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Government of Sierra Leone

Ministry of Finance and Economic Development

PUBLIC FINANCIAL MANAGEMENT REFORM UPDATE

DECEMBER 2012

Public Financial Management Reform Unit December 2012

Public Financial Management Reform Unit, MoFED

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MISSION STATEMENT

The Public Financial Management Reform Unit is Dedicated to Honest, Effective Communication, Information Sharing and Teamwork in a Decent and Comfortable Environment to Satisfy its Users and Promote Transparency, Accountability and Probity in the Use of Public Funds


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Content Page 1. Purpose 6

2. Broad policy objectives for a sound PFM system 6 3. Background 6 4. The IPFMRP 7

5. PFM Progress during 2011 9 5.1 Legal and Regulatory Framework 9 5.2 Macroeconomic Fiscal Framework (MEFF) and 10

Medium Term Expenditure Framework (MTEF) 5.3 Revenue Generation and Collection - NRA 11 5.4 Public Debts Management 11 5.5 Public Procurement 13 5.6 Accounting and Recording 14 5.7 Human Resource Management 15 5.8 Integrated Financial Management Information 17

Systems (IFMIS) 5.9 Information Communication and Technology 18 5.10 Financial Management in Local Councils 19 5.11 Aid Coordination 21 5.12 Monitoring and Evaluation 22 5.13 Internal Audit 22


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5.14 External Oversight - Audit Service Sierra Leone (ASSL) 24 5.15 External Oversight – Parliament 24 5.16 External Oversight – Non State Actors 25

6.0 PFM Progress during 2012 27

6.1 Legal and Regulatory Framework 27

6.2 Macroeconomic Fiscal Framework (MEFF) and

Medium Term Expenditure Framework 27

6.3 Revenue Generation and Collection 29

6.4 Public Debts Management 30

6.5 National Public Procurement 31

6.6 Accounting and Recording 31

6.7 Human Resource Management 32

6.8 Integrated Financial Management information

System (IFMIS) 32

6.9 Financial Management in Local Councils 33

6.10 Internal Audit 34

6.11 External Oversight - Audit Service Sierra Leone 35

6.12 External Oversight – Parliament 36

6.13 External Oversight -Non State Actors 36

6.14 PFM Capacity Building 37

6.15 Monitoring and Evaluation 37 7.0 IPFMRP Restructuring 37


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8.0 Development of a Medium Term PFM Reform Strategy 37 9.0 Update on IPFMRP Performance Indicators (PI) and 37

activities undertaken towards meeting the indicators

9.1 Appendices 38


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1. Purpose This report provides an update of activities undertaken as at the reporting date in meeting the objectives of Government‟s PFM reform.

2. Broad policy objectives for a sound PFM system.

“The objective of PFM Reform is to support the achievement of fiscal discipline, strategic and efficient allocation and use of funds, value for money and probity in the use of public funds”.

3. Background

Government of Sierra Leone has been taking steps to improve its financial management practices over the years based on various diagnostic studies. A Country Profile Financial Accountability (CPFA) assessment was conducted in December 2001 and a Country Financial Accountability Assessment (CFAA) was completed in March 2002.The EC conducted an EC audit resulting in a matrix of corrective measures to be undertaken by the Government.HIPC-AAP was conducted in February 2004 in which sixteen key indicators were reviewed with each ranked A, B or C according to pre-determined criteria. Benchmarks were set for each question, with some requiring a B ranking, whilst others required an A. The assessment showed that Sierra Leone met 7 out of the 16 PEM benchmarks in 2003, with four questions ranked A and 6 ranked B and C respectively. The CFAA, HIPC-AAP and EU matrix of corrective measures had various actions that the government was required to undertake to improve on weak PFM areas over time; all of these were consolidated into a common action plan (CAP) and an oversight committee was formed to monitor its implementation; Budget Bureau acted as the secretariat for the oversight committee though the committee did not meet regularly in the past and the CAP was considered too large to manage. The Poverty Reduction Strategy Paper (PRSP) has PFM targets and indicators needed to monitor its implementation. Our Multi-Donor Budget Support (MDBS) use the Progress Assessment Framework (PAF) to assess performance of the budget and other targets. The Improved Governance and Accountability Pact (IGAP) highlight Government and the Development Partners‟ commitment to PFM reforms around the same agenda. The secretariat for the oversight committee is now with the Public Financial Management Reform Unit (PFMRU) that was formed in June 2004 and new terms of reference for the oversight committee and sub-committees providing technically


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advisory services have been adopted. The oversight committee now uses the IPFMRP to provide oversight for the PFM reforms.

In March 2006, a workshop for key PFM practitioners within GoSL was held to present and interprete the PEFA methodology being adopted by the GoSL for assessing the respective PFM indicators, as this methodology provides an opportunity to consolidate and align all the multiple monitoring frameworks around the 31 PEFA indicators. A self-assessment using the PEFA methodology was thus conducted at the end of the workshop and used to develop a consolidated PFM National Action Plan (PFM-NAP). An internal PEFA assessment was done by GoSL on 27-28 February 2007; the assessment showed that on the whole the PFM system is operating at just ABOVE AVERAGE level with 16 (57%) out of the 28 government indicators scored C+ and above.

This internal PEFA assessment was in preparation for an external assessment which was conducted in May 2007.

Further assessments on PFM have been undertaken over the past years using several methodologies.

Reports for a repeat PEFA assessment initiated in August 2010 for both Central Government and Local Councils have been finalised and widely published.

4. The IPFMRP The GoSL through the support of her development partners (European Commission, Department for International Development (UK), International Development Association and African Development Bank) has designed an Integrated Public Financial Management Reform Project (IPFMRP) in a bid to ensure sustainable improvement in the credibility and predictability, control and transparency of fiscal and budget management. The IPFMRP became effective in December 2009 with activities commencing in February 2010. Key components of the IPFMRP are outlined below: Component 1 – Strengthening Macrofiscal Coordination and Budget Management The key outcomes of this component include improved budget credibility associated with a more appropriately developed and managed aggregate fiscal position, delivery by the Ministry of Finance and Economic Development(MoFED) of predictable funding in accordance with budgets.


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Component 2 – Reinforcing Key Aspects of the Control System to Support Improved Service Delivery The key outcomes of this component include an updated legal framework, robust public procurement practices, tightened payroll controls, strengthened internal audit, improved accounting procedures in the MoFED and MDAs, and further publication of Public Expenditure Tracking Survey (PETS) contributing to an effective control environment in MDAs. Striving for these internal controls will be reinforced through strengthened scrutiny of public finances by Parliament Component 3 – Establishing and Maintaining Sustainable and Capable Central Finance Functions This component undertakes various cross-cutting activities including IFMIS rollout, all aspects of training and human resource (HR) capacity development that are required to support the main PFM functions that are being strengthened in the other three components and other steps to help establish sustainable HR capacity in the MoFED. The latter is undertaken by the Capacity Building Sub-Committee of the PFM Oversight Committee. Component 4 – Assisting Non-state Actors’ Scrutiny This component assists the development of the analytic and dissemination capacity of non-state actors in exercising scrutiny of the use of public resources, as well as building a constituency for reform of the PFM system across an array of non-state actors. Component 5 – Project Coordination and Administration A Project Administration Unit, established within the Directorate of PFM Reforms, MoFED and staffed with a Project Manager who also had monitoring and evaluation responsibilities for the IPFMRP, a Procurement Specialist and a Project Accountant plus support staff. This is now being mainstreamed into MoFED. The tasks of this unit include general project management, administration of sub-grant agreements with NSAs, management of bank accounts, fiduciary management and monitoring and evaluation.


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5. PFM Progress during 2011

5.1 Legal and Regulatory Framework Government Budgeting and Accountability Act, 2005 and Financial Management Regulations, 2007 The revision process is now at an advanced stage following wide stakeholder sensitization of key government officials in August during which the Options and Issues Paper was delivered by the Consultants. This was followed up by a detailed review of key experts during November for which a draft report on the suggested areas of revision was prepared. The final report of this exercise shall be utilised during the drafting stage for the revised legislations. In May, an initial revision to the GBAA to incorporate the proposed „Public Investment Programme‟ was passed by Parliament. This is viewed as an initial step in the detailed review of the GBAA. Public Procurement Act, 2004 and Procurement Regulations, 2006 Following the two consultative meetings held over the past eighteen (18) months, further inputs emanating from the Country Procurement Assessment Review (CPAR) are now being considered. A revised timetable for completion of the review has been set at December 2012. National Debts Law In pursuance of developing an improved legal, policy and institutional framework for sustainable debt management, a National Debts Law which lays out the framework for public sector borrowing and debt management and clearly define sub-national borrowing limits and procedures was enacted in March this year. The process for on-lending, issuing Government guarantees and monitoring of contingent liabilities have also been regulated. A regulation supporting the newly established law is to be drafted together with procedures manual thereby guiding the day-to-day management of public debts and risk management generally. Customs and Finance Acts During the year Customs Act and Finance Act were legislated in order to guide the process of revenue assessment, recording and reporting. The RTPU in collaboration with NRA generally sensitised stakeholders on the contents.


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5.2 Macroeconomic Fiscal Framework (MEFF) and Medium Term Expenditure Framework (MTEF)

Macroeconomic Fiscal Framework Functioning of Macrofiscal Section The Macrofiscal Section within the Economic Policy and Research Division, MoFED, continued the drive towards generating reliable and consistent macroeconomic fiscal projections to facilitate credible and reliable forecasting of revenue flows. In February, the Integrated Macroeconomic Modelling and Forecasting Steering Group (IMMF) held a workshop of key stakeholders to review the macrofiscal framework in advance of the March IMF mission. Regular Steering Group meetings were further held during the period to review and facilitate the smooth operations of the Macrofiscal section. The formation of sub-committees to provide details for inclusion in the SLIM, including inflation and GDP, helped facilitate the collation of relevant information. Sierra Leone Integrated Macroeconomic Model - SLIMM The Sierra Leone Integrated Macroeconomic Model – SLIMM which is an IMF-styled Financial Programming and Policies Model developed during 2010 was externally reviewed by an independent consultant following which recommendations for improvements made and adopted. As part of the exercise, extensive training sessions were provided for key users of the model in strengthening their analytical skills and overall application of the model. Subsequently, key MDAs also benefited from an overview of the model during a session organised by the EPRU. This has now resulted in a fully functioning model and served as a framework for developing the budget framework paper developed for 2012 financial year and macro-economic and fiscal framework for the 2012-2014 MTEF budgets. An economic survey covering Agriculture, Mining and Services was undertaken early 2011 to provide data for analysis for input into the SLIMM. Consideration is now being given towards undertaking a survey on Foreign Direct Investment in strengthening the forecasts generated by the SLIMM. In ensuring that all components of non-tax revenues are considered in applying the SLIM, the Revenue and Tax Policy Unit (RTPU) organised a two-day Non-Tax Revenue Mobilisation Retreat in March which brought together all MDAs generating and collecting non-tax revenues to review the non-tax revenue base and possible review of rates. Following this, proposed revised rates have now been developed for the consideration and concurrence of the affected MDAs.


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Pursuant to this, consideration is now being given towards undertaking a detailed survey of the informal sector in a bid to broaden the tax base and the active monitoring of beneficiaries of duty waivers to ensure that waivers granted are being utilised in accordance with the related agreements. Furthermore, plans for hosting a session designed to serve as a catalyst for a new agenda for reform targeted at revenue mobilisation are now at an advanced stage. It will review amongst others, modes of taxation suited to Sierra Leone and good practice on achieving this therein building a consensus of relevant stakeholders in addressing domestic revenue mobilisation.

Medium Term Expenditure Framework (MTEF) Approval of 2011 – 2013 MTEF Budget and Sensitization of Stakeholders The MTEF budget for 2011 approved by Parliament was implemented with budget outturn reports produced monthly and publicised. Stakeholders across Central Government and Local Councils including Non State Actors were recently sensitized through regional consultative processes on the operations of the budget for the strategic priorities outlined in the Agenda for Change. MTEF Guidelines and Budget Calendar The process of revising the MTEF guidelines is now at an advanced stage and shall be adopted during future budget processes. Also, pre-cabinet discussions have now been scheduled as part of the revised budget calendar for the ensuing budget process.

5.3 Revenue Generation and Collection - NRA The NRA participated in activities organised by the EPRU and RTPU in reviewing policies for domestic revenue generation and how these impact on forecasting and collection. A revenue task force on extractive industries has been developed with regular meetings being held.

5.4 Public Debts Management Debt Buy-Back The PDMU is facilitating the process of external commercial debt buy-back operation in accordance with the second external commercial debt reduction programme. This procurement process is still underway.


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Sensitization of key stakeholders of the Newly Enacted Public Debt Management Act 2011 To ensure the proper articulation of the newly enacted Public Debts Management law for its effective and smooth implementation, the Public Debt Management Division of the Ministry of Finance and Economic Development (MoFED), in collaboration with the Local Government Finance Division, organised sensitization seminars in May, aimed at articulating the provisions of the Act with participants drawn from MDAs, Local Councils, Commercial Banks, Public Enterprises and other Financial institutions. Further sensitization has been undertaken during various meetings organised by MoFED since the enactment of the Public Debts Management Law. Developing Regulations for the Public Debt Management Act 2011

The aforementioned post legislative seminar further informed all stakeholders about ongoing development of the Regulations for the Act. This process is ongoing alongside the development of a procedure manual. Developing Strategy for issuing Medium to Long-term Government Bonds Significant progress has been made in the process of issuing medium to long-term Government bonds. Extensive consultation is ongoing including a road show to deepen the level of engagement with potential investors in the bond market and assess the readiness and desire for medium to long-term bonds. This is a prelude to having a comprehensive issuance strategy. The road show ensured a strong collaboration with the Sierra Leone Stock Exchange in a bid to guarantee the secondary trading or liquidity of the bonds once issued. Thus, the level of readiness of the market and their expectations along bond pricing, secondary trading of the instrument, bond currency, underwriting the instruments and other concerns have been determined. It is envisaged that once the issues raised from engagement with the market are properly addressed, the bonds would then be issued. A technical committee has now been established comprising the Bank of Sierra Leone, Sierra Leone Stock Exchange, Statistics Sierra Leone, NRA and MoFED that is responsible for matters relating to medium to long-term bonds and its related strategy. Furthermore, a framework has been agreed for addressing the 2010 stock of Ways and Means Advances. It is anticipated that actual issuance of medium to long-term bonds will commence during the first half of 2012.


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Policy Formulation and Strategy Preparation (DSA) Plans are now underway to develop a medium term National Debt Strategy consistent with the requirements of the law. This shall be undertaken during the first half of 2012. Debts Sustainability Exercise This will be a follow-up to the national debt sustainability exercise undertaken in August 2010geared towards the continued monitoring of sovereign risks and debts levels. This year‟s Debt Strategy Analysis (DSA) was conducted in July in collaboration with The Commonwealth Secretariat and WAIFEM. This year‟s results show that Sierra Leone is still faced with moderate risk of debt distress. Debt Data and Systems Management In a bid to improve on debt data quality and reporting, the Public Debt Management and ICT Divisions have facilitated completion of a Wide Area Network connectivity between the Bank of Sierra Leone, Accountant General‟s Department and MoFED. The infrastructure for the link has been completed and the WAN is now operational. This paves the way in facilitating the linking of the Commonwealth Secretariat Debt Recording and Management System (CS-DRMS) with the Integrated Financial Management and Information System (IFMIS). Public Debt Bulletin 2010 A comprehensive public debt bulletin for 2010 has been published and widely circulated to all stakeholders both domestically and externally thereby improving on the transparency of the debt process. The bulletin covers comprehensive information on public debt dynamics in the course of 2010 and further highlights debts statistics from 2003 to 2010. Internal DeMPA The institutional and governance arrangements for public debts management was internally assessed adopting the DeMPA framework in December 2011.

5.5 Public Procurement Procurement Forum The yearly procurement forum was organised by the NPPA in January 2011on the theme „The Public Procurement Act – the Way Forward‟ which attracted over one hundred and fifty (150) public officials from both the central government and local councils and representative institutions from the Non State Actors. Participants were updated on progress made in the implementation of resolutions from the


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2009 procurement forum including the recruitment of twenty seven (27) procurement officers and six (6) Senior Procurement Officers who have been deployed to key line MDAs and provided feedback regarding the conduct of procurement during 2010. Training of Procurement Officers within the procurement cadre Pursuant to the recruitment procurement officers into the procurement cadre as outlined above, three-week training programme was conducted for these officials by the NPPA in concert with the Institute of Public Administration and Management (IPAM) in a bid to generally provide an overview and develop their understanding of the various aspects they will be faced with in undertaking their responsibilities within the MDAs. The training which was undertaken during April and May covered various aspects including the procurement planning, use of standard bidding documents, suppliers eligibility, roles and responsibilities of procurement officers and the procurement regulations. Further training programmes on procurement planning, preparation of bidding documents and contract management were attended by one hundred and twenty procurement practitioners across MDAs and local councils. In addition, basic procurement training sessions were provided for the Central Bank and Sierra Leone Police amongst others. Procurement Assessment The annual procurement assessment was undertaken in February 2010 with the

key objective of the assessment was to determine the level to which spending institutions have complied with the institutional framework for implementation of public procurement as dictated by the Public Procurement Act, 2004

5.6 Accounting and Recording Reporting The Accountant General produced the financial statements for the year ended 31st December 2010 by 31st March 2011 in accordance with the Government Budgeting and Accountability Act 2005. These financial statements have subsequently been audited and the report produced by the Auditor General. The in-year statement of fiscal operations (consolidated fund) for period January – September 2011have been published on the MoFED website. Management of Financial Records A three-day seminar on the management of financial records was held during May aimed at ensuring that records are complete, credible and accessible to support


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audit and other requirements. It was further designed to raise the awareness in linking paper and electronic based records and how financial and personnel records are closely interwoven in ensuring the effectiveness of payroll controls.

5.7 Human Resource Management Manpower Planning and Budget Hearings for MDAs In a bid to improve upon the process of manpower planning for MDAs, a three-day training for human resource managers of key growth and policy MDAs was organised in May. This builds on previous sessions held and it is anticipated that this training will significantly improve on the budgeting for manpower and facilitate the preparation of credible and realistic manpower plans and budget. It will further reduce the volatility and unpredictability of payroll and budget management experienced in previous years. Manpower hearings for MDAs were conducted during September in formulating the HR plan and budget for the 2012-2014 MTEF period. Teacher Payroll Verification/Records The Teacher Records Management Improvement Project (RMIP) is ongoing with files already created for 35,505 teachers. A detailed verification exercise in ascertaining the integrity of the records compiled so far is currently ongoing and should be completed by August 2012. This will facilitate the achievement of the ultimate goal of evidence-based verification of all teachers on the payroll, scanning and automating key teacher personnel records and instituting standards and guidelines for the management of personnel records for the teaching service. Review of Civil Service Codes, Rules and Regulations Pursuant to the Cabinet‟s approval of the revised Codes, Rules and Regulations of the Civil Service in February, an Administrative Manual has been designed in support of the new Codes. The aforementioned revised Codes, which has since been widely circulated, replace the General Orders of 1965. Review of Pay Structure and Compensation Scheme In February 2011, a task force was established by the Secretary to Cabinet and Head of the Civil Service to finalise the review of the Civil Service pay and grade structure. The report, which has subsequently been endorsed by Cabinet, stipulates a restructuring of the grades from 14 to 17 in order to properly align salaries and introduce performance-related pay throughout the Public Sector.


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Consequently, seven job families have been created in a bid to harmonize pay across sectors/professions in the public service, which include:

1. Administration, Information and Social Services 2. Engineering, Technology and Sciences 3. Education 4. Fiscal Affairs and Economic Planning 5. Health, Medical and Allied Professions 6. Judicial and Legal 7. Security Services

Introduction of Performance Contracts Performance contracts are now being introduced in MDAs in increasing accountability in the delivery of agreed targets that contribute towards the achievement of key government priorities. The Performance Contract system was introduced in seven pilot MDAs in August including the Ministries of Health, Agriculture, Trade, Fisheries, Foreign Affairs, Works and Energy and Water Resources and further extended to all nineteen local councils. A Director for Performance Management has been engaged by the HRMO to direct and manage the whole process. Creation of Professional Cadres Following the development of the Internal Audit and Procurement Cadres, a HR cadre has been developed through the recruitment of 9 HR Managers and 24 HR Officers. In addition, 10 M&E Officers, 5 Technical Coordinators and 10 Policy and Management Analysts have also been recruited. These have since been assigned to MDAs. Various positions have already been advertised to fill the vacancies in the recently established ICT Cadre. Launching of Newsletter

The maiden edition of a newsletter for the Civil Service was launched in June 2011. Verification of Civilian Employees of Ministry of Defence (MoD) A total of 620 employees out of 705 civilian employees of MoD were included in the HCA for Defence following a verification exercise. Files have been created and jobs rationalised based on qualifications and experience. This was a precursor to


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the roll-out of the IFMIS HCA module to MoD which was eventually effected during the last quarter of 2011. Management and Functional Review of MoFED A Management and Functional Review of MoFED is underway with the aim of rationalising the positions and staff of the Ministry. It is anticipated that this exercise shall provide the framework for the integration of LTAs into the Civil Service.

5.8 Integrated Financial Management Information

Systems (IFMIS)

Support to rolled-out MDAs The PFMRU continued providing training and support to IFMIS users across Ministries, Departments and Agencies (MDAs) in ensuring that activities are properly and adequately captured within the IFMIS by the respective rolled out MDAs. Support to Ministry of Finance, Liberia The Government of Sierra Leone hosted a sixteen-man delegation from the Republic of Liberia led by the Comptroller and Accountant General at the end of the first quarter which undertook a study tour of Sierra Leone‟s IFMIS. Various presentations were made by key IFMIS operatives within the Ministry of Finance and Economic Development, Accountant General‟s Department and Human Resource Management Office. The delegation further witnessed live operations in two rolled out MDAs – Sierra Leone Police and Ministry of Health and Sanitation – during which experiences were shared regarding operations of the FreeBalance Accountability Solution, utilised for the IMFIS. The delegation also visited the Makeni City Council during which they were further introduced to the Petra Accounting Package utilised by the local councils for recording of financial transactions. Roll-out of HCA to Ministry of Defence A verification and validation exercise for the civilian component of the Military was undertaken during the third quarter of 2011, following which the human resource aspect of the Human Capital Accountability (HCA) was rolled out to the Ministry of Defence. This was facilitated through the establishment of wide area network and local area network facilities established at the military headquarters.


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Imminent roll-outs The contracting and renewal of licences with FreeBalanceInc, the IFMIS software providers, is far advanced having been actively engaged in the process since the start of the year. Demonstrations of product enhancements notably of Human Resource Management and Performance Budgeting modules were undertaken during March and April by FreeBalance Inc.following which proposals submitted for continued and increased engagements are now being considered by the Government. Once finalised, it is envisaged that there will be further roll-outs to more MDAs and increased utilisation of the respective modules. Capacity Building of IFMIS end-users Since January, the PFMRU continued the process of providing on-the-job training as relevant for IFMIS end users across rolled-out MDAs. Ad-hoc training for newly assigned staffs within and across MDAs were further undertaken to ensure the continued smooth flow of operations and processing of transactions. During August to October, intensive refresher training programmes were undertaken by PFMRU for all users of the FreeBalance Expenditure and Purchasing Modules including Vote Controllers and Principal Accountants of rolled out MDAs. Total end users trained was one hundred and thirty six (136) and were drawn from all rolled out MDAs. The training covered amongst others, system generated reports for the FreeBalance Financials and Purchasing modules thereby increasing the efficiency of key IFMIS users in generating and interpreting reports generated from the IFMIS. Chart of Accounts Manual A draft Chart of Accounts Manual was developed during the second half of 2011and shared with key stakeholders including Budget Bureau and Accountant General‟s Department for comments prior to finalization during the first quarter of 2012. This draft was also made available to the Local Government Finance Department and served as guide in the preparation of the 2012-2014 MTEF budgets.

5.9 Information Communication and Technology The Information Communication and Technology (ICT) Division furthered the drive towards ensuring that an enabling ICT environment exists to facilitate the smooth operation of financial management and information technology systems within MoFED, IFMIS rolled out MDAs and within local councils.


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ICT infrastructure Actions have been initiated by the ICT Division in revamping of the IFMIS network infrastructure in all online MDAs to ensure that the interconnectivity is operational, effective and secure. It is envisaged that this shall be completed during the second half of the year. Whereas the networking and installation of VSAT within the Treasury Building housing the MoFED are now complete, there is still the urgent need for the acquisition of adequate bandwidth suitable for the Ministry‟s internet connectivity needs. The Ministerial Building has also been fitted with a fibre optic backbone in line with the technology at the Treasury Building. Both buildings are now linked via a fibre optic backbone with VOIP phones installed to enhance communication. A complete revamp of the IFMIS WAN and LAN infrastructures was undertaken during the second half of 2011. Thus, all the IFMIS rolled-out sites are now up and running. ICT Support Continuous ICT support is being provided to all IFMIS-connected MDAs and Petra-installed Local Councils in a bid to ensure that they remain operational and all issues affecting data security and other ICT needs are promptly addressed. Visits were undertaken to MDAs and Local Councils as part of ICT support for both the FreeBalance and Petra Accounting Packages respectively. Plans are underway for training of IFMIS end users and FM staff (including local councils) on basic IT skills and advanced office technology during the first quarter of 2012. Disaster Recovery Plans are well-advanced for the establishment of a disaster recovery centre having negotiated a site lease with the national telecommunications institution – SIERRATEL thereby strengthening the backup procedures for the IFMIS and other ICT needs. In the meantime, arrangements are in place for the Central Bank to be used for off-site back-up.

5.10 Financial Management in Local Councils Implementation of Financial Management Information System In continuation of the implementation of a financial management information system in the local councils, the Petra Accounting Package was rolled out to seven (7) additional local councils in January 2011 in improving the accountability,


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transparency and financial management within local councils. The total number of Petra rolled out local councils is now fifteen (15). The additional seven councils are outlined below:

1. Bo City Council

2. Pujehun District Council

3. Bombali District Council

4. Tonkolili District Council

5. Port Loko District Council

6. Koidu New Sembehun City Council

7. Kenema City Council

Reporting All the Local Councils submitted Financial Statements for 2010 by 31st March 2011 to the Auditor General in accordance with the Local Government Act 2004. Various reports including monthly financial statements and budget management reports are now prepared for the respective devolved functions. Furthermore, statement of use of funds depicting movements in bank accounts maintained by the local councils is now produced for the respective bank accounts maintained by the Petra implementing local councils. Financial Management Support and Capacity Building Since January, the PFMRU has conducted a series of refresher training sessions on the Petra (including the Government‟s 27-digits chart of accounts) and financial Management for Mayors/Chairpersons, Chief Administrators, Finance Officers, Accountants, Sector Heads, Resident Technical Facilitators and Development Planners of local councils. This training on Petra by the PFMRU was extended to the Local Government Finance Departmentand Audit Service Sierra Leone respectively in ensuring that key stakeholders within local governance associated with ensuring sound financial management are knowledgeable and conversant with the financial management system utilised in councils. This Petra capacity building support shall be extended to the Internal Auditors during the first half of 2012. Financial Management Monitoring of local councils The PFMRU continued the process of providing financial management support to the respective local councils in order to ensure the timely recording and reporting of their activities as required by the Local Government Act (LGA), 2004.


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Separate monitoring visits were undertaken of the Local Councils since January 2011 and financial management advice provided to key officials of Councils. Functional Reviews Separate functional reviews of the Finance Departments of Freetown City, Kenema City and Kenema District Councils respectively were undertaken during 2011 which has resulted in realigned roles and responsibilities of finance staffs and improved posting of transactions to the Petra financial package. Records management needs were also addressed during the reviews.

5.11 Aid Coordination

Development Assistance Report 2009 and 2010

The draft 2009 and 2010 Development Assistance Reports (DAR) developed by

DACO have been circulated to partners for verification. Once finalised, both

reports shall be widely publicised.

Paris Declaration and Fragile States Principles Monitoring Surveys DACO facilitated Sierra Leone‟s participation in the above surveys, the process of which commenced in December 2010. Two separate stakeholders meetings were organised including a national consultative forum in March to discuss the preliminary results. The draft report on the Paris Declaration survey has been prepared and submitted to the Organisation for Economic Cooperation and Development (OECD) whereas the latter is being finalised. Both reports shall be consolidated into a country chapter for inclusion in the global report on the Paris Declaration. Development Partnership Committee (DEPAC) Meeting The initial DEPAC meeting for 2011 was held in May focusing on the macroeconomic issues impacting the economy and managing the transition to the next general elections resulting in the development of a draft communiqué. Sector and District Working Groups Efforts were directed towards strengthening the operations of the Sector Working Groups established in 2010 and further establishing District Working Groups (DWG). Working in partnership with the local councils, the DWG shall serve as focal points in the collection of data for updating the DAD. This further enhances the quality of the information in the DAD which now has relatively reliable data.


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Training for various users of the DAD, including development partners and local councils, has been ongoing.

5.12 Monitoring and Evaluation Quarterly Monitoring The quarterly monitoring and evaluation of ongoing projects across the country continued during 2011 interspersed with ad-hoc monitoring of specific projects thus ensuring that that projects are undertaken as designed and mitigating issues are promptly addressed. Public Expenditure Tracking The PET Secretariat within the Economic Policy and Research Unit (EPRU) of MoFED has produced the report for the PET survey undertaken during 2010.The survey, which largely covered distribution of teaching and learning materials and agricultural inputs was replicated during October this year with initial results expected during the first quarter of 2012.

5.13 Internal Audit Strengthening of Internal Audit Units of MDAs During the first half of the year, the Internal Audit Department extended the coverage of functioning Internal Audit Units of MDAs to thirty six (36) through the setting up of such units in four additional MDAs namely:

1. Ministry of Social Welfare, Gender and Children‟s Affairs

2. Ministry of Internal Affairs

3. Ministry of Local Government and Rural Development

4. Ministry of Transport and Aviation

The Internal Audit Unit of the Former Ministry of Education Youths and Sports was disaggregated into two Units following the creation of two separate Ministries – Ministry of Education and Ministry of Youths and Sports respectively. The coverage of functioning Internal Audit Units was increased to thirty seven (37) MDAs during the second half of the year through the establishment of an internal audit unit in NPPA. Majority of the Internal Audit Units in the respective MDAs has produced and submitted at least three reports during the course of this year.


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Capacity Building The capacity building initiatives employed by the Internal Audit Department, Ministry of Finance and Economic Development in strengthening internal audit units of MDAs continued during 2011 through the conduct of a three-day Personnel Audit training which was attended by thirty six (36) Auditors and fourteen (14) Audit Assistants across MDAs . There have been immediate positive impact following the conduct of the aforementioned training with personnel audits conducted resulting in recommendations for deletions from the government payroll of non „bon fidae‟ employees from thirteen (13) MDAs which have already been implemented by the Human Resource Management Office and Accountant General‟s Department. During November, Procurement Audit Training for Internal Auditors across MDAs and local councils was undertaken to strengthen the internal oversight over procurement activities. One hundred and twelve (112) trainees ranging from Audit Assistants to Deputy Director within both central government and local councils, participated during the three separate sets of training. Alongside the above initiatives, a handful of Internal Auditors currently pursue academic training (Certificate and Degree Courses) at the Institute of Public Administration and Management (IPAM). Quarterly meeting of all internal audit personnel to review progress and challenges was held in March which was chaired by the Director, Internal Audit Department supplementing the Director‟s fortnightly meetings with his Deputy and Coordinators. Audit Committees Since January 2011, Audit Committees have been established in three additional MDAs bringing the total of such committees to nine (9) across MDAs. These additional MDAs are:

1. Ministry of Education, Science and technology

2. Ministry of Works, Housing and Infrastructure

3. Ministry of Agriculture, Forestry and Food Security

Technical Support to Local Councils During the course of the year, quarterly visits were made to eighteen local councils to review the effectiveness of the Internal Audit set-up and help them understand their roles and responsibilities. Continuous support is being provided to internal auditors of the respective local councils to enable them develop appropriate audit programmes and effectively undertake audit assignments.


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5.14 External Oversight - Audit Service Sierra Leone (ASSL) Auditing and Reporting Having completed the audit of the 2009 financial statements, the audit reports are now available on the ASSL‟s website. The Auditor General now produces a special „long form‟ report which includes responses by management to queries raised during audits. This initial „long form‟ report for 2009 audit was submitted to parliament in May 2011. The Auditor General‟s reports on the audit of the 2010 Financial Statements for the respective Local Councils have been issued to the local councils and presented to the Minister of Local Government and Rural Development for onward presentation to Parliament. The audit of the Central Government‟s financial statements was completed and laid in Parliament against the due date of end December 2011 and published on the ASSL‟s website. Capacity Building The final module of the Performance Audit Training Course which commenced in September 2010 was completed in March 2011. Twelve (12) ASSL Performance Auditing employees graduated from the course which also attracted participants from the neighbouring countries. Nine (9) ASSL employees further participated in the Procurement Auditing Course alongside Internal Auditors across MDAs and Local Councils held in November.

5.15 External Oversight - Parliament Scrutiny of Audit Reports Following several public hearings on the Auditor General‟s report of 2008 organised by the Public Accounts Committee andoutreach visits to the local councils during March, the PAC report on the same has beentabled in parliament. The PAC reports on the Auditor General‟s reports for local councils for the years 2004-2008 are now being printed and will subsequently be tabled in Parliament. The review (including public hearings) of the Auditor General‟s report on the 2009 Financial Statements of both central government and local councils is now complete and arrangements are now being finalised for printing of the reports. Capacity Building The Public Accounts Committee (PAC) participated in a regional conference organised by the West Africa Association of Public Accounts Committees


December 2012 25

(WAAPAC) in February 2011 on the theme „Breaking Regional Barriers in Enhancing Transparency and Accountability – The Role of Public Accounts Committee‟ with resource institutions including the World Bank Institute and Commonwealth Parliamentary Association. Country specific action plans were developed during the conference, which are now being pursued by the PAC with support fromASSL and PFMRU. It was resolved that a sub-committee within PAC be formed to facilitate follow-up on PAC‟s recommendations. This has already been effected and the sub-committee chaired by the Deputy Chairman.

5.16 External Oversight - Non State Actors Reinvigorating the NSA Oversight Following the resignation of the Non-State-Actors (NSA) Coordinator for the IPFMRP, the NSAs appointed an Acting Coordinator from amongst their constituency to lead and facilitate the affairs of the NSAs and coordinate the implementation of the 2011 AWP. This appointment of the Acting Coordinator reignited the interests of the respective institutions represented, leading to increased participation in the activities in pursuit of the overall objectives. This active participation of the NSAs was evident during the Public Expenditure and Financial Accountability (PEFA) review process for both Central Government and Local councils culminating in a specially organised workshop on reviewing the results of the PEFA assessment for local councils for NSAs which was attended by NSA representatives from all regions within the country. Further to meetings organised by the network which discussed issues surrounding public financial management, the NSAs participated in sensitization and related activities organised by various institutions including MoFED, NPPA and ASSL. Three NSA institutions also represented the NSAs in a three-day East African Conference on Budget Transparency and Accountability jointly with GoSL officials in Dar es Salaam, Tanzania in May 2011. Following the initial dissemination of the outcome of the conference through radio and TV broadcasts by the attendees, the experience acquired was regionally shared with the rest of the NSA membership accordingly. Furthermore, a NSA representative participated in a one-day workshop on Central Finance Agencies in Kenya alongside Government officials. A face book group titled „NSA Accountability Platform‟ has been established which has been signed up to by various NSA members. It is envisaged that coordination and communication across the membership will be improved through postings of regular updates, discussions and opportunities. The vacancy for the position of NSA Coordinator was filled in November. The active involvement of key NSA members at every stage of the process was ensured.


December 2012 26

Plans are underway for the production of the first „citizen‟s budget‟ which is a simplified summary of the national budget. The NSAs actively participated during the policy hearings and budget discussions for the MTEF 2012 – 2014 budget process. Experience gained during such sessions was cascaded to the regional community through a budget dialogue summit organised for NSAs in the four regions during November and December.


December 2012 27

6.0 PFM Progress during 2012

6.1 Legal and Regulatory Framework

Government Budgeting and Accountability Act 2005 and Financial

Management Regulation 2007

The revision process of the above is still ongoing with consideration given towards the inclusion of the fiscal rule in the all-encompassing revised legislation. A working Committee to finalise this process comprising MoFED, ASSL and Solicitor General‟s Office has been constituted and a cabinet paper drafted for submission to Cabinet.

Public Procurement Act, 2004 and Procurement Regulations, 2006

The revision process is now at its final stage with the incorporation of proposed changes emanating from the CPAR. This should be submitted to Parliament by mid-2013.

Public Debt Regulation

The development of a Regulation supporting the Public Debts Law 2011 is in progress, a draft of which should be available for consultations by mid-2013.

6.2 Macroeconomic Fiscal Framework (MEFF) and Medium Term Expenditure Framework (MTEF) Macroeconomic Fiscal Framework

A nationwide field assessment of prospect of the Sierra Leone Economy by Government Experts was undertaken to assess economic prospects, determine perceptions of stakeholders and assess the impact of growth-enhancing policy measures. The Medium Term Macro-Fiscal Framework Paper was developed to underpin the Budget Framework Paper (2013-2015) and the 2013 budget and statement of economic and financial policies. This framework paper also underpins the macroeconomic policies for inclusive growth and poverty reduction under the proposed agenda for prosperity. A foreign private capital inflows and investment perception survey was organized to obtain information on foreign private capital and investment inflows to Sierra Leone and facilitate accurate analysis and forecasting of foreign direct investment flows, thereby improving the robustness of the Sierra Leone Integrated Macroeconomic Model (SLIM-Model).


December 2012 28

Duty Waiver Concession

An examination of the existing policies for duty waivers was undertaken with a view to conduct a holistic review of the policies and to develop a monitoring strategy to ensure that concessions granted are not abused.

Extractive Industry Bill

A draft extractive industry revenue Bill was developed to enlighten government technical staff on the calculation of the mining resource rent tax as well as petroleum resource rent tax, these being new concerns included in the draft Act. Technical staffs were also introduced to the provisions, tenet and assumptions used in developing the draft which is to be submitted to Cabinet for approval.

Investment Incentive Regulations

Consideration was also given towards the development of a unified statutory mechanism for providing investment incentives regulations that are transparent, effective and prevent leakages of tax revenue and to develop a strategy guiding the introduction and withdrawal of tax incentives.

2013-2015 Budget Formulation Process A consultative meeting on policy hearing and budget estimates discussion was held thereby creating a forum for all PFM stakeholders to discuss and agree on the policy issues and resources allocations to various MDAs including PIUs for FY 2013

The vertical allocation and horizontal grants distribution to Local Councils were also reviewed in consultation with the local councils during the year. This includes the size of the vertical pool, as well as the variable and criteria for the horizontal distribution of grants to local councils for FY 2013.

The MTEF Guidelines

The MTEF Guidelines was revised and re-launched during the year. MDAs were accordingly trained on the revised guidelines.

Multi Donor Budget Support (MDBS) Performance Assessment Framework

The Multi Donor Budget Support (MDBS) Performance Assessment Framework was reviewed following discussions amongst stakeholders regarding progress in the implementation of agreed benchmarks.


December 2012 29

6.3 Revenue Generation and Collection- NRA

Large Taxpayers Office

Following the successful merger of the GST and the Income Tax Departments to form the Domestic Tax Department (DTD) in 2011, the Large Taxpayers Office (LTO) Unit was reconstituted and capacitated, with a separate, well equipped office dedicated to serving “big customers”. This ensures that revenue collection with respect to large taxpayers is effectively managed and compliance needs adequately catered for.

Audit

The Audit Unit of the NRA has been strengthened through an audit capacity building programme. Several trainings in audit, including specialized audit techniques in banking and telecoms, were conducted by international consultants in 2012. The Authority has adopted integrated and effective risk based audit systems with a view to minimizing revenue leakage and increasing compliance. Total revenue recovered as a result of audit in 2012 amounted to 43 Billion Leones.

Domestic Tax Department Automation

In order to improve efficiency in the business processes and improve customer experience, the Authority embarked on automating all key business processes. In this regard the Domestic Tax Information System (DTIS) software was developed to support DTD operations. Local Area Networks (LAN) have been installed in all DTD offices in Freetown and interconnected through the NRA Wide Area Network (WAN) to support the roll out of the DTIS. Reduced Legal Barriers to Collection

The legal framework for tax administration, including GST and IT Acts has been reviewed with a view to minimize barriers to revenue collection and ensure consistent and fair application of enforcement. Consideration is being given towards the drafting of a single revenue administration Act that will address all current inconsistencies and ambiguities in existing Acts and other legislations. MOU with Banks

A new MoU has been drafted to guide our operations with the banks. The new MoU is aimed at improving reconciliation and ensuring that commercial banks remits to the Bank of Sierra Leone (BoSL) moneys in all NRA transit accounts in a timely manner.


December 2012 30

Legal Framework

A New Customs Act that provides a legal Customs framework that is consistent with International standards, including the WCO and WTO Kyoto Protocol has been enacted. Construction of Examination Facility

Plans are underway to construct a modern structure within the seaport for all its outdoor activities. The aim is to facilitate trade and increase revenue collection through a one-stop-shop for all customs outdoor activities and for effective intrusive inspection of “high risk” consignments. The facility will also allow for efficient use of resources; and effective supervision of Outdoor staff

Licensing of CFA

NRA took responsibility of issuing license to CFAs in 2012. This change has allowed for better scrutiny of CFA compliance to Customs requirement and could potentially increase compliance and trade facilitation through enhanced regulation, control and management of Clearing and Forwarding Agents (CFA).

Anti-Smuggling

The NRA is currently reviewing proposal for the adoption of a Flexible Anti-Smuggling Team (FAST) that will focus mainly on reducing revenue leakage through smuggling and augment the operations of the Preventive Services and Special Duties (PSSD) Unit of the Customs Department.

6.4 Public Debts Management

Debt Sustainability Analysis

The National Debt Sustainability Analysis was updated thereby providing information on the development of both domestic debt and external profile. This guides the government‟s borrowing approach in a post debt relief environment and fosters debt sustainability.

Debt Data and System Management

A team participated on the CS-DRMS training organized by WAIFEM and African Capacity Building Foundation in Monrovia, Liberia with the view to upscale the capacity of participants by providing hands-on training on the CS-DRMS software for debt recording, analysis, debt projection, interest rate maturity and sensitivity analysis and policy. Plans are underway for the software to be managed directly by the Public Debts Management Division by June 2013.


December 2012 31

Contingent Liabilities

A detailed examination of contingent liability across central government, including State Owned Enterprises, and local councils to review the challenges faced in monitoring contingent liabilities and to communicate the framework for improving the process and reporting on contingent liabilities was undertaken during the year.

Medium Term Debt Management Strategy

Plans are also underway for the development of a Medium Term Debt Management Strategy in order to generate a framework for informed decision regarding government financing requirements.

6.5 Public Procurement

Procurement plans

Support was provided to MDAs and Local Councils during the procurement planning process with procurement plans being developed for the respective MDAs and local councils.

Procurement Assessment

Procurement Assessment and Benchmarking was undertaken in ascertaining and monitoring compliance with procurement laws and regulation, performance on awards of contract and progress pertaining the MDBS agreements, procurement structures, procedures and processes.

6.6 Accounting, Recording and Reporting

Reporting

The Accountant General produced the financial statements for the year ended 31st December 2011 by 31st March 2012 in accordance with the Government Budgeting and Accountability Act 2005. These financial statements have subsequently been audited and the report produced by the Auditor General. The in-year statements of fiscal operations (consolidated fund) were also published on the MoFED website.


December 2012 32

Records Management Procedures Manual

The development of the records management procedures manual for the AGD is currently ongoing which shall ultimately help foster improved records management in AGD.

Training

Finance personnel from subvented agencies and PIUs were trained on new financial reporting format designed to improve reporting and increase comprehensiveness of the financial statements.

6.7 Human Resource Management

Manpower Plan and Budget Hearings for MDAs

A comprehensive manpower plan and budget was developed for MDAs as part of the 2013 budget planning process.

Training of Newly Recruited Civil Servant

A detailed induction course for newly recruited civil servants was undertaken in a bid to adequately introduce them to the functions, principles and values of the civil service, thereby ensuring a standard and uniform staff behaviour and adherence to the public service rules and procedures. This was interspersed with an education and sensitization forum led by the Attitudinal and Behavioural Change Secretariat.

6.8 Integrated Financial Management information System (IFMIS)

Performance Budgeting Module and Budget Book Builder

Implementation of performance budgeting module is in progress with the budget book builder already installed into IFMIS and training for Budget Bureau completed. The Performance Budgeting module of the IFMIS shall go live in 2013.

Civil Service Management (CSM) Module

Implementation of the Civil Service Management (CSM) module of the IFMIS is in progress and training of Human Resource Management Office, Accountant General‟s Department, Sierra Leone Police and Ministry of Defence has been completed. This shall go-live at the end of the first quarter of 2013.


December 2012 33

Capacity Building of IFMIS end-users

Various on-the-job and refresher training sessions were undertaken during the year by the PFMRU thereby facilitating the timely processing of transactions by the respective rolled out MDAs. The finalised chart of accounts manual was pivotal to the respective sessions held.

6.9 Financial Management in Local Councils

Petra Financials

In continuation of the implementation of a Financial Management Information System in Local Councils, the Petra Accounting Package was rolled out to the remaining four (4) local councils in January 2012. Thus, Petra Accounting Package is now installed in all nineteen local councils. The four councils are outlined below:

1. Kambia District Council 2. Kailahun District Council 3. Bonthe District Council 4. Bonthe Municipal City Council

Introduction of International Public Sector Accounting Standards (IPSAS) The Public Financial Management Reform Unit (PFMRU) in collaboration with Audit Service Sierra Leone introduced the International Public Sector Accounting Standard (IPSAS) reporting for Local Councils in 2012. For 2012 financial year, all local councils are to submit financial statements using IPSAS Cash + Modified Cash basis of reporting. Financial Management Support and Capacity Building in Local Councils The Internal Auditors of local councils were introduced to and provided access to the Petra Accounting Package. With the reasonable understanding acquired of the Petra system, their internal check on the councils is enhanced. Refresher training on the Petra Accounting package was organized for Audit Service Sierra Leone and Accountants of Local Councils to help facilitate the audit exercise.


December 2012 34

Also, budget management sessions were organized for Chief Administrators with particular reference to improving budget performance in councils which was identified as an area of weakness during the last PEFA assessment, Records Management in Local Councils

In a bid to improve on records management at the local level, the local councils were supported with scanners, shredders and files. Local Councils Monitoring Support

PFMRU continued the process of providing financial management support to all local councils in order to ensure the timely recording and reporting of their activities as required by the Local Government Act (LGA), 2004. Eighteen out of nineteen local councils timely submitted 2011 financial statements to the ASSL in accordance with the LGA 2004.

6.10 Internal Audit

Preparation of Annual Audit Plan

Local Councils‟ Internal Auditors were supported in the preparation of 2013 audit plans in order to strengthen their performance during the ensuing year.

Internal Auditors across central government were also regularly supported through review sessions during which issues and challenges faced were addressed and recommended actions communicated accordingly.

Technical supports to Local Councils

Technical support was provided to all Local Councils‟ Internal Audit Units in reviewing the efficiency and effectiveness of the local councils operations through mentoring and coaching.

Strengthening of Internal Audit Units in MDAs

Currently there are thirty nine (39) MDAs with internal audit unit. Nineteen MDAs have Internal Audit Committee and seven local councils have Internal Audit Committees.


December 2012 35

Audit Committees

Additional audit committees were established during the year making a total of 19 audit committees in MDAs and 7 in Local Councils

MDAs with Internal Audit Committee

1. Ministry of Defence 2. Sierra Leone Police 3. Sierra Leone Prisons Department 4. National Registration Secretariat 5. Human Resource Management Office 6. Ministry of Finance and Economic Development 7. Ministry of Foreign Affairs and International Cooperation 8. Ministry of Education, Science and Technology 9. Ministry of Works, Housing and Infrastructure 10. Ministry of Information and Communication 11. Ministry of Agriculture, Forestry and Food Security 12. Ministry of Internal Affairs 13. Ministry of Local Government and Rural Development 14. Ministry of Tourism and Culture 15. Ministry of Labour and Social Security 16. Ministry of Transport and Aviation 17. Ministry of Fisheries and Marine Resources 18. Ministry of Trade and Industry 19. Ministry of Health and Sanitation

Local Councils with Internal Audit Committee

1. Bo City Council 2. Makeni City Council 3. Moyamba District Council 4. Kenema District Council 5. Kenema City Council 6. Freetown City Council 7. Koidu New Sembehun City Council

6.11 External Oversight – Audit Service Sierra Leone (ASSL)

Auditing and Reporting

The audit of the 2011 Financial Statement of Central Government was conducted and report submitted to Parliament in accordance with the prescribed legislation and published on the ASSL website. The Auditor General also completed the audit the Local Councils financial statements and the reports issued to Minister of Local Government and Rural Development for onward submission to Parliament.


December 2012 36

Performance Audit

A Performance Audit of the Malaria Eradication Program in the Ministry of Health and Sanitation was undertaken and report presented to Parliament.

6.12 External Oversight - Parliament

Scrutiny of Audit Reports Public hearings were held by the PAC on the Auditor General‟s Report for 2010 Financial Statements and report tabled in Parliament.

6.13 External Oversight - Supports to Non State Actors

Publication and Launch of the Citizens Budget

The inaugural Citizens Budget was successfully launched in May in Freetown and the regions.

NSA Training

A detailed overview of PFM training was regionally undertaken for NSAs to adequately prepare them to effectively participate in the demand driven award of grants for the oversight of PFM. Over one hundred and seventy-five NSAs participated in the exercise for which certificates of merit were issued.

Recruitment of the sub-grant Evaluation Agent/ Launch of the Demand

Driven Component

A sub-grant Evaluation Agent (independent firm) has been recruited to oversee the process of award of grants to NSAs and make recommendations to MoFED in accordance with the grants manual.

The demand driven grants award process was subsequently launched by the Hon. Minister of Finance and Economic Development in November.

The Open Budget Survey 2012

Sierra Leone participated in the 2012 Open Budget Initiative global index survey for which the results are to be published in January 2013.


December 2012 37

6.14 PFM Capacity Building

A comprehensive PFM training programme through the Institute of Public Administration and Management (IPAM) University of Sierra Leone commenced during the year. This initial training, for which certificates of merit shall be awarded, targeted approximately three hundred officials drawn from Public Procurement, Internal Audit, Human Resource Management and Administration.

6.15 Monitoring and Evaluation

The PETS Secretariat is yet to publish the results of the 2011 PETS. The exercise was not undertaken during 2012.

7.0 IPFMRP Restructuring

It was resolved in consultation with the development partners that the IPFMRP shall be restructured through the cancellation of sub-component 3.4 (establishing sustainable PFM capacity in MoFED) and reallocate resources to core PFM technical issues including IFMIS Rollout, Support for Petra implementation in local councils, improved Project Investment Planning, Public Procurement and strengthening of ICT in MOFED. This process is currently ongoing.

8.0 Development of a Medium Term PFM Reform Strategy The process for the development of a medium term PFM reform strategy for the period 2014-2017 is ongoing and should be completed by mid-2013. This strategy shall focus on consolidating the achievements gained through the IPFMRP implementation and seeking improvements to other key areas of PFM needing urgent attention.

9.0 Update on IPFMRP Performance Indicators (PI) and activities undertaken towards meeting the indicators

9.1 APPENDIX 1 depicts the baseline data of the respective indicators designed to monitor the progress of PFM over the life of the IPFMRP. It also provides the opportunity to determine at the end of each of the four(4) years, the level of progress made with respect to the respective indicators. See APPENDIX 2 for revised update of 2009 to 2011 indicators to reflect the actual as at 31st December 2011 where applicable. See APPENDIX 3 for 2012 update to reflect the actual as at 31st December 2012 where applicable and 2013 indicators.


December 2012 38

9.1 APPENDICES

APPENDIX 1 Target Values Data Collection and Reporting

Indicators Baseline

2009 2010 2011 2012 Frequency and Reports

Data Collection Instruments

Responsibility for

Data Collectio

n

PDO Indicators

1 Variance in expenditure composition for the 20 largest budget heads

13.5%

<10%

<9%

<8%

<7%

Annual

Budget and actual data by head

Budget Bureau

2. The share of actual to budgeted spending on HIPC/PRSP priorities compared to the ratio of actual to budget expenditures for all other discretionary primary expenditures

Poverty actual/budget

= 57.5% (148.9/258.9)

Other actual/budget =69.0%

(110.5/160.1)

% to budget on

HIPC/PRSP priorities > % to budget on

other expenditures

% to budget on

HIPC/PRSP priorities > % to budget on

other expenditures

% to budget on HIPC/PRSP priorities > % to budget on other expenditures


Annual Budget Annex 4. The total is net of interest, salaries, external project aid and statutory transfers to NRA and Road Fund.

Budget Bureau

3. Domestic expenditure arrears (total from all years) as % of total expenditure for year (excluding interest and donor-financed project expenditure)

9.4% 8% 7% 6% 5% Annual Implementation Support Mission

4. Publication of Only budget Addition: Addition: 6 items 6 items Annual Annual Budget


December 2012 39

Target Values Data Collection and Reporting

Indicators Baseline



Responsibility for

Data Collectio

n

financial and procurement documents (all six listed in PEFA 10) through gazette and website in accordance with requirements of GBAA and PPA.

documents, in-year execution reports,

and resources available to primary service providers are published by

due dates (total 3)

year end financial

statements, and contract awards (total

5)

external audit reports (total of six items

per PEFA 10)

Government Budget, Quarterly Gazette Statements of Fiscal Operations, Annual Public Accounts, Audit Reports (on trans‟ns and annual accounts), contract awards on NPPA website, PETS reports.

Bureau, Accountant General, Auditor General, NPPA and MoFED

5. Timely audited Public Accounts with no material qualifications concerning basic control system failures.

Disclaimer of opinion on

Accounts for 2002-06

Opinion on 2007 with no more than 3

material qualifications

Opinion on 2008 with no more than 3


Opinion on 2009 with no more than 2 material qualifications

Opinion on 2010 with no more than 1 material qualification

Annual Audit report on Public Accounts and Management Report

Accountant General

6. Percentage of MDA contracts in compliance with provisions of Public Procurement Act and Regulations

49%

55% 75% 90% 95% Annual NPPA database on contracts and Budget Bureau database on commitments and payments to contractors

MDAs NPPA Budget Bureau

Intermediate Outcome Indicators

1.1.1 Deviation in own source 4% (2008) < 5% < 5% shortfall

< 2% shortfall < 2% shortfall

Annual Implementation Support Mission

Budget Bureau,


December 2012 40


Indicators Baseline



Responsibility for

Data Collectio

n

revenues AGD

1.1.2 Number of MDAs with acceptable strategic plans developed within resource ceilings and reflected in budget bids

3 5 8 10 15 Annual Implementation Support Mission

Budget Bureau, MDAs

1.1.3 Capture of aid flows in government financial reporting

Lack of agreed aid policy, including donor reporting; database under development;

Database includes great majority of 2008 aid; all significant donors included

Finalization of aid policy; database cleaned of duplication

90% of total disburse-ments recorded for 2010 reported by March 2011

Database used to check comprehensiveness of budget and accounts


Debt Mgt and Aid Coord‟n Unit

1.2.1. Appropriations backed by quarterly allocations (restricted to non-salary recurrent)

1.2.1.1 Health 1.2.1.2 Agriculture 1.2.1.3 Grants to LCs

1.2.2 Quarterly allocations backed

84.3%.

100.3%

78.9%

90%

100%

92.1%

95%

100%

94%

95%

100%

96%

100%

100%

97%

Annual Annual

Implementation Support Mission

Budget Bureau, MDAs, Acc General, Cash Mgt Unit


December 2012 41


Indicators Baseline



Responsibility for

Data Collectio

n

by approved commitments (restricted to non-salary recurrent)

1.2.2.1 Health 1.2.2.2 Agriculture 1.2.2.3 Grants to LCs 1.2.3 Approved Commitments/MTEF/PETS form 2 backed by payments (restricted to non-salary recurrent) 1.2.3.1 Health 1.2.3.2 Agriculture 1.2.3.3 Grants to LCs 1.2.4. 1 New/additional payment arrears (Outstanding Commitments) during the year as a percentage of total primary expenditures (%).

85.5%

94.2%

95.3%

94%

98.8%

98.9%

1.9%

97%

96.9%

98.7%

97.4%

98%

99%

1.5%

97.5%

98%

98.9%

95%

99%

100%

1.3%

97.8%

99%

100%

99%

99%

100%

1.9%

96%

99%

100%

99%

100%

100%

0.7%

Annual Annual Annual


December 2012 42


Indicators Baseline



Responsibility for

Data Collectio

n

1.3 Revised legal and institutional framework for debt management adopted by Cabinet.

Relevant laws scattered, criteria and ceilings unclear, lack of integrated organization or systems, weak capacity

Initiation of legal and

organizational review

Completion of legal and

organizational review

A new act passed


Debt Mgt Unit BoSL Budget Bureau

2.1a Revised GBAA and FMR adopted and disseminated at all levels.

The 2005 Government Budgeting and Accountability Act and Regulations need updating for the new business processes arising from IFMIS rollout and new foreign aid and commitment control procedures

Bill for amended Act drafted and approved by Law Officers

Cabinet approval and enactment of

Act; regulations reviewed.


Accountant General/PFMRU

2.1b New LG Financial Administration Regulations and Accounting Manual Budgeting Guidelines adopted and disseminated

No Financial Administration Regulations in place to support the LGA 2004. No Accounting Manual in place for LCs

Bill for FAR drafted and approved by Law Officers Draft Accounting Manual to be provided and widely circulated to all LCs

Cabinet approval and enactment of

FAR

Finalised Accounting

Manual to be widely

circulated to all LCs


Accountant General/PFMRU

2.2 Procurement units in MDAs functional as per

Estimated 20 % of MDAs have dedicated

20% of MDAs have dedicated

45% of MDAs have

dedicated

65% of MDAs have dedicated

85% of MDAs have dedicated procurement


NPAA MDAs LCs


December 2012 43


Indicators Baseline



Responsibility for

Data Collectio

n

PPA and Regulations.

procurement officers




officers

2.3 Timely publication of comprehensive annual financial statements with reference to PEFA standards

Public Accounts omit Subvented Agencies expenditure (about 40% of total expenditure captured); incomplete fiscal/monetary reconciliation

Submission of fiscal/monetary reconciliation of subvented agencies; (expenditure captured increase to 45%)





Accountant General, DPs and PIUs, subvented bodies; BoSL, Auditor General

2.4 Own-operated personnel management system under HCA established at 3 MDAs within HRMO oversight framework following completion of verification exercise.

All Personnel management under HCA operationally consolidated within HRMO.

Same as in

2008

Personnel Management under HCA established at one of Sierra Leone Police/Ministry of Defence/ Ministry of Education, Youths and Sports

Personnel Management under HCA established at two of Sierra Leone Police/Ministry of Defence/ Ministry of Education, Youths and Sports

Personnel Management under HCA established at three of Sierra Leone Police/Ministry of Defence/ Ministry of Education, Youths and Sports

Annual

Implementation Support Mission

MEYS; Accountant General; Teacher Pay Mgt Unit, HRMO


December 2012 44


Indicators Baseline



Responsibility for

Data Collectio

n

2.5 a1 Internal Audit Units in at least 15 MDAs functioning as evidenced through quarterly reports copied to Director of Internal Audit MoFED, with evidence of follow-up.

2.5a2 Audit Committees functioning in 4 key MDAs as evidenced by minutes of quarterly meetings containing review of internal audit reports.

Only 7 effective internal audit units in MDAs; reports not effectively used by Vote Controllers. Three audit committees (Defence, NEC, Police) established but not functioning effectively

Half-yearly reports of internal audit available for at least 7 MDAs Audit Committee functioning in at least 1 key MDA as evidenced by minutes of quarterly meetings held.

Quarterly reports of internal audit unit available in at least 5 MDAs and half-yearly reports of internal audit available for at least 5 MDAs Audit Committee functioning in at least 2 key MDAs as evidenced by minutes of quarterly meetings held.

Quarterly reports of internal audit available in at least 8 MDAs and Half-yearly in at least 7. Audit Committee functioning in at least 3 key MDAs as evidenced by minutes of quarterly meetings held.

Quarterly reports in at least 15 MDA‟s. Audit Committee functioning in at least 4 key MDAs as evidenced by minutes of quarterly meetings held.

Quarterly and Half-yearly Quarterly

Internal Audit Records Minutes and summary reports by IAD

MoFED-IAD MDAs MoFED-IAD

2.5b Annual PETS Report published within six months of completion of survey; evidence of material response (service improvement) by relevant agencies

Proportion of essential drugs reaching PHUs: 75.7 % (2005) Proportion of teaching and learning materials reaching primary schools: 82.2% (2007)

85.0%

85.0%

95.0%

87.0%

87.0%

97.0%

90.0%

90.0%

99.0%

95.0%

93.0%

100.0%


MoFED-EPRU


December 2012 45


Indicators Baseline



Responsibility for

Data Collectio

n

Proportion of textbooks reaching primary schools: 89.0% (2005)

2.6 Backlog of Auditor-General reports cleared

Delays in PAC review of audit reports (Review of Auditor General‟s reports for 2003 – 05)

Completion of 2006 Auditor

General‟s Report.

Completion of 2007 &

2008 Auditor

General‟s Report.

Completion of 2009 Auditor

General‟s Report.

Completion of 2010

Auditor General‟s Report.


Parliament; PAC; Auditor General

3.1 Percentage of budgeted expenditures executed online through IFMIS rolled out ministries.

IFMIS online in AGD and 8 MDAs (62% of budgeted expenditure)

IFMIS online in AGD and to 10 MDAs

(67% of budgeted

expenditure)

IFMIS online in AGD and to 12 MDAs

(72% of budgeted

expenditure)

IFMIS online in AGD and to 14 MDAs (76% of budgeted expenditure)

IFMIS online in AGD and to 16 MDAs (80% of budgeted expenditure)


Accountant General

3.2a Timely publication of all MoFED statutory publications in MoFED website.

Lack of GoSL ICT policy; lack of MoFED website; insufficient support for ICT across government

MoFED website operational All documents as per PDO objective 4 available on website

All documents as per PDO objective 4 available on website




MoFED

3.3 No of trained PFM officers in MDAs and MoFED.

Insufficient trained PFM officers at technician or professional levels (estimated 34 technicians and

At least 56 PFM officers in MDAs and

MoFED


MoFED


MoFED

At least 133 PFM officers in

MDAs and MoFED


Accountant General; Budget Bureau; Chief Internal


December 2012 46


Indicators Baseline



Responsibility for

Data Collectio

n

professionals in December 2008)

Auditor; HRMO

3.4 Phased exit and transitional support for staff remuneration

Development partners funding 45 key consultants/LTAs posts in MoFED till end 2008

Project provides

salary support

according to the policy

and implementation plan; no consultants

in line positions.

Project provides salary

support according to

the policy and

implementation plan on a

declining basis; no

consultants in line positions

Project provides

salary support

according to the

policy and implementation plan on a declining basis; no

consultants in line

positions

Project provides salary

support according to

the policy and implementation

plan on a declining basis; no consultants in line positions


MoFED; HRMO; Governance Reform Secretariat

4. Non-State Actors

(NSA) active in the area of PFM monitoring and oversight

Lack of capacity and a forum for an institutionalized and

systematic approach.

National Budget Oversight Network that includes NSAs and other accountability institutions established.

Information sharing Network created

Website for NSA on PFM established and functional

At least 5 NSA are able to access funds through submission of acceptable technical proposals At least 3 publications from NSAs on completed activities related to monitoring and oversight disseminated. Two joint Forums

Simplification of at least 3 Government documents on PFM for dissemination to public At least 7 NSA are able to access funds through submission of acceptable technical proposals

At least 10 NSA are able to access funds through submission of acceptable technical proposals At least 6 publications from NSAs on completed activities related to monitoring and oversight disseminated Two joint Forums organized with Government on


NSA Coordinator


December 2012 47


Indicators Baseline



Responsibility for

Data Collectio

n

3 capacity development learning programs organized for NSA on PFM issues

organized with Government on PFM issues NSA produce annual analytic report on budget preparation process that highlights challenges and constraints

Two joint Forums organized with Government on PFM issues NSA produce analytic report on budget preparation process that shows how challenges and constraints have been addressed

PFM issues NSA produce analytic report on budget preparation process that highlights challenges and constraints

5.1.1 Timely submission of financial reports

5.1.1 Timely submission of audit reports

As required None

As required As required



Quarterly Annual

Progress Reports Progress Reports

PAU/MoFED PAU/MoFED


December 2012 Page 48

IPFMRP RESULTS FRAMEWORK 2011

APPENDIX 2 Outcome Indicator Baseline 2009 2010 2011

Target Actual Target Actual Target Actual 1. Variance in

expenditure for the 20

largest budget heads

13.5%

< 10%

4%

<9%

2.41%

< 8% 10.9%

2. The share of actual to

budgeted spending on

pro-poor spending

priorities compared to the

ratio of actual to budget

expenditures for all other

discretionary primary

expenditures

Poverty

actual/budget =

57.5%

(148.9/258.9);

Other

actual/budget =

69% (110.5/160.1)

% to budget on

HIPC/PRSP

priorities > % to

budget on other

expenditures

Poverty

actual/budget =

109.4%

Other

actual/budget =

114.3%

% to budget on

HIPC/PRSP

priorities > %

to budget on

other

expenditures

Poverty

actual/budget =

188.2%

Other

actual/budget =

88.1%

% to budget on

HIPC/PRSP

priorities >% to

budget on other

expenditures

Poverty

actual/budget =

84.3%

Other actual/budget

= 76.5%

3. Domestic expenditure

arrears (total from all

years) as % of total

expenditure for year

(excluding interest and

donor-financed project

expenditure)

9.4% 8% 14.2% 7% 7.8% 6% 3% (estimate as at

September 2011)

4. Publication of financial

and procurement

documents (all six listed

in PEFA indicator 10)

through the Sierra Leone

Gazette and MoFED’s

website in accordance

with requirements of

GBAA and PPA

Only budget

documents, in-

year execution

reports, and

resources

available to

primary service

providers are

published by due

dates (total 3)

Addition: year-end

financial

statements, and

contract awards

(total 5)

Year-end

financial

statements for

2009 published

on MoFED

website. Contract

awards also now

published on

NPPA website.

Quick link to

NPPA website

now provided on

MoFED website.

Addition:

external audit

reports (total of

six items per

PEFA 10)

All Financial and

procurement

documents (all

six listed in

PEFA indicator

10) including

external audit

report now

published by due

date on the

relevant

websites.

6 items All Financial and

procurement

documents (all six

listed in PEFA

indicator 10) now

published by on the

relevant websites.

1 Implies the absolute value of the difference in variance in expenditure for 20 largest budget heads vs. total variance



Some

procurement

adverts posted to

the NPPA

website but

significant

improvement is

needed to the

publication of

the actual award

of contracts on

the NPPA

website.

5. Timely audited Public

Accounts with no


concerning basic control

system failures.

Disclaimer of

opinion on

Accounts for

2002-06

Opinion on 2007

with no more than

3 material

qualifications

Audit of 2007

financial

statements

completed by

Auditor General.

Of the 5 reasons

for qualification

of the Audit

Report, no more

than three relates

to material

qualifications

regarding basic

control system

failures.

Opinion on

2008 with no

more than 3

material

qualifications

Audits of 2008

and 2009

financial

statements

completed by

Auditor General.

Of the reasons

for qualification

of the Audit

Reports, no more

than three relates

to material

qualifications

regarding basic

control system

failures.

Opinion on

2010 with no

more than 2

material

qualifications

Audit of 2010

financial statement

completed by

Auditor General.

None of the reasons

for qualification was

as a result of basic

control system

failures

6. Percentage of MDA

contracts in compliance

with provisions of the

GoSL's procurement

legislation and

regulations

49% 55% 91% 75% 91.3% 90% 99%



Intermediate

Outcome Indicators

Baseline 2009 2010 2011

Target Actual Target Actual Target Actual 1.1.1 Deviation in own

source revenues

4% (2008)

< 5%

-11%

< 5% shortfall

19.42%

<2% shortfall 333%

1.1.2 Number of MDAs

with acceptable strategic

plans developed within

resource ceilings and

reflected in budget bids

3 5 >5 8 10 10 12

1.1.3 Capture of aid flows

in government financial

reporting

Lack of agreed

aid policy,

including donor

reporting;

database under

development

Database

includes great

majority of

2008 aid; all

significant

donors included

Aid Policy now

developed. MoFED

now has a

Development

Assistance

Database (DAD)

that record

majority of aid

from all significant

donors. This

information is

widely available on

http://dad.synisys.c

om/dadsierraleone/

Finalization of aid

policy; database

cleaned of duplication

Aid Policy now

finalized and

published.

Efforts are now

being directed

towards full

capture of all

aid flows in the

aid database.

90% of total

disbursements

recorded for

2010

Aid policy in

operation. All

projects

requested to

submit full

details of

budgets to

MoFED.

Regional

training

undertaken on

the

Development

Assistance

database

(DAD).

1.2.1. Appropriations backed by quarterly allocations (restricted to non-salary recurrent):

1.2.1.1 Health 84.3% 90% 79.8% 95% 125.1% 95% 97.4%

1.2.1.2 Agriculture 100.3% 100% 74.2% 100% 86.0% 100% 96.2%

1.2.1.3 Grants to LCs 78.9% 92.1% 96.7% 94% 123.1% 96% 90.1%

1.2.2 Quarterly allocations backed by approved commitments (restricted to non-salary recurrent):

1.2.2.1 Health 85.5% 97% 78.6% 97.5% 81.5% 97.8% 87.5%

1.2.2.2 Agriculture 94.2% 96.9% 85.2% 98% 131.1% 99% 89.4%

1.2.2.3 Grants to LCs 95.3% 98.7% 96.7% 98.9% 90.6% 100% 107.7%

1.2.3 Approved Commitments/MTEF/PETS form 2 backed by payments (restricted to non-salary recurrent):

2 Percent in excess of budgeted revenue

3 Percent in excess of budgeted revenue

http://dad.synisys.com/dadsierraleone/

http://dad.synisys.com/dadsierraleone/



1.2.3.1 Health 94% 97.4% 95.8% 95% 97.7% 99% 92.5%

1.2.3.2 Agriculture 98.8% 98% 98.9% 99% 95.8% 99% 96.2%

1.2.3.3 Grants to LCs 98.9% 99% 98.9% 100% 97% 100% 100%

Intermediate

Outcome Indicators

Baseline 2009 2010 2011

Target Actual Target Actual Target Actual 1.2.4. New/additional

payment arrears

(Outstanding

Commitments) during the

year as a percentage of

total primary expenditures

(%).

1.9% 1.5% 0.62% 1.3% 1.4% 1.9% P

1.3 Revised legal and

institutional framework

for debt management

adopted by cabinet

Relevant laws

scattered,

criteria and

ceilings unclear,

lack of

integrated

organization or

systems, weak

capacity

Initiation of

legal and

organizational

review

Legal review of relevant

debt management laws

initiated. Consultant

recruited to review laws

and consultative forum

held for stakeholders

within Central

Government and Local

Councils.

Completion of

legal and

organizational

review

The New Public

Debts Law was

enacted in March

2011.

A new act

passed

The new Public

Debt Law was

enacted in

March 2011

2.1a Revised GBAA and

FMR adopted and

disseminated at all levels.

The 2005

Government

Budgeting and

Accountability

Act and

Regulations

need updating

for the new

business

processes

arising from

IFMIS rollout

and new foreign

aid and

commitment

control

procedures

Bill for

amended Act

drafted and

approved by

Law Officers

Consultant for review of

GBAA and FMR

contracted in April 2010.

Process of review

ongoing.

Cabinet

approval and

enactment of

Act,

regulations

reviewed

Options and Issues

Paper prepared in

respect of ongoing

review; Meeting of

key stakeholders

held to discuss draft

options and issues

paper; Review of

GBAA to include

Public Investment

Programme revision

passed by

Parliament in May

2011.

Review process

now at an

advanced stage

with wide

sensitization of

key Government

Officials on

consultant’s

report followed

by key experts

review on the

Options and

Issue Paper. The

final report will

be used for

drafting.



2.1b New LG Financial

Administration

Regulations and

Accounting Manual,

Budgeting Guidelines

adopted and disseminated

No Financial

Administration

Regulations in

place to support

the LGA 2004

No Accounting

Manual in place

for LCs

Bill for FAR

drafted and

approved by

Law Officers

Draft

Accounting

Manual to be

provided and

widely

circulated to

all LCs

Review of LGA 2004

which is a precondition

for the FAR yet to be

effected.

Decentralization Policy

already submitted to

cabinet for consideration

and approval. This is the

precursor to the revised

LGA. Revised timeframe

for FAR to be in place is

end 2011.

Cabinet

approval and

enactment of

FAR

Draft

Accounting

Manual to be

widely

circulated to all

LCs

Review of LGA

2004 which is a

precondition for the

FAR yet to be

effected.

Decentralization

Policy approved and

adopted by cabinet

and now published.

This is the precursor

to the revised LGA

and FAR. Revised

timeframe for FAR

to be in place is Mid

2012.

Review of LGA

2004 yet to be

completed. FAR

and Accounting

manual to be

undertaken

during 2012

Intermediate

Outcome Indicators

Baseline 2009 2010 2011

Target Actual Target Actual Target Actual 2.2 Procurement units in

MDAs functional as per

PPA and Regulations

Estimated 20% of

MDAs have

dedicated

procurement

officers

20% of MDAs

have dedicated

procurement

officers

20% of MDAs having

dedicated

Procurement Officers

maintained.

45% of MDAs

have dedicated

procurement

officers

Procurement

cadre now

established within

the civil service.

Additional Senior

Procurement

Officers and

Procurement

Officers recruited

and assigned to

MDAs.

97.4% of MDAs

have dedicated

procurement

officers

65% of MDAs

have dedicated

procurement

officers

96% of MDAs

have dedicated

Procurement

Officers

2.3 Timely publication of

comprehensive annual

financial statements with

reference to PEFA

standards

Public Accounts

omit sub-vented

agencies

expenditure

(about 40% of

Submission of

fiscal/monetary

reconciliation

of sub-vented

agencies;

AGD now obtains

quarterly returns from

Sub-vented Agencies

and PIUs at a

submission rate of

Submission of

fiscal/monetary

reconciliation of

sub-vented

agencies;

Quarterly returns

obtained by AGD

from subvented

agencies and

PIUs are yet to be

Submission of

fiscal/monetary

reconciliation of

subvented

agencies

58% of Project

expenditure and

73% of

Subvented

Agencies



total expenditure

captured);

incomplete

fiscal/monetary

reconciliation

(expenditure

captured

increase to

45%)

61% and 71.9%

respectively for 2009.

These are however

yet to be included in

the Public Accounts.

Plans are underway to

include these in the

2010 Financial

Statements

(expenditure

captured increase

to 50%)

included in the

financial

statements.

Efforts are

nevertheless

directed towards

improving the

data collection

rate by the AGD.

(expenditure

captured

increased to

60%)

expenditure were

recorded in the

system

2.4 Own-operated

personnel management

system under HCA

established at 3 MDAs

within HRMO oversight

framework following

completion of

verification exercise.

All personnel

management

under HCA

operationally

consolidated

within HRMO.

Same as in

2008

All personnel

management under

HCA operationally

consolidated within

HRMO.

Personnel

Management

under HCA

established at

one of Sierra

Leone

Police/Ministry

of

Defense/Ministry

of Education,

Youth and Sports

Personnel

Management for

HCA already

rolled out to

Sierra Leone

Police for

employees of the

Department.

Personnel

management

under HCA

established at

two of Sierra

Leone

Police/Ministry

of Defense/

Ministry of

Education Youth

and Sports

Personnel

Management for

HCA now

established at

Sierra Leone

Police and

Ministry of

Defense

2.5a1 Internal Audit

Units in at least 15

MDAs functioning as

evidenced through

quarterly reports copied

to Director of Internal

Audit MoFED, with

evidence of follow-up.

Only 7 effective

internal audit

units in MDAs;

reports not

effectively used

by Vote

Controllers.

Half-yearly

reports of

internal audit

available for at

least 7 MDAs

At least one report

submitted to Director,

Internal Audit,

MoFED for 8 MDAs

with internal audit

department.

Quarterly reports

of internal audit

unit available in

at least 5 MDAs

and half-yearly

reports of

internal audit

available for at

least 5 MDAs

Fifty-one Internal

Auditors

recruited; 36

functioning

Internal Audit

Units. A total of

16 internal audit

reports were

submitted by the

various Internal

audit Units during

2010.

Twenty Five (25)

Internal Audit

Units has

submitted at least

two (2) internal

audit reports

between period

Jan-may 2011

Quarterly reports

of internal audit

available in at

least 8 MDAs

and Half-yearly

in at least 7

Quarterly and

half-yearly

internal audit

reports submitted

by 30 MDAs



with a total of 16

reports submitted

to the Director,

Internal Audit

Department,

MoFED.

2.5a2 Audit Committees

functioning in 4 key

MDAs as evidenced by

minutes of quarterly

meetings containing

review of internal audit

reports.

Three audit

committees

(Defence, NEC,

Police)

established but

not functioning

effectively

Audit

Committee

functioning in

at least 1 key

MDA as

evidenced by

minutes of

quarterly

meetings held

Audit Committee

functioning in 4

MDAs. Reports

submitted during the

2009 are analyzed as

follows:

Audit Committee

functioning in at

least 2 key

MDAs as

evidenced by

minutes of

quarterly

meetings held.

Audit

Committees

established and

functioning in 6

MDAs. Two

additional Audit

Committees

established

between January

and May 2011.

Meetings held by

two Audit

Committees

between January

and May 2011.

Audit

Committees

functioning in at

least 3 MDAs as

evidenced by

minutes of

quarterly

meetings held.

Audit

Committees have

been set up in

nine (9) MDAs.

Four (4) are fully

functional

submitting

minutes of

meetings held

.

Intermediate

Outcome

Indicators

Baseline 2009 2010 2011

Target Actual Target Actual Target Actual

2.5b Annual PETs

Report published within

six months of

completion of survey;

evidence of material

response (service

improvement) by

relevant agencies:

Proportion of

essential drugs

reaching Public

Health Units:

75.7% (2005)

85.0% 68.8% 87.0% Proportion not

measured. No

monetary values

attached to drugs

procured

(Introduction of

the Free Health

Care Initiative).

90%

2011 PETs

survey exercise

completed in

second week of

November

analysis of data

ongoing

Proportion of

teaching and

learning materials

reaching primary

schools: 82.2%

85.0% N/A. Teaching and

Learning materials not

distributed before field

work for survey, hence

not covered by survey.

87.0% 84.2% 90.9% Analysis of

data ongoing



(2007)

Proportion of

textbooks

reaching primary

schools: 89.0%

(2005)

95.0% 92.1% 97.0% 93.1% 99.0% Analysis of data

ongoing

2.6 Backlog of Auditor-

General reports cleared

Delays in PAC

review of audit

reports (Review

of Auditor

General’s reports

for 2003 – 05)

Completion of

2006 Auditor

General’s

Report.

Most backlogs of audit

reports submitted to

PAC now cleared. PAC

Review of Auditor

General’s Report for

2006 completed. Review

of 2007 now at an

advanced stage. Most

backlogs of audit reports

submitted to PAC now

cleared.

Completion of

2007 & 2008

Auditor-

General's report

PAC review of

2007 completed

and report issued

out. PAC review

of 2008 report

completed and

will be shortly

laid in

Parliament and

publicized.

Completion of

2009 Auditor

General’s Report

Auditor

General’s report

of 2008 already

completed and

report issued.

PAC report on

the audit of 2009

financial

statements

already reviewed

and is now being

finalized.

Intermediat

e Outcome

Indicators

Baseline 2009 2010 2011


3.1 Percentage

of budgeted

expenditures

executed online

through IFMIS

rolled out

ministries

IFMIS online in

AGD and 8

MDAs (62% of

budgeted

expenditure)

IFMIS online in

AGD and to 10

MDAs (67% of

budgeted

expenditure)

IFMIS

already online

in AGD and

10 MDAs

(67% of

budgeted

expenditure).

IFMIS online in

AGD and to 12

MDAs (72% of

budgeted

expenditure)

IFMIS already online in

AGD and 11 MDAs

including HCA

implementing MDAs. Plans

already finalized for further

rollouts of the Expenditure

and Purchasing Modules of

the IFMIS to Office of the

Vice President and Ministry

of Lands, Country Planning

and the Environment.

Expenditures for all non-

online MDAs are processed

centrally through the IFMIS

at the AGD. In essence,

100% of expenditures from

the Consolidated Revenue

Fund are processed through

IFMIS online in

AGD and to 14

MDAs ( 76% of

budgeted

expenditure)

Contract discussions

ongoing with IFMIS

software providers to

facilitate further rollouts.

In the meantime, there is

increased focus on

refresher training for end

users to acquaint them

with the reporting and

other functionalities of the

IFMIS.



the IFMIS.

3.2a Timely

publication of

all MoFED

statutory

publications on

MoFED

website

Lack of GoSL

ICT policy; lack

of MoFED

website;

insufficient

support for ICT

across

government

MoFED website

operational

All documents as

per PDO 4

available on

website

MoFED

website fully

operational.

Documents as

per PDO 4

(PEFA PI-10)

posted on

MoFED

website or

available

through links

to NPPA and

Audit Service

Sierra

Leone’s

websites.

All documents as

per PDO 4

available on

website

MoFED website fully

operational. Documents as

per PDO 4 (PEFA PI-10)

posted on MoFED website

or available through links to

NPPA

http://www.publicprocurem

ent.gov.sl/ and Audit

Service Sierra Leone’s

http://www.auditservice-

sl.org/index.html websites.

All documents as

per PDO

objective 4

available on

Website

MoFED website fully

operational. Documents as

per PDO 4 (PEFA PI-10)

posted on MoFED website

or available through links

to NPPA

http://www.publicprocure

ment.gov.sl/ and Audit

Service Sierra Leone’s

http://www.auditservice-

sl.org/index.html

websites.

3.3 No of

trained PFM

officers in

MDAs and

MoFED.

Insufficient

trained PFM

officers at

technician or

professional

levels (estimated

34 technicians

and professionals

in December

2008)

At least 56 PFM

officers in MDAs

and MoFED

Project

became

effective in

December

2009 and thus

activities for

this sub-

component

will be

developed

after

concluding

the strategy

which is now

being

developed.

At least 67 PFM

officers in MDAs

and MoFED

Over 450 PFM Officers in

MoFED and MDAs trained

as follows:

75 Internal Auditors;

20 Budget Officers;

30 Procurement Officers

Over 350 IFMIS users

trained in the use of the

IFMIS application across

Central Government. 30

PFM officers in MoFED

and 1 in NPPA trained on

respective short courses in

budgeting, accounting,

procurement, tax

management, managing

donor funds, ICT and debt

management amongst

others.

At least 111 PFM

Officers in

MDAs and

MoFED

Many trainings and short

courses on various

disciplines were organized

for various PFM personnel

during the year.

Additional 38

procurement and senior


trained. 136 IFMIS end

users trained on the

Expenditure and

Purchasing Modules of the

IFMIS. 112 Internal

Auditors trained on

procurement auditing.

Negotiations are also far

advanced with the

Institute of Public

Management for the in-

country training of various

target PFM groups during

the first half of 2012

3.4 Salary Development Project provides Component Project provides This sub-component is yet Project provides Consultant recruited to

http://www.publicprocurement.gov.sl/


http://www.auditservice-sl.org/index.html








support for

MoFED civil

service staff

partners funding

consultants/LTAs

performing key

functions in

MoFED.

salary support

according to the

policy and

implementation

plan

3.5 provides

for salaries of

consultants

up to 28th

February

2010.

Effective date

for

component

3.4 was 1st

March 2010

(subject to

effectiveness

conditions

being met)

salary support

according to the

policy and

implementation

plan on a

declining basis;

no consultants in

line positions

to become effective.

Proposals for pay reform

approved by cabinet in

February 2011.

salary support

according to the

policy and

implementation

plan on a

declining basis;

no consultants in

line positions.

assist the Government in

meeting the pre-

conditioned outlined for

effectiveness. Inception

report already delivered

by the consultant.

Intermediate

Outcome

Indicators

Baseline 2009 2010 2011


4. Non-State

Actors (NSA)

active in the area

of PFM

monitoring and

oversight

Lack of

capacity and a

forum for an

institutionalized

and systematic

approach.

National Budget

Oversight Network

that includes NSAs

and other

accountability

institutions

established.

Information

sharing network

created

Website for NSA

on PFM established

and functional

3 capacity

development

learning programs

organized for NSA

on PFM issues.

Project virtually

became effective

in December 2009

and coordinator

for this aspect

appointed in

February 2010.

Work plan for this

aspect now

finalized and will

now commence in

earnest. Hence

targets for 2009

not achieved

At least 5 NSA are

able to access funds

through submission of

acceptable technical

proposals

At least three

publications from

NSAs on completed

activities related to

monitoring and

oversight

disseminated.

Two joint forums

organized with

Government on PFM

issues

NSAs produce annual

analytic report on

NSA sub-

component

launched in

August 2010 in

Freetown and

subsequently in

the Regional

Headquarter

Districts. Joint

forum organized

with MoFED on

PFM issues and

information

sharing network

established. PFM

thematic areas

already identified

for capacity

building of NSAs

countrywide. NSA

face book platform

Simplification of

at least 3

Government

documents on

PFM for

dissemination to

public.

At least 7 NSAs

are able to access

funds through

submission of

acceptable

technical

proposals.

Two joint forum

organized with

Government on

PFM issues

Efforts being

directed towards

simplifying the

2012 budget

through the

publishing of a

citizen’s budget.

Two joint PFM

forums were

organized with

MoFED to raise

awareness of



budget preparation

process that highlights

challenges and

constraints

established.

NSA produce

analytic report

on budget

preparation

process that

shows how

challenges and

constrains have

been addressed

NSAs on the

PEFA report and

the revised Audit

Service Act

NSAs

participated in

policy hearings

and budget

discussions as

part of central

government

budget process

and cascaded

outcome of such

meetings

regionally.

Position paper on

the process

produced.

5.1.1 Timely

submission of

financial reports

As required Financial reports

timely submitted

As required Quarterly financial

reports timely

submitted as

required.

As required Quarterly

financial

management

reports submitted

as required.

5.1.2 Timely

submission of

audit reports

None Project became

effective in

December 2009

and initial flow of

funds occurred in

January 2010.

Therefore no audit

of 2009 has been

done.

As required Field work for

2010 Audit

already completed.

Awaiting release

of audit report.

As required Unqualified

Audit Report

issued of the

audit of 2010

financial

statements.



APPENDIX 3

PDO: Support the Government of Sierra Leone in sustainably improving the credibility and predictability, control and transparency of fiscal and budget management

Indicator C

ore

UoM Baseline

(2008) Progress (2011)

Targets Values

Actual Values

Targets Values

Frequency

Methodology/ Data source

Responsibility for Data Collection

Description (indicator definition etc.)

2012 2012 2013

PDO Level Results Indicators

Indicator One:

Variance between total actual primary expenditures (outturn) and total originally budgeted primary expenditures (%)

% 13.5 23.8

15 15.4% 10

Annually Self-calculation of : Variance

between total actual primary expenditures (outturn) and total originally budgeted primary expenditures (%)

Budget Bureau

PEFA indicator-1 PEFA indicator based on unweighted average of preceding three years according to PEFA methodology. Revised – original indicator „ Variance in expenditure for the 20 largest budget heads‟. 2008 baseline is for original indicator. Progress data is for revised indicator.

Indicator Two: Share

of actual to budgeted spending on pro-poor spending priorities compared to the ratio of actual to budget expenditures for all other discretionary primary expenditures

% Poverty actual/budget = 57.5% ; Other actual/budget = 69%

Poverty actual/budget = 120.1% Other actual/budget = 101.7%


% to budget on HIPC/PRSP priorities =134.3 % to budget on other expenditures =110.6%


Annually Self-calculation based on annual financial accounts

Budget Bureau



Indicator Three:

Domestic expenditure arrears (total from all years) as % of total expenditure for year (excluding interest and donor-financed project expenditure)

% 9.4 16 Actual was 16% including stock of unpaid cheques both at the AGD‟s and Central Bank

12

15% 8

Annually IFMIS and Bank of Sierra Leone

PDMD Due to an exceptional situation in 2012 and expected for 2013, the targets are higher in 2012 than the baseline.

Indicator Four:

Financial and procurement documents listed in PI-10 and in accordance with requirements of GBAA and PPA published in Sierra Leone Gazette and/or on MOFED or related Institutions website

Number 3 3 5 5 6 Annually Direct observation

Budget Bureau, AGD, ASSL, NPPA, ICT, PFMRU

Indicator Five:

Submission of audited Public Accounts by Auditor-General to Parliament within 12 months

Yes/No Yes (2011) Yes Yes Yes Annually Submission letter of Audit report of Public Accounts

AGD, ASSL

Indicator Six

Public Contracts signed by LCs and 20 largest budget heads (MDAs) using competitive bidding according to the National Procurement Law and regulations (%)(disaggregation by LCs and 20 largest budget heads (MDAs))

% 63%

80%

63%

95%

Annually Third party assessment using sample of contracts

NPPA, MoFED

Targets the same for LCs and largest budget heads

Indicator Seven:

Deviation in own source revenue

% 104 (2008) 126.4 % of actual to budget

% of actual to budget

Annually Calculation by approved budget and

Budget Bureau, AGD

Deviation in own source revenue, is actual to



revenue not less than 92% and not more than 116%

% of actual to budget revenue is 116.3%

revenue not less than 94% and not more than 112%

actual own source revenue in annual audited accounts

budget revenue. Corresponds to modified PEFA indicator PI-3.

Intermediate Level Results Indicators – component 1:

Intermediate Results

Indicator Two: MDAs

using standard

template for strategic

plans as per MTEF

guidelines

Number 3 2 4 12 6 Annually Review of strategic plans MDA‟s budget proposal submissions

Budget Bureau

Revised – original indicator: „ Number of MDAs with acceptable strategic plans developed within resource ceilings and reflected in budget bids‟. 2008 baseline refers to original indicator.

Intermediate Results Indicator Four: Annual

appropriations backed by quarterly allocations (restricted to non-salary recurrent) for Ministry of Health, Ministry of Agriculture and Local Councils

% Health: 84.3 Agric.: 100.3 LCs: 78.9

Health: 97.4 Agric.: 91.3 LCs: 87

Health:100 Agric.: 100 LCs: 97

81% 114.9% 97.0%

Health: 100 Agric.:100 LCs: 97

Annually IFMIS

Budget Bureau, LGFD

Revised – original indicator:‟ Appropriations backed by quarterly allocations (restricted to non-salary recurrent)‟

Intermediate Results Indicator Five: Quarterly allocations backed by approved commitments (restricted to non-salary recurrent)

% Health: 85.5 Agric.: 94.3 LCs: 95.3

Health 87.5 Agric.: 103.7 LCs: 100.6

Health: 95 Agric.: 100 LCs: 100

200.5% 109% 211.2%


Annually IFMIS Budget Bureau, LGFD

Intermediate Results Indicator Six: Approved Commitments/MTEF/PETS form 2 backed cash releases

% Health: 94 Agric.: 98.8 LCs: 98.9

Health: 92.5 Agric.: 97.8 LCs: 100


99.4% 98.6% 97.7%


Annually IFMIS Budget Bureau, LGFD



Intermediate Results Indicator Seven:

New/additional payment arrears (Outstanding Commitments) during the year as a percentage of total primary expenditures

% 1.3 9.0 5.0 10.5% 3.0 Annually Ad-hoc reports on calculation of new arrears

Public Debts Management Division, AGD


Intermediate Results Indicator One: Revised GBAA and FMR submitted to Cabinet New LG Financial Administration Regulations (FAR) submitted to Cabinet Accounting Manual for Local Councils adopted and disseminated Public Debts Management Regulations adopted

Yes/No Yes/No Yes/No Yes/No

No No No Accounting Manual in Place

No No

No No No No

No No No No

Yes Yes Yes Finalised Public Debts Management Regulations

Annually Annually Annually Annually

Submission letter to Cabinet Submission letter to Cabinet Finalised Accounting Manual adopted and widely disseminated

PFMRU PFMRU PFMRU PDMD

New indicator and hence no 2008 baseline



Revised Public Procurement Act and Regulations submitted to Cabinet

Yes/No

No

No

adopted and widely disseminated Bill for Revised PPA and Regulations submitted to Cabinet

Annually

NPPA

New indicator and hence no 2008 baseline


Indicator Two: MDAs and

Local Councils with

dedicated and trained

Procurement Officers –

baseline total of 60 MDAs

and LCs

% 45 96 85 96 95 Annually Appointment

Letters/

confirmation by HRMO/LGSC

and report of

training providers/trainin

g certification

NPPA


Indicator Three: Subvented

Agencies expenditure

included in the public

accounts.

% Public Accounts omit sub-vented

agencies

expenditure (about 40% of total

expenditure

captured); incomplete

fiscal/monetary

reconciliation

70 70 70 80 Annually Annual Public Accounts

AGD Revised – original indicator: ‘ Timely

publication of

comprehensive annual financial

statements with

reference to PEFA standards’. 2008

baseline refers to

original indicator.

Intermediate Results Indicator Four: MDAs with

IFMIS Personnel

Management aspect of Civil Service Management

Module rolled-out

Number All personnel management under

HCA operationally

consolidated within HRMO

2 3 2 3 Annually Review of IFMIS annual

report/related

PFM reports

HRMO, PFMRU

Intermediate Results Indicator Five:

MDAs copying quarterly

internal audit reports to Director of Internal Audit

Local Councils copying

Number

0

10

12

23

15

Quarterly

Internal Audit Reports and

Cover Letters

IAD



half-yearly internal audit

reports to Director Internal Audit

Number 0 1 2 6 5 Quarterly

Internal Audit

Reports and Cover Letters

IAD New indicator and

hence no 2008 baseline


Indicator Six: MDAs with

Audit Committees meeting quarterly

LCs with Audit Committees

meeting quarterly

Number

Number

No functioning

audit committees

2

0

4

1

6

0

6

3

Quarterly

Quarterly

minutes of

quarterly

meetings containing

review of

internal audit reports

minutes of

quarterly

meetings

containing review of

internal audit

reports

IAD

IAD

New indicator and



Intermediate Results Indicator One: Budgeted

expenditures (other than Projects) executed online

through IFMIS

No. of IFMIS rolled out

MDAs (including AGD) –

Expenditure and Purchasing Modules

LCs using Petra Accounting

Package

%

Number

Number

62

8

76

12

80

12

12

100%

12

19

90

16

19

Annually

Annually

Annually

Calculation of data from IFMIS

report against annual audited

accounts

quarterly returns to MoFED

produced from

the Petra

AGD,

PFMRU, ICT

AGD,

PFMRU,ICT

PFMRU,ICT

New indicator and hence no 2008

baseline

Establishment of Disaster Recovery Centre for IFMIS

Yes/No No Yes Annually ICT, PFMRU New indicator and hence no 2008

baseline


Indicator Two: Salary Support for MOFED Civil

Service Staff

DROPPED



Intermediate Level Results Indicators – Component 4:


Indicator Two: Review and

analytical reports on annual

budget proposals and

priorities in MDAs produced

by NSAs

Number 0 0 0 2 Annually Reports produced

by NSA

Secretariat

NSA Secretariat New indicator and

hence no 2008

baseline


Indicator Three: Reports on

PFM monitoring and

oversight at Local Council

level produced by NSAs

Number 0 0 0 6 Annually Reports produced by NSA

Secretariat

NSA Secretariat New indicator and hence no 2008

baseline


Indicator Three: Citizen Budget yearly published,

launched and disseminated

at national, regional and district level

Yes/No No Yes Yes Yes Annually Citizens Budget,

Reports produced by NSA

Secretariat

NSA Secretariat New indicator and


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