Bangladesh has now acquired an effective position to further modernise its Public Finance Management (PFM) system, increase government’s efficiency, and encourage investment in transformative social and infrastructure projects.
The observation was made by discussants at a recent daylong workshop titled ‘Public Finance Management Reforms and EU budget Support operations in Bangladesh’ organised by The European Union Delegation to Bangladesh.
While successive PFM projects have initiated many important reforms, they put emphasized on several systemic issues that remain to be addressed.
They said PFM reform experience in Bangladesh in the past points to the need for a greater focus on fewer priorities to effectively advance the reform strategy.
In addition, there is a need for an effective change management approach to ensure that reforms are solving functional PFM problems and that improved PFM systems and processes lead to better service delivery, public resource management, and economic development, they opined.
Welcoming the action plan to support effective implement, the PFM strategy approved by finance ministry, they said, the strategy clearly sets out the key goals and objectives of the public finance and identify the priority reform actions.
“The action plan provides the implementation roadmap for those priority actions with clear institutional responsibilities, cost-benefit analysis of sub-activities, and results indicators to monitor the successful implementation,” they said adding, the plan fulfills the need for an operational document, as such it should be read with the strategy to get a complete understanding of the PFM reforms in the country.
About investing in the action plan, the speakers said, as the country has made huge investments in building civil service capacity in its own institutions such as the Institute of Public Finance (IPF) and the Financial Management Academy (FIMA) to provide high-quality trainings that are most suitable. Now these institutions will play a central role in PFM reforms going forward, they added.
In the last two decades, Bangladesh has improved its PFM systems with prudent fiscal management.
However, a few bottlenecks exist in public resource allocation, availability, and use for social service delivery. The program will help Bangladesh address these bottlenecks using the country’s own systems.
It will help strengthen the capacity of the Budget Management Committees in the ministries, including the timely release of budgetary allocations. It aims to reduce the time taken to release funds from departments to frontline service delivery units by more than half.
