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Measuring PFM Performance The PEFA program and tool. CReCER Managua, October 29-31, 2012. Charles Seibert, PEFA Secretariat. Founded in 2001 as a partnership. PEFA Partners World Bank European Commission International Monetary UK Department for International Development - PowerPoint PPT Presentation
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Measuring PFM Performance
The PEFA program and tool
CReCERManagua, October 29-31, 2012
Charles Seibert, PEFA Secretariat
PEFA Partners
•World Bank•European Commission•International Monetary
•UK Department for International Development•French Ministry of Foreign Affairs•Norwegian Ministry of Foreign Affairs•Swiss State Secretariat for Economic Affairs.
Founded in 2001 as a partnership
A multi-donor initiative in PFM: The Approach
Promote results-orientation in PFM development work
Harmonize the support to PFM systems provided to governments by international development agencies
Build on the principles of the Strengthened Approach to Supporting PFM Reform, as an approach to aid effectiveness in the area of PFM (Paris Declaration, Accra Agenda for Action, Busan Declaration)
Work closely with OECD Development Assistance Committee Task Force on PFM for collaboration with a wider group of stakeholders
The Strengthened Approach in reform of PFMOwnership : a country-led agenda reflecting country priorities and implemented through government structures
A coordinated program of support from donors and international finance institutions
A shared information pool on public financial management based on a common assessment framework
A. PFM Outturns
B. Comprehensiveness and Transparency
(PI-5-10)
C. Budget Cycle D. Donor Practices
(D-1-3)
C(1) Policy-based budgeting
(PI-11-12)
C(3) Accounting, Recording
and Reporting (PI-22-25)
C(4) External scrutiny
and audit (PI-26-28)
C(2) Predictability and control in budget Execution (PI-13-21)
Budget Credibility
(PI-1-4)
The PEFA Performance Measurement Framework
Components of the PEFA Framework A standard set of high level PFM performance indicators
(PIs) 31 performance indicators (each 1 to 4 sub-indicators or
dimensions, 76 dim. In total ) scored on a 4-grade ordinal scale (A, B, C, D) grouped in six critical aspects of PFM a compromise between simplicity and
comprehensiveness A standard report format
the PFM Performance Report (PFM-PR) to provide country background, evidence on the
indicators and an integrated, analytical summary
The PEFA FrameworkObjectives To determine if a country has the tools to deliver three main budgetary outcomes:
• aggregate fiscal discipline • strategic resource allocation• efficient use of resources for
service delivery
Implement PFM reforms
High level performance
overview
Investigate underlying
causes
Formulate PFM reform program
Identify main PFM
weaknessesRecommend PFM reform measures
PEFA Assessment
• Measures progress through a set of standardized indicators
• Builds capacity for PFM reform through diagnostic and periodic progress monitoring
• Facilitates donors’ decision on use of country systems
• Promotes joint country analytical work• Fosters stakeholder coordination around one
common assessment tool
PEFA in PFM Reform Cycle
Purpose of the PEFA FrameworkThe Framework provides:• a high level overview of all aspects of a country’s PFM
systems performance (revenue, expenditure, financial assets/liabilities, procurement): are tools in place to deliver 3 main budgetary outcomes (aggregate fiscal discipline; strategic resource allocation; efficient service delivery)?
It does not provide an assessment of:• underlying causes for good or poor performance i.e.
capacity factors• government fiscal & financial policies
;
Credibility in coverage: 285 assessments prepared in 135 countries including 28 government-led and 103 Sub National assessments: PEFA Framework used by governments in most countries to take control of their PFM reform agendas
Effectiveness: adopted globally by 83% of Low Income Countries (LIC) and 89% of Middle Income Countries (MIC) at the baseline level and more than 96 repeat assessments at a completed or planned stage.
Country focus and decision Application entirely decentralized to
the country level (if, when, how to use Framework)
The Framework does not ‘belong’ to any single organization
Applicable for central government level as well as sub-national level
PEFA data provides opportunity for peer learning and research
PEFA experience by income group
Global adoption by partner countries and donors
HIC UMIC LMIC LIC0%
10%20%30%40%50%60%70%80%90%
100%
Not Covered
Planned/Ongoing
Draft
Income Group
% c
over
ed
18% 89% 88% 83%
PEFA assessments map
The PEFA Secretariat Location, structure and operationsFunded by the 7 partners and located in Wash DC (World Bank main building). A Steering Committee comprising the 7 agencies manages the Program while the PEFA Secretariat implements the PEFA related activities Main tasks 1. Training 2. Quality review of: a) PEFA Concept Notes and Terms of Reference; b) PEFA field assessments; 3. Methodological studies and overall guidance on PEFA issues
Role: neutral body supporting / advising any user of the Framework does not represent a particular interest does not undertake or finance assessments support services are free of charge
Activities of the PEFA SecretariatCustodian of the PEFA Framework Development and maintenance of the Framework Issues guidance notes and clarifications
Support PFM research Availability of PEFA indicators database
Dissemination Presentations; PFM blogs; PEFA Newsflashes; sharing PEFA assessment reports
through website
Monitoring Semi-annual updates of PEFA assessment status list Periodic monitoring reports Ad hoc surveys
Promotes harmonization in assessment of PFM systems Working with OECD-DAC Task Force on PFM Stocktaking study of PFM diagnostic instruments Supports developers of ‘drill-down’ assessment tools
What is next?External evaluation of program (2011): “Resoundingly positive” • created credible framework for PFM assessment • assessments comparable over time & constitute common information pool on PFM
performance• 95% LICs, 80% MICs (& 8% HICs!) have used it• used by practically all major DPs working with PFM systems (design, monitoring, or
FRA) • adopted by many governments to inform design of PFM reforms, monitor progress over
time & assess quality of PFM at sub-national levels Phase IV priorities• Using assessments for elaboration of PFM reform programs: guidance being developed• Framework review & update, to reflect newly accepted ‘good practices’ (but recognizing
need for time series to allow progress tracking) • encouraging use of the database compiled from completed assessments• initiatives to broaden voice of stakeholders & improve transparency of program
management• strengthening QA arrangements: ‘PEFA Check’
Framework review & updateTarget for new release = 1 July 2014
Purpose of revising the Framework
• Incorporate editorial ‘clarifications’
• Update ‘good practices’
• Improve areas of weakness
It is not intended to:
• Change the purpose
• Undermine comparability over time
Thank You
Stay in touch with PEFA:
Visit the PEFA website: www.pefa.org
Send questions to the Secretariat: services@pefa.org
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