VN will continue to improve public financial transparency

The PEFA framework provides a high-level overview of all aspects of a country’s public financial management system.

The Ministry of Finance will continue to focus on improving the efficiency in public financial management to ensure the national financial security, contribute to macroeconomic stability, improve the national credit rating, enhance the business environment and promote sustainable growth in Việt Nam, an event was told on Monday.

At the launch of the Việt Nam public expenditure and financial accountability (PEFA) assessment report, jointly held by the Ministry of Finance and the World Bank, Deputy Minister of Finance Bùi Văng Khắng said that Việt Nam has made significant efforts in speeding up public financial management reforms during the past decades with noticeable incomes.

The PEFA report pointed out that Việt Nam has achieved significant results in institutional reforms with the synchronous public finance management to ensure the transparency in management process and more updated and adequate financial database and information.

The PEFA framework provides a high-level overview of all aspects of a country’s public financial management systems performance.

This is the second PEFA report of Việt Nam, the first in February 2021 and reported to the Government in January this year following seven pillars including budget reliability, transparency of public finances, management of assets and liabilities, policy-based fiscal strategy and budgeting, predictability and control in budget execution, accounting and reporting and external scrutiny and audit.

Out of 31 performance indicators, Việt Nam has 4 Grade A, 8 Grade B and B+, 8 Grade C+ and 11 D and D+.

Việt Nam have the number of Grade A and Grade B+ at a high level, only after Mongolia, Indonesia, the Philippines and ahead of Myanmar, Cambodia, East Timor and Laos.

Alma Kanani, Practice Manager in the East Asia and Pacific Region of the World Bank, said that significant improvements in public financial management have helped the Vietnamese Government to achieve healthy pubic financial discipline and increase efficiency in public debt management.

Khắng, however, said that the report pointed out weaknesses in public financial management, including high revenues and expenditures outside the central budget and weak fiscal risk monitoring. Medium-term financial plans do not really create links between policies, plans and budgets.

These problems must be tackled to enhance pubic financial management transparency and efficiency, Khắng said.

The first PEFA was implemented in 2011 and announced in July 2013.