Public Sector Governance and Accountability Series: Budgeting and ...

What Would an Ideal Public Finance Management System Look Like? 381
established such processes across their entire PFM systems. This could
be one of the main reasons that the results of strategic budgeting, with its
performance orientation, are still muted in even the best cases.
Moving Ahead: Toward a Full Response for the G8
In working with countries that are trying to improve their PFM systems,
many colleagues have been amazed at the number of officials who have asked
if there is any one best way. Unfortunately, there is not: no silver bullet or
magic potion. This fact makes the G8 call for a PFM “code” quite interesting.
It seems to be a call for the identification of a one-best-way or a how-itshould-be-done
model for PFM.
This chapter interprets the call a little differently. It sees the call coming
at a time when there are many different approaches to PFM, lots of money
being spent on PFM reform, and many governments facing PFM results that
suggests suboptimality. Against that backdrop, the G8 finance ministers are
asking for some clarity, some standardization, and some guidance as to how
to look at PFM systems in a structured manner.
This chapter attempts to provide some ideas in this light. It introduces
the PEFA framework as a potential foundation for a PFM code and then
discusses the need to go beyond PEFA:
To ensure full, integrated coverage of all PFM processes and of connections
between such processes
To ensure that all role players are given attention in the framework, especially
spending agencies and civil society entities
To ensure that the goal contingency of PFM processes is clearly presented,
even to the point where different indicator sets are used to reflect the
“appropriate”look for PFM systems at different levels of goal achievement.
The PEFA indicators have been useful to many governments and to
many in the donor community by providing a guide for PFM reform and a
mechanism for evaluating PFM system quality. Moving beyond PEFA in the
ways discussed in this article could facilitate the development of an even
more useful product in the future—a more complete code to meet the
demand of the G8.
Notes
1. The framework draws on the Heavily Indebted Poor Country expenditure tracking
benchmarks, the International Monetary Fund’s Fiscal Transparency Code, and
other international standards.