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Abstract

This paper examines the process of budget system reform implied by moving from traditional centralized input-oriented systems to more modern devolved performance-based systems. Based on the experience of recent attempts at this reform in emerging countries, the required sequencing of steps in this process is stressed. the strategy outlined involves a three-prong approach, requiring measures to increase the flexibility in the agency operating environment, provide more certain resourcing for spending agencies, and exert pressure on agencies to improve their performance. the paper stresses firstly, the need to progress on all three fronts simultaneously, and secondly, to base these reforms on a firm platform of agency management skills. the need to attain some basic public expenditure management thresholds in the area of restructuring the budget and its classification, improving the accounting system, developing a financial management information system, and strengthening internal financial management skills, is highlighted.

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The Strategy of Budget System Reform in Emerging Countries

Abstract

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References