Investing in Financial Managements Systems is crucial

In the recent past, we witnessed a clamp down of senior government officials on charges of misuse of public funds. Addressing the monthly press conference on Tuesday at Village Urigwiro, President  Kagame reiterated and made it categorically clear that the clamp down on civil servants  for abuse office is not about to end.

In the recent past, we witnessed a clamp down of senior government officials on charges of misuse of public funds. Addressing the monthly press conference on Tuesday at Village Urigwiro, President  Kagame reiterated and made it categorically clear that the clamp down on civil servants  for abuse office is not about to end.

Mr. President I entirely agree with you! Civil servants must be held accountable at all levels! Accountability knows no status, be it political or social. And it is for the same reason that the country is also heavily investing in building and reforming Public Financial Management (PFM) systems in the country.

In fact, financial management and procurement are key areas for effective functioning of the state. Just recently, it was reported in this paper that government has invested at least 30 million US dollars in financial management reforms, aimed at enforcing efficiency in the use of public resources.

Specifically, the government is spending huge amount of money on professionalization of accounting cadres, development and implementation of SmartGov, an e-government system that connects all government systems electronically, including; tax filing, payments and use of IPPS (payroll software) to strengthen payroll controls in the country.

Every public entity needs financial means in order to provide its services, and to ensure performance in the institutional landscape of a state – ideally for the good of the people.

In this regard, PFM encompasses collection of revenues, allocation of funds through the budgetary process, and utilisation of public revenues, for instance through procurement of goods and services, but also internal and external auditing of public spending and performance of state institutions.

Corruption can occur within all these processes with devastating consequences for service provision and economic growth. However, corruption is not only a problem isolated to the PFM system itself.

As the recent World Bank report ‘The Many Faces of Corruption’ underlines, the “nature and quality of a country’s PFM system to a large extent, determine the ease with which public corruption can occur” in other sectors as well.

Unclear or weak regulation and lack of scrutiny, allow corruption to flourish wherever public spending is involved. This is why PFM institutions, sound procedures and a functioning system of checks and balances, are essential in order to reduce corruption and enhance integrity and accountability in any given state.

Speaking to a team of Accountant Generals recently from 16 Eastern and Southern African countries ,Freeman Nomvalo , South Africa’s Accountant General advised his colleagues that, “the success of any PFMR is dependent on a clear vision, enabling legislative framework, skilled personnel, efficient systems and  effective  oversight.” 

Under its PFM Strategy 2008-2012 that entails the roadmap for the Country PFM reforms, it is very clear that Rwanda has a clear vision needed to have successful PFM reforms.

Notably the country has already completed reforms on legal and regulatory framework, established an Accountant General’s office, instituted organic laws on procurement and created the Rwanda public procurement policy among others.

With this spirit, that I have no doubt that Rwanda will achieve its vision of having “an enhanced public financial management system” in place of international standards. An enhanced PFM is one that is not only effective and efficient but also transparent reducing opportunities for corruption.

Conversely, as Rwanda braces itself to be economically independent, proper use of public funds is also very critical. Laxity in management of the country’s meager resources means that it will be very difficult or if not impossible to be self-sustainable. 

Contact: ubernie@gmail.com

 

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