Digitized Public Financial Management Reforms (PFMR)

Ghana has since the 1990’s embarked on reforms in its public financial management framework which covered a review of Review Management, Legal & Policy framework, Economic Planning, Budgeting, Procurement, Contract Award, Payment, Payroll and Audits. To ensure effective implementation, the Public Expenditure and Financial Accountability (PEFA) framework was adopted to track progress in six (6) broad areas namely:

  • Budget Credibility
  • Comprehensiveness & Transparency
  • Policy-Based Budgeting
  • Predictability and Control in Budget Execution
  • Accountability, Recording and Reporting; and
  • External Scrutiny and Audit.

To date, the reforms have chalked a number of successes. According to a Joint Evaluation on Ghana’s PFMR (2001-2010) commissioned and published by the Swedish International Development Agency (SIDA), Danish Development Agency (DANIDA), and Africa Development Bank (AfDB) in 2012, the country has made significant gains in the area of Revenue Management and the legislation of a number of PFM laws, although implementation of some of these laws and budget credibility remains a challenge.

To encourage compliance with PFM laws and restore credibility and trust in budgeting and execution processes, Ghana has in recent times developed a comprehensive PFMR Strategy which is being implemented in several ways. One of the projects emerging from the strategy has been the new PFMR project (2015-2018). The main characteristic of this International Development Association (IDA-World Bank) US$ 45million supported project currently underway is the high adaptation and application of ICT tools as an enabler for the realization of key development outcomes. It is expected that, through the use of ICT4D,  the Revenue Management, Budget Preparation, Procurement Planning and Payments among others will all be done electronically and operate as an end-to-end integrated system. Some of the key deliverables of the project will be the introduction of an Integrated Financial Management Information System (IFMIS), a Human Resource Information System, Payroll System, E-Government Procurement System, Revenue Management Information System, an International Public Sector Accounting System (IPSAS), Aid & Debt Management System and an Enhanced Procurement Planning System.

Although this project sounds impressive and promises to end waste and enhance efficiency in public financial management, one may want to investigate the extent to which this multi-million dollar project will end up resulting in increased dependence on the West as a huge chunk the support may have to be used to pay for operating licenses to these software development firms mainly found in the West.