Over the past 30 years, African countries have introduced reforms to improve the management of public finances. In a context of scarce resources and enormous social and economic backlogs, these reforms aimed to ensure greater efficiency and effectiveness in the allocation of resources to government’s national priorities.
A common approach of these reforms has been to mimic the practices of developed countries in the hope that they would deliver similar results, irrespective of the political, economic and administrative contexts. However, best practice reforms have had limited success in improving the functionality of PFM systems. High and unaffordable wage bills persist, unapproved or off-budget expenditure continues to divert resources away from priority programmes, and capabilities at the point of service delivery appear to be eroding.
In response, CABRI developed the “Building Public Finance Capabilities” (BPFC) programme – an action-learning programme jointly developed with the Building State Capability programme of Harvard Kennedy School. The programme applies a unique approach to public finance reform: The Problem-driven Iterative Adaptation, or PDIA. Central to the approach, is the recognition that a deep understanding of public finance problems and their causes is critical to developing relevant and effective solutions to improve countries’ PFM systems.