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Can Civil Society Add Value to Budget Decision-Making?

Author: W Krafchik
Date: 2003
Size: 20 pages (139 KB)

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Summary

How can civil society affect the budget process? This paper, commissioned by the International Budget Project, investigates the trend in many developing countries for an emerging subset of civil society organisations, or ‘applied budget groups’, to become more involved in the budget process. It is still early days but evidence suggests that applied budget groups broaden understanding and oversight of budget process - the most important economic policy instrument.

Budget groups are generally independent of government and of political parties, originating in NGO, academic and public sectors, and operating at national, state, local or municipal levels. Budget groups share a common respect for inclusive budget processes, independent oversight, and a pro-poor emphasis within fiscal capabilities. Common activities include training, budget simplification for public consumption, advocacy, budget analysis, including the examination of the budget’s impact on specific groups. The International Budget Project was established to foster the development of these relatively new activities. It has found that as the role of legislatures in the budget process in OECD countries declines, the roles of civil society and legislatures in certain developing and transitional countries is increasing. International developments such as democratisation, decentralisation, public expenditure management, and an increasing emphasis in International Financial Institutions on poverty alleviation, all encourage the formation of budget groups. The paper identifies several ways in which budget groups add value to the budget process.

The opening of budget processes to non-governmental input, a relatively recent phenomenon evident in certain countries, should be supported. Tight executive control is not justified:

• Budget secrecy can encourage speculation and transparency facilitate private sector planning
• Budget groups over time focus on changing priorities within the group rather than expanding it, so do not destroy the integrity of the group.
• External input can be valuable and external parties may perform a useful function of ‘critical allies’ and help to widen capacity. Budget groups should be fostered.

What value can civil society involvement add to the budget process? Country context is key, however budget groups can exercise influence at four clear stages:

• Drafting: offers few opportunities for budget group involvement, other than informally or by bringing new information to public debates on priorities and undertaking training.
• Legislative: representatives debate and sometimes change the budget, for example in Croatia, Kenya and Malawi. Budget groups exert influence through public training and independent analysis and sometimes contribute directly for example through public hearings.
• Implementation: information gathering at this point helps prepare for later legislative stages, particularly the monitoring of planned and actual expenditures where public implementation capacity is weak.
• Auditing: budget groups do not usually fully exploit opportunities at this stage, but may help further by collecting information on program impact, assisting legislatures to monitor the audit’s impact and interpreting and disseminating the audit report.

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Source: Krafchik, W., 2003, 'Can Civil Society Add Value to Budget Decision-making? A Description of Civil Society Budget Work', International Budget Project, Washington D.C.
Author: International Budget Project (IBP), http://www.internationalbudget.org/index.htm