Multi-Tier Government Synchronization (MTGS) Accountability in sub- national fiscal transfers

Agenda Expanding the governance agenda Sub-National Fiscal Transfers Challenges Barriers to Implementation Solutions ? Closing

PFM and Service Delivery Increasing effectiveness and good governance

Public Service Delivery National Government Provincial / State Local Government

Global Monitoring Report Sustainability “Checks and balances institutions are important for the sustainability of effective governance… and (includes) accountable local governments.” Scaling up aid: Moving the agenda forward –“Governance is a critical part of this agenda.” –“transparent budget, administrative (systems) … are key to a well functioning governance system – and provide a straight forward basis for support (from donors).”

Public Service Delivery National Government Provincial / State Local Government Budget

Fiscal Flows Central Government Provinces Cities $$$ $ $ $ $ $ $ $ $ $ FA

Sub-National Fiscal Transfer Challenges

One size ? Accountability, Transparency and Timeliness Public Administration Policies and Procedures Financial Management HR ICT

National Government Provincial / State Local Government Budget Accountability Transparency Timeliness Public Administration

Policies and Procedures Clear rules on assignment, delegation, devolution, authority and responsibility Financial Management practices –Processes applicable at a central level may need to be more flexible at lower tiers –Capacity differences –Flexibility to streamline based on efficiencies

HR Does fiscal decentralization also includes personnel –Remuneration, retention and meritocracy Capacity and sustainability a significant challenge –Variability in capabilities across functional sectors and geographic/demographic regions

Districts States ICT Communes Local Government Provinces Districts Communes Local Government Communes Local Government Districts States Communes Local Government Districts Local IFMIS One Version – Standard policies, procedures and controls Version 1 Version 2 Ver 3 Version 2 Version 4

Barriers to Implementation Complexity and the Competition for scarce resources

Capacity and Sustainability Competition

Complexity $ Time Capacity Custom Leverage

Approaches?

Major Thematic Drivers Stand-alone installation capability Configurable business rules per implementation Standardized information flow –To Provinces / Central Government –From Central Government/Provinces to Local Government Multiple capacity versions with growth

Stand-alone but configurable

Bi-directional fiscal flows COA

Full IFMIS... but constrained

Success Factors … some highlights Technical –Ability to operate in mixed ICT environments –Designed for multiple scenarios Functional –Product designed only for governments Integrated fiscal, budgeting and commitment capabilities –Product designed based on switches

Success Factors (continue) Services –Personnel with extensive government specific experience –Builds on prior successful implementations Capacity –Designed for mixed capacity –Training is government specific. Order of magnitude in absorption rates. –Retention less an issue because of government only solution

Complexity $ Time Capacity Custom Leverage

Closing thoughts Complexity Capacity Sustainability

Thank you!