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

2


Congress cuts transparency funding

How can Timor‐Leste afford government transparency?


4

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


10


build civil society


build infrastructure


build capacity


build citizen involvement in government


improve government performance



GDP Per Capita (PPP, logs)

UG

AN

DA

PA

PU

A N

EW

GU

INE

A

AU

STR

ALIA

-3

-2

-1

0

1

2

3

209 Countries

Nor

mal

ized

Gov

ernm

ent E

ffect

iven

ess

Inde

xHIGH

LOW

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



UG

AN

DA

PA

PU

A N

EW

GU

INE

A AU

ST

RA

LIA

-3

-2

-1

0

1

2

3

207 Countries

Nor

mal

ized

Voi

ce a

nd A

ccou

ntab

ility

Inde

x

.

HIGH

LOW

Benefits of Transparency Voice and Accountability and GDP*



Higher the government accountability = higher the country GDP Per Capita



UG

AN

DA

PAP

UA

NE

W G

UIN

EA

AU

STR

ALIA

-3

-2

-1

0

1

2

3

204 Countries

Nor

mal

ized

Con

trol

of C

orru

ptio

n In

dex

HIGH

LOW

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


25

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

data

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


52

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


67

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


How?


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

Links

• 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: [email protected] Public Financial Management in Timor‐Leste

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2011 05-17 government financial transparency in timor-leste

Technology

country gdp

countries low

world bank gdp

government accountability

world bankgdp

australia2normalized

tosee beingspent