Publication: Study of Recent Literature on Public Financial Management and Accountability (PFMA) System of the Government of India
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2005-11
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2005-11
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This report conducts a survey of the more recent literature on the public financial management and accountability system of the Government of India and analyzes its contents. The overall objective is to provide the basis for enhanced knowledge and understanding of the public financial management and accountability system including its strengths and weaknesses as perceived by the authors of the publications. The study prepares an annotated bibliography of select contemporary material on the public financial management and accountability system and presents an analytical survey relating to its various components. The study concludes that the legal systems are in place in all areas, as well as the attendant procedures, rules and regulations. Trained manpower is available. Oversight systems are vibrant through well established independent external audit and legislative committees. There is increasingly more transparency in the budgetary disclosures. Steps have been taken to review the existing accounting systems. One area of concern is the compliance gap. There is found to be slackness in observing and enforcing the rules and regulations.
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“World Bank. 2005. Study of Recent Literature on Public Financial Management and Accountability (PFMA) System of the Government of India. © World Bank. http://hdl.handle.net/10986/12522 License: CC BY 3.0 IGO.”
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Publication India - Jharkhand : Public Financial Management and Accountability Study(Washington, DC, 2007-09)Jharkhand, India's youngest and 28th state came into existence in November 2000 pursuant to the reorganization of the erstwhile State of Bihar by the Bihar State Reorganization Act, 2000. More than 77 percent of the population of the state resides in rural areas and depends on agriculture for sustenance. Jharkhand is one of the richest states in the country in terms of mineral resources. Close to half of the gross domestic product (GSDP) of the state emanates from industry which includes mining, quarrying and registered manufacturing. But the high degree of industrialization has not resulted in a high level of income for the state. While the structure of the output indicates a high level of industrialization, the structure of employment reveals the predominance of agriculture. The purpose of this study is to make an objective assessment of the Public Financial Management and Accountability (PFMA) system of the state, identify its strengths and weaknesses and areas that may be in need of reforms and related capacity building. This study is a prerequisite to determining the precise nature and extent of any capacity building initiatives in Jharkhand. The study provides the Government a diagnostic tool for establishing priorities and to develop a baseline for monitoring future PFM performance of the state.Publication India : Karnataka State Public Financial Management and Accountability Study(Washington, DC, 2004-04-23)Karnataka as embarked on a major fiscal and governance reform program that aims at restoring the state's financial health and improving the performance of the state's public sector. This study examines Karnataka's public financial management and accountability system (PFMA) light of this reform program. The study covers the following: budget development, execution and monitoring; fiscal transparency; accounting and financial reporting; and internal and external controls, including auditing and legislative oversight. The study does not focus on Karnataka's fiscal position or performance; it also does not cover issues relating to the quality of expenditure allocations; or the effectiveness, efficiency, and poverty focus of public spending per se. However the study does try to take into account the links between these issues and the PFMA system.Publication India : Synthesis Study of Public Financial Management and Accountability in Urban Local Bodies(Washington, DC, 2007)This study assesses the current state of Public Financial Management and Accountability (PFMA) systems in Indian urban local bodies. It identifies, analyzes, and documents good practices, focusing on their existing context, success factors, and replicability. It is important to mention that urban governance in India is a state subject and there are vast differences in the levels of reform that have achieved in different states. For the purpose of comparison, this study has developed good practice benchmarks in each PFMA area and used those to compare practices across Urban Local body (ULB)s. The study analyzes linkages between the legislative, budgeting, implementation, reporting, and oversight process in urban local bodies. Benchmarks and indicators have been developed for each strategic area. Analysis of policy, practice, and progress in each strategic area has also been conducted. This study synthesizes existing literature on PFMA in urban local bodies, identifies key PFMA areas where focused attention was required, and suggests ways forward. The main objectives are: 1) To describe the current PFMA environment in urban local bodies in India and identify replicable good practices; 2) To use the Public Expenditure and Financial Accountability (PEFA) benchmarks in developing good practice in each PFMA activity and to develop indicators for assessing PFMA in Indian urban local bodies; 3) To identify challenges and suggest priorities for improving the PFMA environment in Indian urban local bodies so as to feed into Jawaharlal Nehru National Urban Renewal Mission (JNNURM). This study does not focus on the financial performance or on quality of expenditure in terms of specific aspects of efficiency or effectiveness of spending by urban local bodies. It does not cover intergovernmental relations either in any level of detail except to the extent that such relations impact PFMA performance. It is important to mention that this study does not attempt to develop a scoring system for indicators and therefore does not rate relative performance among urban local bodies. It does however suggest as a key recommendation that states could adopt a scoring system or a "PFMA Report Card" for the urban local bodies as a means of comparison of PFMA performance to build a demand for better governed ULBs.Publication India - Public Financial Management and Accountability in Panchayati Raj Institutions (Rural Local Governments) : Synthesis Study(Washington, DC, 2006-12-21)This Study has been designed to serve as a reference point for (i) mapping the Public Financial Management and Accountability (PFMA) arrangements currently in place; (ii) highlighting good practices that have emerged across States relative to PFMA; and (iii) summarizing issues that are most relevant to the Government of India, State Governments and the Bank when it comes to financing future projects through Panchayati Raj Institution (PRIs). This Synthesis also captures the recommendations of the Eleventh and Twelfth Finance Commissions, as well as the initiatives of the recently constituted Ministry of Panchayati Raj (MoPR). Inter alia, the MoPR has laid out a road map for enhancing the accountability of PRIs to their constituents. Because devolution of powers has resulted in different models in the various states, this study has not attempted prescriptive solutions or standard models for implementation. Rather, this study offers input to the design of Bank interventions and activities relating to Decentralization; it is not in itself a Decentralization study. This Study covers PRIs in six Indian states, including (i) Karnataka, Orissa and Uttar Pradesh where the Bank has carried out State Financial Accountability Assessments (SFAA); (ii) Rajasthan and West Bengal where several good practices have emerged at the urging of the state government and/ or the public at large; and (iii) Uttaranchal where the Bank has changed the design of existing projects, such as the Watershed Project to route funds through the PRIs as much as possible.Publication India : Note on Public Financial Management and Accountability in Centrally Sponsored Schemes(Washington, DC, 2006-05-16)The budget outlay for Centrally Sponsored Schemes (CSS) for India in 2005-06 is significantly higher as compared to the previous year's level of Rs.395,000 million. This includes increased allocations for rural roads, rural employment, and education and nutritional support for pre-school children. At present there are over 200 such schemes in operation, of which a dozen accounts for more than two-thirds of the outlay. Given the states limited scope to significantly raise internal resources within the existing fiscal framework, coupled with a high wage bill that crowds out development expenditure, the CSS are likely to remain an important source for development funds for the states. The objective of CSS is to address issues of national priority with focus on human development, poverty alleviation and rural backwardness. The findings and the suggestions to improve financial accountability systems in CSS needs to be viewed in the light of varying quality of governance across the states and the fiscal stress faced by certain states.
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