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IMF Book Launch: PFM and Its Emerging Architecture

 

April 16, 2013

Doug Hadden, VP Products

I attended the book launch earlier this afternoon at the IMF in Washington. The “Spring Meetings” are in progress with large banners, TV projectors and party tents off Pennsylvania Avenue. So, a good time to launch a new book with a panel discussion. There’s 14 chapters written by numerous PFM experts in 4 parts. I hope to review the book in the coming weeks.

There seems to be some persistent tension between ideas in Public Financial Management that includes:

  1. Those who see real progress in reforms to date vs. those who see little improvement
  2. Those who believe that there are objective “best practices” in PFM vs. those who believe PFM is more art than science
  3. Those who think that reform has been too fast vs. those who think that reform can be accelerated
  4. Those who believe that technology enables reform vs. those who think reform is all about people and institutions

The first two issues were discussed at length with some disagreements among panel members. Panelists seemed to agree that reform momentum has been too fast and that people and politicians are key to reform success.

IMF Book Launch: "Public Financial Management and Its Emerging Architecture"

April 16th. launch at the International Monetary Fund in Washington DC.

Storified by · Tue, Apr 16 2013 12:15:12

IMF Book Launch and Seminar: Public Financial Management and Its Emerging Architecture, April 16, 2013IMF Book Launch and Seminar Public Financial Management and Its Emerging Architecture Event Details Date: Tuesday, April 16, 2013 Time: 1…
Opening Remarks by: Min Zhu, IMF Deputy Managing Director
Moderator: Carlo Cottarelli, Director, IMF Fiscal Affairs Department
Presentation by Marco Cangiano of the IMF Fiscal Affairs Department
Panelists:
Robert Reischauer, Former President of the Urban Institute and Former Director of the Congressional Budget Office
Allen Schick, University of Maryland
Nick Manning, Head of Governance & Public Sector Management Practice, World Bank
Gerhard Steger, Austrian Director General of the Budget, Ministry of Finance and Chair of the OECD Working Party of Senior Budget Officials
Marco Cangiano: the book isnt a cookbook to bake your #PFM reformsFreeBalance
Intro at #IMF book launch for #PFM & emerging architectures yfrog.com/ocfbfqnjFreeBalance
Min Zhu introduced the session with the notion that if not for the innovations in Public Financial Management, the fiscal crisis and debt problem would be far worse than it has been.
Min Zhu: public financials critical b/c of #debt burden #PFMFreeBalance
Min Zhu: how can we prevent future debt crisis especially with demographic chsnge #IMF #PFMFreeBalance
Robert Reischauer: #globalization means countries cant fund based on domestic sources #PFMFreeBalance
There was general agreement that public financials requires more innovation because of demographics changes and globalization. This generates the need for improved risk management in government.
Min Zhu: demographics cause need for increasing gov expenditures yet revenue problems #IMF #PFMFreeBalance
Min Zhu: has been more #PFM #innovation to make #PFM sustainableFreeBalance
Min Zhu: despite #PFM #innovstion we have a gov #debt crisisFreeBalance
Robert Reischauer: if not for #PFM public financials #innovation we would be in far worse conditionFreeBalance
Gerhard Steger: sees emerging fiscal risk management progress #PFMFreeBalance
Allen Schick: biggest needs for #PFM on risk & fiscal rulesFreeBalance
There was significant disagreement about what PFM reforms have worked and not worked.
Allen Schick: #PFM reforms essentially all dressed up & no where to goFreeBalance
Min Zhu: more countries using #MTEF #GFS & accrual reporting #IMF #PFMFreeBalance
Allen Schick: #MTEF a technical exercise that plays little role in reality #PFMFreeBalance
Nick Manning: #MTEF reforms have had bite #PFMFreeBalance
Marco Cangiano: seen proliferation of diagnostics like #PEFA #IMF #PFMFreeBalance
Allen Schick: #PFM innovation adopted well by countries that least needed them such as Northern EuropeFreeBalance
Allen Schick: few countries truly governed by fiscal rules #PFMFreeBalance
Allen Schick: some countries problems were explicit liabilities not contingent #PFMFreeBalance
Nick Manning: gains in Eastern Europe in #PFM reform progressFreeBalance
Other part of panel yfrog.com/odu3oudjFreeBalance
There seems to be more agreement on what makes for bad practices than “best practices”. Nick Manning suggested that PFM experts should focus on “best problems.” The notion of PFM reform as more art than science was an implicit theme.
Nick Manning: ‘best practices’ in #PFM a clumsy idea, need to look at ‘best problems’FreeBalance
Nick Manning: best #PFM improvement is in country engagement & determining why reforms didn’t workFreeBalance
Min Zhu: many countries shoved #debt liabilities to #SOEs #IMF #PFMFreeBalance
Marco Cangiano: the fund accused of cookie cutter approach but no proven reform formula #IMF #PFMFreeBalance
yfrog.com/ochhvglhj second group of #imf #PFM panelFreeBalance
The history of PFM reforms was discussed including fads and that International Financial Institutions may be responsible for some of these fads. [Curb your PFM enthusiasm seems to be a trend these days.]
Marco Cangiano: regretfully went from 1 crisis to another & learned new things #IMF #PFMFreeBalance
Marco Cangiano: no fads solved all public financials problems, some came & went #IMF #PFMFreeBalance
Marco Cangiano: issue is how to turn policy advice into practical results #IMF #PFMFreeBalance
Marco Cangiano: sometimes overly enthusiastic reforms in countries #IMF #PFMFreeBalance
Marco Cangiano: #PFM has moved from administration concept to umbrella idea for all public sectorFreeBalance
Marco Cangiano: #IMF #PFM good practices still emerging tho some have become bread & butterFreeBalance
Marco Cangiano: countries often added single initiative but failed to link with others #IMF #PFMFreeBalance
Marco Cangiano: country context critical for reform success #IMF #PFMFreeBalance
The notion of accrual accounting as a necessary step in PFM reform was discussed. This is a controversy especially in developing countries where the benefits are questioned relative to complexity and human capacity limitations.
Min Zhu: many countries do not show #risk & risk hidden on cash basis of accounting #PFMFreeBalance
Transparency as an enabler of reform was mentions.
Robert Reischauer: communication revolution has given citizen voice even in authoritarian regimes #PFMFreeBalance
Gerhard Steger: seen significant #PFM progress thanks to affects of the marketFreeBalance
Gerhard Steger: #transparency has been key #PFM accomplishmentFreeBalance
The need to incentivize politicians to make the right public financials decisions was described.
Gerhard Steger: #PFM reforms are about people not technologyFreeBalance
Allen Schick: #PFM innovation should make it easier for politicians to make the right good decisionsFreeBalance
Allen Schick: need to reduce gov spending discretion by politicians #PFMFreeBalance
Robert Reischauer: what kind of incentives give people to follow fiscal rules, #sequestration very bad ideaFreeBalance
Allen Schick: we know that every #PFM #innovation has politicians fingerprintsFreeBalance
Nick Manning: we often see politics as dark matter to explain when #PFM results poorFreeBalance
Nick Manning: need to be concerned about how to operationalize politics #PFMFreeBalance
Gerhard Steger: future is need for the political economy of public financials #PFMFreeBalance
There is hope to influence #politicians by understanding how they think #PFM give them no excuse not to actFreeBalance
Future reforms and persistent PFM problems were discussed.
Nick Manning: problems in budget execution in public investment projects key #PFM problemFreeBalance
Robert Reischauer: US public seems to not want gov to reduce services or raise taxesFreeBalance
#IMF #PFM interviews set up yfrog.com/kkzvmbtjFreeBalance
Gerhard Steger: need for common public sector accounting standards #PFMFreeBalance
Allen Schick: can’t manage public financials unless have eye on private sector #PFMFreeBalance

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Doug Hadden

Doug Hadden

Executive Vice President, Innovation at FreeBalance
Doug is responsible for identifying new global markets, new technologies and trends, and new and enhanced internal processes. Doug leads a cross-functional international team that is responsible for developing product prototypes and innovative go-to-market strategies.

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