Why has technical support not led to more progress in PFMA reform? The platform approach to Public Financial Management and Accountability (PFMA) reform is being implemented in a number of countries, supported by a wide range of development agencies. This briefing paper from the UK Department for International Development suggests that more attention should be given to the coordination and sequencing of reform.
Public Financial Management and Accountability (PFMA) reforms use a sequenced platform approach to achieve increasing levels of competence over a manageable timeframe. A platform is a level of PFMA competence defined in terms of improved outcomes. The focus is on enabling genuine government leadership through developing capacity, organisation and motivation.
Separate elements of PFMA reform are often led by different development agencies, resulting in a fragmented and partial approach to reform. Recent experiences gathered from DFID country offices in Africa suggest weaknesses in the current set of measures include:
- Reforms that frequently fail to complement and build on each other.
- Undermining government-led reform and a tendency to promote inefficient parallel systems outside government systems.
- Administrative burden on government.
- An inconsistent approach to PFMA reform between line ministries and the central Ministry of Finance.
- Breakdown of trust between governments and donors.
- Exaggerated focus on technical developments, for example complex computerised financial management packages.
Cambodia initiated four-phased reforms in 2004. Although it is too early to determine the long-term impact, the approach is considered successful so far. It is engaging politicians and staff at all levels in the reform design, and the robust development plan is genuinely owned within the administration. A Reform Committee and a Facilitation Team are key mechanisms for leadership and coordination. Reasons for success are the conscious efforts to address motivational issues and improve institutional and human capacity, alongside the provision of technical support.
Identifying opportunities for improving implementation of PFMA reform requires a good understanding of the political and institutional context. The specific measures will vary considerably depending on country context and starting point. Based on the early experiences of PFMA reform, recommendations to donors are:
- To harmonise their efforts and speak with one voice. All parties, including the donor agency, should communicate which aspects of PFMA performance and reform they consider most important.
- Take a step back and let partner governments take the lead in the reform process. In practice, establishing a framework that governments and donors are in agreement with and willing to support can be challenging.
- Establish a framework of platforms based on trust and informed dialogue.
- Work with individual departments to establish reform activities and related performance indicators to improve the likelihood of successful implementation.
- Set realistic timeframes for the design of government-led reform. In Cambodia the initial planning phase took approximately one year to complete. Champions of the approach need to be prepared to defend necessary planning time.
- Although focus is on building basic systems and competences first, activities that need to be commenced at an earlier stage should be identified to avoid delays later.
