Information Systems Strategies for Public Financial Management

Public Financial Management (PFM) is one of the governments' most important responsibilities. In developing countries, in particular, fiscal constraints induced by macroeconomic adjustment programs require efficient PFM both to maintain economic growth and to alleviate the impact of adjustment on the poor. Many governments, therefore, have reform programs in place to improve PFM. An important element of these programs is the development of computer-based information systems to simplify and speed up the business processes associated with PFM. This paper develops a strategic framework for the network of systems required to support PFM consisting of: (a) an information architecture; (b) a systems architecture; and (c) a technology architecture. To derive this framework, the paper uses a methodology that focuses on the business or functional processes within PFM rather than on the institutions that perform them. This ensures that the framework remains valid in spite of organizational changes, and that it can be used as an implementation roadmap over an extended period of time. This paper addresses questions such as: what are the scope, scale, and type of a particular area's system components; how do these elements interrelate; what are the major issues and options associated with the introduction of these systems; and where do the greatest problems and opportunities lie.