asian regional seminar on public financial …...asian regional seminar on public financial...
TRANSCRIPT
Asian Regional Seminar on
Public Financial Management
PFM Reforms: The lessons learnt -promises and
tears
Session 2: Performance Management and Budgeting Reforms: Necessity or Bridge too
Far
Mr. K. Thomas, Dy. Director, Budget, Malaysia
25th November
Fulfilling the Promise of Performance
Budgeting-lessons on what to do and not to do
Koshy Thomas National Budget Office
Ministry of Finance Malaysia
Asian Regional Seminar on Public Financial Management; PFM
Reforms: The Lessons Learnt-Promises and Tears
25-26 Nov 2014, Phnom Penh, Cambodia
Presentation Will Cover
• The Integrated Model in RBM
• Some Challenges with the Current
Framework
• What’s not so Good
• What’s Looking Good
• Critical Success Factors (must have)
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
4
Integrating Planning, Budgeting and M&E Cycle
Macroeconomic Planning
MTF
Results Based Budget
Formulation
Program Implementation
Performance Monitoring
Evaluation
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
Human Resource
Requirements
5
Issues in Planning, Budgeting and M&E
Macroeconomic Planning
MTF
Results Based Budget
Formulation
Program Implementation
Performance Monitoring
Evaluation
Revenue
Debt
Setting Nat’l Priorities &
Goals Fiscal Policy
• Linking two Tier Process of National
Planning, Medium term and Annual Plans
• Weaknesses in Strategic Alignment of
National Priorities to Sectors/Ministries
• Dichotomous Capital and Operating
Budgets
• Insufficient Data to Determine Aggregated
Performance
• Lack of Coordination, focus on Activity
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
6
Integrating Planning, Budgeting and M&E Cycle
Macroeconomic Planning
MTF
Results Based Budget
Formulation
Outcome based
Planning for Performance
Budgeting
Expenditure Management
Delegation and accountability
• Redundancy and overlapping Programs
• Working in Silos, shared outcomes
• Lack of Clarity and Alignment in the
Role and Contribution of Program
Managers to Ministry’s Goals and
National Priorities
• Difficulty in Establishing Accountability
for Results
• Lack of Performance Orientation among
Program Managers
• No Demand for Evaluation Information
by Budget Office
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
7
Integrating Planning, Budgeting and M&E Cycle
Macroeconomic Planning
MTF
Program Implementation
Performance Monitoring
Results Based Budget
Formulation
• Lack of Systematic Monitoring System in
Place for Programs
• Performance Monitoring limited to
Development Projects
• Information Focuses on Institutional
Performance
• Program Performance not linked to
Resources
• Lack of information for Decision Making
• Poor Expenditure Management
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
Performance Reporting
8
Integrating Planning, Budgeting and M&E Cycle
Macroeconomic Planning
MTF
Program Implementation
Performance Monitoring
Results Based Budget
Formulation
Evaluation
Formative
Summative
Program Rectification
• No Data Management System
• Evaluation carried out on an Ad- hoc
Basis
• Lack of Capacity to Undertake Evaluation
• Lack of Clear Alignment Impedes
Establishing Causality
• Evaluation Information seldom used for
Policy Decisions
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
9
Integrating Planning, Budgeting and M&E Cycle
Macroeconomic Planning
MTF
Results Based Budget
Formulation
Program Implementation
Performance Monitoring
Evaluation
Revenue
Debt
Formative
Outcome based
Planning for Performance
Budgeting
Summative
Setting Nat’l Priorities &
Goals
Program Rectification
Expenditure Management
Delegation and accountability
Performance Reporting
Fiscal Policy
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
1957 - 1968
Detailed Controls & Discipline
1969 - 1990
Programs & Performance
1990 - 2010
Accountability, Flexibility and
Delegation
2011 -2015
Integrated Approach
Traditional
Incremental Line Item Budgeting
Modified Budgeting System
• PPBS • Delegation • Budget Ceilings • Accountability • Exceptions
Reporting
Outcome Based Budgeting
• PPBS/MBS • Integration • Alignment • M&E focus • Perf Reporting
Program Perf Budgeting Sys
•Program Performance •Program-Activities •Perf. Indicators •Evaluation
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
Addressing Critical Issues
Focus on Outcomes
Vertical Alignment of National and Ministry
Priorities to Operational Levels
Managing Cross Cutting Initiatives
& Shared Outcomes
Coordination of Operating and Development budgets
under a Program
Accountability in the Public Sector and
Authority over Resources
Systematic Monitoring and
Evaluation System
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
What’s not so Good
• Performance Culture
• Broad based Implementation, challenging
• Understanding Program-based Approach
• Linking Performance to Resources
• Establishing Clear Accountability (Outcomes
Hierarchy)
• Managing Shared Outcomes
• Quality of Performance Data
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
What’s Looking Good: Leveraging on the Strengths
• Legacy of MBS since 1990
Use of Performance Agreement
Delegation of Authority
• Buy-in at the Highest Level (political &
administrative)
• Use of an Integrated Model
• Adoption of Program-Activity Structure
• Fiscal Policy Committee and Strategy
• Reform Initiative Driven through the Budgetary
Process
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
Critical Success Factors
• Everyone need to understand & buy-in to the model
• Data Integrity (GIGO); with strong integrity your data will be your biggest asset
• Ability for Data Analysis; Business Intelligence skills
• Set a Culture of Continuous Improvement; It drives purposeful ongoing innovation and change
• Performance Information must be demand driven
• Well Trained Budget Officers
• Coordination between Aid and Development Agencies
• Evaluation must be in place concurrently
Asian Regional Seminar on Public Financial Management; 25-26 Nov 2014, Cambodia, Koshy Thomas
thank you
terima kasih
Koshy Thomas National Budget Office
Ministry of Finance Malaysia
Asian Regional Seminar on Public Financial Management; PFM
Reforms: The Lessons Learnt-Promises and Tears
25-26 Nov 2014, Phnom Penh, Cambodia