Posts Tagged ‘Honduras’

Government of Afghanistan and the Open Budgets “controversy”

Wednesday, February 6th, 2013

Doug Hadden, VP Products

I had a few interesting exchanges on twitter yesterday, the first concerning the improvement from 21% to 59% made by the Government of Afghanistan on the Open Budgets Survey . (See below for the “storiefied” version)

The International Budget Partnership provided links to news stories about this achievement.

My sense is that many are incredulous that Afghanistan has a rating just below Italy.

The point is that Afghanistan makes 6 of the 8 documents that should be public by the OBI public. The other 2 are used internally. Public engagement was rating weak and there is room for improvement. Publishing the additional 2 document and increasing public engagement will improve the rating.

The Government of Afghanistan uses the FreeBalance Accountability Suite. This enables the government to publish budget information if there is political will to do so. The Government of Timor-Leste publishes information directly from our software in a Transparency Portal and the Government of Liberia has announced an electronic billboard project to show government expenditures. I suspect that Liberia will also be using FreeBalance back-office software to support this initiative.

The governance news from Afghanistan is usually grim, as I have said in the past. The truth is that there have been achievements in Afghanistan including a good Public Expenditure and Financial Accountability (PEFA) assessment in 2008, rating of achieving substantial PFM progress and evidence of how software reduced corruption in Afghanistan.

To be clear, I am not saying that our software is a magic anti-corruption/good governance pill. I’m saying that the tool, when there is political will and commitment can be used for transparency and accountability. And, the governments of Afghanistan, Honduras and Liberia should be acknowledged for their governance achievements.


Open Budgets Controversy?

Interesting exchanges from the launch of the "increasing the Pace of Budget Transparency" event at the World Bank (http://live.worldbank.org/increasing-pace-budget-transparency) yesterday.

Storified by · Wed, Feb 06 2013 06:10:12

The index is available at http://internationalbudget.org/what-we-do/open-budget-survey/. I listened into the web cast and tweeted.

Cases from Afghanistan, Brazil, Honduras and Liberia were highlighted. Mustafa Mastoor, Deputy Minister of Finance, Afghanistan; 
Eliomar Wesley Rios, Deputy Secretary of the Budget Planning Ministry, Brazil; and Amara Konneh, Minister of Planning and Economic Affairs, Liberia spoke via video conference.

Countries which "improved budget transparency dramatically" include: Afghanistan, Burkina, Honduras, Mozambique, Pakistan #openbudgetindexFelipe Estefan
Vivek Ramkumar, Director of International Advocacy and the Open Budget Initiative, was one of the main speakers. Vivek is a strong advocate for budget transparency. I remember him speaking at an ICGFM (www.icgfm.org) event a few years ago. Some representatives of the Government of Honduras were upset about their rating. Vivek explained the methodology and that the International Budget Partnership was not besmirching their quality of public financial management. At any rate, it looks like Honduras has dramatically improved.
Brazil, of course, is the international poster child for budget transparency. Afghanistan and Liberia leverage the FreeBalance Accountability Suite to support budget transparency. Given the overwhelming narrative in the press about corruption and mismanagement in fragile states, I think that it is important to recognize any governance achievements.
The OBI for Afghanistan improved from 21% in 2010  to 59% (Country Summary – English) while Liberia improved from 2% in 2008 to 43% (Country Summary – English). 
Anyway, this generated some interest from Edward Rees who has significant first-hand experience in fragile states. I find the engagement on social media to be particular valuable because it can enable understanding the situation better. That’s why I follow @ReesEdward and, if you care about fragile states, you should too.
RT @OpenBudgets: Mastoor: increase in #OpenBudgetIndex score has created confidence in government and public of improving situation in AfghanistanFreeBalance
#Afghanistan improved dramatically in the #openbudgetindex for publishing the pre-budget statement, budget proposal, and citizen budget.Felipe Estefan
@freebalance r u serious?Edward Rees
@ReesEdward yes, he was speaking about how they were able to increase #openbudgetindex to 59 points – that’s just below Italy at 61FreeBalance
@ReesEdward #openbudgetindex is set by actions not by perceptionFreeBalance
@freebalance that confuses the average punter. Either way. You know as well as I do that those guys in Kabul are in a world of trouble.Edward Rees
@ReesEdward #governance ratings never fully representative – saying that, budget transparency can’t be a bad thingFreeBalance
My tweets also got noticed by a public financial management expert from the UK on the applicability of publishing internal government documents. 
@freebalance i agree but writing for ext audience is diff’t so public bodies would have to change their prep of internal docsGary Bandy
@garybandyuk shouldn’t assume that these docs are completely obscure to everyone, so needs civil society pressure to make accessibleFreeBalance
.@freebalance: #openbudgetindex many budget docs produced for internal use only, easy to make available #transparency > but understandable?Gary Bandy
@garybandyuk 1 of 2: @OpenBudgets provides full details on how to develop a citizen-centric budget (so does http://www.agacgfm.org/)FreeBalance
@garybandyuk 2 of 2: internal budget documents has policy narrative & chart of accounts operates as good metadata for analysisFreeBalance
A few other tweets about the importance of budget transparency and the process used to develop the Open Budget Index.
Rios: Creation of transparency portals which show amount and objective of federal transfers to state and municipal govts #OpenBudgetIndexOpen Budgets
Sanjay Pradhan: budget is the most important policy document, and the lives of ordinary citizens depend on it #OpenBudgetIndex #wbliveOpen Budgets
step 1: #openbudgetindex doesn’t use consultants, has to be civil society, 2: independent review, 3: government reviewFreeBalance

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Government Accrual Accounting – What about Assets?

Monday, May 7th, 2012

Doug Hadden, VP Products

Nothing can generate a more heated discussion among government accountants than accrual accounting. Some argue that accrual accounting is necessary to determine the true value of government and eliminate short-term thinking in decision-making. Others argue that the complexity of accrual accounting isn’t worth the effort – and, there really isn’t an objective true value of a government.

Liabilities Problem

Full accrual accounting can expose liabilities that are off the balance sheet: contingent liabilities like natural disasters, entitlements like government pension plans, public-private partnership risks etc. It appears that accrual accounting in government exposes more red ink. Not the best thing to expose if you are a politician in government.

Government as Investment

Andy Wynne, the editor of the International Journal on Governmental Financial Management suggested that education should be capitalized. Increasing education ought to increase government and private sector management. It should increase innovation.

This got me thinking. What if we saw government as an investment? We invest on the stock market giving some companies a premium – the value of the company stock is often much higher than the equity. What factors could accrue as government assets?

1. Immigration

A recent article by Joe Friesen in the Globe and Mail suggests that Canada requires more immigration to fuel growth. Immigration represents confidence in the . Despite all the anti-immigration rhetoric in many countries, immigration is a sign of economic desirability and “good will”.

2. Governance

Many companies are valued higher because of proven managerial stewardship. Higher governance quality means that governments are more effective and better able to leverage opportunities and overcome problems. For example, the Government of Honduras may want the Government of Canada to help adminstrate a free enterprise zone, according to Joshua Keating in Foreign Policy. There are numerous governance indices that could be used to calculate governance value. The World Bank World Governance Indicators that take many factors in account could be an ideal source.

3. Foreign Direct Investment

FDI also shows confidence in country management. This generates economic activity. This investment may spur growth.

Feel free to add your ideas.

 

 

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