Genesis of the PFM Reform Roadmap

Genesis of the PFM Reform Roadmap

The work started in earnest in May 2009 when representatives of COA, DBM and DOF met at the PFM Reform Workshop in Tagaytay City. The discussions took off from diagnostic studies on the Philippines PFM system, the most recent of which was the Public Expenditure and Financial Accountability (PEFA) Report of 2007 by the World Bank. The idea of integration was discussed at this workshop when it dawned on the workshop participants composed of senior officials from the three agencies and a few line agency representatives that the three oversight agencies could not function effectively without a common system for recording, reporting and analysis of budget processes and financial management.  An informal group of individuals from COA, DBM, BTr, and some line departments decided to pursue informally some of the issues that came out of the workshop.

This group assumed a formal identity when the COA, DBM and DOF-BTr signed a Memorandum of Agreement on Cooperation to Foster Development and Implementation of Government Integrated Financial Management Information System (GIFMIS) on January 21, 2010. Through this MOA, the GIFMIS Committee, chaired by COA Commissioner Juanito G. Espino, Jr. delved deeper into the specific processes under the budget, accounting and auditing systems to try to remedy gaps and deficiencies—so important in a fragmented system that exists in the Philippines—and to pave the way for a modern GIFMIS. A second workshop in Tagaytay City was held in February 2010 to further develop the ideas from the first workshop and really get down to the business of PFM coordination. The group defined the reform goals and key strategies for their PFM reform roadmap but consensus on the policy implications of such strategies came later.

The finalization of the PFM Reform Roadmap was temporarily restrained with the coming of the new administration in July 2010 and the preoccupation with the budget preparation work for 2011. In the meantime, the GIFMIS Committee benefited from technical assistance provided by World Bank experts who came on separate missions to help government in the elaboration of the issues and to look at available solutions. Mr. Jim Brumby, PFM expert, came in March 2010 and Mr. Cem Dener, GIFMIS expert, came in June 2010. The Committee continued its collaborative work to fine-tune the PFM Reform Roadmap but formal adoption by the new administration had yet to be obtained.

The GIFMIS Committee was reenergized when Finance Secretary Cesar V. Purisima and Budget Secretary Florencio B. Abad formally gave their affirmation of commitment to the PFM reform initiative in October and November 2010. These were in response to a letter-request from COA Chairman Reynaldo A. Villar seeking alignment of the Roadmap with the thrusts of the new administration. These developments ushered in the final stage of fine-tuning the PFM Reform Roadmap and development of concrete implementation plans.

In the third Tagaytay workshop on January 13-14, 2011, COA, DBM and DOF high-level officers came prepared with carefully considered inputs for the roadmap from prior internal consultations. Perhaps inspired by the qualities of honest and transparent governance that the new administration demonstrated, the group was able to arrive at a consensus on some key aspects of the Roadmap. With measures to liberalize and simplify data sharing, treasury accounts, budget execution, and accounting, the operationalization of the GIFMIS within the term of President Aquino is greatly enhanced. Hence the GIFMIS Committee intends to present its PFM Reform Roadmap to the President.