Medium term expenditure frameworks : from concept to practice - preliminary lessons from Africa
Le Houerou, Philippe | Taliercio, Robert
Medium term expenditure frameworks (MTEFs) are receiving renewed attention in the context of the formulation of Poverty Reduction Strategy Papers (PRSPs). Conceptually, MTEFs are the ideal tool for translating PRSPs into public expenditure programs within a coherent multiyear macroeconomic, and fiscal framework. But, do MTEFs work in practice? With a view to drawing preliminary lessons from experience, the paper undertakes a comparative assessment of the design, and impact of MTEFs on public finance, and economic management in nine African countries. Based upon the assessment, it offers recommendations, and practical guidelines for improving both design, and implementation of MTEFs, and sets out a framework for further evaluation. The paper concludes that MTEFs alone cannot deliver improved public expenditure management (PEM) in countries in which other key aspects of budget management, remain weak. The study recommends that comprehensive diagnoses of budget management systems, precede MTEFs to ensure appropriate design of reform programs, and, that in order to have an impact, the MTEF should be integrated with the budget process from the start, with MTEF projections published as part of the budget document. Moreover, it stresses that political motivations for launching MTEFs explain (partly) why MTEFs have been more successful in some African countries than others.
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