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SCP- PERFORMANCE BASED BUDGETING

SCP- PERFORMANCE BASED BUDGETING. Country Case Presentation SRI LANKA. Sri Lanka is an Island situated in the Indian Ocean, off the base of the Indian Sub Continent Total Land Area - 65,610 sq.km 435 km long and 225 km wide Commercial Capital – Colombo

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SCP- PERFORMANCE BASED BUDGETING

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  1. SCP- PERFORMANCE BASED BUDGETING Country Case Presentation SRI LANKA Country paper-Sri Lanka

  2. Sri Lanka is an Island situated in the Indian Ocean, off the base of the Indian Sub Continent Total Land Area - 65,610 sq.km 435 km long and 225 km wide Commercial Capital – Colombo Total Population: 20 million; Multi ethnic & multi religious GDP Rs. 3,578 billion The Country Country paper-Sri Lanka

  3. Key Economic Indicators: Country paper-Sri Lanka

  4. Current Budgetary System • The current budgetary system of the country is a mixed system • Block Budgeting • Parliament approves the block budget • MOF fixed ceilings for sectors, line Ministries (Recurrent + Capital) • Flexibility is given to line Ministries to decide their budget within the ceiling • Programme Budgeting • Cluster based • Expenditure Head, Programmes, Projects, object code Country paper-Sri Lanka

  5. Current Budgetary System- ctd • Performance Based Budgeting • Medium-term Budgetary Framework • Vision, Mission and KPIs for each line Ministry have identified. However, linkages between these outcome indicators and actual budget figures are still weak. • Line Item Budgeting • Expenditure figures are available for administrative and monitoring purposes Country paper-Sri Lanka

  6. Medium-term Macro Economic Framework (2006-2010) Country paper-Sri Lanka

  7. Legal Framework • Constitution- empowers parliament • Finance Act- • Appropriation Act- • Fiscal Responsibility Act- • Budget deficit shall not exceed 5% of GDP • Total liabilities should not exceed 85% of GDP • Financial Regulation Country paper-Sri Lanka

  8. Vision for a new Sri Lanka • Agriculture • Economic Infrastructure • Education • Health • Environment • Public Administration Reforms • Livelihood and Social Protection • Urban Development and Human Settlements • Tourism • Labour • Science and Technology • Sports and Culture • Development of Conflict Affected Areas • Macro-economic vision Country paper-Sri Lanka

  9. Aimed at raising the GDP growth rate in excess of 8% and sustain this rate for 6 years. (9-10% growth thereafter) • Raise per capita GNP to US$ 3960/- by 2016 elevating SL’s position as a middle income country. • Improve growth prospects with equitable development in the country, with special emphasis on the needs of lagging regions. • Enhanced resource allocation for identified strategic priorities in rural development, education, skills development, health, roads, irrigation & delivery systems. • Raise Investment/ GDP ratio to a level of 32 to 38% during next 10 years. www.treasury.gov.lk The document contains overall development policies, strategies, goals, priority areas for next ten year period. Country paper-Sri Lanka

  10. Medium Term Budgetary Framework 10 Year Plan MTEF 1 • Budget estimates are now presented over 3 year horizon. • The present MTBF is from 2008 to 2010 MTEF 2 MTEF 3 Country paper-Sri Lanka

  11. Budget Calendar • Preparation of the MTBF and approval of the Hon. Minister of F&P for the Budget Circular- June • Briefing note to Cabinet on budget outline and priorities- July • Issuing the budget circular calling for proposals- July • Review of budget requests with line Ministries- August • Presenting the Appropriation Bill (Cabinet + Parliament)- October • Budget Speech- November • Release of cash flow statement- December Country paper-Sri Lanka

  12. ACHIVEMENTS TOWRDS PBB 1. MTBF - 3 year Budgetary framework - Cluster Basis approach - More Resources for Priority Sectors - Performance Targets - Expenditure Ceilings (Flexibility ) 2. Managing for Development Result (MFDR) - Whole - of Government Approach - Led By the Ministry of Plan Implementation - Aim is to enhance aid effectiveness Country paper-Sri Lanka

  13. Country paper-Sri Lanka

  14. WHAT WE DID ? and HOW? 1.Government Level Country paper-Sri Lanka

  15. 2. Agency Level • MPI facilitate each ministry to - Form a committee as change agents - Develop aAgency Result FrameworkandResult Card with Mission, Thrust Areas , Goals, and Key performance indicators (KPI) - Report Progress on KPIs UsingScore Cards # electronic Project Monitoring System # 3 Color Traffic lights • MPI evaluate achievements Quarterly and report to the Cabinet • Completed 3 Phases # Phase I – 5 Ministries # Phase II – 12 New Ministries # Phase III – 18 more Ministries • ADB’s Redness Assesment toolkit is use for identify capacity gaps in the Ministries Country paper-Sri Lanka

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  18. Gaps in Public Finance Management and Area for Reforms Country paper-Sri Lanka

  19. CHALLENGES • Make a linkage between existing 2 systems of Budgeting and MFDR • Over coming Capacity gaps • Changes in Attitudes and Mindsets • Improving availability of statistical information • Hard Budget Constraints • Tribunal environment Country paper-Sri Lanka

  20. Thank you Country paper-Sri Lanka

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