Public Finance Management/Peru country office
What is Public Finance Management?
Public Finance Management (PFM) is the administration of funds used to deliver public services. Sound and transparent PFM depends on relevant and enabling legislative, regulatory and policy frameworks as well as their respective enforcement. It promotes accountability and in turn increases the credibility of the public administration vis-à-vis its various stakeholders. This serves to support the achievement of national development objectives.
The World Bank describes PFM as follows:
‘Public financial management entails the development of laws, organizations and systems to enable sustainable, efficient, effective and transparent management of public finance.’
The State Secretariat for Economic Affairs of Switzerland (SECO) and the Peruvian National Public Prosecutor signed an agreement on 15 January 2016 to prevent and investigate acts of corruption in public finance at the subnational level and recover misappropriated public assets. The intent of this agreement is to support the National Public Prosecutor in their ongoing efforts in taking preventative and investigative actions to counter corruption amongst other through improved coordination and capacity building.
Programme of work in Peru
Up until mid 2014 the Basel Institute was primarily engaged in Peru through ICAR by providing its partner country technical and legal guidance on investigative and prosecutorial strategies for recovering illegally obtained assets. In continuation of this initial cooperation, the Basel Institute in the fall 2015 expanded its programme of work in Peru acting as implementing agency for the "Subnational Public Finance Management Strengthening Programme."
For implemening this expanded programme of work in Peru, the Basel Institute opened its first subsidiary office in Lima. The Peru country office also coordinates ICAR’s casework assistance in Peru.
Objectives of the SECO-funded PFM programme
The overall objective of the "Subnational Public Finance Management Strengthening Programme” is to improve PFM at subnational level in order to allow a more strategic allocation of the available public resources in line with the PFM reform priorities defined at national level, and with the purpose of promoting economic development, fostering social inclusion and reducing poverty.
The specific objectives of the Programme are:
- to improve and better coordinate the budget cycle (planning, execution and control) processes at subnational level
- to strengthen transparency and accountability of public funds managed by subnational entities
- to strengthen institutional PFM capacity at subnational level
- to promote dialogue with the central government in order to improve the sustainability of PFM reforms at subnational level and disseminate them in other regions
- to strengthen capacity of the Public Prosecutor to prevent and investigate acts of corruption in public finance at subnational level and recover misappropriated public assets
Institutional partners of the Peru country office include:
- PLADES (Programa Laboral de Desarrollo)
- Universidad ESAN (Instituto de Regulación y Finanzas)
- Pontificia Universidad Católica del Perú (Instituto de Democracia y Derechos Humanos)
The "Subnational Public Finance Management Strengthening Programme" is a four-year bilateral programme signed between the governments of Peru and Switzerland in October 2015. The USD 6 million-programme is funded by the Swiss State Secretariat for Economic Affairs (SECO).