## ppea2024024 ## Source details **Canonical URL:** [ppea2024024](https://www.imf.org/-/media/files/publications/pp/2024/english/ppea2024024.pdf) ## Other formats - [Markdown version](/-/media/files/publications/pp/2024/english/ppea2024024.pdf.md) - [Structured JSON version](/-/media/files/publications/pp/2024/english/ppea2024024.pdf.json) --- ### EXECUTIVE SUMMARY — Context and strategic environment - Global environment described as "complex" with membership facing an "increasingly shock-prone world, increased fragmentation, and longer-term structural challenges." - Characterized by "slow, uneven growth, increased fragmentation, deepening divergence, and still high interest rates, albeit declining with ongoing easing of inflationary pressures." - Fall 2023 Global Policy Agenda priorities: a) help members safeguard macroeconomic stability, rebuild buffers, and promote growth-oriented and green reforms; b) bolster international cooperation to strengthen the global financial safety net and debt architecture and support structural transitions requiring joint action. ### FY25–27 budget framework and trajectory - Budget transitioning "from a growth to stabilization phase." - Fund will: - allocate the final tranche of the FY23-25 augmentation in FY25; - continue unwinding exceptional pandemic-era temporary funding; and - project a flat real trajectory beginning in FY26 and FY27. - Reprioritization guided by agility and discipline amid "difficult trade-offs." ### FY25 net administrative budget (NAB) and composition - Proposed FY25 NAB: $1,501 million (nominal). - Alternate presentation: NAB for FY25 totals $1.44 billion (real), with a projected $83 million in Fund-financed carryforward resources. - Net changes versus FY24 (excluding FY24 Annual Meeting allocation and before reprioritization): $13.8 million in net new resources. - Structural changes increasing net overall structural administrative space by $37.5 million (about 2.7 percent of the NAB): - Augmentation: final $29.0 million (2.1 percent of the NAB). - Executive Board (OED) resources: $8.5 million net increase (0.6 percent of the NAB), gross needs total $10 million, with internal savings of $1.5 million. - Temporary resourcing unwind: reduction of $23.8 million as pandemic-era exceptional temporary space continues to be unwound. ### Externally funded and capital budgets - Externally funded budget (nominal): $276 million. - Three-year increase in externally funded spending limit agreed in FY22; 6 percent real increase proposed to support structural transformation agenda. - FY25 capital budget (nominal): $121.9 million. - Cloud costs expected to rise "as estimated." ### Sustainability and fiscal posture - FY25–27 budget consistent with Fund’s medium-term income position and precautionary balance target. ### Risks, work pressures, and cost pressures - Elevated risks amid multiple membership shocks; significant residual risk related to external drivers. - Key budget risks: uncertainty in demand for Fund lending; sustained high work pressures on staff well-being; pricing uncertainty as 75 percent of spending is affected by salary-structure/deflator dynamics. - Noted cost pressures: - Airfares remain about 36 percent higher than pre-pandemic rates. - Medical benefit contributions increased by 6.8 percent in FY24. - Data subscription costs: 8-12 percent increases. - IT vendors/contractual costs: 13 percent increase. - Cloud costs: 8-18 percent increase. - Workload and well-being indicators: - Average overtime in first 10 months of FY24: 11.1 percent. - FY21 pandemic peak average overtime: 12.4 percent. - Pre-crisis average overtime for same period: 10.0 percent. - Department-level risk assessments identified 18 safety and well-being risks; 11 focused on staff burnout. - Annual leave use recovered to pre-pandemic levels; 2023 Health and Wellness Survey (forthcoming) signals a significant and rising minority of staff rating mental health as fair, poor, or very poor. *Source: EXECUTIVE SUMMARY, March 26, 2024.* ### PERSONNEL SPENDING — staff levels and funding - Overall budgeted staff rose from FY20-24 by about 304 positions (10 percent). - Externally funded positions supporting CD work increased by 20 percent to 109 FTEs. - Fund-financed staff proposed to increase by an estimated 58 positions in FY25 (including OED), before leveling off in FY26-27. - Externally funded positions proposed to rise by 17 (16 percent) in FY25. - Non-staff personnel positions increased between FY20-24 by about 50 percent; 17 percent of that increase were externally financed. - Long-term contractuals increased 60 percent, driven mainly by hires in functional departments. ### Key staffing and budget datapoints (verbatim examples from source figures) - Gross Fund Financed (outturn est.): 1,455 structural, 95 temp, total 1,551. - Example FY26: 1,451 structural, ... total 1,411. - Example FY27: 1,487 structural, 94 temp, total 1,581. - Net administrative budget examples in Figure 4: 1,411; ...; 1,410; 1,441; 1,441; 1,448. - Annual Meetings shown as o/w Annual Meetings: 7. - General Receipts examples: 44; 41; 46; 46; 46. - Carryforward examples: 87; 83; 70; 57. - Gross Externally Financed (FY24): 250 structural, 7 temp, total 257. - Indicative Gross administrative envelope examples across FY24–FY27: 1,706 structural, 102 temp, total 1,808 (FY24); FY25/FY26/FY27 indicative totals shown as 1,668/1,752/1,853/1,824/1,817 across the figure. - Capital examples: 108; 115; 117; 117; 124; 127. - Memorandum: General carryforward limit examples: 72; 66; 54; 40. ### Reprioritization and budget management - Budget reporting aligned to Fund Thematic Framework across direct country operations, multilateral surveillance and global standards, policy and analytics, and corporate functions. - OBP works with sponsoring departments to cost policy proposals at recommendation stage. - Staff developed work intensity indicators for non-recurrent Board Work program items as part of FY25 pilot strategic cycle. - Reprioritization practices include FY16 and FY19 streamlining, FY21 crisis-exigency reprioritization, and ongoing post-pandemic initiatives. ### Addressing medium-term challenges and demand pressures - Executive Board approved Strategic Planning Cycle updates on a pilot basis to reinforce medium-term priority setting. - Members face limited policy space, high debt, slowing growth, rising inequality, and heightened macro-financial risk. - More than half of low-income countries are at high-risk of debt distress. - FY24 RST tentative costs projected at $13.6 million, including $5.1 million in trust administration and $8.5 million in operational costs. - Scale of RSF-related arrangements and related costs expected to increase further in FY25. - Interdepartmental AI working group constituted; departments piloting AI applications with ITD. ### Hybrid engagement, field presence, and operational needs - Field presence as of December 2023: 120 offices, up by 9 since 2020 and 20 since 2010; includes 17 RCDCs and 103 regional and resident offices. - Overall field personnel totals 882: 120 staff, 167 experts, and 595 local staff — a 32 percent increase in overall staffing since FY10 and 11 percent since FY20. - Required minimum office presence for HQ-based employees: 60 percent per month (three days per week baseline). - Capital needs related to hybrid work: about $18 million in FY24 and $15 million in FY25. - Recurring hybrid-related expenditures absorbed through reprioritization: $2.7 million in FY24 and $2.5 million in FY25. - Hybrid model estimated cost avoidance of $18-20 million per year by addressing personnel growth without leased external space. ### Risk management and ERM - ERM policy approved December 2022; phased approach with early implementation review noting improved risk awareness. - Opportunities to simplify ERM guidance and find efficiencies across business processes. ### Income, budget outlook, and precautionary balances - FY25–27 budget consistent with a projected surplus in the medium-term income position and progress beyond precautionary balances target. - Under existing policies, projected operational income remains well above expenses through FY30. - Reimbursements to the GRA from SDR department and RST contribute to income; such flows from PRGT suspended until FY26. - SDR 25 billion target for precautionary balances expected to be reached in late FY24. *Source: ppea2024024 - 8. Personnel spending.* ### SECTION III — FY24 DEVELOPMENTS: achievements and utilization - FY24 expanded direct country support, increased financial operations (including RSF), and CD. - Board of Governors concluded 16th General Review of Quotas, approving an increase of 50 percent. - FY24 is second year of phased three-year budget augmentation; deliverables broadly on track across five targeted strategic priority areas: climate change, digital money, macro-financial surveillance, fragility, and gender and inclusion. - Box 4 selected FY24 achievements: - Financing to 29 countries (incl. 20 LICs). - 13 RSF operations approved, 5 in train. - 123 Article IV consultations, 6 FSAPs concluded. - 173 countries/territories received CD. ### FY24 utilization and spending by input - General structural budget (excluding OED/IEO) projected at 100.8 percent (100.0 percent including OED/IEO); drawdown of about $10.3 million in general temporary resources. - Externally financed budget utilization projected to increase from 85.4 percent in FY23 to 86.5 percent. - Vacancy rates fell slightly below zero by February 2024 in area and functional departments. - Execution expected to exceed structural personnel budget by 3 percentage points for the full year. - Fund-financed travel budget execution projected at 99 percent of budget. - Average ticket prices about 36 percent higher than pre-pandemic levels. - FY24 receipts projected to increase 6 percent relative to FY23, while remaining 13 percent below budget. ### Table 2 — Projected FY24 Budget Utilization (selected figures; Millions of US dollars) - Total Gross: Structural Budget 1,455; Proj. Outturn 1,451; Utilization 99.7 percent - Personnel: Structural Budget 1,118; Proj. Outturn 1,137; Utilization 101.6 percent - Travel: Structural Budget 93; Proj. Outturn 89; Utilization 95.5 percent - Buildings/IT/Other: Structural Budget 227; Proj. Outturn 226; Utilization 99.4 percent - Contingency: Structural Budget 17; Proj. Outturn 0; Utilization - - Receipts: Structural Budget -44; Proj. Outturn -41; Utilization 92.0 percent - Memorandum: - Total Net: Structural Budget 1,411; Proj. Outturn 1,410; Utilization 100.0 percent - General (excl. OED/IEO): Structural Budget 1,316; Proj. Outturn 1,326; Utilization 100.8 percent ### Spending by output and priority topics (FY24) - Direct country engagement spending expected to grow by $28 million or 5 percent versus FY23 ($44 million or 7 percent including travel), with highest non-travel growth in bilateral surveillance. - Policy, analytical, multilateral surveillance and fund financing projected to increase by 3 percent to about $473 million ($492 million, or 4 percent including travel). - Externally financed spending (mainly CD) projected to increase by $9 million to about $217 million, with utilization of 87 percent ($34 million below the budget limit). - CD spending split: 59/41 Fund/external (including overheads); direct-cost ratio 43/57 Fund/External. ### Spending by priority topic — FY24 projections (direct) - Debt: $59 million (including $9 million in external funding and $15 million on CD). - Governance/anti-corruption: $35 million (including $11 million external, $14 million CD). - Climate: $65 million (including $7 million externally funded and $12 million in CD). - Digital Money: $26 million (including $4 million externally funded and $6 million in CD). - Macrofinancial: $112 million (including $2 million externally funded and $2 million in CD). - FCS: $121 million (including $33 million externally financed), CD component 36 percent. - Inclusion/gender: $25 million (including $4 million external and $5 million CD). *Source: ppea2024024 - SECTION III. FY24 DEVELOPMENTS* ### FY25 BUDGET SPACE — structural and temporary - Structural net administrative budget space totals about $84.2 million (about 6.0 percent of the FY24 NAB). - Net change in temporary space: -23.8 million. - Total temporary allocations: 43.7 million (3.1 percent). - Allocated general carryforward: 32.9 million (2.3 percent). - OED/IEO transfers: 10.8 million (0.8 percent). ### Carryforward (Table 7) - Proposed FY25 general carryforward limit: 5 percent (versus 6 percent in FY24 and a high of 8 percent in FY22). - Carryforward breakdown (Millions of FY24 US dollars): - General (Excl. OED/IEO) carryforward: 65.8 - Allocated FY25: 32.9 - Reserve FY26/27: 32.9 - Memorandum items: - Overall FY25 (ceiling) 1: 82.7 - General FY24 (ceiling): 72.4 ### Departmental savings and reprioritization - FY25 structural reprioritization by departments totals $46.6 million, with an additional $23.8 million in reduced temporary budget space. - Contributions to reprioritization/savings include: - Completion of specific policy work and analytics — about 16 percent of total savings. - Streamlining in country work — similar share to policy work savings. - Other savings: hybrid work model completion, after-hours staffing reduction, improved utilities metering, efficiencies in IT software acquisition and communication services, process simplification and automation, HR program streamlining. - Note: figures do not capture day-to-day tradeoffs at staff/team level nor fully capture contributions from staff overtime. ### Key statistics (verbatim) - Structural budget space: 84.2 (6.0 percent of NAB) - Augmentation resources: 29.0 (2.1 percent) - OED increase: 8.5 (0.6 percent) - Dept. Savings/Reprioritization: 46.6 (3.3 percent) - Other structural resources 1: 0.1 (0.0 percent) - Net change in temporary space: -23.8 - Total temporary allocations: 43.7 (3.1 percent) *Source: OBP.* ### Priority areas and FY25 changes — augmentation and deliverables - Augmentation total FY23-25 allocations: $82.3 million. - Administration and communications-related needs: $12.6 million. - Travel for increased direct country staff: $3.5 million. - FY25 planned increases (direct / with travel & overhead where noted): - Climate: $7.5 million direct ($9.1 million with travel/overhead). - Digital Money: $5.7 million direct ($6.9 million with travel/overhead). - Macrofinancial surveillance: $2.5 million direct ($3.0 million with travel/overhead). - FCS additional resources: $8.5 million ($10.1 million including travel and overhead); includes reprogramming of $1.1 million in FCS unutilized resources from FY23. - Gender and inclusion: all augmentation resources ($2.1 million overall, $1.7 million excluding travel and overhead) allocated in FY23 and FY24. - Augmentation by output and issue (summary figures preserved): - Total FY23-25 Proposed: 82.3 (…) - Climate: 30.1 ($, 37%) - Digital Money: 16.1–16.2 ($, 20%) - Macrofinancial: 9.7–9.8 ($, 12%) - Inclusion/Gender: 2.1–2.3 ($, 3%) - FCS: 24.1–24.3 ($, 29%) ### Augmentation key deliverables (highlights) - Climate Change: - FY25 expectations: about 20 countries to receive in-depth climate-related support, including policy advice in 15-20 Article IVs, 4 FSAPs, and approval of 15-20 RSFs; climate-CD focus on long-term resilience and climate-related financial risk management; Fund convening role to catalyze climate finance in RSF countries in 5-6 countries. - Digital Money: - FY25 focus: expand coverage in 10-12 Article IVs and 5 FSAPs; ramp up CD on CBDC, cross-border payments, e-money, financial market infrastructure, and regulatory/supervisory frameworks; continue policy and analytical work including CBDC Virtual Handbook chapters. - Macrofinancial Surveillance: - Continued mainstreaming in Article IVs and integration of FSAP findings; operationalization of the Integrated Policy Framework. - Fragile and Conflict-Affected States (FCS): - Rollout of new Country Engagement Strategies; as of Q4/FY24 CES prepared in more than 50 percent of FCS; FY24 rollouts included 9 CES, UCT-quality programs to 15 countries. - Inclusion/Gender: - FY24 coverage of gender issues increased from 22 (FY23) to 55 Article IV consultations; FY25 to continue mainstreaming with new analytical tools. *Source: Strategy teams, departments, OBP staff calculations.* ### Budget by Output — changes and priorities - Country operations: - Bilateral surveillance and lending total: $487 million; net increase: $3 million, with shift in favor of lending. - Direct CD country delivery: $284 million; projected rise of $12 million, largely through externally funded space. - Over FY23-25, about 75 percent of direct augmentation support went to country operations, including 25 percent for CD. - Policy and analytics: - Total: $127 million; projected decline of $2 million. - Priorities include LIC Debt Sustainability Framework, AML/CFT work, updating lending policy, operationalizing IPF, and AI-related analysis. - Multilateral surveillance and global cooperation: - Total: $178 million; net increase: $1 million. - Focus on spillovers, AML/CFT Program continuation, BPM updates, and global debt and fiscal databases. - Fund governance and finances: - Total: $181 million; net increase: $5 million. - Includes implementation of 16th General Review of Quotas and concessional fundraising strategy. - Corporate functions: - Total: $457 million; net increase: $9.9 million (mainly attributable to one-off CD overhead funded by IMF02). - FY25 allocations support HR modernization, compensation and benefits planning, Institutional Safeguards Review recommendations, and hybrid model support. *Source: OBP and Departmental allocations.* ### CD composition and FY25 outlook - CD spending represents 32 percent of total Fund spending. - Funding split: 59/41 Fund/external (including overheads); direct cost split 43/57 Fund/External. - FY24 direct CD spending expected to reach $380 million (4.0 percent higher than FY23). - Fund-financed direct spending projected at $163 million (3.8 percent increase from FY23), 95 percent utilization. - Externally financed CD: $217 million, up 4.1 percent, with 87 percent utilization. - FY25 CD outlook: - Overall CD budget envelope will increase due to allocation of remaining augmentation resources (25 percent supports CD) and a $15 million increase in externally financed spending limit linked to IMF02 increase. - Projected external resources spending for FY25: $232 million ($13 million above FY24). - Regional priorities: FY25 CD growth across all regions; increased shares in MCD and EUR. *Source: ICD, OBP, staff estimates.* ### DISTRIBUTION OF FUND‑FINANCED RESOURCES BY DEPARTMENT - Overall pattern: small number of departments see small net increases; others flat in real terms with substitution of structural for temporary resourcing; some departments see small net declines driven by expiring temporary resources. - Area departments: - $5.3 million overall real increase in FY25 relative to FY24 (1.4 percent), including $12.5 million from augmentation. - Non‑CD functional departments: - $1.3 million overall real increase in FY25 relative to FY24 (0.6 percent), including $5.9 million from augmentation. - CD departments: - $1.4 million overall real increase in FY25 relative to FY24 (0.4 percent), including $8.6 million from augmentation. - Corporate functions: - $0.1 million overall real decline in FY25 relative to FY24 (broadly unchanged), with $3.3 million from augmentation and a $3.4 million decline in temporary resourcing. ### Key budget and FTE aggregates (selected table figures preserved) - Budget Grand Total: FY24 baseline entries include Total of 1,410.9; FY25 proposed 1,441.4. - Departmental Total row "Total": FY24 shows 1,478.5 and FY25 shows 1,488.2 — percent change 0.7; FY20-25 change 7.7. - FTE Grand Total: - Total (excl. donor financed) FY24: 3,207. - Total (excl. donor financed) FY25 Proposed: 3,265. - Donor financed FTEs: FY24 109; FY25 Proposed 126. - Grand Total FY24: 3,316; Grand Total FY25 Proposed: 3,391. - Percent change FY24–25: 1.8 percent; FY20–25 percent change shown as 12.6 percent. *Source: IMF OBP materials presented in the FY2025–FY2027 Medium‑Term Budget (Section on distribution of Fund‑financed resources and augmentation; Tables 9–10; Figures 17–18).* ### MAJOR BUILDINGS — HQ2 refresh and IT-intensive capital - HQ2 refresh identified in long-term capital plans; initial timing beginning FY25. - FY25 budget includes resources for pre-planning work. - Project drivers: replacement of aging mechanical systems; fit with changed ways of working; lifecycle replacements and flexible space design. - Governance: separate budget appropriation against detailed project plan; regular Board engagement. - IT-intensive capital budget (FY25): $65.2 million (including CCE), versus $60.8 million in FY24 (7 percent real increase). - Key IT-intensive allocations: - Transformation projects: $13.3 million for current projects. - Other new investment funding: $13.7 million (including $1.6 million in information security). - New projects to be prioritized: $7.6 million. - Lifecycle replacements and IT infrastructure: $8.6 million. - Cloud costs (CCE): projected to increase to $22.0 million. - Cost avoidance through streamlining implemented during the year: $0.4 million. ### Transformation and modernization project highlights - Nexus: document management platform replacement; final Fund-wide release deployed in March and in hypercare. - iData: modernizes economic data management; program scheduled for completion in FY25. - CRS-Common Review System: kicked off in FY24; scheduled completion by end-FY26. - Intranet: implementation commenced in FY24 Q3; planned completion by end FY26. - HR Modernization: near-term focus on improving existing functionality; broader Digital HR planning underway. *Source: ppea2024024 - Box 9. Major Buildings* ### ANNEX I — Budget process overview and key statistics - Financial year example: FY25 = May 1, 2024 to April 30, 2025. - Gross Administrative Envelope components include Net Administrative budget, Receipts, Carryforward, and other transitional transfers. - FY24 Nominal Gross Administrative Envelope visual/composite figures: - Net Admin: 1,411 - Carry Forward: 102 - Receipts: 295 - Gross Admin Envelope: 1,808 - Carryforward limits history: - General CF limit proposed to fall to 5 percent in FY25 (from 6 percent in FY24 and 8 percent in FY22); intent to revert to 3 percent normal limit over time. - OED CF limit set at max 20 percent per office (changed to 30 percent for resources from FY25 to FY26; to be reviewed in FY27). - Capital budget and Cloud Capital Equivalent (CCE) treatment summarized. ### FY24 and FY25 budget-related key statistics (selected figures; Millions of US dollars) - Nominal Gross Administrative Envelope (FY20–Prop. FY25 totals): - FY20: 1,444; FY21: 1,493; FY22: 1,570; FY23: 1,668; FY24: 1,808; FY25 Proposed: 1,925. - Personnel: - FY20: 1,043; FY21: 1,123; FY22: 1,143; FY23: 1,228; FY24: 1,329; Prop. FY25: 1,414. - Travel (total): - FY20: 134; FY21: 133; FY22: 144; FY23: 110; FY24: 147; Prop. FY25: 138. - Buildings and other expenditures: - FY20: 231; FY21: 232; FY22: 249; FY23: 268; FY24: 272; Prop. FY25: 298. - Contingency/Other: - FY20: 36; FY21: 5; FY22: 34; FY23: 62; FY24: 60; Prop. FY25: 75. - Externally financed: - FY20: 200; FY21: 165; FY22: 206; FY23: 236; FY24: 257; Prop. FY25: 283. - Budgeted Personnel FTE, selected aggregates: - Structural Non-Augmentation FY20: 2,878; FY21: 2,877; FY22: 2,888; FY23: 2,939; FY24: 2,969; Prop. FY25: 2,981. - Grand Total FTE: FY20: 3,013; FY21: 3,108; FY22: 3,180; FY23: 3,270; FY24: 3,316; Prop. FY25: 3,391. - Nominal Capital Expenditures sample flows: - FY25 New appropriations (Prop.): 121.9; Total funds available (Est.): 159.5. ### Cross-cutting considerations and policy review interactions - Selected reviews with resource implications noted in source (examples include IEO implementation plan estimates, ISR implementation funding increases, climate and AML/CFT strategy implications). - ISR implementation: DRS, Ethics, and Investigation Offices received a 24.6 percent increase in FY24 budget allocations and about 47 percent after including transitional funds. *Source: Annex I. Budget Process Overview, FY2025–FY2027 Medium-Term Budget (selected tables and text).* *Source: ppea2024024.* ### EXECUTIVE SUMMARY ### EXECUTIVE SUMMARY ### Context and strategic environment - The global economic environment is "complex," with membership facing an "increasingly shock-prone world, increased fragmentation, and longer-term structural challenges," driving strong demand for Fund engagement. - The global economy has exhibited resilience to severe shocks but is characterized by "slow, uneven growth, increased fragmentation, deepening divergence, and still high interest rates, albeit declining with ongoing easing of inflationary pressures." - The Fall 2023 Global Policy Agenda highlights Fund priorities: a) help members safeguard macroeconomic stability, rebuild buffers, and promote growth-oriented and green reforms; and b) bolster international cooperation to strengthen the global financial safety net and debt architecture and support structural transitions requiring joint action. ### FY25–27 budget framework and trajectory - The budget is transitioning "from a growth to stabilization phase." - The Fund will: - allocate the final tranche of the FY23-25 augmentation in FY25; - continue unwinding exceptional pandemic-era temporary funding; and - project a flat real trajectory beginning in FY26 and FY27. - Ongoing reprioritization focuses on aligning resources with members’ needs and institutional priorities, guided by principles of agility and discipline and recognizing "difficult trade-offs" given high work pressures and constrained budget. ### FY25 net administrative budget (NAB) and composition - Proposed FY25 NAB: $1,501 million (nominal). - Alternate presentation: NAB for FY25 totals $1.44 billion (real), with a projected $83 million in Fund-financed carryforward resources. - Net changes versus FY24 (excluding FY24 Annual Meeting allocation and before reprioritization): $13.8 million in net new resources. - Structural changes increasing net overall structural administrative space by $37.5 million (about 2.7 percent of the NAB): - Augmentation: final $29.0 million (2.1 percent of the NAB) under FY23-25 augmentation framework. - Executive Board (OED) resources: $8.5 million net increase (0.6 percent of the NAB) agreed February 2024 to support creation of a 25th Chair and increase staffing entitlements; gross needs total $10 million, with internal savings of $1.5 million. - Temporary resourcing unwind: reduction of $23.8 million as pandemic-era exceptional temporary space continues to be unwound. ### Externally funded and capital budgets - Externally funded budget (nominal): $276 million, reflecting continued recovery of in-person capacity development delivery. - As part of the three-year increase in externally funded spending limit agreed in FY22, a 6 percent real increase is proposed to support the structural transformation agenda. - FY25 capital budget (nominal): $121.9 million, to support facilities lifecycle replacements and field offices, accommodate staff growth, and fund IT-intensive investments guided by the forthcoming Business Technology Strategy and strengthened prioritization framework. Cloud costs are expected to rise "as estimated." ### Sustainability and fiscal posture - The FY25–27 budget remains "consistent with the Fund’s medium-term income position and precautionary balance target." ### Risks and work pressures - Risks to the budget remain elevated amid multiple membership shocks; significant residual risk related to external drivers can only be partially mitigated. - Key budget risks and pressures: - Uncertainty regarding level of demand for Fund lending. - Impact of sustained high work pressures on staff well-being. - Pricing uncertainty: mismatches between input prices and the Fund deflator—75 percent of spending is affected by the salary-structure/deflator dynamics. - Noted cost pressures (preserve exact figures as presented): - Airfares remain about 36 percent higher than pre-pandemic rates. - Medical benefit contributions increased by 6.8 percent in FY24. - Data subscription costs: 8-12 percent increases. - IT vendors/contractual costs: 13 percent increase. - Cloud costs: 8-18 percent increase. - Workload and well-being indicators: - Average overtime in first 10 months of FY24: 11.1 percent. - FY21 pandemic peak average overtime: 12.4 percent. - Pre-crisis average overtime for same period: 10.0 percent. - Department-level risk assessments identified 18 safety and well-being risks; 11 focused on staff burnout related to high work demand, tight deadlines, turnover, and health-related absences. - Annual leave use has recovered to pre-pandemic levels; the 2023 Health and Wellness Survey (forthcoming) signals a significant and rising minority of staff rating their mental health as fair, poor, or very poor, with work hours and high workload/demands a key source of stress. ### Fund responsiveness and operational focus - The FY25-27 budget is guided by principles of agility and budget discipline, reinforced by ongoing reprioritization and savings capture. - The Fund will continue cooperating with other institutions and focus on areas within its mandate while addressing new demands (climate change, digitalization) that require transformative reforms and joint action. - Strengthening internal operations in the evolving post-pandemic workplace remains a priority, balancing efficiency and effectiveness amid rapid technological changes and a changing global footprint. *Source: EXECUTIVE SUMMARY, March 26, 2024.* ### 8. Personnel spending. ### 8. Personnel spending. ### Staff levels and funding - Overall budgeted staff rose from FY20-24 by about 304 positions (10 percent). - Externally funded positions supporting CD work increased by 20 percent to 109 FTEs. - Fund-financed increases were funded first by temporary crisis resourcing and later through the augmentation. - Fund-financed staff are proposed to increase by an estimated 58 positions in FY25 (including OED), before leveling off in the FY26-27 budget. - Externally funded positions are proposed to rise by 17 (16 percent) in FY25. - FY25 figures are preliminary in Figure 4. ### Non-staff personnel - Non-staff personnel positions (including HQ- and field-based experts and long-term contractuals) increased between FY20-24 by about 50 percent. - Of that 50 percent increase, 17 percent were externally financed. - Long-term contractuals saw the largest increase, 60 percent, driven mainly by hires in functional departments. ### Key budget envelopes (high-level figures from Table 1 / Figure 4) - Gross Fund Financed staffing datapoints reflected across FY24–FY27p, including example figures: - Gross Fund Financed: 1,455 structural, 95 temp, total 1,551 (outturn est.); FY26: 1,451 structural, ... total 1,411; FY27: 1,487 structural, 94 temp, total 1,581 (FY25p and FY26-27p shown across figure). - Net administrative budget examples in Figure 4 include: - 1,411; ...; 1,410; 1,441; 1,441; 1,448 (presented verbatim as in source table). - FY Augmentation shown as o/w FY Augmentation: 29 (repeated across lines). - OED budget increase shown as o/w OED budget increase: 9 in a FY25 line item. - Annual Meetings shown as o/w Annual Meetings: 7. - General Receipts examples: 44; 41; 46; 46; 46 (as shown). - Carryforward examples: 87; 83; 70; 57. - Gross Externally Financed: 250 structural, 7 temp, total 257 (FY24); FY25 projection examples: 217 structural total 250; FY26/FY27 shown as 265/266 totals. - Gross administrative envelope examples: 1,706 structural, 102 temp, total 1,808 (FY24); indicative FY25/FY26/FY27 totals 1,668/1,752/1,853/1,824/1,817 as presented across the figure. - Capital examples: 108; 115; 117; 117; 124; 127 (reflecting FY24–FY27p entries). - Memorandum: General carryforward limit examples: 72; 66; 54; 40. ### Reprioritization and budget management (Box 1) - Staff expanded granularity of budget data in reporting to inform strategic budget discussions; efforts are continuing. - Budget reporting uses a common set of strategic output categories (the Fund Thematic Framework) for allocations, outturns, and reprioritization across: direct country operations (surveillance, lending, CD), multilateral surveillance and global standards, policy and analytics, and corporate functions. - Enhanced availability of spending estimates in priority growth areas, including those supported by the FY23-25 augmentation. - Updates to complex data systems will be incremental to avoid data quality risks; medium-term budget modernization is ongoing. - Reporting provides budget changes by department for one-year and medium-term changes. - OBP works with sponsoring departments to cost policy proposals at the recommendation stage with attention to broader budget context (Annex II referenced in source). - Staff developed work intensity indicators for non-recurrent Board Work program items as part of the FY25 pilot new strategic cycle. - Reprioritization efforts have included centralized streamlining measures in FY16 and FY19, reprioritization for crisis exigencies in FY21, and ongoing initiatives post-pandemic. - Annual process reassesses work objectives drawing on global policy agenda and Board input; these inputs inform a management-led accountability exercise and a structured demand and savings exercise in budget formulation. - In FY25, reprioritization practices continue to support absorption of reduction in temporary resources. ### Addressing medium-term challenges and demand pressures - Executive Board approved updates to the Strategic Planning Cycle on a pilot basis to reinforce medium-term orientation of priority setting. - Early input from strategic discussions and the FY25 Board Work Program in March inform the budget proposal; future budgets will draw on broader medium-term strategic discussion under new procedures. - Heavy demand: - Members face limited policy space, already high debt, slowing growth, rising inequality, and heightened macro-financial risk. - More than half of low-income countries are at high-risk of debt distress. - Demand for granular, tailored policy advice and financial support remains elevated; CD operations are recovering as travel constraints ease. - Meeting increased demands within a flat real envelope is complicated by reduction in available temporary resources. - Expanding needs to support transformational reforms: - The FY23-25 augmentation allowed ramp-up in new strategic priority areas, but member expectations remain high and tradeoffs are required even within the expanded envelope. - Exceptionally strong take-up of the RSF has stretched climate-related resourcing and required trade-offs between accelerating RSF rollout and mainstreaming climate-related policy analysis in Article IV reports. - FY24 RST costs are tentatively projected at $13.6 million, including $5.1 million in trust administration and $8.5 million in operational costs (incorporating related overheads); final estimates to be included in the FY24 budget outturn report. - The scale of RSF-related arrangements and related costs are expected to increase further in FY25. - Technology and AI: - An interdepartmental working group on AI, co-chaired by ITD, SPR and MCM, was constituted to assess macro-critical impact of AI, the Fund’s role, knowledge gaps, and institutional use of AI. - Departments, with ITD, are piloting AI applications to increase staff productivity while ensuring governance and risk mitigation. - Effective implementation will depend on reassessment of organizational arrangements as work is embedded. ### Hybrid engagement, field presence, and operational needs - Hybrid engagement: - Fund continues hybrid and virtual engagement while recognizing importance of in-person interactions; optimal mix under ongoing assessment. - With mission volumes recovering and ticket prices high, travel budget execution requires careful monitoring. - Rightsizing the Global Footprint: - As of December 2023, field presence included 120 offices, up by 9 since 2020 and 20 since 2010; includes 17 RCDCs and 103 regional and resident offices. - Overall field personnel totals 882, including 120 staff, 167 experts, and 595 local staff — a 32 percent increase in overall staffing since FY10 and 11 percent since FY20, with the largest increase for field-based experts. - Greater field-based operations bring management/oversight and overhead costs related to facilities, security, IT, administrative payments, and HR operations. - Ongoing work to update operational practices and policies to ensure cost considerations are integral to planning. - Addressing changing operational needs: - Increased investment in modernizing operations after underinvestment; continued steady investment in specialized skills required. - Priorities include more efficient/back-office functions through simplification and harmonization, updated systems and user interfaces, reduced cyber-risk exposure, and adherence to data privacy norms. - AI can bring productivity gains but carries risks; FY25-27 investments will reflect facilities and IT needs to optimize finite office space for hybrid work, lifecycle maintenance and refresh of facilities. - Work continues to strengthen governance and prioritization to drive operational efficiencies. ### Implementing the hybrid work model (Box 3) - Required minimum office presence for HQ-based employees is now 60 percent per month, with a three days per week baseline expectation. - Capital investments: - Related capital needs total about $18 million in FY24 and $15 million in FY25 for Teams-enabled rooms, collaboration spaces, reconfiguration of finite office space, end-user equipment, and underlying IT infrastructure. - Recurring expenditures: - Recurring hybrid-related expenditures absorbed through reprioritization, including $2.7 million in FY24 and $2.5 million in FY25. - Efficiencies: - Hybrid model estimated cost avoidance of $18-20 million per year by addressing personnel growth without leased external space. - Additional short-term operating cost efficiencies are marginal (cleaning/upkeep optimization, reduced printing, lower desk phone use). - Future facilities renovations (e.g., HQ2 renewal) present opportunities for Smart Building technology to realize efficiencies. ### Risk management and ERM - Fund is strengthening risk assurance under the ERM policy approved in December 2022, focused on an integrated, phased approach. - Initial phases focus on most critical processes and papers; early implementation review noted improved risk awareness and value in more transparent, structured consideration of enterprise risks. - Feedback points to opportunities to simplify ERM guidance and find efficiencies through economies of scale across business processes and sequencing of demands. ### Income, budget outlook, and precautionary balances - Based on country desk survey projections, FY25–27 budget remains consistent with a projected surplus in the medium-term income position and continued progress beyond the precautionary balances target (Figure 7). - Under existing policies, projected operational income will remain well above expenses through FY30, reflecting high demand for Fund support. - Reimbursements to the GRA from the SDR department and the RST contribute to income, with such flows from the PRGT suspended until FY26. - Improved non-lending income projections reflect the high interest rate environment and corresponding SDR interest rate path. - The SDR 25 billion target for precautionary balances is expected to be reached in late FY24. - The proposed FY25-27 budget ensures continued consistency with the projected path for precautionary balances. *Source: ppea2024024 - 8. Personnel spending.* ### SECTION III. FY24 DEVELOPMENTS ### SECTION III. FY24 DEVELOPMENTS ### FY24 Achievements - In response to multiple shocks and sustained global economic uncertainty, the Fund expanded direct country support through tailored policy advice; increased financial operations, including the continued ramp-up in RSF operations; and CD. - The Board of Governors concluded the 16th General Review of Quotas, approving an increase of 50 percent. - FY24 marks the second year of implementation of the phased three-year budget augmentation, with deliverables broadly on track across the five targeted strategic priority areas: climate change, digital money, macro-financial surveillance, fragility, and gender and inclusion. - Foundational analytical work under the priority-area strategies covered by the augmentation is ongoing; direct country engagement (surveillance, lending, and CD) is ramping up, benefiting from augmentation-related structural resources and build-out of coordination mechanisms with relevant global partners. - Implementation risks are being monitored and addressed, including competition for scarce specialized expertise (e.g., on climate and digital money) as discussed in the CY23 Staff Recruitment and Retention Report. Organizational arrangements for implementation and cross-departmental coordination continue to be reviewed. Box 4 — Key Achievements in FY24 (selected) - Country Operations: - Financing to 29 countries (incl. 20 LICs) - 13 RSF operations approved, 5 in train - 123 Article IV consultations, 6 FSAPs concluded - 173 countries/territories received CD - Multilateral Surveillance: - Analysis on fragmentation/commodity markets - Assessment of vulnerabilities in a higher-for-longer interest rates environment - Policy/Analytical: - Implementation updates of the digital money, FCS, and gender strategies - 2023 CD Strategy Review - Reviews of the lending toolkit - SDN: AI and the Future of Work - Fund Governance and Finance: - Completion of the 16th Quota Review - Attainment of Stage 1 PRGT fundraising target - Creation of a 25th Chair in the Executive Board for Sub-Saharan Africa - Internal Support: - Strengthened governance of the Fund’s modernization agenda - Review of ERM implementation - Implementation of hybrid work model ### Utilization and Spending by Input (FY24) - Overall utilization: - General structural budget (excluding OED/IEO) projected at 100.8 percent (100.0 percent including OED/IEO), versus 100.8 percent in FY23, reflecting full use of structural space and the drawdown of about $10.3 million in general temporary resources. - The $7.0 million in additional budget space in FY24 for Annual Meetings travel is included. - Utilization of the externally financed budget projected to increase from 85.4 percent in FY23 to 86.5 percent, reflecting continued increase in in-person CD delivery. - Staff and vacancies: - For FY24, vacancy rates fell slightly below zero by February 2024 in area and functional departments. - For the full year, execution is expected to exceed the structural personnel budget by 3 percentage points, while remaining within the overall available envelope, including temporary resources. - The number of Fund-financed long-term contractuals and experts is expected to increase by about 22 percent over the full course of FY24 (18 percent including externally financed employees). - Travel: - Fund-financed travel budget execution projected at 99 percent of budget. - Average ticket prices are some 36 percent higher than pre-pandemic levels. - Per diem and other expenses lower on average by 1 percent due to the strong dollar. - Buildings, IT, and other services: - Utilization projected to increase from 98.7 percent in FY23 to 99.4 percent, slightly below pre-pandemic levels of 101.1 percent. - Utilization affected by reprioritization of vendor resources, reduction in telecom, printing, and utility-related spending, and increased IMF02-related cost recovery. - Underspend partly offset by non-travel cost pressures related to the Annual Meetings in Marrakech and increased costs for security, commercial data, and other contractual services. - Receipts: - FY24 receipts projected to increase 6 percent relative to FY23, while remaining 13 percent below budget. - Projected increase driven by higher projected execution of externally financed activities (mainly CD, up 4 percent) and CD-related trust management fees (up 4 percent). - Relative to budget, the gap reflects externally financed activities below the limit, lower-than-projected transfers from the staff-retirement plan, and continued shortfalls in parking fees, publication income, and Concordia revenue. - A FY25 rebasing has been undertaken where lower revenue is expected to continue (Joint-Library and publications). Table 2 — Projected FY24 Budget Utilization (selected figures; Millions of US dollars) - Total Gross: Structural Budget 1,455; Proj. Outturn 1,451; Utilization 99.7 percent - Personnel: Structural Budget 1,118; Proj. Outturn 1,137; Utilization 101.6 percent - Travel: Structural Budget 93; Proj. Outturn 89; Utilization 95.5 percent - Buildings/IT/Other: Structural Budget 227; Proj. Outturn 226; Utilization 99.4 percent - Contingency: Structural Budget 17; Proj. Outturn 0; Utilization - - Receipts: Structural Budget -44; Proj. Outturn -41; Utilization 92.0 percent - Memorandum: - Total Net: Structural Budget 1,411; Proj. Outturn 1,410; Utilization 100.0 percent - General (excl. OED/IEO): Structural Budget 1,316; Proj. Outturn 1,326; Utilization 100.8 percent ### Spending by Output and Priority Topics (FY24) - Overall direct spending expected to increase across most workstreams, drawing on augmentation. - Direct country engagement: - Spending expected to grow by $28 million or 5 percent versus FY23 ($44 million or 7 percent including travel), with highest non-travel growth in bilateral surveillance. - Policy, Analytical, Multilateral Surveillance and Fund Financing: - Spending projected to increase by 3 percent over FY23 to about $473 million ($492 million, or 4 percent including travel). - Policy and analytical work rose 6 percent (with no growth in travel): improvements to the lending toolkit, review of precautionary instruments, debt restructuring, CD strategy review, and analytic work on geo-economic fragmentation, commodity shocks, the integrated policy framework (IPF), and priority areas. - Multilateral surveillance and global cooperation efforts unchanged, or up 1 percent with travel; addressed economic interconnections and spillovers, implications of policy shifts in systemic economies, implications of crypto and collateral in debt financing. - Strengthening Fund governance and finances (up 2 percent, or 4 percent with travel): work on concluding the 16th General Review of Quotas, the replenishment of the PRGT, and the addition of the 25th Board chair. - Corporate functions: - Spending projected to remain broadly stable. Priorities included modernization projects (HR, data, knowledge management), implementation of Institutional Safeguards Review recommendations, oversight and risk management, addressing increased corporate service volumes, third party risk management, hybrid work model support, IT-intensive capital oversight and Business Technology Strategy work. - Externally financed spending (mainly CD): - Projected to increase by $9 million to about $217 million, with utilization of 87 percent ($34 million below the budget limit). - CD-related chargebacks projected to increase by about $3 million relative to FY23 and exceed budgeted chargebacks by about $5 million. - Overall CD spending split 59/41 between Fund/external financing, including indirect costs. Ratio including only direct costs is 43/57. Spending by Priority Topic — FY24 projections (direct spending) - Debt: $59 million (including $9 million in external funding and $15 million on CD). Fund financed spending projected to grow $3 million from last year. - Governance/anti-corruption: $35 million (including $11 million of external funding and $14 million on CD), up $4 million. Fund financed spending projected to increase $3 million. - Climate: $65 million (including $7 million in externally funded resources and $12 million in CD). Fund financed spending projected to grow by $11 million. - Digital Money: $26 million (including $4 million in externally funded resources and $6 million in CD). Fund financed spending will grow by about $2 million. - Macrofinancial: $112 million (including $2 million in externally funded resources and $2 million in CD). Fund financed spending will grow by $11 million. - FCS: $121 million (including $33 million of externally financed costs), up $13 million relative to FY23. The CD component is 36 percent. Fund-financed spending will increase $10 million. - Inclusion/gender: $25 million (including $4 million in external funding and $5 million in CD). Fund-financed spending will grow by $4 million. *Source: ppea2024024 - SECTION III. FY24 DEVELOPMENTS* ### 18. Budget space (Table 6). FY25 real ### 18. Budget space (Table 6). FY25 real ### FY25 structural and temporary budget space - Structural net administrative budget space totals about $84.2 million (about 6.0 percent of the FY24 NAB), driven by the allocation of the last tranche of augmentation resources, the OED increase, and departmental reprioritization. - Net change in temporary space: -23.8 million. - Total temporary allocations: 43.7 million (3.1 percent). - Allocated general carryforward: 32.9 million (2.3 percent). - OED/IEO transfers: 10.8 million (0.8 percent). ### Carryforward (Table 7) - Proposed FY25 general carryforward limit: 5 percent (versus 6 percent in FY24 and a high of 8 percent in FY22). - Carryforward breakdown (Millions of FY24 US dollars): - General (Excl. OED/IEO) carryforward: 65.8 - Allocated FY25: 32.9 - Reserve FY26/27: 32.9 - Memorandum items: - Overall FY25 (ceiling) 1: 82.7 - General FY24 (ceiling): 72.4 ### Departmental savings and reprioritization (Figure 13) - FY25 structural reprioritization by departments totals $46.6 million, with an additional $23.8 million in reduced temporary budget space. - Contributions to reprioritization/savings include: - Completion of specific policy work and analytics (e.g., Access Limits, Precautionary Facilities, LIC DSA) — about 16 percent of total savings. - Streamlining in country work (streamlined Article IV consultations, greater use of LOT, completion of some CD course development) — similar share to the policy work savings. - Other savings: completion of hybrid work model development; reduction in after-hours staffing; improved utilities metering; efficiencies in IT software acquisition and communication services; quick-win process simplification and automation; streamlining of some HR programs. - Note: these figures do not capture significant day-to-day tradeoffs at the staff and team level nor fully capture contributions from still significant staff overtime. ### Key statistics (preserve numeric fidelity) - Structural budget space: 84.2 (6.0 percent of NAB) - Augmentation resources: 29.0 (2.1 percent) - OED increase: 8.5 (0.6 percent) - Dept. Savings/Reprioritization: 46.6 (3.3 percent) - Other structural resources 1: 0.1 (0.0 percent) - Net change in temporary space: -23.8 - Total temporary allocations: 43.7 (3.1 percent) *Source: OBP.* --- ### Priority areas and FY25 changes (Figure 14, Box 5) - Debt - Change in real direct spending: $1.3 million. - Continued support to countries facing high risks of debt distress, coordination role in the Global Sovereign Debt Roundtable, cooperation with Paris Club and other creditors, facilitation under the Common Framework and other mechanisms. - Governance and anti-corruption - Change in real direct spending: $0.4 million. - Increase in number and frequency of Governance Diagnostic Assessments; deepen coverage of governance and transnational aspects of corruption in bilateral surveillance; analytical work exploring rule of law safeguards in digitalization context. - $0.3 million provided for AML/CFT-related assessments. - Augmentation-supported priorities (within $82.3 million total FY23-25 allocations) - Allocated in FY23-25: $82.3 million total. - Administration and communications-related needs: $12.6 million. - Travel for increased direct country staff: $3.5 million. - FY25 planned increases (direct / with travel & overhead where noted): - Climate: $7.5 million increase planned for direct climate-related needs ($9.1 million with travel/overhead). - Digital Money: Net direct funding $5.7 million ($6.9 million with travel and overhead). - Macrofinancial surveillance increases: $2.5 million ($3.0 million with travel/overhead). - FCS additional resources: $8.5 million ($10.1 million including travel and overhead). Includes reprogramming of $1.1 million in FCS unutilized resources from FY23. - Gender and inclusion: all augmentation resources ($2.1 million overall, $1.7 million excluding travel and overhead) were allocated in FY23 and FY24. - Augmentation by output and issue (summary table figures preserved): - Total FY23-25 Proposed: 82.3 (…) - Climate: 30.1 ($, 37%) - Digital Money: 16.1–16.2 ($, 20%) - Macrofinancial: 9.7–9.8 ($, 12%) - Inclusion/Gender: 2.1–2.3 ($, 3%) - FCS: 24.1–24.3 ($, 29%) ### Augmentation key deliverables (Box 5 highlights) - Climate Change - FY25 expectations: about 20 countries to receive in-depth climate-related support, including policy advice in 15-20 Article IVs, 4 FSAPs, and approval of 15-20 RSFs; climate-CD to focus on capacity for long-term resilience and climate-related financial risk management; Fund convening role to catalyze climate finance in RSF countries in 5-6 countries. - Digital Money - FY25 focus: expand coverage of fintech payments, crypto assets, and CBDC in 10-12 Article IVs and 5 FSAPs; ramp up CD on CBDC, cross-border payments, e-money, financial market infrastructure, and regulatory/supervisory frameworks; continue policy and analytical work (CBDC Virtual Handbook chapters, help members implement FSB recommendations on crypto assets and global stable coins, work on tokenization and cross-border platforms). - Macrofinancial Surveillance - Continued mainstreaming of macrofinancial analysis in Article IVs and integration of FSAP findings; further development of analytical tools and staff capacity building; operationalization of the Integrated Policy Framework. - Fragile and Conflict-Affected States (FCS) - Rollout of new Country Engagement Strategies (CES), expansion of field presence, boost CD support to economic institutions, integration of surveillance, CD, and lending in FCS countries. - As of Q4/FY24: CES prepared in more than 50 percent of FCS; FY24 rollouts included 9 CES, UCT-quality programs to 15 countries. - Inclusion/Gender - FY24 increase in coverage of gender issues from 22 (FY23) to 55 Article IV consultations. - Interim Guidance Note on Mainstreaming Gender and upcoming social spending guidance note provided operational guidance. - FY25 to continue mainstreaming gender and inclusion with new analytical tools. *Source: Strategy teams, departments, OBP staff calculations.* --- ### Budget by Output (Section C) — changes and priorities - Country operations - Bilateral surveillance and lending total: $487 million; net increase: $3 million, with shift in favor of lending. - Direct CD country delivery: $284 million; projected rise of $12 million, largely through increased use of available externally funded space. - Over FY23-25, about 75 percent of direct augmentation support went to country operations, including 25 percent for CD. - Policy and analytics - Total: $127 million; projected decline of $2 million. - Policy priorities: LIC Debt Sustainability Framework, AML/CFT work (including updating Correspondent Banking Relationships policy), re-initiating Illicit Financial Flows work, increased AML/CFT assessments; lending policy work on Comprehensive Review of Access limits; Concessional (PRGT) Facilities and Financing; Fund’s Conditionality; Surcharges Framework based on assessment of Precautionary Balances. - Analytical priorities: fiscal and monetary framework design; evolution of global trade; geo-economic fragmentation; operationalizing the integrated policy framework (IPF); interplay between capital flows, CFMs and Crises; IMF macro-fiscal-financial framework for the SDGs to include climate; transformational impact of green and digital transition; industrial policy effectiveness; analysis of Artificial Intelligence and the Future of Work. - Multilateral surveillance and global cooperation and standards - Total: $178 million; net increase: $1 million. - Focus: analysis of economic interconnections and spillovers, including monetary policy and financial stability; continuation of AML/CFT Program and FATF assessment involvement; release/support implementation of updated Balance of Payment Manual (BPM) and System of National Accounts; update of global debt database (GDD) and historical fiscal variables database; G20 guidance/notes for surveillance. - Fund governance and finances - Total: $181 million; net increase: $5 million. - Includes implementation of the 16th General Review of Quotas; maintaining access to borrowing pending effectiveness of quota increases; approaches for quota realignment and new quota formula under the 17th General Review of Quotas; implementation of the new concessional fundraising strategy and interim review of the RST. - Corporate functions - Total: $457 million; increase of $9.9 million in net terms (mainly attributable to one-off CD overhead funded by IMF02). - FY25 allocations support HR modernization; planning for compensation and benefits review; implementation of Institutional Safeguards Review recommendations (strengthening HRD’s administrative review and employee relations unit); diversity and inclusion work; continued delivery of technology capabilities and facilities services; implementation of Enterprise Risk Management framework and Data Privacy Policy; support for hybrid model. ### Administrative budget by output (Figure 16 highlights) - Output area totals (Millions of FY24 US Dollars) shown include structural and temporary components; FY25 net changes summarized (values preserved where provided earlier in section content). *Source: OBP and Departmental allocations.* --- ### CD (Capacity Development) composition and evolution (Box 6) - CD spending overview - CD spending (including related corporate overheads) represents 32 percent of total Fund spending. - Funding split: 59/41 percent between Fund and external resources, with overheads largely covered by Fund financing. - Ratio including only direct costs (including management and administration): 43/57 (Fund/External). - FY24 CD spending (direct) - Direct spending expected to reach $380 million in FY24, 4.0 percent higher than FY23 and 1.7 percent higher than FY19, with overall utilization of 90 percent. - Fund-financed direct spending projected at $163 million, a 3.8 percent increase from FY23, with 95 percent utilization. - Externally financed CD: $217 million, up 4.1 percent, with 87 percent utilization. - Share of in-person delivery increased to about 60 percent, driving up travel spending. - Including related overhead costs, spending will total $523 million, about 1/3 of overall activity, about the same as FY23. - FY25 CD outlook - Overall CD budget envelope will increase in FY25 due to allocation of remaining augmentation resources (25 percent supports CD) and a $15 million increase in the externally financed spending limit linked to the third installment of the parallel IMF02 increase, plus one-off resourcing related to IMF02 field facilities costs (new regional office in Saudi Arabia and move of SARTTAC facilities). - Projected external resources spending for FY25: $232 million (i.e., $13 million above FY24). - CD composition and regional/workstream priorities - FY25 CD growth across all regions; shares to increase in MCD (driven by new regional office in Saudi Arabia and increased allocation to FCS) and EUR (ramp-up of CD support to Ukraine). - Workstreams continue to focus on fiscal, monetary policy and financial system stability, debt, and statistics, with increased spending on climate, governance, gender, and digitalization. *Source: ICD, OBP, staff estimates.* *Source: IMF — OBP, departmental submissions, Strategy teams, ICD, and staff estimates.* ### 21. This section presents a breakdown of distribution of Fund-financed resources by ### Breakdown of distribution of Fund‑financed resources by department (Section 21–22) ### Overall allocation patterns and drivers - Recognizing limited net resourcing for the general budget, a small number of departments see small net increases in overall resourcing, while others see flat real resources with substitution of structural for temporary resourcing. A few departments (CSF, OIA, TRM and small offices) see small net declines in their dollar budgets, driven by expiring temporary resources. A few departments (RES, OIA) see a net reduction in FTEs, linked with expiration of specific positions provided on a temporary basis. - Allocations reflect factors including a focus on direct engagement with the membership and taking into account the existing resource base and changes over time, including during the crisis/augmentation period. ### Area departments - $5.3 million overall real increase in FY25 relative to FY24 (1.4 percent), including $12.5 million from augmentation. - Department-specific focus: - AFR: program work; deepen engagement through UCT/RSF programs and with FCS; link agenda to South Africa’s G20 presidency. - APD: support demand for Fund financing and intensive surveillance; step up engagement with vulnerable countries (e.g., small islands). - EUR: focus on program work and intensive surveillance in crisis/high-vulnerability countries; analytical focus on monetary policy transmission and fiscal pressures. - MCD: address rapid surge in demand, including from FCS, amid intensified conflicts, volatile commodity prices, and more frequent natural disasters. - WHD: provide balance-of-payments support; support resilience to climate change including deploying new RSF programs; step up capacity development. ### Non‑CD functional departments - $1.3 million overall real increase in FY25 relative to FY24 (0.6 percent), including $5.9 million from augmentation. - Department-specific focus: - FIN: review concessional lending toolkit; mobilize concessional resources; implement the 16th General Quota and quota realignment; secure access to borrowed GRA resources; support administration of higher staff and field presence. - RES: lead analytical work on fragmentation challenges; develop modeling tools for macro policies; operationalize the IPF; examine energy transition impacts and climate adaptation needs. - SPR: support countries with financial arrangements (including through the RSF); review Fund policies (e.g., RST, PRGT, access limits, surcharges, conditionality); debt work; analytical work on global financial safety net and artificial intelligence; lead engagement for global cooperation. - COM: align Fund messaging with institutional priorities; adapt policies and toolkit to member needs; support increased program work and vulnerable countries; support Fund’s call for global cooperation (including on debt and transformational reforms, and countering fragmentation pressures). ### CD departments - $1.4 million overall real increase in FY25 relative to FY24 (0.4 percent), including $8.6 million from augmentation. - Department-specific focus: - FAD: strengthen fiscal institutions and capacity for fiscal policy design and implementation, including under the RSF; prioritize program countries and FCS. Global Public Finance Partnership to support responsive fiscal CD. - ICD: prioritize CD delivery to FCS and small developing states; update training curricula; implement 2023 CD Strategy Review recommendations. - LEG: support members on financial/fiscal law, anti-corruption, AML/CFT, and priority areas of climate, digital money, and gender; continue legal advice on Fund policy matters. - MCM: help countries navigate higher-for-longer interest rates, public financing cost, and global financial stability; provide multilateral surveillance and support to crisis countries. - STA: accelerate updates to statistical manuals; strengthen data portfolio management, governance, and privacy policies. ### Corporate (support) functions - $0.1 million overall real decline in FY25 relative to FY24 (broadly unchanged), with $3.3 million from augmentation and a $3.4 million decline in temporary resourcing. - Department-specific focus: - CSF: adapt facilities, services, operations to accommodate staff growth and hybrid work; integrate innovation and market best practices. - HRD: support Institutional Safeguards Review implementation; plan compensation and benefits review; improve HR operations, skills, and process/technology stabilization. - ITD: prioritize and sequence Business Technology Strategy proposals; improve service delivery, efficiency, and cybersecurity posture. - SEC: contribute to complex program and policy reviews; implement 16th General Review of Quotas; creation of the 25th Board Chair; support new strategic planning cycle; strengthen internal governance and Board operations efficiency. - TRM: support IT‑intensive capital projects and modernization programs; strengthen knowledge management; support innovation efforts. ### Augmentation resources (Section 22) - Allocation of the last year of augmentation resources is tilted towards direct country support. - Funds to AFR and MCD will mainly focus on FCS. - Resources to FAD and MCM reflect roles in climate, digital money, and macrofinancial surveillance. - Resourcing for support departments relates to service provision to the additional workforce. ### Key budget and FTE aggregates from Tables 9–10 (selected) - Budget Grand Total (excluding donor financed adjustments shown in table format): FY24 baseline entries include a Total of 1,410.9 and FY25 proposed budget lines with 1,441.4 (table shows Grand Total 1,410.9 -> 1,441.4 in central resources reconciliation lines). - Departmental Total (table row “Total”): FY24 shows 1,478.5 (Total column) and FY25 shows 1,488.2 (Total column) — percent change 0.7 and FY20-25 change 7.7 (as shown in the table). - FTE Grand Total: - Total (excl. donor financed) FY24: 3,207 (3,089 + 119 + 118 breakdown in table). - Total (excl. donor financed) FY25 Proposed: 3,265 (3,201 + 185 + 65 breakdown). - Donor financed FTEs: FY24 109; FY25 Proposed 126. - Grand Total FY24: 3,316; Grand Total FY25 Proposed: 3,391. - Percent change FY24–25: 1.8 percent; FY20–25 percent change shown as 12.6 percent. (See Figures 17–18 and Tables 9–10 for department-level budget and FTE details, including structural versus temporary and augmentation splits.) *Source: IMF OBP materials presented in the FY2025–FY2027 Medium‑Term Budget document (Section on distribution of Fund‑financed resources and augmentation; Tables 9–10; Figures 17–18).* ### Box 9. Major Buildings ### Box 9. Major Buildings ### Need for HQ2 refresh - A refresh to the Fund’s HQ2 building was identified in long-term capital plans presented in previous budget papers. - Initial timing: beginning FY25 was in line with industry standards based on the age of the building and back-of-house systems (20 years). - The FY25 budget includes resources for pre-planning work to better assess building conditions and timelines for the project. - A comprehensive updated assessment will provide assurances on required timelines for replacement. - Additional information on project planning will be provided by CSF in the Fall of 2024. ### Project design, scope, and objectives - Primary driver: replacement of aging mechanical systems. - Design considerations: - Changes in how the Fund works and convenes its membership. - Need to drive further efficiency gains in facilities management and energy usage. - Likely components: lifecycle replacements to maintain HQ2 systems; changes to allow more flexible space use; upgrades to common and auxiliary spaces. - Anticipated coverage: lifecycle replacements, flexible space design, upgrades to common and auxiliary spaces (e.g., HQ1 auditorium, HQ1 virtual mission suite, fitness and wellness rooms, improvements of leased out spaces). ### Governance, oversight, and planning - Project approach will draw on lessons learned from past major buildings projects. - Planned governance features: - Strong governance and oversight functions. - A separate budget appropriation against a detailed project plan. - Regular engagement with and updates to the Board during both project planning and execution. - Medium-term inclusion: Major building investments for HQ2 will be included in subsequent cycles, informed by early diagnostic and planning work. - Timing notes: - Large HQ1 building systems and AV equipment lifecycle projects will continue through FY26. - Investments to update security equipment and refurbish the Concordia in FY27. ### IT-intensive capital envelope (FY25) - Proposed IT-intensive capital budget: $65.2 million, including CCE, versus $60.8 million in FY24 (7 percent real increase). - The FY25 proposal considers near-term demands from current projects and a strong pipeline of medium-term demand. - HR modernization, currently in the planning stage, will be funded from available resources within the overall FY25 IT-intensive capital envelope. - Key components and allocations: - Transformation projects: $13.3 million for current projects (focus on completing in-train projects). - Other new investment funding in FY25: $13.7 million for current projects, including $1.6 million in information security investments. - New projects to be prioritized during the year: $7.6 million. - Lifecycle replacements and IT infrastructure: $8.6 million. - Cloud costs (CCE): projected to increase to $22.0 million, in line with the FY24 estimate. - Cost avoidance through streamlining implemented during the year: $0.4 million. ### Transformation and modernization project highlights and timelines - Nexus (TRM-KMU sponsor): - Replaces the Fund’s document management platform. - Two small releases delivered in November 2021 and August 2022. - Final Fund-wide release deployed in March and currently in hypercare support and stabilization. - Actions taken to minimize schedule and cost impacts from critical security risks and vendor-related data migration quality issues. - iData: - Modernizes economic data management and dissemination systems. - FY24 progress: data migration; iData established as system of record for production of six datasets; parallel runs for the WEO; dissemination system released into production. - Program scheduled for completion in FY25. - CRS-Common Review System: - Will provide a common interdepartmental review process for more consistent and accessible documentation. - Project kicked off in FY24; stakeholder feedback on a clickable user experience prototype underway. - Continued engagement on business requirements, stakeholder analysis, communication plans, and information security requirements. - Scheduled for completion by end-FY26. - Intranet: - Aims to deliver a modern Intranet aligned with new ways of working. - Completed scoping and to-be model; implementation commenced in FY24 Q3; planned completion by end FY26. - HR Modernization: - Following formal close-out of the 1HR program, work is underway on a framework for remaining work within HRD, in coordination with ITD and FIN and support from TRM. - Near-term focus: improve existing functionality and business processes; initial work on broader Digital HR planning. ### Potential new investments and priorities - Potential investments include: - Revamping IMF.org. - Next-stage Identity and Access Management improvements. - Artificial Intelligence (AI) pilots. - Implementation of recommendations of the OIA review of CDMAP. - Ongoing modernization of budget systems. - Proposals will be discussed with the CBIT on an ongoing basis. ### Medium-term funding and prioritization - IT-intensive investments will be informed by the forthcoming Business Technology Strategy (BTS) and road-mapping process, complemented by the strengthened prioritization framework. - The prioritization framework will provide a structured assessment of business needs, priorities, and delivery capacity. - An update on the BTS to the Board is planned for early FY25. *_Source: ppea2024024 - Box 9. Major Buildings_* ### Annex I. Budget Process Overview ### Annex I. Budget Process Overview ### A. Overview of the Budget Process - The budget translates the membership’s priorities (Managing Director’s Global Policy Agenda, the IMFC Communiqué) into allocations across departments and outputs. - The budget takes into account Board reviews of the income and expenditure position, staff compensation, and the capital budget. - The Committee on Capacity Building (CCB) and a Board briefing on CD priorities support CD–budget links. - Financial year (t): May 1(t-1) to April 30(t) - Example: FY25 = May 1, 2024 to April 30, 2025 - Gross Administrative Envelope components (conceptual): - Net Administrative budget (structural spending that is Fund-financed; overall Fund‑financed appropriations, less general receipts; does not include expenses funded by IMF02, including staff resources funded through chargebacks.) - Receipts (general receipts + donor funding) - Carryforward (Fund-financed and donor financed) and other transitional transfers (excess underspend of IEO and OED) - FY24 Nominal Gross Administrative Envelope (visual/composite figures shown): - Net Admin: 1,411 - Carry Forward: 102 - Receipts: 295 - Gross Admin Envelope: 1,808 - (Graph labels: Fund Fin. / Ext. Fin.) ### Carryforward (CF): rules, limits, and recent history - Definition: The right to spend budget allocations beyond the period for which budgetary authority is normally granted (12 months). - CF limits are set for: - IEO - OED (per office) - General level for other administrative expenses - General CF limit history and proposals: - Rose to 6 percent of the general net administrative budget following the GFC; reverted to 3 percent in FY12. - Board approved increase from 3 to 5 percent in 2020, then to 8 percent in 2021 to respond to the pandemic period. - Reduced to 7 percent in FY23 and 6 percent in FY24. - Proposed to fall to 5 percent in FY25, with a view to reverting to the 3 percent normal limit over time. - IEO CF limit: - Has varied between 5 and 8 percent of the IEO net administrative budget since FY21. - OED CF limit: - Set at a maximum of 20 percent of the net administrative budget for each office or the dollar equivalent of two Advisor FTE positions. - OED central carryforward was discontinued effective FY21. - Carryforward limit increased from 20 percent to 30 percent for resources from FY25 to FY26, to be reviewed in FY27 budget cycle. - CF calculation (general budget): - CF_t = min (U_t, B_t x X_t) - Where: - U_t = underspend in current FY (B_t + CF_{t-1} – E_t) - B_t = general net administrative budget in current FY - CF_{t-1} = carryforward from previous FY - E_t = net expenditures in current FY - x_t = limit expressed as a percentage of the current year’s general net administrative budget (approved by the Executive Board) ### Capital budget and Cloud Capital Equivalent (CCE) - Capital budget purpose: - Financing for investments in IT and building improvements and repairs. - Capital budgets are available for three years, after which unspent appropriations lapse. - Projects cover acquisition of building or IT equipment; construction, major renovation, or repairs; major IT software development or infrastructure projects. - Cloud Capital Equivalent (CCE): - Sub-category within the capital budget for cloud subscription costs, per Board-approved budgetary treatment (April 2021). - Introduced in response to migration from a “purchase/build and maintain” software model to cloud-hosted platforms with subscription costs, which would have, all else equal, reduced capital spending and increased administrative spending. ### FY24 and FY25 budget-related key statistics (selected figures from Annex tables) - Nominal Gross Administrative Envelope (selected FY20–FY25 totals): - FY20 Total Gross Administrative Envelope: 1,444 - FY21 Total Gross Administrative Envelope: 1,493 - FY22 Total Gross Administrative Envelope: 1,570 - FY23 Total Gross Administrative Envelope: 1,668 - FY24 Total Gross Administrative Envelope: 1,808 - FY25 Proposed Gross Administrative Envelope: 1,925 - Selected FY20–FY25 expenditure categories (Millions of US dollars; table headings FY20, FY21, FY22, FY23, FY24, Prop. FY25): - Personnel: - FY20: 1,043 - FY21: 1,123 - FY22: 1,143 - FY23: 1,228 - FY24: 1,329 - Prop. FY25: 1,414 - Travel (total): - FY20: 134 - FY21: 133 - FY22: 144 - FY23: 110 - FY24: 147 - Prop. FY25: 138 - Buildings and other expenditures: - FY20: 231 - FY21: 232 - FY22: 249 - FY23: 268 - FY24: 272 - Prop. FY25: 298 - Contingency/Other: - FY20: 36 - FY21: 5 - FY22: 34 - FY23: 62 - FY24: 60 - Prop. FY25: 75 - Receipts and externally financed components (FY20–FY25, Millions of US dollars): - Total Receipts (selected years shown as concatenated series in source): 239 199 237 142 244 166 265 229 294 258 324 (table format in source) - Externally financed (selected FY entries): - FY20: 200 - FY21: 165 - FY22: 206 - FY23: 236 - FY24: 257 - Prop. FY25: 283 - General receipts (selected FY entries): - FY20: 39 - FY21: 35 - FY22: 31 - FY23: 33 - FY24: 44 - Prop. FY25: 48 - Travel detail (FY20–Prop. FY25, Millions of US dollars, select rows): - Business travel: FY20: 108; FY21: 104; FY22: 113; FY23: 93; FY24: 128; Prop. FY25: 120 - Transportation: FY20: 102; FY21: 99; FY22: 101; FY23: 92; FY24: 128; Prop. FY25: 119 - Per diem: FY20: 6; FY21: 5; FY22: 12; FY23: 0; FY24: 29; Prop. FY25: 25 - Buildings, IT and other expenses (select line items, FY20–Prop. FY25, Millions of US dollars): - Building occupancy: FY20: 70; FY21: 73; FY22: 77; FY23: 73; FY24: 79; Prop. FY25: 82 - Information technology: FY20: 72; FY21: 73; FY22: 75; FY23: 71; FY24: 71; Prop. FY25: 75 - Subscriptions and printing: FY20: 14; FY21: 21; FY22: 21; FY23: 23; FY24: 26; Prop. FY25: 28 - Miscellaneous: FY20: 2; FY21: 56; FY22: 64; FY23: 91; FY24: 84; Prop. FY25: 83 - Budgeted Personnel FTE, FY20–Prop. FY25 (selected aggregates): - Structural Non-Augmentation: - FY20: 2,878 - FY21: 2,877 - FY22: 2,888 - FY23: 2,939 - FY24: 2,969 - Prop. FY25: 2,981 - OED Increase (FY24 onward): FY24: 35 - Structural Augmentation (selected): FY22: 54; FY23: 119; FY24: 185 - Temporary and Transitional (selected totals across years visible in source) - Grand Total FTE: - FY20: 3,013 - FY21: 3,108 - FY22: 3,180 - FY23: 3,270 - FY24: 3,316 - Prop. FY25: 3,391 - Gross Administrative Budget/Spending by FTF (FY23–Prop. FY25, Millions of FY24 US dollars; selected programmatic totals and percent of total): - Total (structural budget / actual outturn / prop. structural budget): - FY23 Actual Outturn: 1,618.2 - FY24 Structural Budget: 1,705.9 - FY24 Actual Outturn: 1,668.1 - FY25 Prop. Structural Budget: 1,752.3 - Percent of Total (columns shown for FY23, FY24, FY25; all normalized to 100.0 in source) - Major functional categories (selected FY25 Prop. Structural Budget and FY24 Actual Outturn comparisons in source): Country operations; Bilateral Surveillance; Lending & Other Engagement; Capacity Development; Fund Policies and Analytical Work; Multilateral Surveillance - Global; Global Cooperation/Standards; Fund Governance and Finances; Corporate Functions; Miscellaneous; Center. - Example (Country operations): - FY23 Structural Budget: 695.7; FY23 Actual Outturn: 672.4 - FY24 Structural Budget: 725.8; FY24 Actual Outturn: 716.2 - FY25 Prop. Structural Budget: 757.2 - Nominal Capital Expenditures FY20–FY25 (Millions of US dollars; summary of flows across years for Information, Technology Renewal, Capital): - New appropriations and totals are shown per-year in source tables; sample totals: - FY20 Total funds available: 196.2; Expenditures: 106.8; Remaining funds: 87.6 - FY21 Total funds available: 186.3; Expenditures: 76.9; Remaining funds: 106.9 - FY22 Total funds available: 185.9; Expenditures: 90.2; Remaining funds: 87.4 - FY23 Total funds available: 165.3; Expenditures: 95.3; Remaining funds: 44.9 - FY24 Total funds available (Est.): 153.1; Expenditures (Est): 114.7; Remaining funds (Est): 37.6 - FY25 New appropriations (Prop.): 121.9; Total funds available (Est.): 159.5 - Notes in source: lapsed funds, remaining funds, project closeout adjustments, formula key (Facilities, IT Cloud Capital Equiv.) ### Cross-cutting budget considerations and interactions with policy reviews/evaluations - Selected policy reviews and evaluations (CY23–24) include summaries of resource implications where identified in source: - Elements of Effective Policies for Crypto Assets – February 2023: No resources implications identified; work expected to remain within agreed budget augmentation framework. - Review of the Role of Trade – March 2023: No quantified cost estimates; recommendations to be achieved through reprioritization within existing budget envelope. - IEO – IMF Engagement with Small Developing States Implementation Plan – March 2023: MIP estimates total implementation costs of about 22 FTEs over FY23–FY28 (average of 3.8 FTEs a year); some items to be funded through reprioritization. - Review of the Implementation of the 2018 Framework for Enhanced Fund Engagement on Governance – April 2023: Gross additional cost estimated at 1 FTE, expected to be met through reprioritization. - Review of Climate Macroeconomic Assessment Program Pilots – May 2023: No resources implications identified. - Implementation of the Climate Strategy and the Resilience and Sustainability Trust – May 2023: Resource implications noted; 18 staff hired to the climate workstream in FY23 and around 30 hires planned for FY24. - 2023 Review of the IMF's Strategy on AML/CFT – November 2023: Estimates gross resource implications of about 4 FTEs over the next four years and additional financial resources equivalent to one A13/A14 FTE a year (about 5 percent of LEG’s personnel budget). - Review of the Framework for Data Adequacy Assessment for Surveillance – November 2023: Resource demands expected to be moderate; one-time investment followed by regular updates. - Lending-related reviews (various dates in 2023–2024): Papers generally note limited expected impact on demand for Fund resources and implementation within existing budgetary envelopes. - IEO evaluation-related and CD strategy reviews identify areas with manageable near-term resource implications and some medium-term items that would require material additional funding (as noted in the 2023 CD Strategy Review—April 2024). - Internal support and safeguards: - Review of Institutional Safeguards (ISR) implementation plan (December 2023): DRS, Ethics, and Investigation Offices collectively received a 24.6 percent increase in FY24 budget allocations and about 47 percent after including transitional funds; builds on an overall 30 percent increase in DRS resourcing allocated in FY23, with an overall upward shift in resources since FY22 of about 80 percent. - Enterprise Risk Management (ERM) implementation reporting recognizes capacity constraints and recommends a phased approach. *Source: Annex I. Budget Process Overview, FY2025–FY2027 Medium-Term Budget (selected tables and text).* --- _Source: https://www.imf.org/-/media/files/publications/pp/2024/english/ppea2024024.pdf_