G O V E R N A N C E , E Q U I T Y A N D D I G I TA L D E V E LO P M E N T Bangladesh Strengthening Public Financial Management Program to Enable Service Delivery BASIC APPROVAL END TOTAL IMPLEMENTING INFORMATION DATE: DATE: COMMITMENT: AGENCIES: March 29 June 30 $100.5 Ministry of Finance 2019 2024 million PAVING WAY FOR STRONGER PUBLIC FINANCIAL MANAGEMENT OVERVIEW Bangladesh’s PFM reform journey started in 1989-1990 with was launched in 2003. In 2010, the government and five the Committee on Reforms in Budgeting and Expenditure development partners supported a large multi donor trust Control (CORBEC). In 1993, the government with donors’ funded “Strengthening Public expenditure Management technical assistance, initiated “Reforms in Budget and Program (SPEMP)”, administered by the World Bank. In FY Expenditure Control (RIBEC)” which aimed at reforming 2018, the World Bank approved the Strengthening Public budget and expenditure control system and process. A Financial Management Program to Enable Service Delivery. follow on “Financial Management Reform Program (FMRP)” 98 BANGLADESH STRENGTHENING PUBLIC FINANCIAL MANAGEMENT PROGRAM TO ENABLE SERVICE DELIVERY CHALLENGE RESULTS Despite impressive the improvements in PFM, there is Over 37 million beneficiaries of the Integrated significant room to improve several PFM areas which Budget and Accounting System iBAS++ in 2022-2023. are limiting effective delivery of services to citizens. Key limitations include i. less than optimal budget absorption 1.2 million Government Civil and Defense capacity; ii. shortcomings in the revenue forecast and employees receive salary. expenditure budgets; iii. Insufficient fiscal and performance monitoring of State-owned Enterprises (SOEs); iv. weak internal control and internal audit; v. significant delays 840,737 retirees receive pensions without any in the preparation of fiscal reports and audit of central hassles. accounts; vi. Poor executive response: Audit findings and recommendations is not acted upon in a timely manner. Over 18 million students receive stipends. Close to 13 million social safety net beneficiaries. APPROACH 30 million poor and vulnerable people receive To resolving the PFM bottlenecks by strengthening the social protection benefits. institutions and systems, under the stewardship of Finance Division, MoF, a comprehensive Bangladesh PFM 35 million families received cash transfer strategy 2016-21 was prepared. A PFM Action Plan 2018-23 amounting to over BDT 2 crores, during COVID-19. to support effective implementation of the PFM Strategy, with clearly defined 5 strategic goals was approved by BDT 400 to 500 crore annual savings for the the Minister for Finance. The plan sets out government’s Government of Bangladesh. PFM priorities and included 14 components. The SPFMS program has been helping the government to implement 8 out of 14 components of the PFM Action Plan. The program aims at helping improve fiscal planning, pension and debt management and SOE. Additionally, the SPFMS allows the necessary flexibility for the government to course correct as needed to achieve the reform targets. TOWARDS THE FUTURE SPFMS will significantly improve the PFM systems and the achievement of results under the Program will lead to resource availability to enable service delivery for the citizens of Bangladesh. The recent PFM Summit FY 23 served as a crucial platform for policymakers, financial experts, and stakeholders to chart a new course for the future of public financial management. The govt is contemplating a strong and sustainable PFM to meet the aspiration of a prosperous Bangladesh. To this end, a new Bangladesh PFM Action Plan and Strategy 23-28 is discussed and being approved in FY 23. THE WORLD BANK IN BANGLADESH 2024 | 99