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Public Financial Management

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The Controller General of Accounts had organized three days' International Conference on “Public Financial Management for Effective Programme Delivery” at Vigyan Bhawan from October 20th-22nd, 2008.The need for having a financial management group capable of scrutinizing various social schemes at their formation stage was emphasized upon by Pawan Kumar Bansal, Minister of State in Minister of Finance. This has been considered important to remove the disconnect that often exists between the policy and the ground level realities, particularly in the sphere of financial management.

The role of financial management is to support the programme delivery in a way that the programme objectives are achieved in an efficient and cost-effective manner and the value for tax payer's money is fully realized. Transparency in operation and accountability for utilization of resources as well as achievement of targets are also important concerns.

Bansal emphasized the need for revising the system of classification of accounts with a view to remove the artificial distinction between plan and non-plan expenditures. He also mentioned that alternative and innovative ways of allocating outlays should be explored. There should be independent evaluations of the public programmes and a holistic view of Public Financial Management (PFM) should be taken based on critical areas of analysis, tracking and evaluation.

Further impetus on the issue was given by Montek Singh Ahluwalia, Deputy Chairman, Planning Commission during his keynote address. He emphasized on the need for linking money spent with achievement of outcome, the need for bridging the fund flows with the requirements of the programme and ensuring synergy between programme objectives and social outcomes, an area where internal audit has a critical role to play. The importance of financial inclusion for delivery of social transfer payments was also emphasized upon too. In this country is as high as 73%. Besides, 51% do not access to both formal and informal sources. Poor and weaker sections of society are predominantly excluded from the formal banking structure.

On the final day Aruna Roy represented the other side of programme delivery. She explained how social audit could revolutionize the governance structure. It came out clearly that there is a need to institutionalize arrangements between programme implementers and social groups, as the latter have local presence and widespread reach which could be constructively utilized to enhance efficacy of government programmes.

The need for strengthening the right institutional framework at all levels of programme implementation was also emphasized upon. One aspect which clearly emerged during the course of various presentations was the need for community participation at different stages of programme delivery.

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