October 17, 2011Doug Hadden
Doug Hadden, VP Products
This is where I eat crow for complaining about the media coverage in Afghanistan. As in: Why can’t Journalists report on good news in Afghanistan? and Afghanistan Corruption? Incorrect solutions to the problem. Both from earlier this year.
National Post (Canada) journalist Jane Armstrong’s The campaign for civility in Afghanistan provides a good portrayal of Alhaj Mohammad Aqa, the Director of Treasury at the Ministry of Finance. Ms. Armstrong describes his approach approach to corruption:
“He carries on by keeping his nose clean and trying to provide an example to a young generation of Afghan public servants. His integrity and skill have paid off. The Finance Ministry is viewed as one of the country’s most efficient departments.”
Capacity Building and Public Financial Management
Ms. Armstrong gets to the heart of success in PFM reform success: capacity building. Foreign consultants often provide operational financial management in post-conflict countries. The key factor to making reform sustainable is to build human capacity. This reduces costs and makes government self-reliant. And, less reliant on vendors like FreeBalance.
The Treasury Department has successfully built capacity according to a report on the IMF Blog. A World Bank report showed that Afghanistan is one of a select group of post-conflict countries that have achieved substantial PFM reform. The Treasury Department, under Director General Aqa, was able to roll-out financial management software to all line ministries and provinces with negligible help from foreign companies. Including FreeBalance – this is a significant milestone.
The National Post article could give the impression that the Budget Office is part of the Treasury Department. It is not. This might explain the different approach and success rates in capacity building between the two departments.
We’d like to think that the use of the FreeBalance Accountability Suite is crucial in PFM reform. After all, all the countries listed by the World Bank as having achieved substantial PFM success have been using our software (including Kosovo and Sierra Leone). None of the countries who did not achieve this level of success were using our software at the time. (Liberia subsequently acquired the FreeBalance Accountability Suite.)
The reality is that our software is a tool to enable reform. It implements faster and enables change better than competing tools. But that doesn’t mean that anyone is actually going to leverage financial controls or modernize processes to improve efficiency. That requires leadership in the government.
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