managing public money

MANGING THE MONEY

TOPICS:

Introduction (Revenues and Expenditure)Public Expenditure ManagementBudget Preparation process in PakistanBudget executionManagement control and auditBudgetary reforms in PakistanVision 2030NFC awardPublic sector developmentPakistan’s Current budget(2011-2012)

“MANGING THE MONEY”

SOURCES

• www.planningcommission.gov.pk• www.pildat.com• Public Management in Global Perspective


http://www.planningcommission.gov.pk/

http://www.pildat.com/

INTRODUCTION(Revenues and Expenditure)


Vision 2030Developed, industrialized, just

and prosperous Pakistan through rapid and sustainable

development in a resource constrained economy by

deploying knowledge inputs


Following are the list of budgetary reforms:Poverty Reduction Strategy Paper (PRSP)perspective plan 2001 - 2011Medium term budgetary framework in federal

and PunjabMedium term development frameworkProject for Improving Financial Reporting and

Audit (PIFRA)Performance budgeting in PunjabDecentralization and creation of local

government

BUDGETARY REFORMS

Budgetary reforms Various reforms in the budgetary systems

are creating opportunities for gender responsive budgeting.

includes a number of steps through which resources are allocated to various policy priorities and spent to achieve their objectives

Exercises on five year plans have been replaced by work on PRSP and MTDF.


Poverty Reduction Strategy Paper (PRSP)

The PRSP was formally announced on 31 December 2002.

World Bank and International Monetary Fund.

PRSPs describe the country's macroeconomic, structural and social policies and programs over a three year to promote broad-based growth and reduce poverty.

Perspective Plan 2001-2011abandoned after 1998.In 2000 work was carried out on a ten year

perspective plan with three year rolling plans for its implementation

With improvements in macroeconomic indicators Visions 2030 and the MTDF processes took over.


The Medium Term Budgetary FrameworkMTBF is an approach to budgeting which

links the spending plans of government to its policy objectives.

main objectives of the MTBF are to:Strengthen the allocation of federal resources

to the government’s strategic prioritiesImprove operational efficiency, by

strengthening the capacity of federal line ministries to prepare and manage their budgets effectively.


Medium Term Development Frameworktogether with Vision 2030 a five year plan has

been developed called the MTDF.

MTDF is an ongoing process, with periodic updating, and will keep providing policy direction to development in the country in an ongoing manner


Decentralization and Creation of Local Governments:

These are as follows: Decentralization of expenditure units:Decentralization of revenue items:Local level legislative role in budget making:Accounting:Performance budgetingIntegration of recurrent and development budgetsPunjab Planning ManualIntergovernmental grants

The role and objective of public expenditure management:

policy objectives require financial resources which can only come from the public in the form of taxes and fees

four components of good governance:AccountabilityPredictabilityParticipationTransparency


The objective of public expenditure management:

three objective of good public expenditure management:

Fiscal discipline (expenditure control)Allocation of resources consistent with public

priorities ( strategic allocation)Good operational management


Budget systems, annuality and comprehensiveness:

The legislature could authorize the executive to:

Spend for certain programs up to a certain amount, without specific time limit.

Enter into commitments up to a certain amount, within the fiscal year only.

Make payments on the exposed expenditures, within the fiscal year only.


The first type of authorization produces an obligation budget

The second type of authorization produces a commitment budget

The third of authorization produces a cash budget

reconciling the government fiscal operations with monitory and balance of payments developments.


Annuality of the budget:the budget covers twelve months (the fiscal

year), and the authority to collect revenue and make expenditure expire at the end of the fiscal year

desirable balanced between the need of legislative control and the need of the executive to adapt to changes


Budget comprehensiveness:The major issues are two:First if the budget excludes major

expenditure, there is no assurance that scarce resources are allocated to priority programs.

Second, if a category of expenditure is not included in the approved budget, the amount is itself likely to be uncertain and opaque.


Extra budgetary funds:Extra budgetary funds are expenditure

programs that are not subject to the annual budgetary approval process, but are financed by approved multi year allocation or by dedicated revenues.

road funds to black lung disability, hazardous substances super funds, and oil spill liability funds.


Management control, audit and evaluation:

Management control and internal audit:Management control also called internal control

is the policies and proceduresTo be effective the management control

system must have the strong support of the entity’s leadership.

Internal audit can assist senior managers in assessing risks and developing more effective control system.


External auditsupreme audit institution normally

independent of the executive branch of government and reporting its funding to legislature as well as to the audited agency itself.

. Weak governance and accountability requires a concentration on compliance and financial audit

In developed countries, external audit should look more and more in efficiency and effectiveness issues.

MANGING THE MONEY

Evaluation:good evaluation close the programming loop

by feeding into the preparation of the next budget relevant information concerning the execution of the previous one.

evaluation of the results of public spending is important both for accountability and to improve the quality of expenditure over time.

MANGING THE MONEY

MANGING THE MONEY

managing public money

Government & Nonprofit

public management

year perspective plan

audit budgetary reforms

policy objectives

year plans

list of budgetary reforms

sustainable development

punjab decentralization