Project entitled Transforming Public Financial Management System Brief Summary: This artifact seeks to target the citizens of Liberia and to convey to them what government has done to improve the Public Financial Management system for effecting service delivery. It is very important such an information, especially in a Principal (citizens)-Agent (Politicians) relationship, is communicated to inform the citizens of these initiatives. It is also critical that the citizens are made aware that various data have revealed many challenges besetting the PFM system, including the manual processes for revenue collections, expenditure management, accounting and reporting and what the government has done to remedy the situation.

1. Transforming Public Financial
Management System in Liberia
Prepared by
Lawrence S. Taylor
November 12, 2021

2. Presentation Outline
❖ Country and economic context
❖ Situational Analysis
❖ Improvements since the implementation of the reform
❖ Challenges
❖ Lessons Learned

3. Liberia: Country & Economic Context (1)
• Became independent on July 26, 1847
• Population of 4.5m (LISGIS 2010) and constitutes:
– Americo Liberians…5% (minority group)
– The rest is made up of indigenous population

4. Country & Economic Context (2)
• Liberia experienced series of political upheavals in its history:
– 1980: Coup plot (Indigenous liberation) after
133+ years of one party rule (Minority)
– 1989 to 2003: Civil & Political Crisis
• Liberia economy and the Global Health Crisis:
– Liberia economy is very small.
– Current GDP in 2021 is 2.9b (According to World Bank)
• The Global Health Crisis:
– led to the decline in the price of the two major exports: rubber
and iron ore
– Impacted the national budget, employment and the foreign
currency reserves
– It is projected that the Real GDP is expected to grow moderately in
2021 by 3.3 percent and will average 4.4 percent in 2022-2023.

5. Situational Analysis-Public Financial Management System (1)
• 1989 to 2003: 14 years of civil unrest:
• 2006: GoL Adopted a Staff Monitoring Program with the IMF with the
objectives of:
• Rebuilding Public Institutions characterized by:
– Weakened institutions and public finance systems
– Rampant corruption
– Low capacity
• Restoring credibility of the PFM system to improve service
delivery through:
• Credible & comprehensive budgeting
• Strengthening budget execution & reporting
• Enhancing accounting and transparency

6. Situational Analysis-Public Financial Management System (2)
• The Government wanted to restore credibility of the PFM system and
improve reporting, accountability & transparency through the use of
Integrated Financial Management Information System (IFMIS)
and Tax Administration System
• Pre- 2010: Study Data Showed that:
◦ Revenue collections and expenditure was manual
◦ Accounting & reporting done through manual ledgers
◦ Difficulty in consolidating financial information
◦ Difficulty in tracking financial transactions
◦ Significant delays in payment processing
◦ Internal control weaknesses in financial management
◦ Reconciliation issues

7. Improvements since the implementation of the PFM Systems (1)
 IFMIS went live at MFDP on – 1st July 2011
 The system has been rolled out to 50 M&As
– 50 IFMIS rollout entities & 4 County Treasuries-(96% of FY 2020/21
budget)
– Functional LAN within all M&As and WAN (WIMAX) connecting all sites
to the Main Data Center
– M&As process Requisitions, Purchase Order, Good Received Note and
Invoices
• Results:
– Increased efficiency-No more queues at Ministry of Finance
– Reduction in manual processes
– Greater integration of Budget and Expenditure Departments during
budget execution
– Enhanced transparency & Accountability-Financial statements are
regularly produced & published
– Improved service delivery: Payments are made timely
– Greater security around transaction processing (approval workflows and
controls): PEFA 2016 saw improvement in PIs-18, 20, 24, 25

8. Improvements since the implementation of the PFM Systems (2)
 Results
 Pre-IFMIS Revenue:
– Revenue continues to improve on an annual basis
– 2005/2006: Revenue was 84.5m
– 2006/2007: Revenue was 129m
– 2007/2008: Revenue was 184m
• Post-IFMIS Revenue:
– 2019/2020: Revenue was $518.9m
– 2020/2021: Revenue was $570.1m
• The Data showed that there has been improved
performance in revenue collections due the deployment
of the IFMIS and TAS.

9. Challenges
 Funding to Integrate the IFMIS with other systems such as SIGTAS (ITAS),
EFT, ASYCUDA, e-Procurement System for the full appreciation of Data
 Lack of adequate IT capacity (including Systems Audit) to maintain data
integrity
 Retention of trained Staff (FMOs & IT staff)
 Lack of reliable power supply to keep the system functional
 Establishing a Data Center or a Co-location data centers for all the systems
 Sustainability of IFMIS - replacement and maintenance costs of the
infrastructure
Lessons Learned
• Use of credible data can help improve development outcomes, assist in
distribution of wealth and managing pandemics and other disasters;
• Training of key staff, including senior management in revenue and
expenditure data use and interpretation is important for key fiscal policy
decisions;
• Continued change management around data should be prioritized
• Create internal capacity for data management
• Put in place a National Data Governance Framework

10. Thank You