idb public financial management in latin america and the caribbean
TRANSCRIPT
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ICGFM 27th Annual International Training Conference
Miami, Florida
May, 2013
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I. Overview Inter-American
Development Bank (IDB)
II. Assessment of PFM in the region
III.
IFMIS key component of PFMmodernization in LAC
IV. IDB support
V. Conclusions
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I. Overview Inter-American
Development Bank (IDB)
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Established in 1959
The leading source of development financingfor Latin America and the Caribbean
48 member countries, including 26 LACborrowing members, who have a majorityownership of the IDB:
Non regional 49.99%: - USA 30%, Japan 5%, Canada 4%
LAC 50.01%: Argentina 10.9%, Brazil 10.9%, Mexico 7%
Lending and grants in 2012:$11.4 billion
Source: www.iadb.or aboutus
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The IDB has the following main areas ofaction: Reducing poverty and social inequalities;
Addressing the needs of small and vulnerablecountries;
Fostering development through the privatesector;
Addressing climate change, renewable energy
and environmental sustainability; and Promoting regional cooperation and integration.
Source: www.iadb.or aboutus
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Institutional strategy (2010 - 2015) basedin 4 sector priorities:
1. Social policy for equity and productivity;2. Institutions for growth and socialwelfare;3. Competitive regional and global
international integration; and4. Protection of the environment.
Source: www.iadb.or aboutus
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II. Assessment of PFM in the region
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AR
BL BA
BO
BH
CH
DR
EC
ME
NIGY
HA
BR
VE
JA
SUTT
PE
PR
PN
UR
CO
ESHOCRGU
20 Countries Completed*
Source: PEFA Secretariat, November 19, 2012
26 IDB BorrowingMember Countries
+2 Countries In Process
85% of IDB countries have
completed a PEFA
assessment
* 10 countries have had repeat PEFA assessments
5 Countries - NationalPEFAsplannedfor 2013 and 2014
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0
0.5
1
1.5
2
2.5
3
3.5
4
1. Credibilidad del
presupuesto
2. Cobertura y
transparencia
3. Presupuesto
basado en
polticas
4. Predictabilidad
y control en la
ejecucin de
presupuesto
5. Nmina,
compras pblicas
y controles
internos
6. Contabilidad,
registro y reportes
7. Escrutinio
externo y auditora
ECA LAC SAS SSA
1. BudgetCredibility
2. Comprehensivenessand transparency
3. Policybased
budgeting
4. Predictabilityand controls in
budgetexecution
5. Payroll,procurementand internal
controls
6. Accounting,recording and
reporting
7. Externalscrutiny and
audit
Source: Analysis carried out by Carlos Pimenta IDB, with information from PEFA Secretariat, 2012
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0
0.5
1
1.5
2
2.5
3
3.5
4
PI-1 Resultados del gasto
agregado en comparacin
con el presupuesto original
aprobado
PI-2 Desviaciones del gasto
presupuestario en
comparacin con el
presupuesto original
aprobado
PI-3 Desviaciones de los
Ingresos Totales en
comparacin con el
presupuesto original
aprobado
PI-4 Saldo y seguimiento de
los atrasos de pagos de
gastos
PI-5 Clasificacin del
presupuesto
ECA LAC SAS SSA
PI-1 Aggregateexpenditure out-turncompared to originalapproved budget
PI-2 Composition ofexpenditure out-turn compared tooriginal approvedbudget
PI-3 Aggregaterevenue out-turncompared tooriginal approvedbudget
PI-4 Stock andmonitoring ofexpenditure paymentarrears
PI-5 Classification of
the budget
Source: Analysis carried out by Carlos Pimenta IDB, with information from PEFA Secretariat, 2012
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BE BO BR CO CR DR EL GU HA HO JA PE PR TT
2009 2009 2009 2009 2010 2012 2009 2010 2012 2009 2007 2009 2008 2008
2.8 2.8 3.8 2.9 3.6 2.6 2.8 2.6 1.9 3.6 2.8 3.0 2.9 2.9 2.9
Resultados del gasto agregado en comparacin con el presupuesto original aprobado 3.0 3.0 3.0 4.0 3.0 1.0 2.0 4.0 3.0 4.0 3.0 3.0 2.0 3.0 2.9
esv a c o nes e gas o presupues ar o en comparac n con e presupues o or g na4.0 2.0 4.0 3.0 4.0 2.5 3.0 2.0 2.5 3.0 2.0 2.0 3.0 2.0 2.8
Desviaciones de los ingresos totales en comparacin con el presupuesto original aprobado 4.0 4.0 4.0 4.0 4.0 3.0 4.0 4.0 1.0 4.0 4.0 4.0 4.0 4.0 3.7Saldo y seguimiento de los atrasos de pagos de gastos 1.0 1.0 4.0 1.5 3.0 3.5 3.0 1.0 1.0 3.0 1.0 3.0 2.5 3.5 2.3
Clasificacin del presupuesto 2.0 4.0 4.0 2.0 4.0 3.0 2.0 2.0 2.0 4.0 4.0 3.0 3.0 2.0 2.9
1.5 2.7 3.7 3.4 3.7 2.4 3.5 3.0 1.5 2.0 2.7 3.9 2.6 3.5 2.9
Suficiencia de la informacin incluida en la documentacin presupuestaria 2.0 2.0 4.0 4.0 4.0 3.0 4.0 4.0 2.0 2.0 2.0 4.0 2.0 3.0 3.0
Magnitud de la s operaciones gubernamentales incluidas en informes presupuestales . 1.5 4.0 4.0 4.0 4.0 2.5 4.0 3.0 1.0 2.5 2.0 4.0 3.5 4.0 3.1
Transparencia de las relaciones fiscale s intergubernamentales 1.0 2.3 3.7 2.7 3.3 2.0 3.3 2.0 2.3 2.0 2.3 4.0 1.7 3.3 2.6
Supervisi n del riesgo fiscal agregado provocado por otras entidades del sector pblico 1.0 2.0 3.0 3.5 4.0 1.5 3.0 2.0 1.0 1.5 4.0 3.5 2.0 4.0 2.6
Acceso del pblico a informacin fiscal clave 2.0 3.0 4.0 3.0 3.0 3.0 3.0 4.0 1.0 2.0 3.0 4.0 4.0 3.0 3.0
2.3 1.8 3.1 3.3 3.1 2.9 2.5 2.9 1.3 3.1 2.8 3.2 2.6 2.4 2.6
Carcter ordenado y participacin en el proceso presupuestario anual 3.0 1.7 3.7 3.0 4.0 3.3 2.7 3.0 1.0 3.7 3.0 3.7 3.7 2.3 3.0
Perspectiva plurianual en materia de pl anificacin fiscal, poltica del gasto y presupuestacin 1.5 2.0 2.5 3.5 2.3 2.5 2.3 2.8 1.5 2.5 2.5 2.8 1.5 2.5 2.3
1.9 3.3 3.4 3.0 3.3 3.1 3.3 3.4 1.7 2.9 2.5 3.3 2.8 3.3 2.9
Transparencia de las obligaciones y pas ivos del contribuyente 2.5 3.3 3.7 2.7 2.7 3.7 3.0 3.7 2.3 2.7 3.0 3.3 2.3 3.3 3.0
Eficacia de las medidas de registro de contribuyentes y estimacin de la base impositiva 2.0 3.3 3.3 3.0 2.7 3.3 3.0 3.3 1.7 3.0 2.3 3.7 2.0 3.3 2.9
Eficacia en materia de recaudacin de impuestos 1.5 3.3 3.7 2.0 3.7 3.0 3.7 3.5 1.3 2.3 2.0 3.0 3.0 2.0 2.7
Certeza en l a di sponibil idad de fondos para comprometer gastos 1.0 2.7 2.7 4.0 4.0 2.7 3.7 3.0 1.7 2.7 1.7 3.3 3.3 3.7 2.9
Registro y gestin de los saldos de caja, deuda y garantas 2.5 3.7 3.7 3.3 3.7 3.0 3.0 3.3 1.3 3.7 3.3 3.3 3.3 4.0 3.2
1.3 2.5 3.7 2.8 2.6 2.1 3.4 1.8 1.3 2.4 2.0 3.4 2.1 2.4 2.4
Eficacia de los controles de la nmina 1.5 3.0 3.5 3.0 3.3 2.8 4.0 2.0 1.5 2.8 2.0 3.8 2.3 3.3 2.8
Competencia, precio razonable y controles en materia de adquisiciones 1.0 2.7 3.3 3.0 1.3 1.5 3.3 1.7 1.5 2.7 2.0 3.3 3.3 1.7 2.3
Eficacia de los controles internos del gasto no salarial 1.5 2.3 4.0 3.0 2.7 2.3 3.7 1.7 1.3 2.3 2.0 3.7 1.7 2.7 2.5
Eficacia de la auditora interna 1.0 2.0 4.0 2.0 3.0 2.0 2.7 1.7 1.0 2.0 2.0 2.7 1.3 2.0 2.11.5 2.3 3.8 3.3 3.3 3.0 3.5 2.5 1.3 3.0 2.1 2.7 2.8 2.8 2.7
Puntualida d y periodicidad de la concili acin de cuentas 2.0 3.0 4.0 3.0 4.0 3.5 3.5 3.5 1.0 4.0 1.5 3.5 3.0 3.0 3.0
Disponibil idad de informacin recursos recibidos por las unidades de prestacin de servicios 1.0 1.0 4.0 3.0 3.0 3.0 3.0 2.0 1.0 1.0 2.0 1.0 2.0 1.0 2.0
Calidad y puntualidad de los informes presupuestarios del ejercicio en curso 1.5 3.0 4.0 3.3 3.7 3.0 3.7 2.0 1.0 3.7 3.3 2.3 3.3 4.0 3.0
Calidad y puntualidad de los es tados financieros anuale s 1.5 2.0 3.3 4.0 2.7 2.7 4.0 2.3 2.0 3.3 1.7 4.0 3.0 3.0 2.8
1.3 1.9 2.7 2.7 3.4 1.9 2.3 2.4 1.7 2.4 2.8 3.1 2.6 2.3 2.4
Alcance, naturaleza y seguimiento de la auditora externa 1.0 2.7 3.0 3.0 3.7 2.7 3.0 3.0 1.0 2.7 2.7 3.3 2.3 3.0 2.6
Escrutinio legisl ativo de la le y de presupuesto anual 1.5 2.0 4.0 2.8 3.8 2.0 2.8 2.8 3.0 2.8 3.3 3.8 3.8 2.3 2.9
Escrutinio legislativo de los informes de los auditores e xternos 1.5 1.0 1.0 2.3 2.7 1.0 1.0 1.3 1.0 1.7 2.3 2.3 1.7 1.7 1.6
1.8 2.5 3.5 3.1 3.3 2.6 3.0 2.6 1.5 2.8 2.5 3.2 2.6 2.8 2.7
AV
PI-10
PI-11
PI-8
PI-9
PI-6
PI-7
Dimensiones
PI-1
PI - 4
PI-5
PI-2
PI-3
Indicators
PI-28
PI-26
PI-27
1. Credibility of the budget
2. Comprehensiveness and transparency
3. Policy based budgeting
4. Predictability and control in budget execution
5. Payroll, procurement and internal controls
PI-17
PI-14
PI-15
PI-12
PI-13
7. External scrutiny and audit
PI-18
PI-19
PI-16
PI-24
PI-25
PI-22
PI-23
PI-20
PI-216. Accounting, recording and reporting
Source: Carlos Pimenta IDB- PFM Workshop for IFMIS Coordinators May 15, 2013
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Stock and monitoring of expenditurepayment arrears
Multi-year perspective in fiscal planning,expenditure policy and budgeting
Competition, value for money and controls inprocurement
Effectiveness of internal audit
Availability of information on resourcesreceived by service delivery units
Legislative scrutiny of external audit reports
Source: Carlos Pimenta IDB- PFM Workshop for IFMIS Coordinators May 15, 2013
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http://www.openbudgetindex.org/
PEFA and Open Budget IndexInternational Budget Partnership
Source: Carlos Pimenta IDB- PFM Workshop for IFMIS Coordinators May 15, 2013
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http://www.worldbank.org/wbi/governance
PEFA and Worldwide Governance
IndicatorsWorld Bank
Source: Carlos Pimenta IDB- PFM Workshop for IFMIS Coordinators May 15, 2013
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III. IFMIS key component of PFM
modernization in LAC
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Source: Fiscal Institutions of Tomorrow. IDB 2012 prepared by Carlos Pimenta andPedro Farias
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Country Procurement Payroll Asset Mgmt Warehouse PublicInvestment Taxadministration
Source: Fiscal Institutions of Tomorrow. IDB 2012 prepared by Carlos Pimenta and Pedro
Farias
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Key factors: Complexity of PFM processes
Funcionalities and platform
COTS vs Inhouse development Local market of IT suppliers
Number of users and entities to be covered
Service level (on-line, query times,
transaction volumes) Interoperability
Source: Carlos Pimenta IFMIS in LAC Presentation September 2012
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CR: SAPGY: Freebalance/SmartstreamSU: Freebalance LAC
Source: www.baselinema .com
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In-house COTSInvestment Lower initial costs,
goes up in the longterm
Higher upfront cost(licenses)
Length ofimplementation Continuos development 2 3 yearsInstitutional status quo High LowSupport Internal External (licenses,
source code)
Source: Carlos Pimenta IDB- PFM Worksho for IFMIS Coordinators Ma 15 2013
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IV. IDB Support to PFM reform and
modernization in LAC
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Improve the efficiency, efficacy andaccountability of public expendituremanagement in the region, contributing tofiscal sustainability.
Scope of support Legal and institutional frameworks Expenditure management systems
Information for decision makers that is reliable andreadily available Use of country systems
Source: Carlos Pimenta IDB- PFM Worksho for IFMIS Coordinators Ma 15 2013
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Budget, treasury, accounting, debt andpublic procurement
Integrated Financial Management Systems(IFMIS)
Results based budgeting
Electronic Government Procurement (e-GP)
Payroll
Public Investment Systems
Source: Carlos Pimenta IDB- PFM Worksho for IFMIS Coordinators Ma 15 2013
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PROYECTO PROYECTOUS$
mill.SIAF PbR SNIPeGP Inst
NI-L1033 Modernizacin Sistema Administracin Financiera Pblica 10
PR-L1027 Programa Fortalecimiento y Modernizacin Fiscal II (PROFOMAF II) 9.5
PE-L1087 Modernizacin Sistema Administracin Financiera Pblica 20
PN-L 1066 Programa de Fortalecimiento de la Gestin Fiscal 50
JA-L1039 Fiscal Administration Modernization Programme 65
HO-L1015 Programa para Consolidacin Gestin Fiscal y Municipal 28,6
BO-L1063 Programa de Mejora de la Gestin Municipal 53
AR-L1127 Fortalecimiento Institucional Productivo y de Gestin Fiscal Provincial II 36GU-L1031 Apoyo a la Modernizacin del Ministerio de Finanzas Pblicas 8,5
RD-L1005 Programa de Modernizacin de la Administracin de Recursos Pblicos 21
ME-L1047 Programa de Apoyo al Presupuesto Basado en Resultados 25
BA-L1004 Modernization of the Barbados National Procurement System 5
BR-PROFISCO 18 Proyectos en Estados Sub-Nacionales de Brasil 493
BO-L1006 Apoyo al Sistema Nacional de Inversin Pblica 13EC-L1084 Fortalecimiento del Ciclo de Pre-inversin 40
PR0093 Programa de Pre-inversin 5
PE-L1101 Gestin de la Inversin Territorial 20
US$ 410 millones LAC + US$ 493 millones PROFISCO-BR: Promedio US$ 26 millones (LAC), US$ 27 millones (PROFISCO-BR)
Source: Carlos Pimenta IDB- PFM Workshop for IFMIS Coordinators May 15, 2013
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Pas US$ mill Aprobacin1 Argentina 500 2006
2 Bolivia 127 2005, 2010, 2010, 2011
3 Brasil - PROCONFIS 800 2012
4 El Salvador 200 2010
5 Guatemala 200 2006, 2007
6 Haiti 25 2007, 2008
7 Jamaica 580 2008, 2010, 2010, 2010, 2011
8 Mxico 1000 2010
9 Nicaragua 60 2008, 2009
10 Per 475 2005, 2006, 2007
11 Paraguay 200 2010, 2012
12 Surinam 40 2011, 201213 Trinidad Tobago 100 2010
14 Uruguay 335 2006, 2009
Total 4.642Source: Carlos Pimenta IDB- PFM Workshop for IFMIS Coordinators May 15, 2013
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Barbados
Brazil
Rep. Dominicana
Guatemala
Jamaica
Trinidad y Tobago
El Salvador
Paraguay
Suriname
Source: Leslie Har er RICG Presentation Panama Se tember 2012
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Brazil
Guatemala Trinidadand Tobago
El Salvador
Paraguay
Bahamas
JamaicaBelize
Suriname
Nicaragua
Costa Rica
Colombia
Ecuador
Chile
Argentina
Source: Leslie Har er RICG Presentation Panama Se tember 2012
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National Treasurers Network
(FOTEGAL) Budget Directors
Heads of procurement Network(RICG) Subnational Finance Network (GEFIN)
-Brasil
IFMIS Coordinators Network
Source: Carlos Pimenta IDB- PFM Worksho for IFMIS Coordinators Ma 15 2013
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V. Conclusions
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Public Financial Management in LACGreat variation across countries (from Chile to Haiti)
Progress over recent decades but also stagnation very
country specific.
In general, challenges remain: Budget management and the linkages between medium-term fiscal
management and budget;
Treasury management; Arrears recording and management
Budget transparency and upgrading of accounting standards.
Sector level PFM operations
Other areas: investment, performance budgeting, revenue Subnational dimension
Source: World Bank PEFA in LAC Seven Years of Implementation EuropeAid Workshop December 2012
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Importance of public financial managment for themodernization of public management as a whole.
Transformational moment in LAC and other regions(accounting, technology, interoperality, TSAs etc) Need for comprehensive reform strategies IFMIS is a key strategic component in modernization. Knowledge and innovation in PFM (synergies: academia,
international organizations, countries and the private
sector)
Contribution to a greater governmental effectivenessand transparency.
Source: Carlos Pimenta IDB- PFM Worksho for IFMIS Coordinators Ma 15 2013
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PFM Team
Fiscal and Municipal Management Division
Inter-American Development Bank