Friday, June 19
Ms. Michelle Stone, Mr. Vincent Tang, Mr. Ashni Sing and Mr. Yugo Koshima, all IMF, Fiscal Affairs Department
As governments “do what it takes” in launching strong fiscal responses to address the adverse impact of the COVID-19 pandemic and protect lives and livelihoods, Public Financial Management (PFM) systems capability and adaptability come into focus. PFM systems are crucial in ensuring the efficacy of the governments’ emergency responses. PFM managers need to reassess policy priorities, ensure availability of funds to service delivery units, and account and report on the use of resources, while ensuring business continuity. Yet, lessons from other crises show that emergency spending is often vulnerable to misuse and corruption. Risks stemming from lockdowns and absences of staff, involvement of many, often uncoordinated, actors, or the size and speed of announced interventions are present also in the responses to the current crisis.
Presenting the recent IMF special series on fiscal policies, the panelists addressed these concerns by outlining the trade-offs and tensions PFM managers need to navigate to deliver the announced policy responses. As countries use PFM emergency response mechanisms, reprioritize spending, ensure liquidity and timely fund disbursal, the panelists strongly emphasized the crucial need for safeguarding the accountability, transparency and legitimacy of the measures. Transparent mechanisms for tracking, accounting and reporting information for policymakers and public should not be abandoned but rather strengthened, for instance through ex-post control by Supreme Audit Institutions. Drawing on recent experiences from the Ebola crisis, the crucial role of sound budget execution procedures and controls (especially procurement, commitment controls, invoice processing, and payment authorization) was emphasized. The webinar concluded with a lively Q&A session that emphasized how different initial conditions and system capabilities influenced quality and efficiency of the fiscal response.
Challenges, common lessons, and policy recommendations were presented based on the following COVID-19 FAD special series papers:
The webinar was opened by Thomas Richardson, JVI Director, and Carolina Renteria, chief of the PFM Division of the IMF's Fiscal Affairs Department.
Moderation was provided by Barbara Dutzler and Tatiana Evdokimova (both JVI).
Barbara Dutzler, Senior Economist, JVI