
monitoring of
performance and
progress over time
A PFM Performance Report
• Integrative, narrative report
based on the indicators and
assessing performance; based
on observable, empirical
evidence.
• Updated periodically, depending
on country circumstances and
operational needs
• Contributing to coordinated
assessment
• Feeds into government-donor
policy dialogue