PFM blog

Good financial governance in Africa

19 March 2010

Effective states, economic growth and sustainable development is associated with states’ ability to raise taxes, borrow prudently and manage other revenue flows effectively; to plan and manage the spending of public money effectively and efficiently; and to account for the use of funds and the results achieved. The management of public funds in states that achieve these outcomes commonly are characterised by elements of transparency, participation, responsiveness, oversight, accountability and predictability and by the rule of law. Together these features are constituent elements of good financial governance, the subject of a key work stream for CABRI in 2010/11.

The work will build up to a declaration on good financial governance to be considered for adoption by African ministers of finance, an important potential support for the network’s efforts to support senior budget officials in member countries to drive quality budgeting reforms. The work is being undertaken in collaboration with the African Development Bank and CABRI’s sister networks, the African Organisation of Supreme Audit Institutions (AFROSAI) and the African Tax Administration Forum (ATAF). It will comprise at first a collaborative research study on good financial governance in Africa, funded by GTZ, to set out the challenges and priority actions to achieve improved financial governance in Africa.

This is our first blog relating to the good financial governance work, and it serves as an invite to members to participate in the work in an ongoing manner. It is hoped that the blog will develop to feed into the good financial governance research and discussions. It is important that the work and an eventual declaration are grounded in African experience and reflect African priorities. Engagement by CABRI, AFROSAI and ATAF members in the study, its outputs and the process towards a declaration will be essential to ensure declaration that is relevant to challenges faced by practitioners on the continent. Future blogs will present outputs from the work as well as key discussion points and issues for members’ inputs.

The blog comes just prior to the first technical workshop for the good financial governance research which will be held in Pretoria, South Africa in the course of this week. The workshop initiates the study and will agree a common research framework for three technical input papers – on the status and challenges of good financial governance in the areas of (i) budgeting, budget execution and accounting, (ii) audit, accountability and oversight and (iii) tax administration – on the basis of which a synthesis Status Report on Good Financial Governance will be drafted. The Status Report will be discussed in a stakeholders’ conference in the middle of year, after which it will be finalised and a draft declaration prepared. The workshop will define good public financial governance for the purposes of the study, unpack its constituting elements and identify study focus issues within the three research areas.

A study on good financial governance can be demarcated as broadly or narrowly as is appropriate for the objective of working towards a declaration that will assist in improving development outcomes sustainably in Africa. What do members think would be appropriate for the study to consider? The first paragraph above sets out some elements that are commonly seen as essential for achieving good governance of the public finances. Are these relevant concepts? What other concepts are relevant? What are the key challenges to achieving good financial governance in the public sector? What do members see as first priorities for improving good financial governance in their countries, on the continent? What should the input studies focus on within the three designated research areas?

Further information

For further information, please contact Nana Boateng

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