1 / 25

Public Policies for Financing Sustainable Development

Public Policies for Financing Sustainable Development. Cielito F. Habito, Ph.D. Professor, Ateneo de Manila University Former Secretary of Socioeconomic Planning Republic of the Philippines December 11, 2002. Financing Sustainable Development: A Four-Way Partnership. Government.

glyn
Download Presentation

Public Policies for Financing Sustainable Development

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Public Policies for Financing Sustainable Development Cielito F. Habito, Ph.D. Professor, Ateneo de Manila University Former Secretary of Socioeconomic Planning Republic of the Philippines December 11, 2002

  2. Financing Sustainable Development: A Four-Way Partnership Government International Development Institutions Private Business Civil Society

  3. Public Finance for Sustainable Development • National level • Resource pricing policy • Tax & subsidy policy • Public expenditure policy • International context • global taxes • ODA

  4. National Level Policies

  5. Resource Pricing Policy • Management by prices vs. management by control • Actual cost pricing (e.g.timber resources, water) • Environmental funds

  6. Tax & Subsidy Policy • Environmental fees • Energy taxes • Pollution taxes • Perverse subsidies

  7. Public Expenditure Policy • Never enough • Highly inadequate to meet all needs • Usually makes up a small proportion of total environmental resources

  8. Public Expenditures for Sustainable Development: Three Concerns • Ensuring stability and sustainability in public expenditure program • Ensuring that the Budget funds activities that truly promote sustainable development • Ensuring that public expenditures by environmental agencies address fiscal, economic and social considerations integratively

  9. Goals of Sound Public Expenditure Management • Aggregate Fiscal Discipline (spending within affordable limits) • Allocative Efficiency (spending on the right things) • Operational Efficiency (providing public services at reasonable quality and cost)

  10. Aggregate Fiscal Discipline • Limiting spending to total budget resources (domestic revenues plus a sustainable level of domestic and foreign borrowings) • Total budget is determined in the context of the medium term • Annual total budget increases are matched by revenue increases

  11. Allocative Efficiency • Budget allocation based on • strategic priorities • effectiveness of programs • Reallocation is encouraged • from lesser to higher priorities • from less to more effective programs • Spending levels are set for each sector

  12. Operational Efficiency • Refers to the production of goods or delivery of services • Costs should be competitive with market prices • Cash limits on operating expenses • Managers have discretion in using resources in exchange for pre-specified outputs

  13. Sound Public Expenditure Management: Key Principles • Transparency (ready access to relevant information) • Accountability (by whom, for what, to whom?) • Comprehensiveness (One Fund Concept to equalize marginal benefits of last Peso spent for each program)

  14. The Way We Were • Government budgets prepared on annual basis • Prone to deviations in direction and priorities • Not adequately related to medium term development strategy/plan • Subject to arbitrary political forces

  15. The Way We Were • Little regard for environmental sustainability in activities funded by the budget • Lack of priority on environmental expenditures (low in hierarchy) • Environmental expenditures derive greater funding from extra-budgetary sources

  16. The Way We Were • Proliferation of earmarked special funds • Disjoint (sometimes conflicting) activities • Failure to tap complementarities and synergies among sectoral concerns (e.g. water supply and health); • Inefficient operational mechanisms for budget implementation

  17. Now: Public Expenditures for Sustainable Development • Multi-year budgeting framework tied to medium term public investment program • Environmental Assessment of the budget • Move towards integrative programs

  18. Linking the Budget to the Plan (and to Agenda 21) MTPDP/PA21 MTPIP 3-yr Budget (MTEF) Annual Budget Plan Objectives linked with PAPs

  19. Assessing Environmental Funds & Expenditures • Regular Budgetary Resources of Dept. of Environment & Natural Resources • Special Environment Funds/Accounts • Environment Guarantee Fund • Environmental Heroes Fund • Power Industry Environmental Trust Account (PIETA)

  20. Performance Triangle Analysis of Environmental Funds • Environmental policy • Public finance • Effective fund mgt

  21. International Policy

  22. Global Taxes • Aviation fuel tax • Tobin tax

  23. Official Development Assistance • Global Environmental Facility • Multilateral assistance • Bilateral assistance

  24. Concluding Points • Public resources not likely to be the largest component of financing for the environment • Sustainability enhanced by a tangible counterparting of resources (and efforts) • Challenge is how to leverage limited government resources for much larger private sector resources potentially available

  25. Thank You

More Related