Checking the Receipts from Pandemic-Related Spending
IMF Blog, May 20, 2021
Source details
- Canonical URL
- Checking the Receipts from Pandemic-Related Spending
Other formats
Bibliographic details
- Authors: Chady El Khoury, Jiro Honda, Johan Mathisen, Etienne Yehoue
- Published: May 20, 2021
Context and purpose
- Governments provided lifelines to people and firms to combat the pandemic and its economic fallout; transparency and accountability are important to support effectiveness.
- IMF stance: "spend what you must, but keep the receipts."
- IMF pressed for better governance through greater transparency and sought specific governance measures for countries receiving IMF financing during the crisis.
IMF-required governance measures
- Commitments include:
- Publish pandemic-related procurement contracts.
- Publish beneficial ownership of companies awarded these contracts.
- Publish COVID-19 spending reports and audit results.
- Tailoring and safeguards:
- Measures are tailored to country circumstances and the severity of corruption risks.
- All recipient countries commit to undertake a Safeguards Assessment to ensure the central bank can provide reliable information and transparently manage IMF funds.
Implementation progress (one year into the emergency response)
- Publication of contract information:
- Most commitments have or are in the process of being met, including in the Dominican Republic, Guinea, Nepal, and Ukraine.
- In some countries, capacity constraints limit progress; IMF provides capacity development support.
- Beneficial ownership publication:
- Purpose: deter corruption and facilitate detection of conflicts-of-interest by requiring bidding companies to provide names of people with effective control ("beneficial owners") to procurement agencies for publication.
- Implementation status: "only half of the countries (including Benin, Ecuador, Jordan, Malawi, and Moldova) having implemented this commitment or made substantial progress toward it."
- Positive spillovers: commitments prompted some countries, such as Kenya and the Kyrgyz Republic, to adopt the reform permanently (beyond pandemic-related spending).
- Audits of emergency spending:
- Typical deadline for ex-post audits: "3-12 months after the end of the fiscal year."
- It is too early to assess implementation—most audits are in preparation based on existing systems.
- Early action examples: Jamaica, Honduras, Maldives, and Sierra Leone have conducted risk-based, real-time audits.
- IMF support: stepping up capacity development to help supreme audit institutions and improve retrievability of information.
- Reporting of pandemic-related spending:
- Most countries are, or will shortly begin, publicly reporting on execution of this spending.
- Safeguards Assessments:
- Being undertaken rapidly, "with the pace of these assessments doubling after the pandemic’s onset."
Tackling deeper governance and anti-corruption challenges
- Longer-term engagement:
- Emergency measures are not silver bullets; deeper vulnerabilities are addressed under the IMF’s broader "2018 Framework for Enhanced Fund Engagement on Governance."
- Focus areas in the 2018 Framework: multi-year IMF lending arrangements, annual health checks of IMF member countries, and capacity development.
- Examples of reforms under multi-year IMF financing arrangements:
- Fiscal governance: Ecuador, The Gambia, Jordan, Liberia, Rwanda, and Senegal.
- Anti-corruption and anti-money laundering frameworks: Angola, Armenia, Republic of Congo, Kenya, and Tunisia.
- Financial sector oversight and central bank governance: Liberia and Ukraine.
- Capacity development:
- IMF staff will continue to provide tailored capacity development through technical assistance, training, and webinars.
Transparency and accountability beyond IMF financing
- Practices in non-recipient and other countries:
- Comprehensive spending portals: Brazil, Colombia, Costa Rica, France, and Peru.
- Frequent external audits: South Korea.
- Emergency procurement guidelines: Spain.
- Detecting conflicts-of-interest via beneficial ownership and disclosures: Romania.
- IMF engagement channels:
- Through Article IV consultations and policy dialogue, IMF staff discuss transparency and accountability in pandemic-related spending in countries such as Poland, the United Kingdom, and the United States, and on fiscal, monetary, and financial sector measures more generally.
Building on progress and next steps
- Sustained country engagement on governance and anti-corruption is necessary to support effective implementation of pandemic reforms and beyond.
- IMF priorities and actions:
- Implement the 2018 Framework, which addresses governance issues beyond anti-corruption, including fiscal governance, financial sector oversight, central bank governance, market regulation, rule of law, and anti-money laundering frameworks.
- Continue tailored capacity development to address varying implementation capacity across countries and measures.
- Take stock of progress in implementing the 2018 Framework in mid-2022 to assess continued IMF support for strengthening governance.
- Enablers of success:
- High-level political ownership of reforms.
- International cooperation.
- Joint effort with civil society and the private sector.
- Sustained implementation over an extended period.
- Outlook: Progress is not easy but is achievable and essential for fostering stronger and more inclusive economic growth.
Source: IMFBlog, "Checking the Receipts from Pandemic-Related Spending", May 20, 2021.
Content in this bundle
- Implementation status of governance commitments on crisis-related spending_To depts.docx
References
- عربي
- Español,
- 日本語
- Português
- transparency and accountability
- spend what you must, but keep the receipts
- governance measures
- Safeguards Assessment
- 2018 Framework for Enhanced Fund Engagement on Governance
- Ecuador
- The Gambia
- Jordan
- Liberia,
- Rwanda
- Senegal
- Angola,
- Armenia
- Republic of Congo
- Kenya
- Tunisia
- Ukraine
- Poland
- United Kingdom
- United States