Transcript Performance elements in budget and reporting process - Norway 5TH ANNUAL MEETING OF OECD SENIOR BUDGET OFFICIALS NETWORK ON PERFORMANCE&RESULTS – 28 OCTOBER.

Performance elements in budget and
reporting process - Norway
5TH ANNUAL MEETING OF OECD SENIOR BUDGET OFFICIALS
NETWORK ON PERFORMANCE&RESULTS – 28 OCTOBER 2008
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Finansdepartementet
Performance Information in the Budget Process
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The 1986 budget reform in Norway called for a greater focus
on results and efficiency.
Ministries and agencies increased managerial flexibility in
order to improve efficiency and performance and to hold
them accountable for results measured in the form of
outputs and outcomes.
Changes in the Appropriation Regulations (by Stortinget)
Government system of performance budgeting and
management has developed slowly.
Finansdepartementet
Government requirements of performance
information
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Require that the budget proposal contain information on
planned objectives and achieved results for the previous
financial year together with financial information
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Government Decree on Financial Management regulates
management of all administrative central government
bodies, all activities in the administration and all grant,
contribution and guarantee schemes
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The Ministry of Finance has also issued Provisions on
Financial Management in accordance with the government
decree.
Finansdepartementet
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The ministries must ensure that agencies report relevant
and accurate performance information and that they
commission evaluations.
The ministries shall in consultation with the agencies
define needs and agree on the scope and content of the
reporting of performance information.
The scope of the reporting shall be in accordance with
the letter of allocation and shall focus on achievement of
objectives and results.
Ministries decide on the reporting requirements
Reporting on results may include inputs, activities,
products and services as well as outcomes
Finansdepartementet
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The agencies shall prepare a separate annual report to
the ministries, in accordance with requirements in the
letter of allocation, and it shall contain relevant
performance information
Individual line ministries have the flexibility to establish
their own approach for overseeing and managing
agencies
Ministries shall ensure that evaluations are performed to
obtain information on efficiency, achievement of results
within the ministries area of responsibility
The frequency and scope of evaluations shall be decided
on the basis of the agency`s distinctive characteristics,
its risk profile and its significance. The need for
evaluations must be considered in light of the quality and
scope of other reporting.
Finansdepartementet
Practice
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Many ministries and agencies have made only limited
progress in developing meaningful performance measures
and using them in the budget process
The MoF has so far not put pressure on ministries or
agencies to actively implement performance information in
the budget process
There are exceptions and progress does vary with
individual ministries and agencies
Norway struggles with problems of goal definition and
developing good quality performance measures and data
The development of output and outcome measurements
has been slow and generally the quality of the data is
problematic
Finansdepartementet
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These problems are compounded by a decentralized
system in which there are few incentives and little
pressure in ministries to use performance information in
the budget process.
There is little systematic evaluation or monitoring by the
MoF of ministries or agencies progress and activities in this
area
In 2004 MoF established The Government Agency for
Financial Management. Important role in initiating,
promoting and coordinating reforms within performance
management and financial management within
government
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Give advice, prepare advisory material, methods and
tools for finance management, training and conduct
consultative functions.
Finansdepartementet
Initiatives
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MoF has taken an initiative in 2008 to consider different
models of centralized reporting of conducted evaluations. No
final decision has been taken.
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MoF has together with The Government Agency for Financial
Management initiated a project which examine the status of
performance budgeting in a systematic matter.
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Survey of five budget propositions and six letter of
instructions are carried out recently. The project will be
finalized in 2008.
Finansdepartementet
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Major findings are:
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The overall framework of performance management, according to
the regulations, seems to established both at ministerial and
agency level. However, there are differences when it comes to
quality
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The goal definition both in budget propositions and letters of
instruction are generally formulated, and with some exceptions,
and not measurable
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There is not a overall framework of goals in the budget
propositions (exception; Ministry of Justice)
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Performance information in budget propositions are mainly on
activities (seldom output or outcome)
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The ministries use few performance indicators to measure cost
efficiency
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There are huge differences between ministries and agencies in
structure and quality of performance information
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Different practice between ministries in use and references to
conducted evaluations in the five budget propositions
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Additional measures are planned in 2009. Case-collection of good
practice.
Finansdepartementet
Conclusions
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Extensive improvements have been made by
managerial flexibility.
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However, the government-wide system of
performance budgeting and management has
developed slowly.