Budgeting-Medium Term Expenditure Frameworks (MTEFs)

Budgeting-Medium Term Expenditure Frameworks (MTEFs)

Proper construction and control of expenditure plans and budgets is central to organization and governments. This requires a comprehensive financial planning and approval framework; consistent and rigorous processes for constructing plans and budgets, both capital and revenue; sound methodologies for assessing the financial impact of proposed expenditure; compatibility with other management and performance data, and a control system that sets clear responsibilities and produces prompt and accurate monitoring information on performance against budgets. Budgeting and Budgetary Control is a rational means of allocating and controlling scarce resources of any organization towards the attainment of set goals and objectives.

Moving towards a Medium-Term Expenditure Framework (MTEF) involves building upon the current budget and policy decision-making process, with an aim to overcome some of the current constraints in the process and improve public expenditure decisions and management. A well thought out MTEF tries to integrate policy with resource allocation decisions in a multi-year context to better reflect the effects of decisions on public finances, and generally lead to improved policy decisions. It also involves structuring the decision-making process to encourage economy efficiency and effectiveness (the 3Es), and focus spending and policy on attaining the government’s objectives. So, a MTEF could be said to be about strategic allocation of resources in line with government priorities and the opportunity costs of decisions.

This training will explore planning, budgeting, the stages of a MTEF process, the role of some of the key institutions in the MTEF process, and references to international best practices to illustrate points and have a discourse using a few examples of successful countries that have implemented MTEF.

Training Modules

Strategic Planning and budgeting

• Brief History of Developments in Planning and Budgeting Techniques
• Linkages in Policy, Planning and Budgeting
• Budgeting and Budgetary Controls

Budgeting and Budgeting Techniques

• Planning, Budgeting and Performance Review Process
• Budgeting Techniques and their Advantages and Disadvantages
  • Incremental Budgeting
  • Zero-Based Budgeting

Budget Documentation Formats

• Line Item Budgeting
• Performance Based (or Results Based) Budgeting and Financing
• Programme Based Budgeting and Financing

Budgeting Approaches

• Top-Down (Imposed) Approach
• Bottom-Up (Participatory) Approach

Medium-Term Expenditure Framework

• Developing a Medium-Term Expenditure Framework
• Discourse on MTEF Implementation
• Key Issues for Introducing MTEF and Top-down Budgeting
• Successful Installation of MTEF in a Country’s Fiscal System
• MTEF – the Swedish Budget Process: Expenditure Targets and Top-down Decisions
• Medium-term Financial Planning in the Federal Republic of Germany
• Medium-term Perspectives in Budgeting: The S. Case

Performance Management

• An Overall Framework for Considering Performance Management
• Introducing Performance Management
• Practicum Performance Management in the Health Sector & Education
• Establishing a Performance Management Strategy: Governing for Results
• Results Based Budgeting
• Performance Management and Budgeting
• Brief on Performance Audits

Fiscal Transparency

• Important Principles of Public Finance Fiscal Transparency
• Coverage of Public Finance in South Korea and other countries
• Information Flow for Successful MTEF Operation and its Implication for Governments
• Discourse on Importance of Automation of the Country PFM System in MTEF Implementation

Way forward After the Training

Participants will develop a work plan through the help of facilitators that stipulates application of skills acquired in improving their organisations. ASPM will continuously monitor implementation progress after the training.

Training Evaluation:

Participants will undertake a simple assessment before the training to gauge existing knowledge and skills; another assessment will be done after the training in order to monitor knowledge gained through the training.