Menu
- 10 Marks
Question
The Public Expenditure and Financial Accountability (PEFA) program was initiated in 2001 by seven international development partners: The European Commission, International Monetary Fund, World Bank, and the governments of France, Norway, Switzerland, and the United Kingdom. PEFA began as a means to harmonize the assessment of PFM across the partner organizations. It subsequently established a standard methodology for PFM diagnostic assessments, the PEFA framework. Since 2001, PEFA has become the acknowledged standard for PFM assessments.
Required:
Describe the scope and goals of the PEFA framework.
Answer
Scope of the PEFA Framework:
The PEFA framework is a methodology for assessing and reporting on the strengths and weaknesses of public financial management (PFM) performance. It identifies 94 characteristics (dimensions) across 31 key components of PFM (indicators) in 7 broad areas of activity (pillars).
The outcome of the performance assessment, the PEFA report, provides the basis for dialogue on PFM reform strategies and priorities. The methodology can be replicated in successive assessments, giving a summary of changes over time as well as providing a pool of information that contributes more broadly to research and analysis of PFM.
Goals of the PEFA Framework:
- Strengthen Capacities: To strengthen capacities to assess the status of country PFM systems and develop a practical sequence of reform and capacity development actions.
- Encourage Country Ownership: To encourage country ownership of the PFM reform process.
- Reduce Transaction Costs: To reduce transaction costs to countries by harmonizing the assessment process.
- Enhance Donor Harmonization: To enhance donor harmonization around a common understanding of PFM performance.
- Monitor Progress: To allow monitoring of progress in country PFM performance over time.
- Address Developmental and Fiduciary Concerns: To better address developmental and fiduciary concerns in the PFM reform process.
- Improve Reform Impact: To lead to improved impact of PFM reforms by providing a comprehensive diagnostic tool.
- Uploader: Theophilus