1. “How a ‘Citizens’ Guide to the Budget’ can strengthen fiscal transparency and increase public participation” Jon Shields International Monetary Fund ICGFM Conference Florida May 18, 2011

3. Style, format and quality

5. Why do governments publish CGBs? Ensure budget message is understood; broaden informed electorate. Explain countries’ economic problems. Enhance accountability. Counter hostile assessments. Increase buy-in for unpopular policies.

6. What do CGBs add? Accessibility. Snapshot of fiscal position and decisions. Supplement to technical information required for legislatures. Insight into specific economic, spending or revenue decisions.

8. Pre-Budget framework

9. Final Budget

11. IMF Code of Good Practices in Fiscal Transparency – Four Pillars Clarity of roles and responsibilities: Structure and functions of government, responsibilities within government, relations between government and the rest of the economy Open budget processes: Budget preparation, execution, and monitoring; timetable for legislature; realism of estimates and medium-term framework; fiscal sustainability. Public availability of information:Specification of the coverage, detail, and timing of fiscal information to be provided to the public. Assurance of integrity: Quality of fiscal data, internal oversight, and external scrutiny.

12. FT Code: (1) Clarity of Roles and Responsibilities: 1.1Scope of government. The government sector should be distinguished from the rest of the public sector and from the rest of the economy, and policy and management roles within the public sector should be clear and publicly disclosed. Show all ramifications of central government; QFAs, EBFs, local government relations 1.2 Framework for fiscal management. There should be a clear and open legal, regulatory, and administrative framework for fiscal management.

13. FT Code: (2) Open Budget Preparation, Execution, Monitoring and Reporting 2.1 Predictable and technically sound budget preparation. Budget preparation should follow an established timetable and be guided by well-defined macroeconomic and fiscal policy objectives. Realistic annual budget set in comprehensive economic policy framework, with measures and sensitivities assessed. 2.2 Clear procedures. There should be clear procedures for budget execution, monitoring, and reporting.

14. FT Code: (3) Public Availability of Information 3.1 Comprehensive information. The public should be provided with comprehensive information on past, current, and projected fiscal activity and on major fiscal risks. Full disclosure, as for legislature, coverage, comparability, significance, long-term outlook. 3.2 Relevance. Fiscal information should be presented in a way that facilitates policy analysis and promotes accountability. Citizens’ Guide, minimum aggregate data requirements, results 3.3. Timeliness. A commitment should be made to the timely publication of fiscal information.

15. FT Code: (4) Assurances of Integrity 4.1 Quality. Fiscal data should meet accepted data quality standards. 4.2 Oversight. Fiscal activities should be subject to effective internal oversight and safeguards. 4.3 Auditing. Fiscal information should be externally scrutinized.

19. Preferably for medium-term Medium-term projections of the fiscal aggregates (revenues, spending, the deficit) Use simple tables and charts.

20. A Citizen’s Guide – How much of the government’s activities does the budget cover? Explain different types of accounts or funds, and what agencies are inside or outside the budget. Include information on the government’s extra- budgetary activities, and their impact on consolidated government accounts. Summarize and explain “quasi-fiscal activities”. Show transfers between different levels of government and any formulae used.

21. A Citizen’s Guide – What the government intends to spend Where possible: by function (or sector), by administrative agency, by economic category (e.g. wages and salaries, interest, capital expenditures). Where applicable: by major programme. Provide references and links to more detailed spending information.

22. A Citizen’s Guide – Where the money will come from Breakdown of the main revenue sources, separately identifying domestic revenues (by tax) and external grants. Intended financing sources in the event of a projected deficit (use of domestic assets, domestic markets, international markets, or concessional assistance) Any implications for economic stability or fiscal sustainability.

24. Other specific fiscal risks (e.g. loan guarantees being called)

26. A Citizen’s Guide – How the budget will help the government meet its objectives Describe the government’s medium-term economic and social objectives. Identify Millennium Development Goals, where relevant. Explain role of fiscal policy strategy and any numerical targets. Show contribution of budget to fiscal strategy and broader objectives. Explore sustainability of the public finances and public debt. Describe service delivery objectives and social impacts of spending programmes, including available information on performance and evaluations.

27. Suggested chapter outline of a citizens’ guide to the budget Introduction: Place of the annual budget in public finance legislation; description of the coverage of the budget and the budget process, including opportunities for public participation. The Economic Outlook and Government Objectives: Macroeconomic forecasts, assumptions and sensitivity analysis; national development strategy; medium-term fiscal policy objectives. The Government’s Accounts and Budget Prospects: Aggregate revenues, expenditures, and the fiscal balance over medium-term; broad allocation of spending and sources of revenue, comparative figures for previous year; public debt, fiscal risks, and the sustainability of current policies and trends. New Measures: Summary of the main budget initiatives; estimates of their fiscal effect and impacts on key policy groups; contributions to meeting the government’s stated policy objectives. Improving Delivery of Services: A brief indication of what the government is doing to improve service delivery

28. A Citizen’s Guide – Style and Format Stand-alone document Ideally, produced by Ministry of Finance Treat as technical document - avoid political overlay More than a budget speech More than an executive summary Limit jargon Use layman’s terms Highlight simple and attractive charts and diagrams Keep short but provide lots of links

29. A Citizen’s Guide – Content and Quality Focus on substantive budget issues. Avoid extraneous or irrelevant material. Only include data that is accurate, reliable and credible. Explain uncertainties.

31. Radio podcasts,

32. Posters

33. PamphletsUse multiple languages where relevant.

34. Thank you jshields@imf.org Main reference: ‘Producing a Citizens’ Guide to the Budget: Why, What and How’ by Murray Petrie and Jon Shields OECD Journal on Budgeting, Volume 2010/2