Your SlideShare is downloading. ×
0
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×
Saving this for later? Get the SlideShare app to save on your phone or tablet. Read anywhere, anytime – even offline.
Text the download link to your phone
Standard text messaging rates apply

Public Expenditure Management: Allocative efficiency, forward estimates, public programs and prioritization

2,769

Published on

This presentation address to finding the one function of Allocative efficiency as part of PEM objectives. In addtion, it has presented several research from Allen shick and collaboration the …

This presentation address to finding the one function of Allocative efficiency as part of PEM objectives. In addtion, it has presented several research from Allen shick and collaboration the government expenditure in Indonesia and Malaysia with several exercise have been given to audience to understanding several practice concept.

Published in: Education
2 Comments
0 Likes
Statistics
Notes
  • Be the first to like this

No Downloads
Views
Total Views
2,769
On Slideshare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
71
Comments
2
Likes
0
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide
  • Expenditure policy is trying to find an answer for the question "what" is to be done, Expenditure management tries to find an answer for the question "how" it is to be doneJadrankaDjurović-Todorović, Marina Djordjević: 2009
  • Public expenditure management approach has been taken into consideration not onlyby World Bank and IMF but also The Organization for Economic Co-operation and Development(OECD) and European Union has supported this approach
  • Fiscal discipline has a close relation with the control of budget magnitudes effectivelyand it assumes a binding role on both macro level and expenditure unit by means of expenditureceilings (Allen, Tommasi, 2001, p.19).The three basic objectives of PEM provide a frameworkto assess progress in improving performance of the budget system
  • Richard Allen and Daniel TommasiEfficiency in allocation is the skill of distributing sources in budget priorities
  • From the book of management and control of government expenditure, OECD-1987
  • Source: Laura Irwin Langbein, Public Progrm Evaluation : A Statistical Guide , Second ,Edition,UnitedStates:Library Materials, pg 4See also: Allen, Tommasi,2001, Allen, Richard and Daniel Tommasi (2001), Managing Public Expenditure A Reference Book for Transition Countries, SIGMA, OECD, pg19
  • Source: Set: National Account of OECD Countries Volume II, 2010, OECD, pg 904
  • “ Transfer payments refer to money transferred from one person or group to another which is not in return for any good or service”Government transfer or simply transfer is a redistribution of income in the market system.These payments are considered to be exhaustive because they do not directly absorb resources or create output.SOURCE: Susan Grant Chris, Chris Vidler, , Andrew Ellams, Heinemann Economics A2 for Edexcel, Uk: Scotprint.pg 207
  • See also: sources : Lyman Rose 2012, 4 Step to prioritize expenditures, Retrieved November 16, 2012, from www.imf.org/external/pubs/ft/expend/guide3.htm
  • Transcript

    • 1. COLLEGE OF LAW, GOVERNMENT AND INTERNATIONAL STUDIES PUBLIC EXPENDITURE MANAGEMENT The process of : Allocative Efficiency, Forward Estimate, Public Programs and PrioritizationPREPARED FOR : PUBLIC FINANCIAL MANAGEMENT CLASS | Dr. SALIHU ABDULWAHEED ADELABUCompany Proprietary and Confidential Copyright Info Goes Here Just Like 1
    • 2. CONTENTS PEM General Overview of Public Expenditure Management The process of allocative efficiency PEM : Forwards estimates Public Programs Managing prioritizationCompany Proprietary and Confidential Copyright Info Goes Here Just Like 2
    • 3. GENERAL OVERVIEW OF PUBLIC EXPENDITURE MANAGEMENT Public expenditure management (PEM) is one instrument of government policy. Public expenditure management is a basic means of government policy distributing utilizing sources productively, effectively and sensitively (Allen, Tommasi, 2001, p.19).Company Proprietary and Confidential Copyright Info Goes Here Just Like 3
    • 4. Aggregate Allocative of Fiscal of Discipline effective, efficient Technical efficiencyTHE OBJECTIVES OFPUBLIC EXPENDITURE MANAGEMENT Worldbank:1999 -
    • 5. PUBLIC EXPENDITURE MANAGEMENT (PEM) OBJECTIVES Allen, Tommasi, 2001,Company Proprietary and Confidential Copyright Info Goes Here Just Like 5
    • 6. 1 ALLOCATIVE EFFICIENCY STRATEGY DEFINITION That is capacity to establish priorities within the budget, to distribute resources on the Unified Budget basis of the government’s priorities and the program is Consolidation effectiveness. Moreover, is to shift resources Forward from old priorities to new Estimates ones, or from less to more Rolling plan budget productive activities, in correspondence with the government’s objectives Performances (Allen & Tommasi : 2001) Based Budgeting Efficiency & effectiveCompany Proprietary and Confidential Copyright Info Goes Here Just Like 6
    • 7. Allocative Efficiency Problems of Some Developing CountriesPractice ProblemsShort-term Government budgets one year at a time, without consideringBudgeting medium-term implications, such as the recurring operating costs of new projects.Escapist Planning Planning is politically important but the government promises in the plan what it cannot pay for in the budget.Distorted Priorities Scarce resources are spent on showcase projects that produce meager social return while the budget underspends on human capital (health, education, etc.).“Enclave” Efforts (often by international organizations) to protect certainBudgeting priorities by establishing special funds, separate investment budgets, social (or physical) investment programs, and other devices that wall off the "enclaves" from the rest of the budget. Source: Allen shick : 1999: 39Company Proprietary and Confidential Copyright Info Goes Here Just Like 7
    • 8. FORWARD 2 ESTIMATES DEFINITION FUNCTION Structured of budget Application of the forward estimates in the medium-term work during periods of perspective to create certainty of program expansion as funding for ministries / agencies. well as during periods of contraction, and it The assurance gives have to survived opportunities in ministries / against several agencies in planning expenditure changes in government / spending in subsequent years in leadership. accordance with the principles of efficient allocative efficiency. Indonesia the National Development Planning Agency (Allen Schick:1998) Cont: Public ProgramsCompany Proprietary and Confidential Copyright Info Goes Here Just Like 8
    • 9. 3 PUBLIC PROGRAMS Public programs is implement policy. “Programs are ongoing service or activities…programs authorized by policies, are directed toward bring about collectively shared ends. These ends, or goals, include the provision of social and other public services and implementation of regulations designed to affect the behavior of individuals, businesses, or organization.” Source: Laura Irwin Langbein, Public Progrm Evaluation : A Statistical Guide , Second ,Edition,United States:Library Materials, pg 4 Government final consumption expenditure In What Intended to create future Programs benefits (investment) government expenditure Transfer paymentCompany Proprietary and Confidential Copyright Info Goes Here Just Like 9
    • 10. Government final consumption expenditure “Government final consumption consists of expenditure, including imputed expenditure, incurred by general government on both individual consumption goods and services and collective consumption services” Source: Set: National Account of OECD Countries Volume II, 2010, OECD, pg 904 Water, Food Clothing Electricity, Health Transpo Commu Education Gas rtation nicationCompany Proprietary and Confidential Copyright Info Goes Here Just Like 10
    • 11. Intended to create future benefits (investment) “…Capital expenditure decisions, therefore, involve a current outlay or a series of outlay over a period of time in return for future benefits.” Source: Banerjee Bhabayosh, (2008)Fundamentals of Financial Management.. New Delhi: PHI Learning Private Limited. Pg 256. PERLIS Airports, Machinery Roads Transport Building Railway, For Equipment Bridges TechnologyCompany Proprietary and Confidential Copyright Info Goes Here Just Like 11
    • 12. Transfer payment Transfer payment Example of Transfer Payments. Payment Transfer payment made by government to an individual that are not in exchange for good or services, have important implications for the alleviation of poverty and distribution of income. Welfare Payments can be either in cash or in kind Social security There’s two type, Means- tested transfer and social insurance programs Source: John B. Taylor, Akila Weerapana: 2007Company Proprietary and Confidential Copyright Info Goes Here Just Like 12
    • 13. 4 PRIORITIZATION IN PEM What is public expenditure Priorities The government need to arrange the public programs expenditure starting from high – priority category until the low priority category. budget allocations would reflect the government’s considered and reasonable judgment on priorities Sources : David Bevan 2007,Promoting and Protecting High-Priority Expenditures, pg2Company Proprietary and Confidential Copyright Info Goes Here Just Like 13
    • 14. 2. Look at 3. Now give a number to all 4. Now you each programs starting have them1. Look at programs from high –priorityour budget in priority and assign category until the low orderand make it a letter priority categorysure it is as based on thecomplete situation in the country Sources : Lyman Rose 2012, 4 Step to prioritize expenditures, pg1Company Proprietary and Confidential Copyright Info Goes Here Just Like 14
    • 15. LET’S WE DO ONE EXERCISE TO UNDERSTAND PUBLIC EXPENDITURE PRIORITIESCompany Proprietary and Confidential Copyright Info Goes Here Just Like 15
    • 16. FURTHER READING Allen, Richard and Daniel Tommasi (2001), Managing Public Expenditure A Reference Book for Transition Countries, SIGMA, OECD Banerjee Bhabayosh, (2008)Fundamentals of Financial Management.. New Delhi: PHI Learning Private Limited. David Bevan 2007,Promoting and Protecting High-Priority Expenditures, Laura Irwin Langbein, Public Program Evaluation:A Statistical Guide , Second ,Edition,United States:Library Materials, Lyman Rose 2012, 4 Step to prioritize expenditures, Retrieved November 16, 2012, from www.imf.org/external/pubs/ft/expend/guide3.htm Minister of Finance Malaysia(2012),Retrieved November 16, 2012, from www.treasury.gov.my/.../2012/.../FGDE20122013... Set: National Account of OECD Countries Volume II, 2010, OECD, Susan Grant Chris, Chris Vidler, , Andrew Ellams, Heinemann Economics A2 for Edexcel, Uk: Scotprint. Schick, Allen (1999), A Contemporary Approach to Public Expenditure Management, World Bank Institute, Governance, Regulation, and Finance Division, Second Printing, (April).Company Proprietary and Confidential Copyright Info Goes Here Just Like 16
    • 17. THANKS FOR YOUR AT T E N T I O N

    ×