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The PEFA Framework – rationale, adoption and use. PEMPAL Plenary Plus Istanbul, February 27, 2008 . Jim Brumby, World Bank. Content. Rationale for the PEFA Framework Status on rolling-out Challenges & Opportunities Services provided by the PEFA program.

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The pefa framework rationale adoption and use l.jpg

The PEFA Framework – rationale, adoption and use

PEMPAL Plenary Plus

Istanbul, February 27, 2008

Jim Brumby, World Bank

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  • Rationale for the PEFA Framework

  • Status on rolling-out

  • Challenges & Opportunities

  • Services provided by the PEFA program

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Rationalefor the PFM Performance Measurement Framework

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PEFA Objectives

To improve:

  • government ownership

  • harmonization

  • donor alignment

  • results orientation

    in the area of public financial management

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The Strengthened Approach

  • A country-led reform program– including a PFM reform strategy and action plan

  • A donor-coordinated program of analytical, technical and financial support

  • A common information pool– based on a framework for measuring and monitoring results over time

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Creating a Common Information Pool

  • Creation of the Common Information Pool is facilitated by adopting the PEFA PFM Performance Measurement Framework

  • Application of the PEFA Framework is entirely decentralized to the country level (if, when, how to use Framework)

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The PFM Performance Measurement Framework

  • 28 + 3 PFM performance indicators

  • Supported by an explanatory and analytical PFM performance report

  • Indicator scoring based on:

    • Transparency

    • Evidence

    • Objective criteria

    • Internationally recognized good PFM practice

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What can countries use PEFA assessments for ?

  • Inform PFM reform formulation, priorities

  • Monitor results of reform efforts

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

  • Compare to and learn from peers

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Roll-out status and outlook

  • Assessment Status as at August 2007

    • About 3 assessments completed every month

    • 67 substantially completed reports, covering 60 countries

    • 15 on-going but report not yet issued

    • 30 agreed with government but not started

  • Outlook for end of 2008

    • 90 countries covered

    • 10 repeat assessments

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Geographical coverage

  • Large regional variations

    • High : (>80% of countries covered by completed or ongoing work)

    • Sub-Sahara Africa and Caribbean

    • Medium : (40-60% of countries covered)

    • Eastern Europe, Asia, Pacific, Latin America

    • Low : (<25% of countries covered)

    • Other (Middle East / North Africa & high income)

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Eastern Europe / Central Asia

  • 12 countries / territories implementing PEFA assessments (as of Feb. 2008):

  • Kyrgyz Republic 2005 completed, published

  • Albania 2006 (part of PEIR and CFA) completed

  • Armenia 2006, update 2008 draft, update starting

  • Moldova 2006 completed, published

  • Serbia 2006 completed, published

  • Ukraine 2006 completed, published

  • Kosovo 2007 completed, published

  • Tajikistan 2007 completed, published

  • Azerbaijan 2007 draft final

  • Macedonia 2007 (as part of CFA) completed

  • Georgia 2007 draft report

  • Belarus 2008 starting

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Challenges& Opportunities

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Global Issues

  • Tracking progress over time

    • when will repeat assessments be implemented in ECA?

  • Sharing of assessment results

    • dissemination of reports in ECA not a big issue. 6 out of 8 completed reports are publicly available

  • Quality of assessments and reports

    • improving

  • Country comparison

    • not the primary objective. May be done with caution.

  • How to move from assessment to reform action

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Quality is key to credibility and use

  • Ex-ante and ex-post factors affecting quality

  • Government engagement in planning and implementing the assessment

  • Full donor collaboration

  • A well planned and managed process

  • Adequate resources, quantitative & qualitative

  • Comprehensive review arrangements for TOR and reports

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Country Comparison

  • Global trends and regional differences may be identified

  • Comparison of two countries must be done very cautiously.

  • Comparing the scores alone is dangerous:

    • Technical definitions may be different

    • Carefully read each report to understand performance differences behind the scores

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Relative Performance in PFM

  • Country characteristics affecting overall level of ratings:

    • Main factor: Economic development

    • Minor factors: Population size, aid dependency, degree of democracy

    • No significant link to: regional affiliation or administrative heritage

  • Comparing ECA countries to global average of 60 countries:

    • Overall level of ratings - close to global average

    • Higher than average - budget credibility

    • Lower than average - external oversight

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From assessment to reform action

  • Analyze results and identify priorities

    • what weaknesses are important, which ones less so?

    • technical links – platform approach?

    • what is the government politically motivated to address

  • The identify underlying causes for weak performance in selected areas and prepare capacity building plan

  • Peer discussion can be useful for identifying reform priorities

  • Country case – Norway

    • one of the richest countries in the world

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Norway’s self-assessment

  • Most indicators scored ‘A’ or ‘B’ but …

  • Several indicators rated ‘C’ or ‘D’

  • Weaknesses identified:

  • No central collection of ex-ante budget information from municipalities (PI-8iii)

  • No central overview of risks from AGAs and SOEs (PI-9i)

  • No multi-year program budgeting (PI-12)

  • No data on use of open competition in procurement (PI-19i)

  • SAI criticism of procurement routines in agencies (PI-19ii)

  • No comprehensive system of internal audit (PI-21)

  • No central collection of info on funding of primary services (23)

  • Little follow up by agencies on external audit findings (PI-26 iii)

  • Little parliamentary scrutiny of external audit reports (PI-28)

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Reform priorities for Norway !

  • Government reaction to low ratings:

  • Need for improvements confirmed

    • procurement routines and system monitoring (PI-19)

    • scrutiny / follow up on external audit reports (PI-26 & 28)

  • Need for improvements questioned

  • Not the responsibility of central government

  • because primary service delivery is decentralized to municipalities

    • PI-8 and PI-23

    • because public administration is decentralized

    • PI-9 and PI-21

  • Not a priority for central government

    • multi-year program budgeting (PI-12)

  • Will a domestic or international debate about the latter be initiated when the report is published

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Services provided by the PEFA program

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Support to assessment managers

Support tools on the website (

  • List of completed, ongoing and planned assessments – updated periodically

  • Links to completed reports, when public

    Support on request:

  • Advice / Video-conference briefings to country teams on assessment planning

  • List of consultants with PEFA experience

  • Review of terms of reference

  • Quality reviews of draft assessment reports

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Support to Assessors

Support tools on the website:

  • The Framework (English, French, Spanish, Portuguese, Russian, Arabic)

  • Calculation spreadsheets for some indicators

  • Guidance on information / evidence for assessment

  • Clarifications and additional guidance on indicators

  • Training materials

    Support on request:

  • Indicator interpretation and other advice to assessors during implementation

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Stay in touch with PEFA

  • Visit our website

  • Send us questions :[email protected]

  • Get on our news distribution list : Send us your name, organization and email address

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Thank You for Your Attention