Assessment of Non-Technical Drivers of PFM Reforms in Georgia

Project Description:

The objective of the project is to develop succinct assessments of non-technical, political economy factors influencing achievements and prospects of public financial management (PFM) reforms in Georgia, with a particular focus on institutional and political relations and also the role of development partners and other external advisers, as well as the role played by civil society.

The World Bank is preparing a new operational engagement on Public Investment Management. The assessment will focus on factors that currently constrain the efficient allocation and utilization of public investments, and opportunities for continued improvements.

The PMCG team with its knowledge of the local context and expertise in the field of PFM will provide advice and contribute to the assessment of non-technical drivers of PFM reforms in Georgia.

PMCG will enable the World Bank project team to obtain the following information: 

• What lessons can be learned from the Georgian experience about factors that enabled significant improvements in PFM over the past 10 years?
• What are the main constraints and opportunities for consolidating the PFM reform agenda, in particular with regards to the timely allocation of funds to sectors and implementing agencies, internal and external audit, and ensuring that program budgeting is seen as an added value by all key stakeholders involved?
• What are the main opportunities and constraints with regards to tackling a second generation of reforms focused on the good selection, utilization and maintenance of public investments?

Background information:

According to the 2012 PEFA assessment report, Georgia has made significant progress in PFM reform and advanced its budgetary and financial management systems since 2008. The areas of strategic budget planning, budget formulation and execution, integrated
PFM system including treasury operations, spending institutions, budget preparation, payroll and external/internal debt management modules, electronic government procurement and external audit have significantly improved.

PFM reform and PFM system performance is influenced by non-technical factors, therefore consideration of the political economy and organization factors is important. Namely, political, economic, sociocultural and governance environment, institutional structure of the PFM system, relationship between the key stakeholders and internal organization of PFM process should all be assessed.

Follow the links below for related materials:
Creating Incentives for Budget Reform: Enhancing Engagement of CSOs and Accountability Institutions for Budget Transparency and Accountability Case Study – Georgia
Sharing Experience of Georgian Reforms and Visegrad Countries’ EU Economic Integration for Albania and Kosovo
USAID Kosovo Partnership for Development (PFD) – Enhancing Macro-Economic Stability and PFM at the Central and Local Level