Context
Improved public service delivery, including the broad-based provision of education, healthcare and sanitation, relies on the transparent and efficient management of public finances. This is a key to development and poverty reduction in Africa, yet many countries still face challenges in the effective management of their resources. Many governments are unable to mobilise sufficient revenues; budget execution remains difficult, with shortcomings in transparency as well as the expected results. Since they lack capacities to fulfil their supervisory mandates, supreme audit institutions and parliaments are often seen as weak links in the chain of accountability. And where mismanagement of public resources is exposed, sometimes little is done to enforce the corresponding sanctions or changes in behaviour.
Good financial governance involves the promotion of democratic principles in the management of public resources. It represents a significant contribution to the delivery of services by governments, and to their credibility in the eyes of their citizens.
Objective
Decision-makers in the field of public finance in Africa are equipped to use region-specific services, products and further education to improve good financial governance.
Approach
GIZ is implementing this programme on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), as well as the European Union as the co-financer. In the five areas described below, the programme cooperates with regional networks and provides technical advice, training and support for continent-wide peer learning, in order to strengthen the knowledge and skills of decision-makers.
Tax policy and administration: To foster effective tax administrations and provide appropriate training for tax officials, the programme supports the African Tax Administration Forum (ATAF) in introducing e-learning courses and higher education programmes tailored to the specific needs of tax officials. It also supports ATAF in its planning and research activities, and is assisting the Forum’s members in setting up the African Tax Research Network in order to establish a dialogue with tax academics.
Budget reform: The programme is assisting the Secretariat of the Collaborative Africa Budget Reform Initiative (CABRI) in conducting a series of joint country case studies, in which one country analyses a peer country’s public financial management (PFM) systems and processes. The CABRI Secretariat also receives support in establishing sector policy dialogues and knowledge exchange platforms, and in expanding the services it offers to its member countries. The programme is developing a PFM training course that will provide budget practitioners with tools they need to make better informed decisions on the allocation of scarce resources.
External audit: Rather than carrying out purely financial audits, Africa’s supreme audit institutions (SAIs) are increasingly undertaking performance auditing in order to highlight their governments’ results. GIZ is supplementing the skills they need for this type of audit, for example by organising study tours and workshops to discuss such topics as the strategic value of performance auditing. The programme also encourages a process of learning through joint audits. GIZ is also working to strengthen SAIs institutionally, for instance through the reform of the legal framework in Burkina Faso.
Legislative oversight: To enhance the capacities of legislatures to hold governments to account and to improve budget planning and execution the programme specifically addresses parliamentary structures and staff. In a continent-wide approach to strengthening legislative oversight, it has initiated research on the topic to underpin peer learning processes, and it is supporting the creation of networks and exchanges. Moreover, it has encouraged and is fostering a number of cooperative pilot projects for legislative budget experts.
An African voice on good financial governance/liaison with AFRITACs: GIZ is supporting technical discussions between relevant stakeholders. As good financial governance involves a systemic approach, in order to ensure a holistic discussion the programme facilitates collaboration between ATAF, CABRI and the African Organisation of Supreme Audit Institutions (AFROSAI), as well as the newly established network of the African Organisation of Public Accounts Committees (AFROPAC). It also liaises between BMZ and the International Monetary Fund’s four Africa Regional Technical Assistance Centres (AFRITAC).
Results achieved so far
In March 2014, supported by GIZ, ATAF successfully hosted the Consultative Conference on New Rules of the Global Tax Agenda, which brought together the heads of African tax administrations and finance ministries. They discussed international tax issues as well as a G20/OECD project on base erosion and profit shifting, seeking a unified African response to these international challenges.
In September 2014, AFROSAI and GIZ jointly organised a study tour to Germany and Austria for 20 heads of African SAIs from 12 countries. This encouraged participants to use performance auditing to improve the performance of their public administrations.
To enhance the leadership and capacities of Africa’s tax administrations, the programme worked with ATAF and the Berlin School of Economics and Law to develop a Masters course on tax policy and tax administration. In October 2014, 27 employees of revenue authorities and ministries across sub-Saharan Africa began studying for this degree in Berlin.
In 2014, SAIs from Cameroon, Chad, Niger and Nigeria completed a joint environmental audit of the water management of Lake Chad. This was conducted under the auspices of AFROSAI, the African Organisation of Supreme Audit Institutions, with GIZ’s support. The findings will be communicated in 2015. During the audit, experienced auditors from around the region provided peer-learning and mentoring to promote the learning process.