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Cross Cutting Issues: General

 

 

 

International Good Practices and Reference Models

Guidelines for Public Financial Management Reform: The Commonwealth Secretariat draws on case studies from Commonwealth countries and previous reports to provide universally accepted principles, best practices and processes for PFM reform. Examples are drawn from the South African PFM reform experience and best practices from other Commonwealth countries including Australia, Canada, India, Malaysia and Malta.

Australia’s Experience in Utilizing Performance Information in Budget and Management Processes: This document from the Australian Government, Department of Finance and Administration provides a description of Australia’s performance system and the budgeting and management framework that is an important aspect of the government’s public sector financial structure.

 

Putting it Together - An Explanatory Guide to the New Zealand Public Sector Financial Management System: The Treasury of New Zealand published this brief introduction to the New Zealand public sector financial management system, explaining key concepts, planning and budgeting, and managing it efficiently.

 

A Revolution in Financial Management - The Public Finance Act of 1989: This article from the State Services Commission (the Government's lead advisor on New Zeland's public management system) describes the new FM system in New Zealand and the principles it is based on in addition to key features of the reformed system.

 

Financial Management - Developing a Capability Model: This report from 1997 presents a study of FM conducted by the Office of the Auditor General of Canada in the federal government with the ultimate objective to develop a model of FM that will permit the Treasury Board Secretariat to assess the FM capability of departments against an agreed-upon standard.  It includes initiatives to improve FM and the principles of a FM capability model. 

 

Toward Better Governance - Public Service Reform in New Zealand (1984-94) and its Relevance to Canada: This study, conducted by the Office of the Auditor General of Canada, focuses on reform of the core public service in New Zealand. It examines the principal stages of a decade of reforms, including commercialization, corporatization and restructuring undertaken primarily over the period from 1984 to 1989.  It includes information on their financial management reform and strengthening of the budgetary regime.

Reform Priorities for PFM in Developing Countries: This chapter of the Governance, Corruption and Public Financial Management paper (published by IDB) first presents some general strategic considerations; then outlines the key priorities and sequencing of reform in each of the various aspects of public expenditure management. It also includes a few “universal principles” and recommendations to improve expenditure management in the specific country context.

Uganda: A Decade of Budget Reform and Poverty Reduction: This article was featured in OECD’s Journal on Budgeting describing the drastic fluctuations of Uganda’s economy from the 1960s to its revival in the late 1980s.  It discusses key PFM reforms that improved macroeconomic performance, strengthened budgetary discipline, and focused on the efficiency and effectiveness of financial management and accountability.

Strategy of Public Finance Management Reform: This research and initiative was written by Slovakia’s finance ministry and provides references to OECD best practices. It provides information on what the nation did to improve its financial stability and implement IMF / OECD recommendations.

Strengthening Public Sector Administration and Financial Management in Mongolia: The Asian Development Bank assisted Mongolia with enhancing the efficiency and quality of the services provided by the public sector. This paper describes how transparency and accountability of public sector financial output was increased through strengthening overall standards at all levels of public administration.

From Line-item to Program Budgeting: Global Lessons and the Korean Case:  This document from the Korean Institute of Public Finance and the World Bank contains four separate papers written by the World Bank and consultants on Korea’s innovations in public finance, particularly program budgeting.  It addresses the conceptual and practical issues in shifting from traditional to program budgeting, different models for program budgeting, Korea’s application of lessons learned from other countries, and the implementation plan for the final program and performance budgeting proposals.           back to top

 

Guidance and Tips

A Platform Approach to Improving PFM (Published by the Department for International Development): PFMA reform process in Cambodia as a Sector-Wide Approach including six steps: 1) Define platform; 2) Assess current position; 3) Identify measures to implement; 4) Assess measures against criteria; 5) Select and consolidate; 6) Assess overall strength of platform.

Integrated Financial Management in Least Developed Countries (Published by UN Network of Public Administration and Finance): This report highlights the key elements of integrated financial management. It identifies barriers to improvements in LDCs and recommends measures to sustain reforms.

Caught in an Evaluatory Trap - A Dilemma for Public Services under NPFM: This paper seeks to highlight the possible dangers of persisting with reform programs in the arenas of PM and governance, when they so often depend on accounting based techniques with length histories of mishaps.  Though not necessarily a “best practices paper” on PFM, it may provide insight on what not to do.

Guidelines for PFM Reform (Published by the Commonwealth Secretariat): This document provides a strategic financial reform framework and how to improve various budgetary implementations.     

Managing Government Expenditure (Published by the Asian Development Bank): This is a comprehensive manual, based on a sound conceptual foundation but with a deliberate operational thrust, covering the entire public expenditure management cycle – from multiyear expenditure programming and budget formulation through budget execution, audit, and evaluation. The approach is largely a synthesis of the literature in this area and of international experience, with a view to a pragmatic assessment of the benefits, costs, risks, and implementation requirements for different budgetary practices in different country circumstances.

Managing Fiduciary Risk when Providing Poverty Reduction Budget Support (Published by the Department for International Development): This note has key areas of guidance in relation to risk in: evaluation; credible program of improvement and reform; and finally providing direction on how to record a fiduciary risk assessment and ensure that judgments are clearly stated and based on reasonable and consistent evidence. 

Public Expenditure Management Handbook (Published by the World Bank): This paper provides guidelines for improving budgetary and financial management in the public sector.  It discusses developments in budget practice, institutional arrangements for better budgetary outcomes, budgeting in a medium term framework, FMIS, approaches to budget reform, and diagnostics

Public Investment Management in the New EU Member States (World Bank Working Paper): This paper describes the characteristics of public investment management (PIM) in seven EU countries as it applies to a single sector - transport infrastructure. The report highlights some of the common challenges that four relatively new EU member states - Poland, Slovakia, Slovenia, and Latvia - face as they plan and execute their transport infrastructure projects. It recognizes the importance that EU-mandated processes and procedures have in shaping national systems in the new member states (NMS), but the report finds that actual practices often fall short of EU goals due to capacity constraints, weak institutional structures, and other factors. The experiences of the NMS are compared with those of more developed economies (namely Spain, the UK, and Ireland) to assess whether the later countries have faced similar challenges in PIM, and if so, what measures they have adopted to overcome them. This comparative analysis serves to draw out several good practice examples that are relevant for all countries.  

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Country Case Studies and Lessons Learnt

Public Financing Management Reform in Malawi (Published by the Swedish International Development Cooperation Agency): The study provides an analysis of the system of public financial management in Malawi and of recent efforts to reform the system.   This document includes information on IFMIS, MTED, and Malawi’s poverty reduction strategy.

The Tanzania PFM Reform Memorandum: In 1998, the GoT initiated the PFMRP whose strategic goal is to achieve “high economic growth, macro-economic stability and sustainable efficient delivery of public services” by establishing effective financial management arrangements which minimize resource leakages and strengthen accountability.

  Models of Public Budgeting and Accounting Reform (Published by the Organization for Economic Co-operation and Development): This document includes a discussion on public accountability and government financial reporting and then provides a comparative look at financial management systems from a family of systems point of view, including: China and Central-Eastern European; Anglo-American; and Continental European models. 

Effectiveness and Impact of Asian Development Bank Assistance To The Reform of Public Expenditure Management in Bhutan, India, Kiribati, And Lao People’s Democratic Republic(Published by the Organization for Economic Co-operation and Development): The public expenditure management process involves policy making; budget instructions; budget proposals; budget approval; budget execution; and controls, such as audit and evaluation. Governance criteria that ADB adopted and that relate to the budget cycle include efficiency, effectiveness, transparency, and accountability.

Wax and Gold: A Decade of Financial Reform in Ethiopia ( Produced by the Kennedy School of Government Ministry of Finance, Government of Ethiopia):  Includes a pre-project status of financial management and the Decentralization Support Activity project’s approach to PFM reform with an international best practice sequence of implementing financial reform.

 

Assessing Public Management Reform in an International Context (Published by the University of St. Gallen, Switzerland):   This working research paper attempts to make sound multi country comparisons with regard to global public management reform and assesses whether management reforms have helped each nation solve its particular problems.

 

The World Bank and Korea Development Institute: Reforming the Public Expenditure Management System: This publication is broken into three parts: medium-term expenditure framework, performance management, and fiscal transparency.  Each part includes separate chapters dealing with development, country case study implementation examples, and the results of those implementations in each country. 

 

Mozambique State Financial Management Project (Published by the Department for Democracy and Social Development and Department for Africa): This document is an external evaluation report on the SFMP which sought to both reform and build capacity in budget preparation and budget execution / accounting, aiming at the control of expenditure in accordance with budget and the reporting thereof.  The report also highlights lessons in PFM for the future both for SIDA and MPF.          

 

Strengthened Approach and PFM - PR Case Study - Ukraine: This PowerPoint presentation by Bill Dorotinsky (World Bank)   provides a background and context of Ukraine including its impetus for change, timelines, and recent bank support for assisting in its PFM reform process.  It also discusses the country’s strategy and approach for carrying out its reform.

Sustainable Public Finance through Good Financial Governance (Published by the German Agency for Technical Collaboration): This publication is based on the third public finance conference in Eschborn.  It takes into account the national budget as a lever in sustainable poverty reduction, the role of the SAI, participative and transparent budgeting (experiences from Latin America), and lessons learnt. 

Public Investment Management in the New EU Member States (World Bank Working Paper): This paper describes the characteristics of public investment management (PIM) in seven EU countries as it applies to a single sector - transport infrastructure. The report highlights some of the common challenges that four relatively new EU member states - Poland, Slovakia, Slovenia, and Latvia - face as they plan and execute their transport infrastructure projects. It recognizes the importance that EU-mandated processes and procedures have in shaping national systems in the new member states (NMS), but the report finds that actual practices often fall short of EU goals due to capacity constraints, weak institutional structures, and other factors. The experiences of the NMS are compared with those of more developed economies (namely Spain, the UK, and Ireland) to assess whether the later countries have faced similar challenges in PIM, and if so, what measures they have adopted to overcome them. This comparative analysis serves to draw out several good practice examples that are relevant for all countries.

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Other Reference Materials

Finance and Economic Development - Policy Choices for Developing Countries: This World Bank policy research working paper talks about various financial systems around the world and discusses different policy options to make finance work for development.

Public Expenditure and FM Overview of Issues and Approaches: This PowerPoint presentation from Bill Dorotinsky (World Bank) touches on a variety of issues from a seminar that took place last year.  He discusses the budget cycle (formulation and execution), the PFM systems and its functions, outcomes / impact; common problems and common solutions; and measuring PFM systems.

The Centrality of Public Finance Policy & Management in Development: This PowerPoint presentation from Sanjay Pradham (World Bank) touches on a few key issues, including: Governance and development; PFM analysis and trends; an example of procurement reform in the Philippines; Satisfaction improvement; and transparency in extractive industries.

A Comparison between Two Public Expenditure Management Systems in Africa: This IMF working paper assesses the advantages and disadvantages of the French and British public expenditure management systems as used in Africa.  The primary differences discussed are in budget execution and government accounting, both of which are referenced.  The paper also mentions that desirable reforms in both systems will only be successful if they are accompanied by measures that enhance the accountability of those who operate the systems; including enforcing the rules embodied in existing or reformed regulatory frameworks.

 

Public Expenditure Management in Francophone Africa: A Cross-Country Analysis: This IMF working paper undertakes a cross-country study to compare francophone African PEM systems through analyzing similarities in them and whether there are divergences both between them and the French systems and among the francophone African countries themselves. It primarily compares PEM systems, highlights similarities and differences among them, and draws some lessons for TA implementation.

Strategic Development Plan for PFM Reform 2005-2007(Published by the Romanian Ministry of Finance): The key areas covered by the SDP include: program budgeting, accruals accounting, financial reporting; treasury cash management; internal audit; and financial management and control systems.

Research Summary 31: IDS Working Paper Series No. 306: Where are ‘Pockets’ of Effective Agencies Likely in Weak Governance States and Why? A Propositional Inventory (by David K. Leonard for the Centre for the Future State, Institute of Development Studies):  This paper presents hypotheses on how and why well-functioning public agencies are able to exist in countries with poor governance, analyzes the relative importance of the hypotheses and how they influence one another, and suggests implications of the analysis for policy makers.

Research Summary 27: IDS Working Paper Series No. 307: Idealism, Realism and the Investment Climate in Developing Countries (by Mick Moore and Hubert Schmitz for the Centre for the Future State, Institute of Development Studies):  This paper discusses the central elements for improving the investment climate in OCED countries – legal protection of property rights and enforcement of contracts – and includes a short study of China to indicate how some countries have made dramatic progress without these elements in place.  It also compares the relationship between public authority and private capital in OCED countries with that of poorer countries.

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