Transcript Презентация - World Bank Group

Republic of Moldova
Ministry of Finance
Progress in reforming
budget elaboration
process
2002-2005
Warsaw
February 2005
2
Transition Context
 Severe
economic decline
In
2000 GDP represented 35% of
1990 value
Public spending fell by 9% GDP
during 1996-2000
Total public debt exceeded 90% of
GDP by 2000
 Strong
economic recovery since 2000
Budget
deficit: -0.1% of GDP (2001),
-1.8% of GDP (2002), +0.5% of GDP
(2003)
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Reform of the Budget System

1996 Budget Law
– consolidated previous reforms
– formalised budget planning arrangements
 budget
Concept
 budget planning cycle
 new budgetary classification

But slow progress with budget planning
reforms
– economic crisis and instability - short-term
outlook
– weak macro-fiscal framework
– weak linkage between policies and budgets
4
– unrealistic ministry budgeting
2001 - Decision to introduce more
strategic approach to budget
planning –
Introduction of MTEF
2 stage budget planning cycle:
MTEF to be prepared prior to
budget preparation.
Design of MTEF based on
international good practice
(assisted by WB and other
donors)
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MTEF Objectives

Realistic macro-fiscal framework for
budgeting

Greater predictability for budget planning

Policy-led resource allocation process

Multi-year perspective for budget planning

Greater transparency and wider
participation
6
Main Elements of MTEF in Moldova

Macro-fiscal framework
– macroeconomic outlook
– projections of revenue, budget deficit and financing

Analysis of cross-cutting budgetary issues
– implications of EGPRSP for expenditure allocations
– wagebill analysis
– inter-governmental finance

Sector level analysis and expenditure
priorities
– Strategic expenditure strategies

Expenditure plans
– sector resource ceilings for budget planning
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Introduction of MTEF Required


Extended budget planning cycle
Effective management
arrangements

Strong stakeholder involvement

Capacity building
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Extended Budget Cycle





MTEF – inseparable part of budget cycle
Macro-fiscal framework at centre of
budget process
Sets out budget parameters and
priorities
Allows annual updating of expenditure
plans
Provides for greater stakeholder
participation
9
Middle Term Expenditure Framework and
Budgetary Cycle
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Effective Management Arrangements

MTEF Coordination Group
– chaired by Minister
– meets regularly during MTEF
preparation

Technical Working Groups
– fiscal policy
– macro-fiscal framework
– wagebill

Sector Working Groups
MoF Budget
Synthesis
Department and
Sector Divisions
• Operational coordination
• Preparation of MTEF
document
– education
– health
– social protection
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MTEF Organizational Chart
MTEF Coordinating Group
Working Group responsible for the macroeconomic
framework
 Analyzes macroeconomic trends and developments
 Assesses main macroeconomic aggregates
 Elaborates alternative scenarios
 Macro policies and budgetary implications
Working Group responsible for public resource framework
 Analyzes revenue trends
 Revenue policy measures and objectives
 Assesses and distributes the revenues
 Financial equalization and financing sources
Working Group responsible for public expenditure policies
and priorities
Cross-cutting expenditure policy issues
 Analyzes expenditures on main economic categories
 Identifies key problems and makes recommendations
 Makes long term assessments
 Branch expenditure priorities and policies;
 Revise and analyze the allocations on branches
 Government policy implications on public expenditures
 Recommendations for future allocations
 Incorporate strategic expenditure plans on branches
Sector Working Group
(education, health care and social
protection)
 Sector expenditure strategic
plans
 Assess current situation
 Review policy objectives
 State’s role in sector
 Expenditure programs priority
reform actions
 Implications
on
public
expenditures
 Identify
monitoring
and
performance indexes
Branch Finance Divisions
within the Ministry of Finance
Budgetary Synthesis department within the Ministry of Finance
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Stakeholder Involvement

Membership of MTEF Coordination
Group

Discussion of MTEF in Government

Briefing of Parliamentarians

Seminars for Local Government
Officials
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Capacity Building


Macro-fiscal forecasting model
Formats and guidelines for sector
analysis

Seminars and workshops

MTEF manual being developed
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MTEF Experience – Expanding
Coverage
Scope of Analysis
Budget Coverage
2003-05 MTEF
2004-06 MTEF
State Budget
Local Budgets
Special Means
State Budget
2005-07 MTEF
State Budget
• Special Means
• Donor Projects
Local Budgets
Local Budgets
Social and Health
Care Funds
Special Means
Donor Projects
Education
Education
Education
Health
Health
Health
Social Protection
Social Protection
Social and Health Care
Funds
Wagebill Analysis
Risk Analysis
Sector Prioritisation
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MTEF Experience - Future Challenges

Strengthen linkage between EGPRSP and MTEF
– affordability of EGPRSP proposals
– sequencing of updating EGPRSP and MTEF

Policy and budgeting capacities in line
ministries
– stronger sector policy frameworks
– linking policy and budget planning in line ministries

More detailed analysis of key budget issues
– extended process of policy and expenditure reviews
– spread work throughout year

Capacities for budget planning
– enhanced training programme
– staff retention issues
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MTEF Experience - Impact on the Budget
Process

On Budget preparation
– has made budget preparation quicker and easier
– greater realism in budget proposals

On involvement of Government
– lengthy discussion of MTEF in Government
– seen as key stage in budget decision-making
– increasingly referred to by Prime Minister and
President

On engagement of Parliament
– MTEF provides context for discussion of annual
budget
– More strategic approach to budget debate in
Parliament
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Thank You!