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Role of PFM in Governance. Presentation Outline. Governance and Good Governance PFM: Backbone of Governance Nepal Context Gaps Next Step PEFA and Nepal. Fundamentals. ‘WHY’ Better government Better service delivery Better result Greater interest of the greater people ‘WHAT’

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Presentation outline
Presentation Outline

  • Governance and Good Governance

  • PFM: Backbone of Governance

  • Nepal Context

  • Gaps

  • Next Step

  • PEFA and Nepal



  • Better government

  • Better service delivery

  • Better result

  • Greater interest of the greater people


  • Legislative, judicial & executive functions of government at each level

  • Subsidiarity: what can be devolved that should be devolved

  • Universally applicable principles, norms & standards

  • Mutual cooperation within and between levels of government systems, institutions and processes


  • Feasibility & affordability: implementable, doable, achievable

  • Incremental process

  • Efficiency in process, due process of law

  • Build on what we have: organic


State : geography, population, sovereignty, government

Government : governing body, political institutions

Governance : act or manner of governing

Good governance : rule of law, transparency, accountability,

participation, equity, fairness, inclusion, responsiveness, consensus oriented, efficiency, effectiveness

Reform:make changes in something so as to improve it

Restructuring : organize differently

Vertical form of government

Federal or unitary

Central, state, local government relations and dynamics

Horizontal system of government

Presidential/parliamentary system

Executive, legislative and judicial relations and dynamics

" Power tends to corrupt and absolute power corrupts absolutely": John Dahlberg

Major functions of government
Major Functions of Government

  • Traditional: law and order, revenue collection, external affairs, police state

  • Vertical functions : Policy, legislation, national standard, guideline, overall planning: vision and mission, asset creation: human, social and infrastructure, Implementation, M&E, financing, coordination and accountability

  • Horizontal Functions : Economic: revenue collection, agriculture, land reform, labour and employment, trade and commerce, poverty alleviation, help enhancing growth

  • Social : health, education, social justice, social security, social protection

  • Infrastructure: road, highway, irrigation, hydropower, information highway

  • Governance: regulatory, oversight, law and order, RTI, corruption control, human right, external affairs, environment, natural resources, climate change

  • Deliver classic public goods, Involve in delivering larger public goods, assist marginalized and vulnerable, formulate policy of equity, create conducive public Service delivery environment

  • Human resource management/development, public financial management

  • Regulator, facilitator, enabler, coordinator

    "Enabling approach is better that feeding"

Dimensions of governance
Dimensions of Governance

  • The Political Dimension: Process by which governments are selected, monitored and replaced;

  • The Economic Dimension: Capacity of any government to effectively formulate and implement sound policies as well as provide public services for its citizens;

  • The Institutional Dimension: Respect of citizens and the state for the institutions that govern social and economic interactions among them.:

  • Ethical Dimensions: State actors, officials, corporate, mind set, behavior and paradigm

Good governance and poor governance
Good Governance and Poor Governance

Good Governance

Poor Governance

Diversion of Public Resources for Private Gains

Impunity or arbitrariness in the application of Law

Excessive rules which impede the functioning of markets

Non-transparent Decision-making

Discretionary allocation of resources

  • Accountable

  • Consensus oriented

  • Participatory

  • Transparent

  • Rule of law

  • Responsive

  • Equitable & inclusive

  • Economy, efficient and effective

Cfwf e t kfgt 0f
cfwf/e"t ?kfGt/0f

Fiscal governance
Fiscal Governance

  • Public expenditure policy: Impacts on growth, social security, employment and inflation

  • Revenue/taxation policy : impacts on investment, equity, inflation and resource allocation

  • Foreign aid policy: aid management

  • Public debt policy : impacts on interest rate, inflation and private investment

  • Financial policy : financial stability/private investment

Ultimate goal of fiscal governance
Ultimate Goal of Fiscal Governance

  • Maximization of domestic resource

  • Decreasing the dependency upon foreign aid

  • Rational use of domestic borrowing

  • Efficient and productive allocation of public resources

  • Poverty alleviation through growth

  • Macro economic stability and predictability

Public finance
Public Finance?

  • Public: citizens, people, of the people, by the people, for the people or related to government

  • Finance: to invest, or mobilization of financial resources or money for desired goal

  • Public finance: subject matter related to mobilization and utilization of public/government money or resources

  • Government : trust

  • Government employees: Trustees, change agent, cream of the society, neutral competency, integrity, objectivity, confidentiality

Dimensions and principle of public finance
Dimensions and Principle of Public Finance


  • Public expenditure: public goal, expenditure policy programs, and public spending

  • Public revenue: tax and non tax revenue

  • Public debt: internal, external, grants etc.


  • No taxation without representation

  • No public expenditure without parliamentary consent

Public financial management
Public Financial Management

  • PFM talks about planning, resource mobilization, expenditures, reporting and audit of public monies and involves systems and staff in every agency of government.

  • Public Financial Management (PFM) is about how government manages public monies for better government, better results and better services to the citizens.

  • Those results must be for the wellbeing of the society and people at large.

Public financial management1
Public Financial Management

  • Handling of public purse for better results

  • Achieving results, managing risks, prudence behavior

  • ;/sf/sf] ;du| ljQLorqmsf] Joj:yfkgug]{ sfo{nfO{ ;fj{hlgsljQLoJoj:yfkgelgG5

  • ;fj{hlgsvr{,, /fh:jkl/rfng, ;|f]t kl/rfng, hjfkmb]lxtf -k|ltj]bg / hjfkm_

  • ;'zf;gsfrf/} cfofdx? -/fhgLlts, cfly{s, Joj:yfksLo / g}lts_ ;u ;/f]sf/ /fVb5 .

  • ;dfj]zLcfly{s j[l4(Growth), cfly{s :yfloTj(Stability), ;fdflhsGofo(Equity) xfl;nug]{ k|d'vdfWod g} ;fj{hlgsljQLoJoj:yfkgxf]

    "A Good PFM system is prerequisite for GOOD GOVERNANCE"


  • Public value maximization

  • Parliamentary approval

  • Due process of law

  • Public accountability

  • Prudence: judgment

  • Due care: public trustee

  • Principle of fiscal sustainability

  • Independent audit

Fj hlgs ljqlo joj yfkg p2 zo
;fj{hlgsljQLoJoj:yfkg: p2]Zo

  • ;dli6ut cfly{s cg'zf;gsfodug]{,

  • >f]t / ;fwgsf] /0fgLlts ljt/0f ug{{],

  • >f]t / ;fwgsf] pkof]udfk|efjsf/Ltf, sfo{s'zntf, kf/bzL{tftyfhjfkmb]xLtfclea[l4 ug]{,

  • ;fj{hlgs ;]jfk|jfxdf ;'wf/ ug{ ;xof]u k'¥ofpg' ,

  • ljQLohf]lvdGo"gLs/0f ug{] pkfox? klxNofpg]

  • ;'zf;gsfodug{ ;xof]u k'¥ofpg'

Fj hlgs ljqlo joj yfkgsf if q sfo x
;fj{hlgsljQLoJoj:yfkgsfIf]q / sfo{x?

  • sfo{x?

    != ljQLo ;|f]t ;fwgsf] cg'dfg / klxrfg

    @= ljQLo ;|f]t ;fwgsf] k|flKt

    #= ljQLo ;|f]t ;fwgsf] af8kmf8

    $= sf]if Joj:yfkg

    %= vr{ pkof]u

    ^= n]vfkfng

    &= cfGtl/s lgoGq0f

    *= k|ltj]bg

    (= n]vfk/LIf0f



!= cfly{s of]hgf

@= ah]6 Joj:yfkg

#= ;fj{hlgsvr{ Joj:yfkg

$= n]vfÍg / k|ltj]bg

%= cfGtl/s lgoGq0f

^= n]vfk/LIf0f

Fj hlgs ljlqo joj yfkgsf cjojx
;fj{hlgsljlQoJoj:yfkgsf] cjojx?

  • gLlt, of]hgf / sfo{qmd

  • ah]6 k|0ffnL

    • /fh:jjfcGok|fKtLsf] Joj:yfkg

      • vr{ Joj:yfkg

      • lgsf;f, vr{ / vr{ >f]t Joj:yfkg

      • sf]if Joj:yfkg -vftfk|jfx, ;dli6 cfly{s sf/f]jf/ ;dfj]z_

      • Zf]wegf{ Joj:yfkg

      • ;fj{hlgsvl/b Joj:yfkg,

      • cfGtl/s lgoGq0f,

      • C0fsf] Joj:yfkg

  • n]vf+sg, k|ltj]bgtyfljlQok|ltj]bg

  • cfGtl/s n tyfclGtd n]vfk/LIf0f, cfGtl/s tyfafXolgu/fgL

Fj hlgs ljqlo joj yfkgdf nug lgsfox
;fj{hlgsljQLoJoj:yfkgdf ;+nUglgsfox?


!= Joj:yfkLsf ;+;b -;ldlt ;d]t_— cfo—Jooug]{ clVtof/L k|bfg — ;/sf/nfO{ hjfkmb]xLt'Nofpg]

@= /fli6«o of]hgfcfof]u— cfly{s of]hgf / sfo{qmdth'{dfdf ;dGjoug]{

#= cy{ dGqfno — ah]6 th'{df / sfof{Gjogsf] cg'udgtyfd"Nof+sg

$= ljifoutlgsfox?— ah]6 sfof{Gjog

%= d=n]=lg=sf= — ;l~rtsf]ifsf] ;~rfng, n]vfÍg / k|ltj]bg

^= sf]=n]=lg=sf= — ah]6 lgsf;f, cf=n]=k=/ k|ltj]bg

&= g]=/f=a}+s / cGo a}+sx?— vftf ;~rfng

*= d=n]=k=sf] sfof{no— n]vfk/LIf0f / d"NofÍgk|ltj]bg

(= c=b'=c=cfof]u — clVtof/sf] b'?kof]u / e|i6frf/hGosfo{sf] cg';Gwfg

!)=bft[ ;d'bfo — cfly{s tyfk|fljlws ;Nnfx / ;xof]u

!!= gful/s ;dfh — cfly{s k|zf;gsf] ;'b[9Ls/0fsf nflu ;sf/fTdsbjfjl;h{gf .

!@= ljsf; ;fe]mbf/x?

Public expenditure management
Public Expenditure Management

  • ;/sf/n] hgtfsf] nfluhltklgsfd u5{ ;fj{hlgsvr{s} dfWodaf6 ub{5 .

  • rfn' vrnfO{ jfl~5t ;Ldfleq /fVg], pTkfbgzLnPjd\ k"FhLutvr{df j[l4 ug{], vr{sf] k|fyldstflgwf{/0f ug{], ljQLokf/blz{tfsfodug{], vr{sf] cg'udgtyfd"Nof+sgdfk|efjsf/LtfNofpg] h:tf ;fj{hlgsljQLoJoj:yfkgsfljljwkIfx?sf ;fy} ;fj{hlgsvr{ s;/L ePsf] 5 / To;sf] s'zntf s:tf] 5 eGg] af/] ;du| d'Nof+sg / ;dLIff

  • Aggregate fiscal discipline, efficiency in resource allocation, better service delivery

  • Operational efficiency : economy, efficiency

    effectiveness, due process of law

    ;fj{hlgsvr{ ;fj{hlgsljQLoJoj:yfkgsf] Ps cleGgc+uxf] .

  • ;fj{hlgsljQLoJoj:yfkgdfhjfkmb]xLtf /xg' kb{5 .


  • Governance indicator (2012 WB): Voice and accountability-33, Political stability: 17, Government effectiveness: 30, Regulatory quality: 32, Rule of law: 36, Control of corruption: 36

  • GNI per capita $721

  • Population in agri. and non-agri. 73.9 and 26.1 percent

  • 23.8 percent of population below the national poverty line.

  • Economic growth: below 5 percent

  • Poverty : 23.8 % (One of the poorest countries )

  • Unemployment : 2.1 %

  • Under employment : 30 %

  • Globalization index: 165/188

  • Doing business index: 135/186

  • Global competitive index: 125/144


  • of]hgf k|0ffnLdf ;'wf/

  • ah]6 k|0ffnLdf ;'wf/

  • sf]if Joj:yfkgdf ;'wf/

  • n]vfk/LIf0fdf ;'wf/ :cfGtl/s / afx\o

  • /fh:jk|zf;gdf ;'wf/

  • C0f Joj:yfkgdf ;'wf/

  • ;fj{hlgs v/Lb Joj:yfkgdf ;'wf/

  • n]vf k|0ffnL, clen]lvs/0f / ljQLok|ltj]bg k|0ffnLdf ;'wf/

  • pQ/bfloTj k|0ffnLdf ;'wf/

  • ljQLokf/blz{tf

  • :yfgLolgsfodfljQLocg'zf;g

  • ;fj{hlgs ;+:yfgdfljQLocg'zf;g

  • u}/;/sf/L ;+:yfx?dfljQLocg'zf;g

  • gLlh If]qdfljQLocg'zf;g

  • Mission Accounting System


  • Knowledge economy index :135/145

  • Corruption perception index: 116/177

  • Human development index: 157/187

  • Gross happiness Index: 135/156

  • Failed state index: 27/177

  • Per day 1500 young people going abroad for job (3d)

  • Gini coefficient : 32.8

  • Power shortage: 12 hours per day

  • Trade deficit : 39281 corer export-import ratio: 13.5

  • Remittance Trap over than budget


dxfn]vf k/LIfssf] PsfpGgf}+ jflif{s k|ltj]bg, @)&)

;/sf/L sfof{nosf] km5\of}{6 ug{ afFsL a]?h' M &# cj{ ^* s/f]8

cGo ;+:yf, ;ldlt / lhNnfljsf; ;ldltsf] a]?h' M &! cj{ &$ s/f]8

n]vf k/LIf0f aSof}tf M @ cj{ %! s/f]8

/fhZjaSof}tf M (# cj{ #^ s/f]8

Zff]wegf{ lngafFsL a}b]lzscg'bfg M @) cj{ && s/f]8

Zff]wegf{ lngafFsL j}b]lzs C0f M * cj{ (% s/f]8

hdfgta;LlbPsf] C0fsf] efvf gf3]sf] ;fFjfJofh M @ cj{ % s/f]8

hDdf km5\of}{6 ug'{kg]{ tyfsf/jfxL u/L 6'+uf] nufpg'kg]{ M @ vj{ $# cj{ ( s/f]8


c;"n ug'{kg]{ M !)=@, lgoldtug'{kg]{ M %!=#, k]ZsLM #*=#*

/fhZj r'xfj6, v/Lb Joj:yfkg, ah]6 cg'zf;g, cfGtl/s lgoGq0f / lhDd]jf/L axgk|efjsf/L gePsf]

  • cfGtl/s lgoGq0f k|0ffnL ;an gePsf]

  • lgof]ux?sf] v/Lb Joj:yfkg k|efjsf/L x'g g;s]sf]

  • cfGtl/s n]vfk/LIf0f x'g] gu/]sf],

  • /fhZjsf] gubL /l;b lgoGq0f g/fv]sf]

  • ah]6 a]u/ vr{ u/]sf]

  • aLdf tyf cf}ifwL pkrf/df kof{Kt ah]6 sf] cefj /

  • s/ s6\6L gePsf]

  • cGt/f{li6«o ;+3 ;+:yfx?sf] ;b:otf z'Ns




Information gap

Coordination gap

Fiscal gap

Policy gap

Blaming game

Culture gap

Behavioral gap


Negative thinking

Survival stage

  • Trust gap

  • Roles gap

  • Resource gap

  • Capacity gap

  • Knowledge gap

  • Technology gap

  • Management gap

  • System, process and institutional gap


  • gtLhftyfsfo{ ;Dkfbgdfcfwfl/t Joj:yfkg k|0ffnL cjnDjgug{ cfjZos 5 .

  • ;fj{hlgsvr{ k|0ffnLnfO{ kf/bzL{, ldtJooL / k|efjsf/L agfO{ hgtfsf] hLjg:t/df ;fy{s / u'0ffTds kl/jt{g NofO{ ;'zf;gsf] cg'e"ltlbnfpg] sfo{ cem} r'gf}ltk"0f{ 5 .

  • ;a} sfdx? r':t, b'?:t, ;Ifd / k|efjsf/L ?kdf ;DkGgug{ cem} a9L lhDd]jf/, O{dfGbf/, sd{lzn, pRr g}ltsrl/q / dgf]jnsf ;fysfdug{ cfjZos 5 .

;'wf/sfo{ of]hgf

Next Step

Pfm links to development goals
PFM Links to Development Goals

MDGs, Vision, Mission, LDC Graduation, Political Manifesto

Other influencing factors

Dev Goals

Budget deficit, Sector allocations, Investment, Debt ratio, Tax burden etc

ServiceDelivery Goals

Fiscal discipline, Strategic allocation, Operational efficiency

Budgetary Outcomes

Fiscal/Exp Policy Goals

PEFA Framework

PFM system performance

Next step
Next Step

  • Fiscal Framework, Budgetary Framework, Expenditure Framework

  • Investment, production, distribution, redistribution

  • Sector Business Plan, MTEF, MTBF, SWAP, FMIS, IFMIS, LMBIS, PEFA, MCPM, result monitoring

  • Global budget, agency budget

  • Local level PFM Reform (DDC, VDC, Municipality, School, Hospital)

  • Expenditure tracking: health, education, infrastructure

  • Off Budget/off aid through national treasury system

  • Whole of the government reporting

  • Grant policy

Next step1
Next Step

Psnvftfsf]]if k|0ffnL (Treasury Single Account) :

  • cf=j= )^^÷)^& b]vLeQmk'/ / nlntk'/ lhNnfdfgd"gfk/LIf0fsf] ?kdf

    z'? eO{ )&)÷)&! b]lv &% j6} lhNnfdfnfu" ePsf] cj:yf 5 .

  • ;a} lhNnfx? dxfn]vflgoGqssfof{no;FuOnline System dfhf]l8Psf] . g]kfn ;/sf/sf] ah]6 vr{sf] ljQLocj:yfonline,real time anytime anywherex]g{ ;lsg] cj:yf 5 .

  • 5l/P/ /x]sfsl/j $%)) e"QmfgL s]Gb|x? / !$))) ;/sf/L a}+s vftfdfpNn]Vo ?kdfsdLcfPsf] 5 .

  • e"QfgLcfb]z k7fPsf] b'O{ 306f leqe"QmfgLul/;Sg] k|ltj4tf k'/f ePsf] 5 . ah]6 sfof{Gjogdfk|efjsf/Ltf a9]sf] cj:yf 5 .

  • cGt/fli6«o If]qdf g} Role Model sf] ?kdfljsf; ePsf] cj:yf 5 .

  • TSA system nfO{ yk ;jn, ;Ifd / e/kbf]{ agfO{ e-payment ;Ddk'Ugsfnfluk"jf{wf/ tof/ ug'{kg]{ cfjZostf 5 . sf]if tyf n]vflgoGqssfof{nox?sf] k"jf{wf/ ljsf; / sd{rf/Lx?sf] Ifdtfljsf; ug{ h?/L 5 .

Next step2
Next Step

FMIS df ;'wf/ M

  • FCGO : FMIS, DTCO : DECS, Spending unit: CGAS

  • vr{, /fhZj / ljQLocj:yfOnline real-time/anytime anywhere x]g{ ;lsg] cj:yf 5 .

  • dGqfnout, lhNnfut, pklzif{sut, rfn" / k"FhLutvr{ x]g{ / To;sf] cWoog, ljZn]if0f / ;+Zn]if0f ug{ ;lsg] cj:yf 5 .

  • FMIS nfO{ cy{ dGqfnotyfdxfn]vf k/LIfssf] sfof{no;Fu cfj4 ul/Psf] 5 . o;af6lhNnfutclVtof/L / vr{, /fhZj / w/f}6Lsf] ljj/0f sfof{nod} a;]/ x]g{ ;lsg] ePsf] 5 . j}b]lzs ;xfotfJoj:yfkgdf ;d]t FMIS nfO cfj4ug]{ sfo{ tof/L cj:yfdf 5 . lzIffljefu;FuFMISnfO{ linkages ug]{ sfo{ clGtd r/0fdf k'u]sf] 5 .

  • ;/sf/sfgLlt, sfo{qmd/ of]hgfaf6 jf:tljsBeneficiarynfeflGjtePePgg\ egLTo;sf] Trackingug]{ /FMIS nfO{ cGoljifoutdGqfnox?;Fu ;d]t cfj4 ug'{kg] 68\sf/f] cjZostf 5 .

Next step3
Next Step

cfGtl/s n]vf k/LIf0f k|0ffnLdf ;'wf/

  • cfGtl/s n]vf k/LIf0f k4lt, k|lqmof / k|0ffnLdf yk ;'wf/ u/L ljQLo ;'zf;gsfodug{ cfGtl/s n]vf k/LIf0fsf] Trackingug]{sfo{ z'? Ufl/Psf] 5 . O;sfnfluKfFfR j6f lhNnf 5gf}6 u/L sfo{ cufl8 a9fO{Psf] 5 . cfn]k Manualtof/ ug]{ tyfcfn]ksf] /0fgLlts of]hgftof/ u/L sfof{Gjogug]{ / Nf]vftyfcfGtl/s n]vf k/LIfsx?sfnflu 5'6\6} cfrf/;+lxtfhf/L ug]{ sfo{ cufl8 a9fO{Psf] 5 .

  • a]?h" / ljQLohf]lvda9\bf] 5 . d=n]=k= sf] kl5Nnf] k|ltj]bgcg';f/ ;/sf/L sfof{nosf] s"n a]?h' ^^ cj{ @^ s/f]8 k'u]sf] cj:yf 5 . :yfgLolgsfox?dfnfdf] ;dob]vLhgk|ltlglwgx'FbfAccountability Vaccumdf5 . :yfgLolgsfodf of]hgf, ah]6, n]vftyf n]vf k|0ffnL c:tJo:t 5 .

  • ;fj{hlgs ;+:yfgx?sf] n]vf k|0ffnLnfO{ klgcGt/f{li6«o:t/sf] agfpg ;lsPsf] 5}g . k|To]s ;+:yfgx?sf] cf–cfk\mg} n]vf k|0ffnL /x]sf] ljBdfgcj:yf 5 . clwsf+z ;fj{hlgs ;+:yfgx? a]?h'n] ynf k/]sf] cj:yf 5 .

Next step4
Next Step

  • cuffdL ^ dlxgfleq ;DkGgug]{ u/L Second PEFA assessment ;DaGwLsfo{ k|f/De ePsf] 5 . ( j6f sub-group u7g eO{ sfo{ b|'t ?kdf cufl8 a9]sf] cj:yf 5 . Credibility of the budget, comprehensivenessand transparency, budget cycle and donor practices28+3 = 31 indicators

  • ;dod} zf]wegf{ dfuug]{ sfo{nfO{ pRrk|fyldstflbO{Psf] 5 . oBlkzf]wegf{ ;dod} dfugug]{ k|j[lQcem} sfod} 5 . cem} klg !& cj{ eGbf a9L /sd ;f]ewegf{ lngafFsL g} cj:yf 5 .

Next step5
Next Step

  • g]kfn ;/sf/sf] ;fj{hlgs ;DklQsf] PsLs[t ljj/0f -ejg, ;/sf/L hUuf, -klt{ h+un, ;8s cflbafx]s dfq_ tof/ ul/Psf] 5 . o;dflgoldt ?kdfUpdateug] sfo{ e}/x]sf] 5 . pQmljj/0f dn]lgsfsf] Websitedf ;fj{hlgs ;d]t ePsf] 5 .

  • Vfr{ ug]{ PsfO{x?dfComputerize Government Accounting System/CGAS sf] nfu" ug]{ tof/L eO/x]sf] 5 . sfZsL lhNnfaf6 Piloting sf] sfo{ z'? eO{ ;s]sf] 5 .

  • /fhZj ;+sngtyfk|ltj]bgnfO{ ykk|efjsf/L agfpgtyfdn]lgsf, cy{ dGqfno / g]kfn /fi6«a}+saf6 x'g] tYof+s;"rgfk|jfxdfPs?ktfNofpgBusiness Process ;lxtRevenue Management Information System (RMIS)agfpg] sfo{ cufl8 a9fO{Psf] 5 .

Next step6
Next Step

  • g]kfn ;/sf/sf]n]vfk|ltj]bg k|0ffnLnfO{ cGt/f{li6«o:t/sf] agfpg] ;Gbe{df g]kfn ;fj{hlgs If]q n]vfdfg(Nepal Public Sector Accounting Standard NPSAS) sf] g]kfnL ?kfGt/0fsf] sfo{ ;DkGgePsf] 5 / rfn" cf=j= b]vLdlxnfafnaflnsftyf ;dfh sNof0f dGqfno / ef}ltsk"jf{wf/ tyfoftfoftJoj:yfdGqfnodfPilotingsf] ?kdfnfu" ug] ;Gbe{dfConsultantlgo'lQmeO{ 8«fkm\6 l/kf]6{ ;d]t k|fKtePsf] 5 .

  • Accounting Manual agfpg] sfo{ cufl8 a9fO{Psf] 5 .

Next step7
Next Step

  • vr{ / /fhZj /sdjuL{s/0f / JofVofnfOIMFsf] GFS 2001 cg'?kcGt/f{li6«o:t/sf] agfpgSteering Committee/ Task Force sf] u7g eO{ sfo{ k|f/De ePsf] cj:yf 5 .

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Next Step

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Next Step

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Latest treasury position
Latest Treasury Position

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What is the pefa program
What is the PEFA Program?

Aim: contribute to development effectiveness via the

‘Strengthened Approach’ to support PFM Reform

(country-led; harmonized PFM analytical work; common data pool)

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;fj{hlgsvr{ tyfljQLopQ/bfloTj ;lrjfno(Public Expenditure and Financial Accountability Secretariat)

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Strengthened approach to pfm reform
Strengthened Approach to PFM Reform

  • A country-led PFM reform program, including a strategy & action plan reflecting country priorities; implemented through government structures

  • A donor coordinated program of support, covering analytical, technical & financial support

  • A common information pool, based on a framework for measuring performance & monitoring results over time i.e. the PFM Performance Measurement Framework

Purpose of the pefa framework
Purpose of the PEFA Framework

  • The 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)?

  • What can countries use PEFA for?

  • Inform PFM reform formulation, priorities

  • Monitor results of reform efforts

  • Harmonize information needs for external agencies around a common assessment tool

  • Compare to and learn from peers

Adoption of the pefa framework
Adoption of the PEFA Framework

Very good progress – globally

  • 350+ assessments, covering 140+ countries

  • Since 2010, mostly Repeat & Sub-National assessments

    High country coverage in many regions

    • Africa and Caribbean 90% of countries

    • Latin America, Eastern Europe, Asia Pacific 50-80%

      Used in many Middle Income countries

    • Upper MICS: e.g. Brazil, Turkey, Belarus, South Africa

    • Lower MICS: e.g. India, Kazakhstan, Ukraine, Morocco

Components of the framework
Components of the Framework

  • A standard set of high level PFM indicators to assess performance against 6 critical dimensions of a PFM system

    • 28 government indicators covering all aspects of PFM

    • 3 donor indicators, reflecting donor practices influencing the government’s PFM systems

  • A concise, integrated performance report – the PRM-PR – developed to provide narrative on the indicators and draw a summary from the analysis

Standard set of high level indicators
Standard set of high-level indicators









Calibration & scoring

Calibrated on 4 Point Cardinal Scale (A, B, C, D)

  • Reflecting internationally accepted ‘good practice’

  • Determine score by starting from ‘D’, go upwards

  • Do not score if evidence is insufficient

  • Most indicators have 2, 3 or 4dimensions - each mustbe rated separately

  • Aggregate dimension scores for indicator; two methods M1 or M2, specified for each indicator

  • Intermediate scores (B+, C+, D+) for multi-dimensional indicators, where dimensions score differently

T he pfm performance report
The PFM Performance Report

An integrated narrative report including:

  • Summary assessment of PFM system

    • The impact of PFM system performance on budgetary outcomes (fiscal discipline; resource allocation; service delivery)

    • What is the story line, the number one message? - it may be all Minister remembers! (starting point for discussion of reform priorities)

  • Introduction with the context for the assessment

  • Country background information

  • Evidence & justification for scoring the indicators

  • Country specific issues

  • Description of reform progress & factors influencing it

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  • Leadership and strategic direction of the Public Financial Management Reform Program

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  • PEFA Implementation Unit (Ministry Level): Planning chief and account division

  • District PEFA Implementation Unit (District Level): Chief DTCO, civil society member

Pefa implementation flow
PEFA Implementation Flow

National Planning Commission (NPC)


Public Account Committee (PAC)

Steering Committee

  • Other Agencies

  • OAG

  • PPMO

  • CIAA

  • NVC

  • Local PFM Donor Forum

  • ICAN

  • ASB

  • CSOs

Line Ministries and Departments


Working Committee


Line Agencies


Paying Offices



PEFA Secretariat

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