Public Financial Management and Frontline Service Delivery

Question

What are the key issues to consider when designing a PFM reform programme which targets effective frontline service delivery? Please also provide examples of successful PFM interventions which have improved frontline service delivery and lessons from cases when this has not worked and why.

Summary

A review of the literature suggests that in designing PFM reform programmes it is essential to consider the following:

  • PFM reforms must be understood as part of a more general public sector reform process.
  • PFM reforms should have poverty reduction as a central objective.
  • PFM reforms need to be designed at sector level in order to accommodate the needs, capacities and willingness of public sector workers in different areas of service provision.
  • PFM reforms and their effects on service delivery require rigorous monitoring and evaluation.
  • Donors must ensure coordination between programmes, approaches and funding mechanisms in order to streamline reform activities, avoid duplication and avoid increasing the chances of corruption within the public sector.
  • Civil society (including parliamentarians and audit institutions) have a crucial role to play in demanding, sustaining and promoting PFM reforms in order to enhance service delivery.

PFM reforms are seen as crucial for the success of government and donor efforts to reduce poverty through the provision of effective services such as health, water and education. However in practice the reform process has met a number of problems:

  • Capacity amongst staff often remains weak
  • A long-term perspective for reforms needs to be adopted
  • Coordination between the Ministry of Finance and other ministries/agencies is often weak
  • Whilst promoting openness and transparency of government finances, the reform process is often hindered by a lack of information.

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