May 19, 2013Doug Hadden
This series examines different scenarios and the impact of Government Resource Planning (GRP) to improve governance. [Framework described in more detail.]
Information and Communications Technology (ICT) initiatives such as Government Resource Planning (GRP), sometimes known as Financial Management Information Systems (FMIS) for government, are seen as an expression of PFM reform. Diamond and Khemani suggest that “the establishment of an FMIS has consequently become an important benchmark for the country’s budget reform agenda, often regarded as a precondition for achieving effective management of the budgetary resources. Although it is not a panacea, the benefits of an FMIS could be argued to be profound.”
IMPACT: Profitability is the key concept in the private sector. Budget is the key concept in government. In business the budget is only an internal document. In governments and not-for-profits, the budget is the key fiscal document.
PROBLEM: Many government budgets are created with little regard for spending realities or budgets are changed in execution without the spirit of the original plan.
OTHER FACTORS: Credible budgets require effective economic understanding and linkage with policy.
SCENARIO:Use of GRP systems for improved budget planning and budget execution.