This presentation was made by Brigida Soares, Timor-Leste, at the 12th Annual Meeting of OECD-Asian Senior Budget Officials held in Bangkok, Thailand, on 15-16 December 2016

1. BUDGETING FOR A SUSTAINABLE FUTURE:
TOWARDS A ROADMAP OF BUDGETARY
GOVERNANCE REFORM IN TIMOR-LESTE
16 December 2016
UPMA

2. Presentation Outline
■ Background of Planning and Budgeting in Timor-Leste
– Input based budgeting (2010-2013 PEFA & IMF report)
– No link between Planning & Budgeting
– Difficulty in Monitoring & Evaluation (measuring SDP 2011-2030 Progress)
■ PFM Reform in Timor-Leste
– Fiscal Reform (Public Revenue & Expenditure reform)
– Establishment of UPMA (Decree Law 22/2015 on Planning, Monitoring &
Evaluation)
– Program Budgeting (Linking Planning & Budgeting)
■ Challenges
– Planning, Finance and Line Ministries (Services Delivery Agencies)
– Human Resources and Information System

3. Background of Planning and Budgeting in Timor-
Leste
(Input based budgeting (2010-2013 PEFA & IMF
report)
■ Using Input Based Budgeting inherit from UN Administration
– Budget prepared and calculated based on Line Item and approved at item
level;
– Modified cash basis accounting;
– Separate Planning & Budgeting preparation process until 2015
– PFM Law introduce in 2009 include Program Budget Structure
– FMIS in 2009, new CoA include segment of Program & Activities –program
budgeting
– Budget implementation is measure by Cash Execution

4. Fiscal Reform in Timor-Leste Reform
(Public Revenue & Expenditure reform)
■ 2015:
– Fiscal Sustainability of TL public finances
– Legislation was passed which created the Unit of Planning, Monitoring and
Evaluation (UPMA) which provided a clear mandate and responsibilities for
planning, reporting and monitoring between UPMA, Central Agencies (MoF)
and Line Ministries
– Moving towards Program Budgeting to enhance economic, efficiency &
effectiveness of SDP implementation focus on services delivery
– A comprehensive system and culture of performance management will be
instituted across the Timor-Leste civil service as new public management
reform.
– Support Public Administration, Legal & Economic Reform

5. What we have achieved so far?
■ Phase 1 Implementation of PB commences with the aim to:
– Develop Programs and Activities with 25 Government entities covered
Social, Economic and Infrastructure Sectors
– Update the FMIS Chart of accounts for the Programs and Activities and link
plan and budget book
Please refer to Program Budgeting Report

6. How did we do it – keep it simple?
■ Mantain input based system and introduce program & activity structures
■ Held wide consultation and workshops with all stakeholders
■ Developed methodology and guidelines including key definitions based on
some Golden rules:
■ No changes to the structure of Government Entities
■ No changes to the FMIS chart of account structure
■ No changes to budget control level – still at the Division appropriation
category level
■ No change to transactional procedures
■ Did not include salaries and wages
– Undertook the evaluation of the first SDP Implementation Phase (2011-2015)

7. Early results and achievements for 2017 Budget
 Shifting in discussion more focus now on policy outcomes rather than inputs
 Program Budgeting implemented in 10 Line Ministries and 15 Autonomous
Agencies for 2017 Financial Year
 Represents 58% of the total OGE Budget (excl. infrastructure)
 2017 Annual Plan aligned with 2017 Annual Budget
 FMIS Chart of Accounts updated for Programs and Activities
 83 Programs across the 25 entities
 1 Standard Program of Good Governance and Institutional Management across
all 10 Line Ministries
 Activities for Gender reporting identified
 Impact already felt during Parliament discussions on 2017 budget

8. TL Way Forward – our Priorities
■ Implementation of Phase 2:
– Roll out PB methodology to all remaining Government entities
– 2018 Budget preparation will be PB based for all Government entities
– Support Phase 1 entities in implementation during 2017 Fiscal Year
– Implement a new M & E tool for quarterly progress reports
■ Introduce Performance Auditing
■ Government approval of the Roadmap and its implementation in the next 5 to 10
years

9. cv
cv
P
L
A
N
N
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G
&
B
U
D
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T
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PED 2011 – 2030 & SDGs 2030
OUTCAME (Medium terms result
contribution from output produced to
change the existing condition (better)
Procurement
Plan Progress
Report
Quarterly
Performance Report
Annual Performance
Report
5 Years Performance
Report
TARGET (Immediate result produced by the
Activities)
ACTIVITY ( a process need to transform Input to
Output )
INPUT
Resources (i.e. labor, supplies, equipment, energy,
buildings, etc) that are needed by the Activities to
produce the Output
5 YEAR
PROGRAM
Expenditure
Plan, Include
Procurement
Plan
REVISE PED 2011 – 2030 & SDGs 2030
IMPACT (Long
terms result
direct &
indirectly from
Outcome
achieved)
EXECUTION
LONG TERM
MEDIUM
TERM
SHORT
TERM
OUTPUT ( Short term result produced by
the activity)
Annual Action
Plan
E
V
A
L
U
A
T
I
O
N
&
M
O
N
I
T
O
R
I
N
G
INTEGRATION OF PLANNING, BUDGETING, MONITORING & EVALUATION IN ONE
SYSTEM
Financial
Report
BUDGET

10. Our Challenges
■ Move from annual to multiyear planning and budgeting
■ Monitoring & Evaluation skills at all Line Ministries
■ Need for Planning, Budgeting, Monitoring & Evaluation information system
(integration)
■ Kept up with One Plan, one Budget, one M&E
■ Institutionalising the training on Planning and Program Budgeting Frameworks
■ Ensuring the skills and systems in place to monitor results
■ Ensuring that the data is utilised to better inform forward estimates, budget
allocations and Government Priorities.

11. OBRIGADA BARAK
KHOB-KUN-KA
THANK YOU