By Kiana Wilburg
The manner in which the national budget is prepared, rolled out and accounted for, will be characterized by stricter measures to ensure a level of transparency that has not been seen in over 20 years, says Finance Minister, Winston Jordan.
Minister Jordan, an economist, said that one of the measures to be seen quite soon is the national budget being presented before the start of the new fiscal year. He said that the 2017 budget is slated to be presented to the National Assembly in December.
The Finance Minister, asked about accountability when it comes to monies disbursed from the Consolidated Fund to various budgetary agencies, said that all ministers were informed that monies which have not been used for projects at the end of the fiscal year must be returned to the nation’s purse.
The economist said, “This was explained to the ministers and it was actually part of their orientation. In any case, the Permanent Secretary, who operates as the accounting officer for the Minister, is absolutely aware of this.
“All Permanent Secretaries are in possession of budget manuals and they also had pep-talks from the Accountant General and the Finance Secretary. Under this administration, there is a new direction and there will be stricter accountability for the budget spending.”
The Finance Minister was also asked about the new transparency budget framework. He noted that this plan was inherited from the European Union.
The economist said that the Union usually conducts an assessment on Guyana’s performance and seeks to ascertain what achievements have been made by the country.
According to the framework, the Ministry of Finance is expected to incorporate a strengthened budgeting framework in the National Budget. This is to provide for greater accountability for outputs, outcomes and impacts.
The plan for Guyana notes that despite the efforts made to embed programme budgeting as evidenced by the compilation of Volumes 1 and II of the Estimates to the National Assembly, statements of impact and indicators of achievement are not specific and quantifiable to facilitate ex post evaluation.
The identified field for financial reform in this regard is expected to be the programme budgeting system and performance reports within an enhanced Monitoring and Evaluation environment. This accountability measure is expected to be effective from the fiscal year 2018, in respect of all Ministries, Departments and Regions.
The plan also states that provision should be made for the specialized training of key staff of budget agencies on the latest techniques in programme budgeting. The importance of this area was underscored by the fact that limited training has been provided over the years to budget agency staff on programme budgeting.
Trained staff will be expected to facilitate the preparation of programme budgets and budget agency performance reports. This mechanism is effective from this year and all budget agencies are expected to use an updated Programme Budgeting Manual. By January last, 80 percent of key staff from the Ministry of Finance and budget agencies will be trained.
Among the other 11 measures mentioned, the plan also stipulates that the Ministry of Finance in collaboration with other budgetary agencies, prepare and present a more comprehensive mid-year report on the execution of the National Budget.
This was recommended so as to provide detailed information to all stakeholders and the public on the progress of budget execution by all budget agencies.
The transparency plan noted that that the Mid-year report has often been restricted in content, focusing mainly on macro-economic issues. It stated too, that there is limited mention of major risks for the remainder of the year, together with policy responses to mitigate such risks. The plan makes it pellucid that these are requirements of Section 67 of the Fiscal Management and Accountability Act.
The plan stated that while the mid-year report does contain useful tables in the annexes, and it would be more useful if these are explained and discussed in the narrative of the report.
It called for an improved midyear reporting on the National Budget with effect from this year, including reporting similar to that of the End of Year Budget Outcome and Reconciliation Report and explanations of variances, major risks for the rest of the year and measures to mitigate the risks.
For the first time in recent history Guyana’s mid-year report was presented within the six-month period and was detailed in the areas specified by the transparency plan.
The Finance Minister also revealed that in the case of the 2017 budget there will be a better roll out of Public Sector Investment Projects (PSIP).
“As President, David Granger had said, there will be no more excuses by the Permanent Secretaries about what their allocation for the year is and when they will get to spend it. They will know this in December.
“So come January 1, 2017, they will have an entire year to do their spending on their respective projects.”
Regarding the percentage of the spending of the PSIP for this year, Jordan estimates that this is over 50 percent as there was marked acceleration over the past few months.
It was noted in the Mid-Year Report on the economy that Budget 2016 was notably one of the earliest budgets presented to Parliament in Guyana’s recent history. It was anticipated that the early presentation in January last would have afford Budget Agencies a greater opportunity and more time to execute their annual budgets thereby improving the rate of implementation and chances of success.
However, this was not to be and, as indicated in the Report, implementation of the Public Sector Investment Programme languished under the weight of some intractable bottlenecks.
Nevertheless, Government continues to identify key policy initiatives, critical to the transformation of the economic landscape, so that economic activities are stimulated, growth is accelerated, and the divide between the hinterland and coastland is reduced as it moves to realize the good life for all Guyanese.
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