The Public Financial Management Reform Project (PFMRP)

The Socialist Republic of Vietnam The Public Financial Management Reform Project PFMRP Presented by Vice-Minister of Finance: Dr.. Some weaknesses• Fiscal sustainability concerns: decli

The Socialist Republic of

Vietnam

The Public Financial Management Reform

Project (PFMRP)

Presented by Vice-Minister of Finance: Dr Tran

Van Ta

• Reform background

• Project goal

• Project description summary

• Sustainability and risk

considerations

• Project progress

• Lessons learnt so far

Reform background

• The Public Administrative Reform Master Plan over 2001-2010 sets platform

• The revised State Budget Law promotes

decentralization, transparency, accountability, and administrative rationalization &

streamlining.

• The reform areas are recommended from

analysis supported by the World Bank and

other donors i.e PER 2000, PER 2004, CFAA 2001,

Vietnam Development Report 2003,…

Some weaknesses

• Fiscal sustainability concerns: declines in

crude oil revenues, mismatch between capital and recurrent expenditures, salary reform

pressure, extra-budgetary accounts,

non-performing loans to SOEs, and weak

prioritization processes

• Poor budgetary information: lack of fully

consolidated budget, lack of a common

accounting structure, lack of integrated,

electronic data recording

Identified five areas of

reform

The PFMRP addresses the first 04 areas of reform:

• Budget management

• Debt management

• SOE fiscal risk management

• Public asset management

To be addressed by the other 2 important projects:

• Revenue management :

The PFMRP’s project

goal

• Aiming at good governance, contributing

to poverty reduction.

• Objectives:

– to strengthen budget planning, execution,

reporting and accountability,

– to strengthen the links between budget

management and the developmental goals

within a medium-term expenditure

framework; and

– to improve the management of public debt

Project performance

indicators

• Improved accuracy, timeliness,

relevance, transparency and compliance with international best practices;

• Better planning of the State Budget and

the Public Investment Program; and

• Greater fiscal sustainability.

Project description

overview

• Component 1: Strengthening

Treasury and Budget Management

• Component 2: Strengthening State

Budget and Investment Planning

• Component 3: Strengthening

Management of Public Debt and

Monitoring of SOE Fiscal Risks

Component 1: Strengthening

Treasury and Budget

Management

Information System (TABMIS) will be operational

in all central, provincial and district treasury

offices, finance & planning agencies, based on a new, integrated account code structure

development of Unified Chart of Accounts/State Accounting regime

Component 2: Strengthening State Budget and Investment

Planning

• Technical assistance for the piloting of the

Medium-term Fiscal Framework (MTFF) and the Medium-term Expenditure Frameworks (MTEF)

• Change management and communication of

the new practice

• Design and implementation of a budget

preparation system

Component 3: Strengthening Management of Public Debt and Monitoring of SOE Fiscal

Risks

to support strengthening of recording and management of domestic debt

consolidation and management of public

debt

Sustainability & risk

considerations

‘learning by doing’, a strong legal framework, making a platform for further development as committed

Difficulties in the integration of different accounting structures; Network infrastructure preparedness.

implementation capacities; Substantial organizational changes; Acceptance of new technologies, practices

Project progress

TABMIS

organizational preparedness

the first time

Management and Mobilization Plan, domestic

markets

Lessons so far

and adjustments to be discussed and agreed if necessary

independent consulting services are needed

meetings and an empowered Project Management Unit (PMU)

are even more emphasized during the process.

stakeholders is a prerequisite

Thank you!

&

The Ministry of Finance looks forward to your cooperation

and assistance