• By 2012 México will evaluate 75% of its spending compared to 14% in 2007

“At this moment in Mexico, 14% of the programmable annual spending can be evaluated. This is our reality. The goal is for it to ascend to 75% by 2012”, according to Dionisio Perez Jacome, Undersecretary of Expenditure of the Ministry of Finance, during his participation in the International Conference on Performance based budgeting.

The Ministry of Finance, World Bank and other international organizations planned this Conference, in which different systems of evaluation were analyzed to allow for a better quality in the exercise of spending, and a systematic revision of results.

In this way, Mexico joins the tendency that was set in motion a few years ago by most of the countries associated to the OECD, with the intention of improving operative efficiency and effectiveness in public spending.

The international community recognizes that the different processes applied to elaborate national budgets are vital in order to carry out objectives in public policy. Performance based Budgeting contributes, not only to establishing a better fiscal discipline, but also to promoting effectiveness in the assignation of resources and transparency in accountability. The objective is for budgeting to become more than just a vehicle for allotting resources and controlling expenditure.

Even though bureaucracy could become a mayor obstacle for Mexico to reach the desired level in the assignation of Performance based Budgets, if applied correctly it would combat corruption and strengthen democracy, according to Blanca Heredia, of the OECD.

The International Conference on Performance based Budgeting took place in Mexico City on June 9 and 10, with the attendance of approximately one thousand participants and representatives of over forty countries, as well as institutions such as the IDB, the OECD, the DIFID; academic institutions such as CIDE and civil society organizations.

The Conference was based on three pillars: (i) setting institutional grounds for Performance based Budgeting, (ii) production and quality of the information necessary for adequate observance, and (iii) execution of the information in order to make better budgetary decisions.

The Conference paid special attention to the Mexican context (federal, state and municipal), as well as emphasizing on the correlation between the execution of budgets and provision of services.

After two days of lectures and accounts in which experiences from different countries were presented, various subjects were discussed, such as the importance of linking budgetary reform to a more inclusive public administration program. These reforms cannot be centered on technical mechanisms; they should include political processes that require commitment and leadership, which need to be adapted to the circumstances of each individual country. The process implies a change of culture, which requires time, patience and persistence. The speakers emphasized that “the journey is as important as the destination”.

Marcelo Giuggale, Director of the Poverty Reduction and Economic Management sector of the World Bank, summed up the essence of the debates establishing that Performance based Budgeting is the foundation of a “new social contract”, an instrument that could serve to break the cycle of lack of confidence between citizens and the government: a recurrent issue in Mexico and all of Latin America.