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Presentation by:
PFEM Secretariat
Ministry of Finance
MALAWI
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Outline Introduction
PFEM Reform Roadmap
Drivers of the Reform Process
Good Practices Achievements
Challenges
Success Road ahead
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Introductions
PFEM Reforms aim to improve, strengthen, or changethe PFM system;
The objectives of the reforms are to achieve:
fiscal discipline;
efficient allocation of resources towards nationalstrategies; and
ensuring value for money
The ultimate goal is to ensure effective and efficientpublic service delivery.
PFEM Reform process is complicated as it involves a
wide range of stakeholders
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PFEM REFORM ROADMAP IN
MALAWI In 2001 the Country Financial Accountability Assessment
(CFAA) was with the assistance of the World Bank toidentify accountability issues and risks
The recommendations of the assessment formed the basisfor the development of the Malawi Financial
Accountability Action Plan (MFAAP) in 2003
MFAAP had a purpose of coordinating initiatives aimed at
strengthening financial accountability. The MFAAP had 52 initiatives covering Central
Government, Local Governments, Parastatal.
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PFEM REFORM ROADMAP IN
MALAWI Contnd The action plan was organized in 5 themes:
budget preparation;
implementation and expenditure control;accounting and reporting;
procurement;
external oversight ; and
private sector
For effective progress monitoring of the AP, theMFAAP Technical Committee was established
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PFEM REFORM ROADMAP IN
MALAWI Cntnd The first PFEM Action Plan 2006-08 on the MFAAP, was
developed to coordinate activities across the PFEM cycle
MFAAP TC was changed to be PFEM TC
Progress in PFM was made especially regarding theimplementation of the IFMIS and enactment of the:public procurement, Audit and Financial ManagementActs in 2003
Second PFEM Action Plan aligned to the Malawi Growthand Development Strategy (MGDS ) developed in 2008
The Action Plan had 130 actions points and difficult tomonitor
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PFEM REFORM ROADMAP IN
MALAWI Cntnd It was hence revised in 2009 and had 39 actions for
implementation between 2010-11
In 2010 the Ministry of Finance through functional review
established a PFEM Unit responsible for coordinating,
Facilitating; and
monitoring implementation of PFEM reforms
In June 2011 Government developed a comprehensivereform programme covering all key PFEM Institutions
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PFEM REFORM ROADMAP IN
MALAWI Contnd It covers issues of;Planning and Policy Analysis,
Resource Mobilisation,
Budgeting,Procurement,
Accounting and Financial Management,
Cash and Debt Management,
Parastatal Financing,
Monitoring and Reporting,
External Audit and Programme Management
Government priority identifies projects to be fundedunder the programme
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Drivers of the Reform Process in
Malawi Government with Development Partners established a
multi-donor trust fund
Development partners have worked with Governmentin PFM reforms through;
Undertaking Studies and Assessments to inform areaswhich need reform
provision of Financial support
Government has driven the reform process by
Undertaking relevant PFEM analyses
implementing the recommendations
Putting in place relevant structures
providing other resources for PFEM projects
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Good Practices Government Leadership in the PFEM reform process for
ownership and ease of institutionalisation of the reformsGovernment chairs all PFEM committees in Malawi
Use of PFEM AP indicators for conditionality
PFEM Reforms are complicated hence require a
comprehensive programme like the PFEM RP
PFEM Reform is on-going and requires well establishedimplementation structures
Relevant stakeholders are highly involved through regularmeetings
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Achievements Improvements had been observed in some areas of
PFEM as evident by movements in PEFA scores inareas of;
Budget classification and comprehensiveness whereMalawi mover from B in 2008 to A in 2011
Effectiveness of payroll controls from C+ to B+
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Challenges Complicated PFM systems which requires advanced
coordination skills
relevant capacity being built in the PFEM Unit
Lack of commitment by PFM Institutions
Requires an understanding of change management
Poor Coordination in the early stages
PFEM Unit is now in place and this has been solved
Resource constraints as PFEM reforms dont achieve quick wins so funding gaps
are usual
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Success Stories Comprehensive PFEM RP developed with GovernmentLeadership
Multi Donor Trust Fund established as a funding
vehicle to ensure complete funding of all thecomponents
Relevant structures institutionalised to ensure smoothimplementation of PFEM programmes
(including; PFEM SC, PFEM TC, TWGs and the PFEMUnit)
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Moving Forward PFEM Secretariat to function beyond coordinating
To be involved in initiating and spearheading reforms
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Thank You