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

412 Salvatore Schiavo-Campo
compliance. Value-for-money issues should be addressed only if and after
financial and compliance audits are on a solid basis and corruption ceases to
be a major concern. However, efficiency audits of specific programs of major
economic or social importance can take place—preferably subcontracted to
specialized firms, although under the guidance and leadership of the country’s
supreme audit institution.
internal audit. Internal audit is frequently misunderstood as an
additional layer of financial control by the ministry of finance over the line
ministries. Indeed, most francophone African countries follow the practice
of placing financial controllers from the ministry of finance in each line
ministry. In those cases, the appropriate role of the financial controller
should be limited to ensuring the conformity of the expenditure with the
budget and its regularity before the payment can be authorized—and must
not extend to questioning the reasons for the transaction or its probable
effectiveness. Properly understood, instead, internal audit is a management
support function, aimed at reporting to and advising the head of the agency
(who is the accountable official) on the soundness of the internal accountability
mechanisms in the ministry or agency and the incentive frameworks
for ensuring service efficiency. Therefore, internal audit capacity can most
usefully be developed only in countries with an already reasonably solid system
of financial control and external audit. Once again, this general rule does not
preclude initiating internal audit in ministries that administer specific programs
of major importance; indeed, in those cases, development of internal
audit and of selected value-for-money audits by the external audit entity
becomes strongly complementary.
Capacity: The Missing Link
Without sufficient institutional, administrative, and technical capacity to
implement them, the best reform programs and carefully designed measures
are hardly worth the paper they are written on. A budget reform strategy
paper—indeed, any strategy paper—is a paper, not a strategy, unless it
addresses convincingly and realistically the questions of how the reforms are
to be implemented, by whom they are to be implemented, with what
resources they are to be implemented, and when they are to be implemented.
In all developing countries, including African countries, the issue of capacity
building stands left, right, and center of the budget reform agenda. Yet
budget reform programs have been too often designed and pushed onto
African countries’ governments with no attention to implementation capacity,
no consideration of all the other commitments the civil servants concerned