- The Government of Jamaica is undertaking a US$388, 967 pilot project aimed at reforming the budget preparation process and to better align spending with anticipated results.
- The objective is to link budgeting with Government policy priorities through a gradual transition from annual expenditure planning to a medium-term results-based expenditure framework.
- This will improve accountability and ensure a more efficient and effective allocation of resources.
The Government of Jamaica is undertaking a US$388, 967 pilot project aimed at reforming the budget preparation process and to better align spending with anticipated results.
The objective is to link budgeting with Government policy priorities through a gradual transition from annual expenditure planning to a medium-term results-based expenditure framework. This will improve accountability and ensure a more efficient and effective allocation of resources.
The project, which gets underway on August 17, will see the implementation of a Medium Term Results Based Budgeting (MTRBB) programme in three ministries.
Deloitte Overseas Consulting LLP has been contracted to provide technical assistance for the roll out of the project in the ministries of Education; Agriculture and Fisheries; and Transport, Works and Housing, over the next five and a half months.
Under the project, MTRBB-focussed budgets are to be created within the pilot Ministries for financial year 2016/17.
An agreement for the implementation of the project was signed by representatives from Deloitte, the Ministry of Finance and Planning, and the United Kingdom’s Department for International Development (DFID), during a ceremony at the Finance Ministry in Kingston on Friday, August 14.
The MTRBB is a major activity under the Strategic Public Sector Transformation Project (SPSTP), which aims to strengthen public resource management and support selected public sector institutions in facilitating a more enabling environment for private sector growth.
It is supported by a US$35 million loan from the World Bank and DFID grant of US$2.6 million.
Speaking with journalists following the signing ceremony, Project Director, SPSTP, Dunstan Bryan, explained that result-based budgeting is essentially “creating more efficiency in terms of how we manage the resources that Government has.”
“What we are trying to do is ensure that every dollar that we invest in the country can be properly accounted for. What we are doing is a critical element under the economic reform programme,” he noted.
He said that through medium-term results-based budgeting, the Government will now look at developing “forward estimates” (meaning) what do we plan to do in the future, how do we plan to do it, and can we do it based on the resources that we project to have in the future”.
Mr. Bryan noted that formulating forward estimates over a minimum of three years, will provide a better understanding for the public “as to where the Government is going in terms of policy and will also provide a better opportunity for the people and the Parliament to analyse and critique the budget process.”
Acting Financial Secretary, Everton McFarlane, said that reforming the budgeting process is one of the mechanisms that will better aid the Government in improving how it makes spending decisions.
“What we are doing here, in regards to results-based budgeting, is fundamental to what we want to achieve over our entire economic reform programme. It is one of the bases on which we can, on a long-term basis, on a sustainable basis, lift ourselves from a situation where we will always be seeking to spend more than we are earning,” he said.
Director, Deloitte Overseas Consulting, Michael Vlaisavljevich, said it is important that the public budget is managed wisely and efficiently, which is the intention of the MTRBB approach.
He explained that the results-based element “focuses the budget on what you want to achieve, and deliver, not just what you spend. The medium-term element enables you to shift resources to the highest priorities on a sustained basis to achieve those priority results.”
The results of the pilot will be used to: identify gaps in the current budget system and make recommendations for critical next steps to fill these gaps; develop a risk mitigation strategy for the full roll out of MTRBB in Ministries, Departments and Agencies (MDAs); develop a capacity development plan for the Ministry of Finance and MDAs that is based on the specific needs that have been identified through the pilot; and develop culturally appropriate manuals, templates and formats that will facilitate the effective and efficient implementation of MTRBB.