Public Financial Management: Principal Issues in Small Pacific Island Countries
IMF Policy Discussion Papers, February 1, 2002
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- Public Financial Management: Principal Issues in Small Pacific Island Countries
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Bibliographic details
- Authors: Klaus-Walter Riechel
- Published: February 1, 2002
- Series: IMF Policy Discussion Papers
- DOI: https://doi.org/10.5089/9781451974973.003
Summary
- The paper discusses reform in public financial management in small, resource-constrained economies such as the Pacific island countries (PICs).
- It describes the efforts undertaken by PICs in the past and assesses their results.
- A principal conclusion is that reform in public financial management needs to be defined against the capacity of countries to sustain it at the national level.
- This requires a careful definition of priorities for action and the determination of appropriate pacing and sequencing of reform.
- In this decision, achievement of the imperatives of expenditure control and sustainability of deficits is typically more important than exploitation of the scope for efficiency gains promised by "cutting edge" public financial management systems.
Key findings
- Reform must be calibrated to national capacity to sustain changes in public financial management.
- Prioritization, pacing, and sequencing of reforms are essential for successful implementation in PICs.
- Expenditure control and sustainability of deficits are typically more important objectives than pursuing advanced PFM systems for efficiency gains.
Policy recommendations and implications
- Define reform agendas against the capacity of the national administration to sustain reforms.
- Carefully determine priorities for action to focus limited resources on the most critical PFM weaknesses.
- Sequence reforms appropriately to ensure that foundational objectives—especially expenditure control and deficit sustainability—are achieved before pursuing advanced efficiency-oriented systems.
Subject areas and keywords
- Subject: Accrual accounting, Budget planning and preparation, Fiscal policy, Fiscal transparency, Public financial management (PFM)
- Keywords: a number of management mechanism, accounting, accounting methodology, Accrual accounting, Australia and New Zealand, Budget planning and preparation, budget system, budget systems, cash management, country, development budget, economic reform, Fiscal policy, forum country, management, Pacific Islands, PDP, public finance, public financial management, reform strategy, small country issues
Content in this bundle
- Public Financial Management: Principal Issues in Small Pacific Island Countries - PDP/02/1