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The indicator attempts to capture the reliability of government budgets: do governments spend what they intend to and do they collect what they set out to collect.

The indicator - Primary government expenditures as a proportion of original approved budget -measures the extent to which aggregate budget expenditure outturn reflects the amount originally approved, as defined in government budget documentation and fiscal reports. The coverage is budgetary central government (BCG) and the time period covered is the last three completed fiscal years.

Ministry of Finance (MOF)

Ministry of Finance (MOF)

Annual

Percentage (%)

N/A

Aggregate expenditure includes actual expenditures incorporating those incurred as a result of unplanned or exceptional events—for example, armed conflicts or natural disasters. Expenditures financed by windfall revenues, including privatization, should be included and noted in the supporting fiscal tables and narrative. Expenditures financed externally by loans or grants should be included, if covered by the budget, along with contingency vote(s) and interest on debt. Expenditure assigned to suspense accounts is not included in the aggregate. However, if amounts are held in suspense accounts at the end of any year that could affect the scores if included in the calculations, they can be included. In such cases the reason(s) for inclusion must be clearly stated.

Actual expenditure outturns can deviate from the originally approved budget for reasons unrelated to the accuracy of forecasts—for example, as a result of a major macroeconomic shock. The calibration of this indicator accommodates one unusual or “outlier” year and focuses on deviations from the forecast which occur in two of the three years covered by the assessment.

None

The methodology for calculating this indicator is provided in a spreadsheet (titled “En PI-1 and PI-2 Exp Calculation-Feb 1 2016 (xls)”) on the PEFA website (http://www.pefa.org/en/content/pefa-2016-framework).

It is also detailed in part 2 of the document “Framework for assessing public financial management” (https://www.pefa.org/sites/pefa.org/files/attachments/PEFA%20Framework_English.pdf).

Scoring is at the heart of the indicator. A country is scored separately on a four-point ordinal scale: A, B, C, or D, according to precise criteria:

(A) Aggregate expenditure outturn was between 95% and 105% of the approved aggregate budgeted expenditure in at least two of the last three years.

(B) Aggregate expenditure outturn was between 90% and 110% of the approved aggregate budgeted expenditure in at least two of the last three years.

(C Aggregate expenditure outturn was between 85% and 115% of the approved aggregate budgeted expenditure in at least two of the last three years.

(D) Performance is less than required for a C score.

In order to justify a particular score, every aspect specified in the scoring requirements must be fulfilled. If the requirements are only partly met, the criteria are not satisfied, and a lower score should be given that coincides with achievement of all requirements for the lower performance rating. A score of C reflects the basic level of performance for each indicator and dimension, consistent with good international practices. A score of D means that the feature being measured is present at less than the basic level of performance or is absent altogether, or that there is insufficient information to score the dimension.

The D score indicates performance that falls below the basic level. ‘D’ is applied if the performance observed is less than required for any higher score. For this reason, a D score is warranted when sufficient information is not available to establish the actual level of performance. A score of D due to insufficient information is distinguished from D scores for low-level performance by the use of an asterisk—that is, D* at the dimension level. The asterisk is not included at the indicator level.

The coverage is budgetary central government (BCG) and requires data for three consecutive years as a basis for assessment. The data would cover the most recent completed fiscal year for which data is available and the two immediately preceding years.

This indicator helps the Ministry of Finance (MOF) gauge the reliability of government budgets.

One limitation of the indicator is that it is an aggregate indicator of budget reliability. While it can be disaggregated across regions, it is not disaggregated across various budget subcomponents.

Different indicators are used for assessing changes in expenditure composition in the PEFA framework. Also, while this indicator is intended to measure budget reliability it should be understood that actual expenditure outturns can deviate from the originally approved budget for reasons unrelated to the accuracy of forecasts—for example, as a result of a major macroeconomic shock. However, the calibration of this indicator accommodates one unusual or “outlier” year and focuses on deviations from the forecast which occur in two of the three years covered by the assessment. Therefore, single year shocks are discounted.

All the metadata shown was gathered from United Nation Statistics Division. The metadata was extracted from https://unstats.un.org/sdgs/metadata/.