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Review: The State of Budget Transparency Worldwide

 

December 21, 2009

Vivek Ramkumar of the International Budget Partnership describes the importance of open budgets in a recent article of the International Journal on Governmental Financial Management.  There is a wide range in budget transparency in countries around the world.  Budget proposals are often not presented to the public prior to the legislative process. Sometimes budgets are not presented to legislators in a timely manner. The finalized government budget is often not presented to the public. The final budget results at the end of the fiscal year are not always presented to the public. The Open Budget Index assessed oversight by legislative bodies and Supreme Audit Institutions (SAI).

The budget is the most critical financial process in government. The budget is the legal embodiment of government intentions. Mr. Ramkumar makes a strong case for  transparency across the entire budget cycle. He provides examples of how civil society organizations interact with governments to help improve development results.  The Open Budget Index concludes  “that the state of budget transparency around the world is very poor.” Some countries have shown improvement in budget transparency.

Mr. Ramkumar advocates the use of 8 key documents in the budget cycle to demonstrate transparency:

  1. Pre-Budget Statement
  2. Executive’s Budget Proposal
  3. Enacted Budget
  4. Citizens Budget
  5. In-Year Reports
  6. Mid-Year Review
  7. Year-End Report
  8. Audit Report

The State of Budget Transparency Worldwide

Mr. Ramkumar observes patterns:

  • Countries dependent on aid
  • Geographic location
  • Countries with high oil and gas revenue
  • Political systems

Mr. Ramkumar provides a set of recommendations for governments. He recommends that  “the most immediate – and often the least costly – action that governments can take to improve transparency is to make publicly available (through their websites) the budget information they already produce for the government’s internal use.”  He also provides advice for legislature and SAI reform.

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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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