Measuring and Monitoring Treasury Performance PEMPAL TCOP Plenary Meeting Measuring and Monitoring Treasury Performance Azerbaijan, Belarus, Georgia, Kazakhstan, Ukraine Tirana (Albania), May 22 , 2018

Overview of Country Practices

Participants : Treasury, MoF Special Department ( Kazakhstan, Ukraine) Current Approaches to Monitoring Treasury Performance (Participants, Processes, Tools, etc.) Tools: There exists a set of indicators and reporting documents, however a systemic approach to monitoring and monitoring-based decision-making is lacking ( Azerbaijan). The Ministry of Finance’s Strategic Plan (every 3 years, for 5 years) includes indicators. On the basis of the above plan, an Activity Plan is worked out to include specific activities, responsible officers and deadlines linked to indicators of budget programs. Formalized in the Budget Code (Kazakhstan); There is no special monitoring system, but strategic documents include specific (measurable) Treasury’s reform implementation objectives: Georgia ( at the same time the country has a number of strategic national documents including the Public Finance Management Strategy ( 4 years) and Annual Activity Plan, including objectives for the Treasury) There is no special monitoring system in place, the central Treasury monitors discharge of the treasury functions by the treasury head office and territorial branches (Belarus, Azerbaijan, Ukraine). Participants : Treasury, MoF Special Department ( Kazakhstan, Ukraine) Indicators : а) indicators characterize timeliness and quality of work of the Treasury’s head office and its territorial branches. ( Examples: KPI – reducing the time of processing finance documents (Kazakhstan), Belarus – monitoring the work of the head office and territorial branches ( Ukraine, Belarus). b) Treasury’s Control Activity Indicators (Belarus), c) Indicators of achieving strategic goals of reforms (Georgia)

Challenges in Measuring and Monitoring Treasury Performance Lack of management’s interest in implementing performance monitoring Unsubstantiated setting of strategic objectives. Making every employee aware of the strategic objectives. Establishing a system of incentives linked to the system of indicators. Added complexity to indicator (calculating) methodology. Lack of a specialized unit and technical tools (automation).

Using PEFA Indicators as Treasury Performance Indicators (example: PI-22 Expenditure Arrears)

Are we using the same language when speaking of “expenditure arrears” Are we using the same language when speaking of “expenditure arrears”? (examples of definitions used) …Kazakhstan: there exists a notion of payables, based on the accounting data as of the reporting date, which does not coincide with the PEFA framework Belarus, Azerbaijan: lack of a legal term Overdue Payables. Defining overdue payables is prescribed by a regulatory document ( based on source documents recording). Payment deadlines are regulated by contracts (Georgia, Ukraine, Kazakhstan). The Treasury has information on commitments including overdue payables, in electronic form. (Ukraine, Kazakhstan, Georgia – from January 1, 2018)

Challenges in using PI-22 for measuring treasury performance Discrepancies in terminology which are related to differences in methodologies of identifying expenditure arrears.

PI-22 Expenditure Arrears – Self-Assessment 22.1. Stock of Expenditure Arrears 22.2. Expenditure Arrears Monitoring Kazakhstan А В ( tentatively) Belarus В Georgia С (data collected once a year) Azerbaijan А- Ukraine

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