West Bank and Gaza : Country Financial Accountability Assessment
This CFAA is able to report major improvements in the public financial management (PFM) system of the West Bank and Gaza (WB&G) in the period since mid-2002. Recent areas of improvement are in budgeting (both development and execution) and in f...
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| Format: | Country Financial Accountability Assessment |
| Language: | English en_US |
| Published: |
Washington, DC
2013
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2004/06/5001769/west-bank-gaza-country-financial-accountability-assessment http://hdl.handle.net/10986/15464 |
| Summary: | This CFAA is able to report major
improvements in the public financial management (PFM) system
of the West Bank and Gaza (WB&G) in the period since
mid-2002. Recent areas of improvement are in budgeting (both
development and execution) and in fiscal transparency. Other
PFM include the following: 1) All Palestinian Authority (PA)
revenues are now paid into the Central Treasury Account (the
CTA), a single treasury account which brings together all
government revenues and provides a single pool of funds out
of which all expenditures are paid. 2) An orderly system of
budgetary appropriation is now in force. 3) Reflecting these
new and improved processes, the budget speeches and
extensive background budget data are posted on a regular
basis on the Ministry of Finance's (MOF) external
website, itself a symbol of a new approach to transparency
and improved budget management. 4) MOF is exercising firm
control over budget expenditures - with the obvious caveat
that the chronic post-September 2000 shortage of Budget
funds has led to strict limits on non-wage expenditures and
to continuous ad hoc adjustments, with h d s often being
released by MOF on a daily basis. One consequence of chronic
revenue shortage and the erratic nature of donor budget
support has been a periodic accumulation of expenditure
arrears to the PA's pension funds, to commercial
suppliers. These arrears and the short-term commercial bank
debt that MOF has also contracted are, however, being
transparently handled. The IMF is also regularly monitoring
budget execution and the arrears and debt situation. 5)
Monthly budget execution reports are now being prepared and
posted on MOF's external website within a few days of
the end of each month. 6) A program of placing in each
ministry financial controllers who report to MOF has been
initiated. 7) The MOF has launched a program to develop an
ex post internal audit department in MOF. 8) Control over
the civil service payroll has improved significantly. 9) In
the 2004 Budget, the previous large discretionary transfer
appropriation for the President's Office has been
virtually eliminated with these funds instead transferred to
relevant service ministries (Health, Education and Social
Affairs). 10) The establishment of the Palestine Investment
Fund (PIF) has brought all PA equity holdings, including
virtually all state-owned enterprises (SOEs), under MOF
oversight and within a centralized and commercially oriented
management framework. 11) Measures have been taken to reduce
PA monopolistic activities in the importation of cement,
while the management of the Petroleum Commission has been
taken over directly by MOF. On the basis of these
improvements, and of Palestinian Authority (PA) commitment
to further reforms, the World Bank is able to support a
program of general donor budget support to the PA. However,
the CFAA also identifies "residual weaknesses" in
financial accountability, which relate to the lack of
adequate public aggregate financial statements, inadequate
auditing, and the undeveloped oversight role of the
Palestinian Legislative Council (PLC). The report discusses
a significant number of actions, which still need to be
implemented and notes that most of the essential steps are
either under implementation by the PA, or are planned. |
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