1. Strengthening Public Financial Management through Transparency in Timor-Leste International Consortium on Governmental Financial Management May 17, 2011

2. Confusion? Strengthening Public Financial Management in Timor-Leste 2

3. Congress cuts transparency funding

4. How can Timor-Leste afford government transparency? Strengthening Public Financial Management in Timor-Leste 4 Timor-LesteUnited StatesComparison Independence200217763.4% GDP Per Capita$2,600$47,4005.5% GDP Growth8%2.7%338% Unemployment20%9.7%206% Below poverty line42%12%350% Life Expectancy67.9578.9286% Literacy58.6%99%59%

5. globalization Strengthening Public Financial Management in Timor-Leste

6. = competition Strengthening Public Financial Management in Timor-Leste

7. choice Strengthening Public Financial Management in Timor-Leste

8. citizens are watching Strengthening Public Financial Management in Timor-Leste

9. empowered Strengthening Public Financial Management in Timor-Leste

10. Democratic Republic of Timor-Leste (RDTL) Transparency Objectives Strengthening Public Financial Management in Timor-Leste 10

11. Strengthening Public Financial Management in Timor-Leste build civil society Strengthening Public Financial Management in Timor-Leste

12. build infrastructure Strengthening Public Financial Management in Timor-Leste

13. build capacity Strengthening Public Financial Management in Timor-Leste

14. build citizen involvement in government Strengthening Public Financial Management in Timor-Leste

15. improve government performance Strengthening Public Financial Management in Timor-Leste

16. ?

17. GDP Per Capita (PPP, logs) UGANDA PAPUA NEW GUINEA AUSTRALIA -3 -2 0 1 2 3 209 Countries Normalized Government Effectiveness Index HIGH LOW Benefits of Transparency Government Effectiveness and GDP* * At purchasing power parity Source: The World Bank Higher the government effectiveness = higher the country GDP Per Capita Strengthening Public Financial Management in Timor-Leste

18. GDP Per Capita (PPP, logs) UGANDA PAPUA NEW GUINEA AUSTRALIA -3 -2 0 1 2 3 207 Countries Normalized Voice and Accountability Index. HIGH LOW Benefits of Transparency Voice and Accountability and GDP* * At purchasing power parity Source: The World Bank Higher the government accountability = higher the country GDP Per Capita Strengthening Public Financial Management in Timor-Leste

19. GDP Per Capita (PPP, logs) UGANDA PAPUA NEW GUINEA AUSTRALIA -3 -2 0 1 2 3 204 Countries Normalized Control of Corruption Index HIGH LOW Benefits of Transparency Control of Corruption and GDP* * At purchasing power parity Source: The World Bank Higher the control of corruption = higher the country GDP Per Capita Strengthening Public Financial Management in Timor-Leste

20. = stability Strengthening Public Financial Management in Timor-Leste

21. = investor confidence Strengthening Public Financial Management in Timor-Leste

22. avoid the resource curse Strengthening Public Financial Management in Timor-Leste

23. technology leapfrog Strengthening Public Financial Management in Timor-Leste

24. use what works Strengthening Public Financial Management in Timor-Leste

25. skip what doesn’t work Strengthening Public Financial Management in Timor-Leste 25

26. skip stages Strengthening Public Financial Management in Timor-Leste

27. modernize Strengthening Public Financial Management in Timor-Leste

28. rapidly Strengthening Public Financial Management in Timor-Leste

29. review Transparency and Accountability The next generation of public financial management technology will allow the public to track the budget live, to see where every dollar is being spent, and to gain renewed confidence in the process Democratic Republic of Timor-Leste Vision Strengthening Public Financial Management in Timor-Leste

30. sequenced Strengthening Public Financial Management in Timor-Leste

31. Public Financial Management – Foundation for Country Growth FMIS (software and hardware) Human Resource Development Capacity Building (Training) GoTL LAWS Procurement Commission Autonomous Agencies Ministries Decentralization Public Financial Management

32. Strengthening Public Financial Management in Timor-Leste

33. 1. International Standards Strengthening Public Financial Management in Timor-Leste

34. IPSAS IPSAS International Public Sector Accounting Standards Strengthening Public Financial Management in Timor-Leste

35. EITI EITI Extractive Industries Transparency Initiative Strengthening Public Financial Management in Timor-Leste

36. GFS GFS Government Financial Statistics Strengthening Public Financial Management in Timor-Leste

37. MTEF MTEF Medium Term Expenditure Frameworks Strengthening Public Financial Management in Timor-Leste

38. IATI IATI International Aid Transparency Initiative Strengthening Public Financial Management in Timor-Leste

39. 2. Manager’s Dashboard Strengthening Public Financial Management in Timor-Leste

40. review Strengthening Public Financial Management in Timor-Leste40 integration with macro-economic data examines budget execution data integrated with back-office procurement & commitment accounting within IFMIS

41. 3. Document Management Strengthening Public Financial Management in Timor-Leste

42. manages correspondence with senior managers repository for freedom of information

43. 4. e-Procurement Portal Strengthening Public Financial Management in Timor-Leste

44. review Strengthening Public Financial Management in Timor-Leste44 integrated with back-office procurement & commitment accounting within IFMIS vendor alertstender results publishedgovernment tenders published

45. 5. Transparency Portal Strengthening Public Financial Management in Timor-Leste

46. review Strengthening Public Financial Management in Timor-Leste46 www.transparency.gov.tl

47. subscribedrill downarticles

48. Expenditures, Transparency Portal 10 years of datadrill through the chart of accounts

49. Expenditures, Transparency Portal export to xls, doc, pdf, html, xmltrack commitments

52. Lessons Learned Strengthening Public Financial Management in Timor-Leste 52

53. 1. Leadership Strengthening Public Financial Management in Timor-Leste

54. Goodbye Conflict, Welcome Development Timor-Leste will be the country that goes down in history as the nation to put a stop to falling victim to large companies and the resource curse Prime Minister Xanana Gusmão Strengthening Public Financial Management in Timor-Leste

55. 2. Learn from the mistakes of others Strengthening Public Financial Management in Timor-Leste

56. Goodbye Conflict, Welcome Development When we in the developing world face these types of crisis, which we do on a more regular basis than our colleagues in more economically advanced nations — then we are repeatedly told to increase our openness to the global economy, to trust in the market but to regulate them well. To be honest this approach has worked Minister of Finance Emilia Pires Strengthening Public Financial Management in Timor-Leste

57. 3. Transparency is not an Option Strengthening Public Financial Management in Timor-Leste

58. YouTube Facebook Twitter SMS citizen auditors

59. 4. Transparency = Performance > Embarrassment Strengthening Public Financial Management in Timor-Leste

61. Role of Civil Society NGO’s can help organise literacy groups and provide materials. They can provide private education and education for the blind. They can provide school materials for students, and assist with school equipment chairs and books NGO’s can help us organise and run technical training courses in our villages Timor-Leste National Vision Strengthening Public Financial Management in Timor-Leste

62. 5. Sequenced Holistic Multiple-Year PFM Strategy Strengthening Public Financial Management in Timor-Leste

63. Improve budget execution Improve government capacity Improve transparency & accountability Improve government performance review Strengthening Public Financial Management in Timor-Leste Public Financial Management – Foundation for Country Growth

64. 6. Build Capacity Strengthening Public Financial Management in Timor-Leste

65. review Training beyond software – IT capacity – Project management – Government accounting Beyond training – Adaptable help – E-Learning – Knowledge management Intuitive systems – Translation including terminology – Simple & goal-oriented interfaces Mentoring Strengthening Public Financial Management in Timor-Leste PFM Modernization Alignment with Capacity Building

66. 7. Require Sustainability in Partner Performance Strengthening Public Financial Management in Timor-Leste

67. 8. Adopt International Standards Strengthening Public Financial Management in Timor-Leste 67

68. 9. Leverage Open Systems Strengthening Public Financial Management in Timor-Leste

69. Transition to Open Environment: Transparency DomainClosedTransitionOpen TransparencyAccess to InformationDocumentMachine Readable Data AvailabilityData for SalePublish as Exception Do not Publish as Exception Mode Publish, Audited & Vetted Mixed Near Real-Time Publishing ROI ReasonRevenue Generation What are they going to do with the data? Government as Platform TargetBusiness CommunityCivil Society & Press Citizens

70. Transition to Open Systems: Technology DomainClosedTransitionOpen Integration Proprietary within Suite Support for Industry Standards Service Oriented Architecture Middleware Proprietary = Customer Lock Proprietary/Open Tactical approach Open Standards = Customer Choice Viewpoint Open Systems reduce system performance Open Systems extend value Open Systems = Extensibility ExtensibilityHigh Costs Need for vendor Ecosystem Low Cost Application Assembly

71. 10. Leapfrog is possible Strengthening Public Financial Management in Timor-Leste Timor-LesteUnited StatesComparison 1. Standards GFS, IPSAS, EITI, IATI, MTEF ?Leaped 2. Performance Management Manager’s Dashboards Various tools across government To leap 3. Document Management Manager Document Management Various Records & Correspondence Catching Up 4. e-ProcurementAugust 15FedBizOppsTo leap 5. TransparencyTransparency Portal Data.gov & others - underfunding Leaping

72. www.revenuewatch.org Strengthening Public Financial Management in Timor-Leste

73. How? Strengthening Public Financial Management in Timor-Leste Timor-LesteUnited States Strategic VisionHolistic 1 Year Budgets, complex election cycles Government StructureUnitaryFederal Civil Society & MediaSeen as Improving ResultsSeen as “Special Interests” Government InterventionSeen as GoodSeen Suspiciously 1. Standards Ease to Move to International Standards Long History of Entrenched National Standards 2. Performance Management Single system data sourceMultiple entrenched systems 3. Document Management 4. e-Procurement 5. Transparency

74. Links Open Systems Enable Government Transparency Leapfrog http://www.freebalance.com/blog/?p=1559 http://www.freebalance.com/blog/?p=1559 E-Government Transparency in Developing Countries http://www.cutter.com/offers/egovt.html http://www.cutter.com/offers/egovt.html Developing Countries can Leapfrog Developed Countries in Government Transparency http://tech.state.gov/profiles/blogs/how-developing- countries-are http://tech.state.gov/profiles/blogs/how-developing- countries-are More: dhadden@freebalance.comdhadden@freebalance.com Strengthening Public Financial Management in Timor-Leste 74

75. Goodbye Conflict, Welcome Development Strengthening Public Financial Management in Timor-Leste