2011 05-17 government financial transparency in timor-leste

Strengthening Public Financial Management through Transparency in Timor‐Leste

International Consortium on Governmental Financial Management

May 17, 2011

Confusion?

Strengthening Public Financial Management in Timor‐Leste

Congress cuts transparency funding

How can Timor‐Leste afford government transparency?

Timor‐Leste United States Comparison

Independence 2002 1776 3.4%

GDP Per Capita $2,600 $47,400 5.5%

GDP Growth 8% 2.7% 338%

Unemployment 20% 9.7% 206%

Below poverty line 42% 12% 350%

Life Expectancy 67.95 78.92 86%

Literacy 58.6% 99% 59%

globalization

= competition

choice

citizens are watchingStrengthening Public Financial Management in Timor‐Leste

empowered

Democratic Republic of Timor‐Leste

(RDTL)Transparency Objectives

build civil society

build infrastructure

build capacity

build citizen involvement in government

improve government performance

GDP Per Capita (PPP, logs)

209 Countries

Benefits of Transparency Government Effectiveness and GDP*

* At purchasing power parity

Source: The World Bank

Higher the government effectiveness = higher the country GDP Per Capita

207 Countries

Benefits of Transparency Voice and Accountability and GDP*

Higher the government accountability = higher the country GDP Per Capita

204 Countries

Benefits of TransparencyControl of Corruption and GDP*

Higher the control of corruption = higher the country GDP Per Capita

= stability

= investor confidenceStrengthening Public Financial Management in Timor‐Leste

avoid theresource curse

technology leapfrog

use what works

skip what doesn’t work

skip stages

modernize

rapidly

review

Transparency and Accountability

The next generation of public financial management technology will allow the public to track the budget live, to see where every dollar is being spent, and to gain renewed confidence in

the process

Democratic Republic of Timor‐Leste Vision

sequenced

Public Financial Management –Foundation for Country Growth

FMIS(software and hardware)

Human Resource

Development

Capacity Building(Training)

GoTL LAWS

Procurement Commission

Autonomous Agencies

Ministries

Decentralization

Public Financial Management

1. International StandardsStrengthening Public Financial Management in Timor‐Leste

IPSASInternational Public Sector Accounting

Standards

EITIExtractive Industries

Transparency Initiative

GFSGovernment Financial Statistics

MTEFMedium Term

Expenditure Frameworks

IATIInternational Aid

Transparency Initiative

2. Manager’s Dashboard

review

Strengthening Public Financial Management in Timor‐Leste 40

integration with macro‐economic

examines budget execution data

integrated with back‐office procurement & commitment accounting within IFMIS

3. Document Management

manages correspondence with senior managers

repository for freedom of information

4. e‐Procurement Portal

review

integrated with back‐office procurement & commitment accounting within IFMIS

vendor alerts

tender results published

government tenders published

5. Transparency Portal

review

www.transparency.gov.tl

subscribe

drill down

articles

Expenditures, Transparency Portal

10 years of data

drill through the chart of accounts

Expenditures, Transparency Portal

export to xls, doc, pdf, html, xml

track commitments

Lessons Learned

1. Leadership

Goodbye Conflict, Welcome Development

Timor‐Leste will be the country that goes down in history as the nation to put a stop to falling victim to large

companies and the resource curse

Prime Minister Xanana Gusmão

2. Learn from the mistakes of othersStrengthening Public Financial Management in Timor‐Leste

When we in the developing world face these types of crisis, which we do on a more regular basis than our colleagues in

more economically advanced nations — then we are repeatedly told to increase our openness to the global

economy, to trust in the market but to regulate them well. To be honest this approach has worked

Minister of Finance Emilia Pires

3. Transparency

is not an Option

YouTubeFacebookTwitterSMS

citizen auditors

4. Transparency = Performance > Embarrassment

Role of Civil Society

• NGO’s can help organise literacy groups and provide

materials. They can provide private education and

education for the blind. They can provide school

materials for students, and assist with school equipment

chairs and books

• NGO’s can help us organise and run technical training

courses in our villages

Timor‐Leste National Vision

5. Sequenced Holistic Multiple‐Year PFM Strategy

Improve budget execution

Improve government capacity

Improve transparency & accountability

Improve government performance

review

Public Financial Management –Foundation for Country Growth

6. Build Capacity

review

• Training beyond software– IT capacity

– Project management

– Government accounting

• Beyond training– Adaptable help

– E‐Learning

– Knowledge management

• Intuitive systems– Translation including terminology

– Simple & goal‐oriented interfaces

• Mentoring

PFM ModernizationAlignment with Capacity Building

7. Require Sustainability in Partner Performance

8. Adopt International Standards

9. Leverage Open Systems

Transition to Open Environment: Transparency

Domain Closed Transition Open

Transparency Access to Information Document Machine Readable

Data Availability Data for Sale Publish as ExceptionDo not Publish as

Exception

ModePublish, Audited &

VettedMixed

Near Real‐Time Publishing

ROI Reason Revenue GenerationWhat are they going to do

with the data?Government as

Platform

Target Business Community Civil Society & PressCitizens

Transition to Open Systems: Technology

Domain Closed Transition Open

IntegrationProprietary within

SuiteSupport for Industry

StandardsService Oriented Architecture

MiddlewareProprietary = Customer Lock

Proprietary/Open Tactical approach

Open Standards = Customer Choice

ViewpointOpen Systems reduce system performance

Open Systems extend value

Open Systems = Extensibility

Extensibility High CostsNeed for vendor

EcosystemLow Cost Application

Assembly

10. Leapfrog is possible

Timor‐Leste United States Comparison

1. StandardsGFS, IPSAS, EITI, IATI,

MTEF? Leaped

2. Performance Management

Manager’s DashboardsVarious tools across

governmentTo leap

3. Document Management

Manager Document Management

Various Records & Correspondence

Catching Up

4. e‐Procurement August 15 FedBizOpps To leap

5. Transparency Transparency PortalData.gov & others ‐

underfundingLeaping

www.revenuewatch.org

Timor‐Leste United States

Strategic Vision Holistic1 Year Budgets, complex

election cycles

Government Structure Unitary Federal

Civil Society & Media Seen as Improving Results Seen as “Special Interests”

Government Intervention Seen as Good Seen Suspiciously

1. StandardsEase to Move to International

StandardsLong History of Entrenched

National Standards

2. Performance Management

Single system data source Multiple entrenched systems3. Document Management

4. e‐Procurement

5. Transparency

• Open Systems Enable Government Transparency Leapfrog http://www.freebalance.com/blog/?p=1559

• E‐Government Transparency in Developing Countries http://www.cutter.com/offers/egovt.html

• Developing Countries can Leapfrog Developed Countries in Government Transparency http://tech.state.gov/profiles/blogs/how‐developing‐countries‐are

• More: dhadden@freebalance.comStrengthening Public Financial Management in Timor‐Leste

2011 05-17 government financial transparency in timor-leste

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