18th December 2022, Skopje – Public finance reform is carried out via eight pillars, which is to provide for more efficient system and accelerated economic growth in the medium term. Minister of Finance, Fatmir Besimi indicated, under his most recent column, that in 2022, despite managing the global price and energy crisis, the Government carried out major public finance reforms. Minister pointed out that times of crisis best show the required changes to the system. New Organic Budget law is among the carried out major reforms, introducing medium-term budgeting, fiscal decentralization reform from the aspect of financing and accountability, as well as reform aimed at expanding the tax base.
“Public finances reform is aimed at longer-term and better planning of budget programs and budgets, sustainability and continuity in implementing the policies, more just model from the point of view of revenues, expenditures and the manner of financing (how the funds are collected in the Budget and how citizens’ money is spent), as well as monitoring and measuring the performance. Among the main pillars of public finances reform are transparency, accountability, allocating public funds where greater benefits are generated when prioritizing the optimal policies in support of both the citizens and the businesses, “value for money” concept and introducing so-called key performance indicators”, Besimi pointed out, thereby stressing that public finance reforms are essential for faster recovery from the crisis and accelerated economic growth.
In line with the Public Financial Management Reform Program, the reforms are based on eight pillars. The first pillar pertains to strengthening the economic analysis capacities, the second one refers to revenue mobilization via tax and customs policy, the third one involves budget planning, the fourth concerns public procurement, the fifth refers to integrated public finances, the sixth pertains to public internal financial control, with the seventh and the eighth covering external control and parliamentary oversight and PFM at local level respectively.
Minister of Finance emphasized the importance of each of this pillar in building a public finance system, which will be basis for accelerated economic growth. He also touched upon the centralized single web-platform for integrated and efficient public finance – IFMIS, which will be significant step in increasing its efficiency.
“IFMIS is expected to support the amended legal and institutional budget framework, thus responding to the existing challenges by expanding the scope as regards monitoring the budget execution and the fiscal reporting, covering all expenditure cycle phases (from procurement until payment), as well as getting a picture of consolidated public expenditures in a timely manner. IFMIS will provide for, among other things, establishing a multi-year budget framework, introducing a public investment management function related to the future public-private investment system, an automated system for monitoring the liabilities, including multi-year commitments and centralized data on the assumed liabilities, management of fixed assets and debt management. It will provide comprehensive availability to public finance data, thus contributing to increased efficiency when projecting the liquidity and managing the financial flows”, Besimi pointed out.
Within this pillar, continuous education of the public administration in the field of public finance management and creating a modern and competent administration for rendering quality and rapid services to citizens and businesses, will be provided via the Academy. Besimi stressed the need for human capital investments and enhanced capacities all to the end of carrying out these systemic reforms.