Republic of Montenegro: Public Expenditure and ... - Vlada Crne Gore

More documents

Recommendations

Info

CURRENCY AND EQUIVALENT UNITS (As of June 20, 2006) Currency Unit = euro US$1 = 0.79 euros FISCAL YEAR January 1 – December 31 ABBREVIATIONS BiH Bosnia and Herzegovina MONSTAT Montenegro Statistical Office BOT Build, Operate and Transfer MOU Memorandum of Understanding CEEC Central and Eastern European Countries MTMA Ministry of Transport and Maritime Affairs CPAR Country Procurement Assessment Report NEX Montenegro Stock Exchange DPR Department of Public Revenue NHA National Health Accounts DPW Directorate of Public Works NMS10 New Member States 10 DRRI Department of Roads and Railway PAYGO Pay-as-you-go Infrastructure EAR European Agency for Reconstruction PCG Pošta Crne Gore EBRD European Bank for Reconstruction and PEIR Public Expenditure and Institutional Review Development EF Employment Fund PHC Primary Health Care EIB European Investment Bank PIO Pension Fund EPCG Electric Company of Montenegro PPA Public Procurement Agency EU European Union PPAA Public Procurement Administrative Authority EUR Euro PPC Public Procurement Commission FDI Foreign Direct Investment PPI Private participation in infrastructure FFCD Frozen Foreign Currency Deposits PPL Public Procurement Law FIAS Foreign Investment Advisory Service PPPs Public Private Partners HIF Health Insurance Fund RER Request for extraordinary review HRM Human Resource Management RoM Republic of Montenegro ICAO International Civil Aviation Organization SAA Stabilization and Association Agreement IMF International Monetary Fund SAI Supreme Audit Institution KFW German Funding Agency SAM Serbia and Montenegro LFS Labor Force Survey SOE State-owned Enterprises LSMS Living Standards Measurement Survey SPAI Stability Pact Anti-Corruption Initiative MOES Ministry of Education and Science SUs Spending Units MOF Ministry of Finance WTO World Trade Organization Vice President : Shigeo Katsu, ECAVP Country Director : Orsalia Kalantzopoulos, ECCU4 Sector Director : Cheryl Gray, ECSPE Sector Manager : Bernard Funck, ECSPE Task Team Leader : Abebe Adugna, ECSPE
CONTENTS ACKNOWLEDGMENTS .............................................................................................................I EXECUTIVE SUMMARY ...........................................................................................................I 1. THE ECONOMIC AND INSTITUTIONAL CONTEXT ..................................................1 A. EU INTEGRATION AS A STRATEGIC ANCHOR .................................................................. 1 B. MACROECONOMIC DEVELOPMENTS................................................................................ 3 Growth and Employment ............................................................................................... 3 Inflation.......................................................................................................................... 4 Current Account Deficit................................................................................................. 4 Debt Position.................................................................................................................. 5 C. THE GOVERNANCE AND INSTITUTIONAL CONTEXT......................................................... 5 Survey-based Governance Indicators for Serbia and Montenegro ................................ 6 Survey-based Governance Indicators for Montenegro .................................................. 7 D. WHAT THIS REPORT DOES AND HOW IT IS ORGANIZED.................................................. 9 2. COMPOSITION OF PUBLIC EXPENDITURE AND KEY SOURCES OF FISCAL PRESSURE ...........................................................................................................................11 A. RECENT FISCAL DEVELOPMENTS .................................................................................. 11 B. COMPOSITION OF PUBLIC EXPENDITURE ....................................................................... 13 Economic Composition................................................................................................ 13 Functional Composition............................................................................................... 16 C. SOURCES OF FISCAL PRESSURE: WAGE BILL................................................................. 19 Progress in Lowering the Cost of Public Employment................................................ 20 Deeper Reductions Still Needed .................................................................................. 21 Public Sector Wage Bill Concentrated in Key Functions ............................................ 23 D. SOURCES OF FISCAL PRESSURE: EDUCATION ................................................................ 25 Pressures on the Education Budget: Staff Salaries and Reform Schools..................... 25 Opportunities for Cost Savings .................................................................................... 30 Implementing the Cost Saving Measures..................................................................... 34 E. CONCLUSIONS AND RECOMMENDATIONS...................................................................... 35 3. PUBLIC ADMINISTRATION REFORM.........................................................................39 A. THE LEGAL AND INSTITUTIONAL FRAMEWORK FOR REFORM ....................................... 40 Components of the PAR Strategy ................................................................................ 40 The Institutional Arrangements for Reform Implementation ...................................... 41 B. CREATING THE STRUCTURES AND INCENTIVES FOR PERFORMANCE.............................. 43 Creation of a Professional Civil Service ...................................................................... 43 Introduction of the Performance Appraisal System..................................................... 47 C. ASSURING ACCOUNTABILITY OF THE PUBLIC ADMINISTRATION................................... 48 D. ORGANIZATIONAL CHALLENGES TO SUSTAINING REFORM ........................................... 50 Addressing Structural and Organizational Fragmentation........................................... 50 Meeting the Demands of EU Integration ..................................................................... 53 E. CONCLUSIONS AND RECOMMENDATIONS...................................................................... 55
Page 1: Report No. 36533 Republic of Monten
Page 5 and 6: TABLES Table 1.1. Montenegro’s Gr
Page 7: ACKNOWLEDGMENTS This is the first v
Page 10 and 11: ii Executive Summary and procuremen
Page 12 and 13: iv Executive Summary 2006-2010 is p
Page 14 and 15: vi Executive Summary bill in the ke
Page 16 and 17: viii Executive Summary 23. Going fo
Page 18 and 19: x Executive Summary 27. The impleme
Page 20 and 21: 2 Chapter 1: The Economic and Insti
Page 28 and 29: 10 Chapter 1: The Economic and Inst
Page 30 and 31: 12 Chapter 2: Composition of Public
Page 52 and 53:
34 Chapter 2: Composition of Public
Page 54 and 55:
36 Chapter 2: Composition of Public
Page 57 and 58:
3. PUBLIC ADMINISTRATION REFORM 3.1
Page 59 and 60:
Chapter 3: Public Administration Re
Page 61 and 62:
Page 63 and 64:
Page 65 and 66:
Page 67 and 68:
Page 69 and 70:
Page 71 and 72:
Page 73 and 74:
Page 75 and 76:
4. PUBLIC FINANCIAL MANAGEMENT AND
Page 77 and 78:
Chapter 4: Public Financial Managem
Page 79 and 80:
Page 81 and 82:
Page 83 and 84:
Page 85 and 86:
Page 87:
Page 90 and 91:
72 Chapter 5: Public Investment Pla
Page 92 and 93:
Page 94 and 95:
Page 96 and 97:
Page 99 and 100:
6. BEYOND THE NATIONAL BUDGET: FISC
Page 101 and 102:
Chapter 6: Beyond the National Budg
Page 103 and 104:
Page 105 and 106:
Table 6.2. Montenegro: Characterist
Page 107 and 108:
Page 109:
Page 112 and 113:
94 References Langseth, Peter Jerem
Page 114 and 115:
96 Annex 1 Indicator 2001 2002 2003
Page 116 and 117:
98 Annex 3 ANNEX 3. COSTS OF ALTERN
Page 118 and 119:
100 Annex 4 Local roads planning, f
Page 120 and 121:
102 Annex 4 with EU standards and d
Page 122 and 123:
104 Annex 4 Most of the railway’s
Page 124 and 125:
106 Annex 4 C. Public Expenditure o
Page 126:
108 Annex 4 Table A4.6. Transport i
show all

Republic of Montenegro: Public Expenditure and ... - Vlada Crne Gore

Create successful ePaper yourself

Delete template?

Save as template?