Jamaica s Public Investment Management System (PIMS) April 23, 2015

Size: px

Start display at page:

Download "Jamaica s Public Investment Management System (PIMS) April 23, 2015"

Darcy Stafford
7 years ago
Views:

1 Jamaica s Public Investment Management System (PIMS) April 23, 2015

2 Background & Context Reform of Public Investment in Jamaica is a major outcome of the Public Financial Management Action Plan and the enhanced fiscal governance framework promulgated by the Government of Jamaica. The PFM Action Plan is the response to the February 2013 Public Expenditure & Financial Accountability (PEFA) Report.

3 The Assessment The PEFA Assessment identified the absence of an effective & efficient functioning Public Investment Management System (PIMS) as a weak link in Jamaica s Public Financial Management (PFM) system. (a) No proper framework of rules-based procedures, tools, institutions (b) No governance mechanisms for the purpose of analyzing, prioritizing, managing monitoring and evaluating the efficiency and effectiveness of public investment projects As a result of (a) and (b), Jamaica has not been able to maximize the benefits of its investments in the projects

4 Diagnosing the Weaknesses The following specific weaknesses were identified: Poor project design & planning Weak institutional capacity to prioritize through screening and providing the feasibility analysis required prior to proceeding with the implementation of projects and programmes Policy mismatch with project goals & objectives

5 Diagnosing the Weaknesses Absence of an effective monitoring & evaluation system No regulations mandating regular reporting on public investments Expenditures that were not genuine capital expenditures were included in the Capital A budget Capital investments undertaken by public bodies were not reflected in the PSIP, neither were PPPs

6 From Diagnosis to Concrete Actions The weaknesses identified were corrected by legislative and administrative actions. Legislative actions (March 2014): Amendment of the Financial Administration and Audit Act to include a comprehensive definition of public investment that encompasses the specified public sector (public sector excepting entities certified as commercial); a new Fourth Schedule to set out the Public Investment Management System (PIMS) and all its components to address poor project design and weak institutional capacity and policy mismatch.

7 From Diagnosis to Concrete Actions Legislative Actions (cont d): Within the PIMS (new Fourth Schedule), there is a Public Investment Management Secretariat to which all project ideas/concepts should go for initial appraisal prior to the Public Investment Management Committee taking a decision to recommend projects to the Cabinet for inclusion in the PSIP. PIMSEC would ensure all the basics are covered, including policy and planning alignment, and undertake technical analyses to advise the PIMC. The PIMSEC will host a Monitoring and Evaluation System (in collaboration with the Ministry of Finance s Projects Branch and the Development Bank of Jamaica). The Fourth Schedule prescribed a regular/annual Public Investment Performance Report

8 From Diagnosis to Concrete Actions Administrative Actions: The Capital A budget was cleaned up. Capital A is public investment financed with state funds. Amortization (debt) was removed from Capital A and given its own section of the budget. One time expenditures of a recurring nature was removed. The public investment undertaken by public bodies, as well as PPPs, were included in the Public Sector Investment Programme (PSIP) tabled for the first time in April 2014, in keeping with the legal definition of public investment.

9 From Diagnosis to Concrete Actions The first phase of a web-enabled Public Investment Management Information System (PIMIS), a project database, was completed in April The database was populated with 139 central government projects that are included in the Estimates of Expenditure Projects that are financed through Public Bodies are currently being added to the database and are scheduled to be completed by August 2015.

10 From Diagnosis to Concrete Actions Regulations: Financial Administration and Audit (FAA) Fiscal Responsibility Framework (FRF) Regulations, FAA (Financial Management) Regulations and Public Bodies Regulations were Gazetted in April 2015.

11 From Diagnosis to Concrete Actions Implementation of the PIMS is being supported by part proceeds from a IBRD (WB) loan and a grant from DFID. The loan for the Strategic Public Sector Transformation Project was signed in September The project is designed to target two thematic areas: Reinforcing Fiscal Discipline and Revenue Enhancement Public Sector Institutional Strengthening to remove barriers that impede trade facilitation.

12 Comprehensiveness of the PIMS Implementation of the PIMS is actively in progress to achieve the following guiding principles as well as address the diagnosis: Extensive: PIMS extends across all public entities and sectors Inclusive: PIMS includes all types of public sector expenditures (actual and contingencies) Complete: PIMS covers all steps and phases that a project has to complete through its productive life Strategic: PSIP projects and programmes will be selected and oriented to add value to a larger development purpose.

13 Next Steps Convene the first meeting of the PIMC to evaluate new projects and make recommendations to the Cabinet Have an Executive Director for the PIMSEC on Board by May 1, 2015 Staff the PIMSEC so it is functional by September 2015 include Project Analyst and Monitoring and Evaluation Specialist

14 Next Steps Do further cleaning up of the PSIP to red-flag nonperforming projects for removal, pending a costbenefit analysis, and update the PSIP Policy Paper Further streamline the process and improve sensitization so all stakeholders are aware of the process. Complete the PIMS Guidelines which sets out the operational procedures.

MINISTRY OF FINANCE & DEVELOPMENT PLANNING PUBLIC FINANCE MANAGEMENT (PFM) REFORM PROGRAMME FOR BOTSWANA

MINISTRY OF FINANCE & DEVELOPMENT PLANNING PUBLIC FINANCE MANAGEMENT (PFM) REFORM PROGRAMME FOR BOTSWANA 1. Background The Public Finance Management (PFM) Reform Programme for Botswana is a response to