2. “The Key to the Solution is the
formulation of the Problem”
Tom Dietrich – IEEE Computer Society
Lectures on Artificial Intelligence
Portland Oregon 1984
3. Fiscal Policy Working Group Goals
goals to provide capacity, perspectives and objectives
• Provide view and content on effect of fiscal policy initiatives across the
range of macroeconomic sectors…
• Reveal, verify and validate how economic policy different strategies interact
to achieve desired goals and objectives.
• Measure and assess how different strategies interact .....
• Provide a verifiable, transparent, collaborative, robust & customisable
framework
• Provide capacity to verify policy implementation and validate results to
achieve planned goals and objectives
• Provide an effective way of incorporating the public sector into aggregate
econometric models
• Contribute to programmes such as public finance management, budget
cycle, revenue projections, expenditure monitoring & control, and statistical
accountability
• Provide a Republic of Namibia Ministry of Finance a Macroeconomic
and Economic Policy Analysis Database Framework
– all rights reserved - D. Garigan
5. Factors Influencing Legislative
Roles
• Constitutional foundation
– From Presidential separation of powers to
Parliamentary systems
• Cohesiveness of party systems
• Institutional features of legislatures
– Bicameral
– Full time governing bodies vs. part time
– Capacity to review executive budgets
• Comprehensiveness of budget
6. 20th Century as Executive Century
• Legislative Roles Eclipsed
– Little role in fiscal policy targets
– Limited authority to change executive budgets
– Limited time and capacity to review budgets
• Range of Influence Across Legislatures
– Budget making legislatures
– Budget influencing legislatures
– Budget marginalized legislature
7. Economic Policy Analysis Database Framework
1. External Interface Layer
3. Macreconomic Model Data Layer
Statistic Reporting
& Modeling
Workbench
Fiscal Transaction
Data Warehouse
General Ledger
Shadow Database
FISCAL
SYSTEM
IFMS
Interface for
GL, JE, and
Transaction
Reports
Experimental
Statistics and
Policy Analysis
Workspace
Fiscal Policy Projections
GFS 2001 Monthly Report
Analysis &
Projections
Transactions
GL Report
GL Report
Transaction based
Model data
EPAD Block Structure
d.garigan June 2009
Custom Reports
Sector Socket #1
Sector Socket #3
(transaction level data)
Sector Socket #2
Sector Socket #4
(transaction level data)
Economic Policy Analysis Database (EPAD) Framework
Economic Policy Work Space
for Statistics and Modelling
2. IFMS Warehouse Layer
8. Issues of Influence in Budgeting
• Government response to social and
financial and international pressure
• Influence of key legislative actors
• Linking of Legislative Action with results
• Executive control of implementation
• Synchronisation of legislative & executive
– Economic policy reforms, executive action
with legislative reaction
9. Legislative Budget Changes
• Formulating economic impact of budgets
• Strengthening monitoring process
• Enhancing legislative capacity for detail
• Present appropriations and budget
execution in a common context
• Common set of concepts, semantics for
economic outputs, results and quantitative
measures; review of formulated policy
10. Barrier to the Economic Policy Framework
Problems Complex of agents, actors, roles,
Standards for sector data, arbitrary definitions
Quantitive “results” with unknown validity
Top-down Budgeting
Single agency proposal
No external monitoring
Executive Branch Performance Management
Administrative summary report results
Dispersed
Fiscal Information
Information notes.. not data. Cannot integrate
No Digital Budgeting and Accounting System
Lack of common semantics across agents.
No Standard Measures of activities or results
Administrative overheads for collecting data
agent accountability,
centralized control,
actors & roles; no data
11. Fiscal Policy Monitoring Feasibility Demonstration Project
First Steps in multi stage budget approval/execution monitoring
• Identify functional classifications of economic policy data.
• Identify sources/gaps in required data
• Assess existing capacity and quality of data
• Focus on short term achievable objectives
• Construct/select preliminary development plan and
sequence of events –
• Accounting category standards based on IMF Cost of
Functions Of Government (COFOG) pilot.
(Customs, IRS, 2 Local & Regional Govt) (80/20 rule scenarios)
• Test flight with prototype Database Framework context
and Accounting Chart of Accounts redefinition, integrated
into budget preparation and approval process
12. Economic Policy Database Framework
Functional Layers
The mulitier database specification, includes 3 basic layers:
1. External agent Interface Layer
2. Data Warehouse IFMS Interface and Economic Policy Work Space
3. Macroeconomic Entity Layer
• NOTE #1 External Agents– the lower tier provides an interface specification for receiving and
managing data streams from external data sources (regions, ministries and organizations -
e.g. Bank of Namibia, National Planning Commission, Customs and Excise, etc) for receiving
subscription based transfers of non fiscal sector reports and data. Much of the subscription
data could be directly translated to the Macroeconomic layer 3
• NOTE #2 The Government Financial Management Information System (GFMIS) layer enables
the “economic” approach to the Financial Mangement accountancy in the General Ledger as a
basis for capturing data to support Macroeconomic modeling.
• NOTE #3 Workshop Layer - the repository of Macroeconomic Entities (ME) sets are
constructed from summaries the processing of #1. External Interface “preformed data” (e.g.
Bank of Namibia monthly summary transactions). Other constructions would involve merging
the IFMS transactions with the Development Project Registration Tables
13. Economic Policy Collaboration Sequence Diagram
verify project detail
m odify/approve
taskplan,
activitycode
and outputindicator
Update cofog
+ project
funds
confirm
stakeholders,
project task > cofog
+ budget line funds
Review activities
projectplan
output indicators
and
target values
Grant
Applicant
prospective
project
XA Region O/M/A NPC MoF Parliament
Factor
activities
a sse ss
potential
stakeholders
review
proposed project
output indicators
and
target values
subm itproject
proposal
prospective
project
provides
project
managmentand
codes for OMAs
financialmanagment
reviewbudget
amounts and codes;
adjust and/or
approve
submit verified
project package
Archive
approved
budgetpackage
verify invoice +
monitoringdetail
submit project as authorised budget request
budget measure
introduced,
approved/modified/
rejected
fundingresult
funding result
funding result
funding result
invoice+project
monitoringreport
carry out
project tasks
purchases and
planned
events
approved request for payment
authorise
payment
update amounts
Request for Development Project Grant Funding
d.garigan 12June2009
EPAD Seq-1
cofog
expense
function
codes
cofog list
setup activty
expense
codes
cofog list
EPAD Seq Diagram
collaborating roles and actions
14. Functional Slice of Context
XA OMA
Review
Project
Proposal
Archive
Documents
Parliament
Region NPC
Review
Project set-
up
prepare
project
accounting
Package MOT/
IT Message
MoF
Development Project Proposal/Approval & Funding
Evaluate and
Recommend Revue with sponsor
Authority
Authoritize
Accoutning
Authoritize Budget
7. Models and Processes
15. Role Activity and Results
The Deliberative Process
• Legislative institute structure change the budgetary
process
• Greater time afforded for review of executive requests.
Examples include
– United States Congress receives budget 8 months before fiscal
year
– United Kingdom presents estimates two weeks before
Parliamentary consideration
• Committees as the heart of legislative influence
– Emergence of Budget Committees
– Roles of authorizing committees
Paul L. Posner
George Mason University
16. Roles for integrating project budgeting into
Fiscal Management Framework
• Role Code Activity
• External Agent XA Individual / enterprise with project for
government funding
• Regional Admin RA Regional administration of Local
Governments
• Line Ministry OMA Responsible for national sector activity &
funding government
• Nat’l Planning NPC National Planning authority, standards,
coordination
• Ministry Finance MOF Financial Management authority for
standards and practices
• Parliament PAR Legislative body for allocating state
revenues and expenditures
Budgeting Role and Activity integration into a Legislative
Based Fiscal Management Framework
17. FY2006
Cabinet
Prime Minister
Minister of Finance
Minister of Economy,
Trade and Industry
Minister of Internal Affairs
And Communications
・・・
Other Ministers
Minister of State for
Economic and Fiscal Policy
Budget Bureau
Tax Bureau
・
・
・
Cabinet
Governor, National Bank
Chief Cabinet Secretary
Prime Minister
Minister of Finance
Minister of International
Trade and Industry
Minister of Home Affairs
・・・
Other Ministers Budget Bureau
Tax Bureau
・
・
・
Chief Cabinet Secretary
Council on Economic
and Fiscal Policy
corporate executive
scholar
scholar
corporate executive
Example council on Economic and Fiscal Policy
Until 2001 Paul L. Posner
George Mason University
18. Budget Execution
• Appropriations Accounts as Foundation of
Legislative Accountability
– Legislatures in Korea, Italy and France broaden
account structures to promote performance
accountability
• Legislative Controls Over Budget Execution
Mixed
– Transfers across appropriations items
– Carry over of funds across fiscal periods
– Contingency Funds
19. Entity Model of Multi Sector Tutorial Demonstration
Capital Entity
Disbursement
Capital Project
supports
creates
enables
Loan
Annual Depreciation
Exchange Rate
Revenue Collection
External Bank
Fund
Foreign
Currency
funds
Sector Program
includes
Accrues
Services
Goods
repay
Foreign Direct Investment Capital Project for Sector
Function Results in Goods & Services Revenue
Collection
External Debt
20. Legislative Oversight
• Enhanced Reporting and Information
– Some legislatures require monthly, bimonthly, quarterly and
annual reporting
• Performance and financial management reforms yield
systematic information
– United Kingdom Spending Reviews
– France Performance Plans and Reports
– United States and Korea PART
• Legislative oversight committees
– Public Accounts Committees
– Netherlands Public Expenditure Committee
• Roles of National Audit Offices
– From Financial Audits to Performance Audits
21. Macroeconomic view of Functional
Data Implementation Data Schema
• External Bank Fund =
• External Debt =
• Foreign Currency =
• Loan =
• Disbursement =
• Capital Project =
• Capital Entity =
• Sector Program =
• Goods =
• Services =
• Revenue Collection =
22. Issues to Consider: Strengthening
the Budget Process
XA OMA
Review
Project
Proposal
Archive
Documents
Parliament
Region NPC
Review
Project set-
up
prepare
project
accounting
Package MOT/
IT Message
MoF
Development Project Proposal/Approval & Funding
Evaluate and
Recommend Revue with sponsor
Authority
Authoritize
Accoutning
Authoritize Budget
7. Models and Processes
