In response to the Paris Declaration (2005) and the Accra Agenda (2008) for donor commitments to channel more of their aid to developing countries through country systems, there has been a growing movement away from the project and aid program-typically managed or directly from development partner who contributes-for budget support which aid is channeled directly through the developing nation of consolidated revenue fund of the Treasury. As you might expect, as a result of this growing shift to budget support there has not been a corresponding increase in donor focus on the performance of public finance management in countries receiving budget support. This is as it should be, given the real or perceived risks increased Trustees associated with the use of national systems for managing hard-earned taxes of citizens of partner countries.
But this is only one side of the story. Unfortunately there is still much interest or appreciation in another side of the story. From the other side of the story are citizens of developing countries who may suffer in consequence of tinkering with systems of public finance management in the name of reform, which can only serve to undermine the weak current systems and make them even more. Public finance management seems out of reach for most of us. Even where it is accessible to us we consider to be boring, irrelevant and something sad and accountants accounts only need to worry about. But think, public finance management is about our money, it’s about our children’s future, is our growth.
The importance of public finance management and its reform comes as a result of his direct role in the policy-be it improve education, getting the best health care, promoting tourism or increase agricultural yields. With weak public finances management, even where policy makers come with sound policy, it’s not possible to implement this policy effectively. Additionally, unique enough so the performance of public finance management affects the performance of all other sectors-yes the macroeconomic environment and opportunity so the private sector and the provision of services in agriculture, health, education, transport, energy, public safety and the list goes on. When it works, all the other sectors have a probability of success; but when the public finance management fails all other sectors fail.
As the citizens of developing countries must be concerned that the agenda for the reform of public finance management. Is the IMF, like imposing conditionality reform of public finance management that are not only related to the strengthening or improvement of financial systems, but are related in particular to the adoption of particular reform approaches-in spite of these approaches in some cases not having in several countries. Is the World Bank as it makes the adoption of integrated information systems in financial management (IFMIS) the basis for supporting the reform of public finance management? Or is the result of the internal debate and consideration for the nationality of the country that influence their elected leaders to address basic things which they know not to work using approaches that are within the reach of our ability rather than adopt methods of reform that cannot yet be suited to our circumstances?
This donor’s interest in improving the performance of public finance management has immense pressure on countries to adopt new approaches to public management. These have included (1) medium term expenditure frameworks (MTEFS) often pushed to be implemented before a country can have developed the ability to make credible their annual budgets and also as development partners themselves continue to struggle with the ability to disburse funds expected during the year, especially as measured in a mid-term perspective. or (2) the use of the basic criteria of the budget and programme of activities such as budget long before they have the institutional capacity to effectively coordinate programmes, build fiscal space for consideration significant policy or access data from monitoring to accurately assess the results of the policy; or (3) the adoption of integrated financial management information systems (IFMIS) to manage expenditure that occurs among those thousands of units, many of them still struggling with staff retention problems, supply of electricity or integration in a nationwide network of financial administration.