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Finance Minister Abdul Hafeez Shaikh. — Photo by AFP/File

ISLAMABAD, Jan 29: Pakistan’s score on the ‘Open Budget Index’ has increased from 38 in 2010 to 58 in 2012, indicating that the government provides the public with only some information on its national budget and financial activities during the course of the budget year.

“This makes it challenging for citizens to hold the government accountable for its management of the public money,” according to the index published on Tuesday by the International Budget Partnership (IBP), an independent budget transparency survey organisation based in Washington.

“Pakistan’s score, which is higher than the average score of 43 for all the 100 countries surveyed but is lower than the score of country’s neighbours India and Afghanistan,” according to the index.

However, with a score of 58 out of 100 on the Open Budget Index 2012, Pakistan has the potential to greatly expand budget transparency by introducing a number of short-term and medium-term measures, some of which can be achieved at almost no cost to the government, notes the survey summary.

In Pakistan, eight key budget documents are published by the government. Five documents – budget proposals, enacted budget, in-year reports, year-end reports and audit reports are published while ‘pre-budget statement’ is produced for internal use. Citizens’ budget and mid-year review are not published.

In order to improve budget transparency, the International Budget Partnership (IBP) recommended that Pakistan should publish a ‘pre-budget statement’ which is currently produced for internal use. As per the Open Budget Survey 2012, 47 countries publish a pre-budget statement, including Afghanistan.

IBP also recommended that Pakistan produce and publish a ‘Mid-Year Review’ and ‘Citizens Budget’.

Based on several indicators, the survey finds that opportunities for public participation in the budget process in Pakistan are limited. Stating that Pakistan has much room to improve public participation, the survey notes that the process followed before consultation, process of consultation and process followed after consultation does not exist.

Pakistan should increase the comprehensiveness of the federal budget proposals, specifically by focusing on anticipated revenues for at least two years beyond the budget year; data on the total government debt outstanding for the budget year and on the composition of government debt; macro-economic forecasts and assumptions used in developing the budget; new policy measures; and financial and non-financial assets held by the government, future liabilities and tax expenditures.

It suggests that the government should increase the comprehensiveness of ‘in-year reports’ by comparing actual year-to-date expenditures and revenues with either the original estimate for that period or the same period in the previous year and presenting information related to the composition of government debt.

Further, the government should increase the comprehensiveness of the ‘year-end’ reports by explaining the difference between the enacted levels and the actual outcomes for revenues; differences between the original macro-economic forecast, original estimates of non-financial date, original performance indicators, and enacted levels of funds intended to benefit the poor and their actual outcomes, along with actual outcomes for extra-budgetary funds.

To improve budget oversight, the International Budget Partnership recommended that the Parliament should formally debate the overall budget policy prior to the tabling of the budget proposals; the government should provide the legislature with the budget proposals at least six weeks, but ideally three months prior to the start of the budget year; the executive seek approval from the legislature prior to shifting funds between administrative units and prior to using funds from supplementary budgets, contingency funds, and excess revenues.

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