1. Somali Region Implementation of the EMCP reform projects in Somali region December 2005

2. Structure of Presentation • Background of EMCP • Objectives and Goals of EMCP • Components and Program Management of EMCP • Status of Reforms • Evolutionary Approach to Reform • Benefits of Reform • Reform Activities Planned in Somali Region • Progress to date • Constraints facing Reform • Immediate Assistance required from the region • Support required from senior officials

3. Background • Expenditure Management and Control Sub-Program is one of the five sub programs of the Civil Service Reform

4. Objectives of EMCP • To strength the capacity of the public financial management system to manage public sector financial transactions • To improve the capacity of public sector managers to use information to permit better planning, management and control • To develop on the platform that budget allocations are driven by policy

5. Components of EMCP • Legal Framework • Budget Reform • Accounts Reform • Expenditure Planning • Internal Audit • External Audit • Cash Management • Financial Management Information System • Accounts and Audit Professional Development

6. Program Management • National Steering Committee • EMCP Coordination Office • Regional Steering Committees • Regional / Federal Reform Teams

7. Status of Reforms

8. Evolutionary Approach to Reform • Reform is a process not a product • Contextual with prudent ‘best’ practice • Begin with exiting government systems, improve and innovate • Devolution requires evolution • Reform at the pace of government • IT should support not drive a financial reform Multi-year exp. Planning Performance budgets Financial Statements Mgmt accounting On-line FIS (IBEX) MIS Cost Center Budget Double/E, Mod/Cash Accts BIS/BDA Line Item Budget Single Entry, Cash Accts Spreadsheets FY 89 FY 91-95 FY 99

9. Benefits of Reform • Legal framework established • Accounts backlog reduced • Budget & Accounts manual/module developed and translated (Amharic, Oromiffa, Somali & Tigrigna) • Financial Information System developed and used (BIS/BDA) • 55,691 staff trained

10. Benefits of Reform…cont’d • Standard chart of accounts used • Budget structure standardized • Improved cash and management control • Development partners confidence increased • Direct budget support reporting • Debt write off • Ramping up financial support

11. Benefits of Reform…cont’d • Improve content and quality of information • Provide more timely information • Increase transparency • Accounts undertaken at single pool • Single treasury system developed • Reduce costs • Modernizes public sector financial systems • Meets international standards

12. Reform Activities Planned in Somali Region • Budget Reform – FY 1997/98 • Budget Execution – FY 1998 • Accounts Reform– FY 1998/99

13. Progress to Date • Budget Reform • Budget manual and module developed • Development of new budget structure • Cost center budgeting • New chart of accounts used to prepare FY 98 budget • Printed & distributed new budget preparation forms

14. Progress to Date… cont’d • Region-wide training delivered • Over 1,200 budget experts trained • FY 98 budget is under preparation • Budgets are being processed using BIS

15. Progress to Date …cont’d • Budget Execution • Single Pool and Single Treasury Systems implemented • Budget execution manual/module developed • New chart of accounts introduced • New forms under print • TOT Training delivered

16. Constraints Facing the Reform • Delay in approval of blocked grant formula • Delayed delivery of budget preparation training • Delay in budget approval at region and sub-regional levels • Delayed budget execution training • Delayed printing of budget execution forms

17. Constraints Facing the Reform • Inadequate staff capacity • Number of staff assigned to posts • Low technical capacity • Poor infrastructure • Communications • Power • Office space, furniture, equipment, etc • Delays in commencement of FY 98 accounts

18. DSA Strategy to strengthen the budget reform implementation to introduce the accounts reform • Conduct a region-wide assessment of the implementation of budget reform • Deliver a region-wide budget execution training to strength the wereda Financial Management • Provide on the job support to expedite accounts closure • Conduct reform awareness workshop for senior officials

19. DSA Strategy… cont’d to strengthen the budget reform implementation to introduce the accounts reform … cont’d • Provide extensive support to weredas • Deliver refresher training on budget preparation • Design accounts manual and training modules • Deliver region wide accounts training • Provide post implementation support • Install and implement BDA

20. Immediate Assistance required from the region • Procure accounts reform forms well in advance of the accounts reform • Recruit qualified accountants at regional and wereda levels • Assign qualified accountants to key posts in the Accounts Department • Allocate budgetary resources to strengthen the Finance Offices

21. Area of Support Required • Office Heads • Recruit qualified staff • Implement organizational structure • Match technical capacity to job requirements • Minimize staff reassignments • Finance Heads • Assign dedicated staff to work on closure of FY 97 accounts • Ensure account records are up to date for FY 98 given the delays in commencement of accounts

22. Area of Support Required…cont’d BOFED Should Lead the Reform • On: • Policy issues • Technical issues • Management and operational issues

23. Area of Support Required…cont’d • To: • Enhance quality of the technical design • Ensure timely and quality implementation • Minimize risk of failure • Ensure future sustainability