9-10.15am_Challenges in Implementing a Performance Framework (P. Perczynski and M. Postula) ENGLISH

8/14/2019 9-10.15am_Challenges in Implementing a Performance Framework (P. Perczynski and M. Postula) ENGLISH

1/21

11

CHALLENGES IN IMPLEMENTINGCHALLENGES IN IMPLEMENTING

A PERFORMANCE FRAMEWORK A PERFORMANCE FRAMEWORK

Polish experiencesPolish experiences

dr. Piotr Perczynskidr. Piotr Perczynski

National Coordinator for Performance BudgetNational Coordinator for Performance Budget

in Ministry of Financein Ministry of Finance

Washington DC; December 3th, 2009Washington DC; December 3th, 2009

Ministry of FinanceMinistry of Finance


2/21

11

6,2

5,0

3,0

3,4

1,4

2,5

3,1

3,6

6,8

0,91,2

2,8

6,8

5,0

0

1

2

3

4

5

6

7

8

2005 2006 2007 2008 2009 2010 2011 2012 2013

%

The public finance sector in PolandThe public finance sector in Poland

GDPGDPgrowth in 2005-2013growth in 2005-2013


3/21

33

38,9 39,7 41,2 40,4 41,2

41,9 41,8 41,1 42,044,

-3,0-2,1

-1,6

-3,3

-4,3-3,9

-1,9

-3,9

-6,6

0,1

20

30

40

50

60

70

80

2005 2006 2007 2008 2009

%G

DP

MF data, draft of nb 2010: forecast 2009-2010; Result ESA95: Eurostat 1999-2008,UC Forecast 2009-2010


Revenue, expenditure and public finances resultRevenue, expenditure and public finances result

in 2005in 2005--2010 (% GDP)2010 (% GDP)


4/21

44

47,5 47,8

44,8

47,0

49,8

54,5 54,854,7

40

42

44

46

48

50

52

54

56

2005 2006 2007 2008 2009 2010 2011 2012


-- debt todebt to GDPGDP ratioratio in 2005-201in 2005-20122


5/21

55

The puzzle of public financeThe puzzle of public finance

fiscal rules

consolidation of

fiscal sector

performance

budget

multi-annual

planning


6/21

66

Polish model of Performance BudgetPolish model of Performance Budget

Polish solutions only to be directly applied in PolandPolish solutions only to be directly applied in Poland..

Countries which directly adopted foreign models later had toCountries which directly adopted foreign models later had to

adjust these modelsadjust these models oror reconstruct them completely withreconstruct them completely withrespect to:respect to:

specifics of their own public financesspecifics of their own public finances;;

national prioritiesnational priorities;;

social-economical circumstancessocial-economical circumstances..

There is no single model of performance budget


7/21

77

TheThe PolPolishish definitiondefinition ofof

Performance BudgetPerformance Budget

Performance budgetPerformance budget consolidatedexpenditure plan for entities from thepublic finance sector for more than onebudgetary year, prepared in a functionalsystem (function, task, subtask), basedon the targets and measures of theirrealisation.


8/21

88

Performance Budget Performance Budget modern expendituremodern expendituremanagement in public sector based onmanagement in public sector based on::

Multi-annual planning

Transparency

Effectiveness

Efficiency


9/21

99

Polish calendarPolish calendar

of Performance Budgetof Performance Budget

4th stage

3rd stage

2nd stage

1st stage

2006 2007 February 2008 20102006 2007 February 2008 2010

2012


10/21

1010

Governmentalinitiative

PerformanceBudget

a pilot stage inthe Ministryof Scienceand Higher

Education

The first rulesconcerning

performancebudget

in Public

Finance Act

1st stage

February 2006 February 2007


11/21

1111

Presentation of performance budgets of most budgetaryPresentation of performance budgets of most budgetary

chapters trustees into justification to budgetary actchapters trustees into justification to budgetary act

draft for 2008draft for 2008..

Performance budget coversPerformance budget covers 44%44% of State budgetof State budget

expenditure. Multi-annual structure principle is not inexpenditure. Multi-annual structure principle is not in

full use.full use. HHigh degree of trustee discretion into shapingigh degree of trustee discretion into shaping

budgetsbudgets structure on all levels.structure on all levels.

2nd stageFebruary 2007 February 2008


12/21

1212

In the first quarter of 2008 the project moved to the MIn the first quarter of 2008 the project moved to the MoF.oF.

Methodological changes aimed towards:Methodological changes aimed towards:

setting tasks by the Ministry of Finance Decree to introducesetting tasks by the Ministry of Finance Decree to introduce

budgetary expenditure classification based on COFOGbudgetary expenditure classification based on COFOG;;

preparing indicators, which enable full application of medium-preparing indicators, which enable full application of medium-

term and multi-annual expenditure planning mechanismsterm and multi-annual expenditure planning mechanisms;;

implementation of functional structureimplementation of functional structure of performanceof performanceexpenditure planning.expenditure planning.

3rd stageFebruary 2008 2010


13/21

1313

FFunctional structure ofunctional structure of

performance expenditure planningperformance expenditure planning

1st level

2nd level

3rd level

4th level

State functions expenditure of one Stateactivity area;

Tasks expenditure according to objectives;

Subtasks influence on the achievement ofobjectives on the task level;

Activities most important elements ofobjectives achievement process on the levelof subtask and task.


14/21

1414

Objective setting levels

Priority objectives

Set by Prime Ministeron the functional level

Strategic objectives

Set by Minister/Office Headon the task level

Operational objectivesSet by Secretary/Undersecretary of State

on the task and subtask level

Administrational objectivesSet by General Director

on the task and subtask level


15/21

66

PProcessrocess

Ministry of Finance

Individual Ministries

NationalCoordinator for

Performance Budget

Department ofPublic Finance

Reform

State BudgetDepartment

Strategic group(representatives of

management)

Ministrycoordinators

BudgetDepartments


16/21

1616

Performance budgeting structure of expenditure

2008 r. 2009 r.

166 tasks 454 subtasks 656 objectives 957 indicators

152 tasks 550 subtasks 1041 objectives 1060 indicators

performance budget cover44%

of State budget expenditure;

performance budget cover100%

of State budget expenditure;

part of trustees excluded fromperformance planning;

the first performance budgeting structure ofexpenditure for all budgetary chapters

trustees;

preliminary expenditure projection fortwo bugetary years;

full expenditure projection for2010 and 2011;

tasks and subtasks specified by trusteeswithin the scope ofparticular budgetary

chapters.

tasks and subtasks defined by trustees inaccordance with functional expenditure

structure, according to the list of functionsand tasks specified by the Minister of Finance.

Expenditure plan in Performance Budgetstructure in 2008 and 2009


17/21

1717

Example of Function 20.Organization of health policy and health care

Function/task/subtaskFunction/task/subtask TrusteesTrustees ChapterChapter ObjectiveObjective IndicatorIndicator Planned state budget expenditurePlanned state budget expenditure

in 2009 (thousand pln)in 2009 (thousand pln)

NameName Base valueBase value ValueValue

in 2009in 2009

TotalTotal SpecificSpecific

provisionsprovisions

shareshare

11 22 33 44 55 66 77 88 99

Function 21. Organization of health policy and healthFunction 21. Organization of health policy and health

policypolicy

1 724 6571 724 657 53 79053 790

Possibility to comparetrustees

effectiveness and efficiencyof spending within the

equivalent activity

List of all trustees

objectives determined bytheir policiesPossibility to show

all trustees who realizeobjectives in the given function

Consolidation of expenditure spentby all trustees on objectives

within given function

B d f 2010


18/21

1818

Budgetary act for 2010

in Performance Budget structure

100% of State budget expenditure

in performance budget structure. Forecast for 2011-2012 in

performance budget structure.

Multi-annual and investment

programs in performance budget

structure. Financial plans of other public

finance sector units (100% of

agencies, 25% of state legal

entities).

Description of tasks and subtasks.

Specification of priority tasks instrategic areas.

Description of financial plans of

public finance sector units.

Table form Descriptive form


19/21

1919

2012

Executed simultaneously according totraditional and performance classification

4th stage2010 2012

TraditionalBudget

PerformanceBudget

Annual report of 2012 in performance budgeting structurewith elements of traditional structure


20/21

2020

Target benefits from Performance Budgetimplementation in Poland

rational use of resources by public administration decrease of the cost for State functioning and transferachieved savings to priority tasks, optimizing ofemployment level in public sector;

assurance of planning cohesion of funds for tasks conductedby various institutions within the framework of Statebudgetary functions;

improvement of efficiency and effectiveness of governmentadministration and judicial entities;

more universal and competent supervision and estimationof public funds spending, beneficial from the point of view ofthe qualitative and quantitative aspects of costs.


21/21

2121

Thank youThank you

for your attentionfor your attention

Ministry of FinanceMinistry of Finance

9-10.15am_Challenges in Implementing a Performance Framework (P. Perczynski and M. Postula) ENGLISH

Documents

Transcript of 9-10.15am_Challenges in Implementing a Performance Framework (P. Perczynski and M. Postula) ENGLISH