12 Principles to Empower Government COVID-19 Pandemic Responses Through Public Financial Management

Unpack PFM Recommendations from the International Monetary Fund, PEFA Secretariat, and the World Bank Group.

Are you overwhelmed by so many organizations talking COVID-19 response in government? Faced with:

  • Information overload 
  • Little to do with your reality 
  • More about selling stuff than helping you 
  • Far more noise than signal 

What’s going on for public finance among experts? Valued advice for us comes from these sources:

Background

Takeaways : 12 main PFM and policy themes. These align with my previous post:

  1. Controls: adjust, loosen, tighten controls
  2. Liquidity: manage cash, debt, support the Treasury Single Account
  3. Social Spending: reallocate spending for health, income & business support
  4. Transparency: fiscal transparency for spending, procurement, revenue, debt
  5. Speed: improve efficiency & timeliness
  6. Technology: adopt technology to achieve government objectives
  7. Audit: leverage internal & external audit
  8. Business Continuity: keep government working, support for working at home
  9. Government Decision-Making: improved quality, timeliness, comprehensiveness
  10. Policy: policy & legal reform
  11. Scenario Management: trends & scenarios to predict spending needs
  12. Communications: improve communications to citizens, civil society, business

In a relatively top-down view, the papers focused on:

  1. Government Problem: fiscal problems faced by governments
  2. Fiscal Policy Objectives: evaluate whether fiscal policy effective
  3. PFM Objectives: evaluate whether PFM actions effective
  4. PEFA Measurement: specific PEFA elements critical for the fiscal response
  5. Finance Ministry Actions: recommendations for finance ministry interventions and changes
  6. Treasury Operations: recommendations for treasury interventions and changes
  7. Budget Preparation: changes to 2021 budget formulation processes
  8. GRP Enhancements: adapt government financial management systems support Covid-19 response

By the numbers: speed at which these organizations provided insight requires a little unpacking to see the 12 patterns. Here’s my unpacking:
A. Government Problem 

B. Fiscal Policy Objectives

C. PFM Objectives

D. PEFA Measurement

E. Finance Ministry Actions

F. Treasury Operations

G. Budget Preparation  

H. GRP Enhancements

What’s important for public finance? The consistency among recommendations. Your actions depends on country context and capabilities.  In the short term, the focus in many countries should be:

  • Controls 
  • Liquidity 
  • Social Spending 
  • Transparency 
  • Speed

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