2003年-世界发展银行全球_Sri_Lanka___Country_Financial_Accountability_Assessment_34页_638kb

Sri Lanka Country Financial Accountability Assessment (CFAA) Study Summary

Core Content

The Country Financial Accountability Assessment (CFAA) study, conducted by the World Bank in 2002–2003, evaluates the effectiveness of financial management and accountability mechanisms in Sri Lanka. The assessment focuses on three main levels: central government, provincial and local governments, and state-owned enterprises (SOEs). It also examines the role of public audit, legislative scrutiny, and public access to information in enhancing accountability and transparency. The study concludes that while there is political will for reform, institutional and capacity-related challenges remain.

Main Viewpoints

1. Public Financial Accountability in Sri Lanka

• The current financial accountability framework is archaic, inherited from British colonial rule, and is not aligned with modern performance-based management.
• The framework is limited to input control and compliance with administrative rules, rather than outcomes and value for money.
• Parliamentary control over public funds is weak, with frequent budget revisions and under-realized revenues, indicating poor oversight.
• Sub-national financial accountability is even more lacking, with excessive duplication of effort, lack of clarity in accountability relationships, and insufficient public scrutiny.

2. State-Owned Enterprises (SOEs)

• There are over 216 SOEs in Sri Lanka, many of which suffer from inefficiencies, heavy losses, and dependency on budget transfers.
• Delayed publication of audited accounts and weak management practices further erode accountability.
• The Ceylon Electricity Board has been a focus of scrutiny by the Public Enterprises Committee (COPE), highlighting the need for improved performance monitoring.

3. Public Audit

• The Auditor General lacks independence from the executive and has limited capacity to provide relevant audit information to Parliament.
• Audit reports are often delayed, and reconciliation issues exist between different financial statements, raising reliability concerns.
• The Netherlands Court of Audit has supported the need for strengthening the Auditor General’s role and independence.

4. Legislative Scrutiny and Public Access

• Parliamentary oversight is not effective, as COPA and COPE are not fully utilizing their powers.
• The Freedom of Information Act is proposed to enhance public access to information, aligning with global standards.
• E-governance initiatives, such as the 'e-Sri Lanka' project, aim to improve financial transparency and public engagement.

Key Findings

• Reform will is evident at both political and bureaucratic levels.
• Five priority areas were identified for reform:
  1. Strengthen parliamentary control over public funds by improving the effectiveness of COPA and COPE.
  2. Shift focus from "spending to budget" to "managing for results" through performance-based incentives.
  3. Enhance the independence and capacity of the Auditor General.
  4. Promote open governance by removing obstacles like the Official Secrets Act and revising the Establishment Code.
  5. Clarify accountability relationships between central, provincial, and local governments, and improve financial reporting standards.

Proposed Action Plan

The Government of Sri Lanka (GOSL) has outlined a two-pronged approach for reform:

1. Institutional Reforms

• Amend standing orders and the Parliamentary Powers and Privileges Act to allow greater public access to COPA and COPE hearings.
• Enact the Public Finance Bill to establish legal authority for financial management and accountability.
• Pass the Freedom of Information Bill to ensure transparency and public access to government information.
• Develop standardized financial reporting formats aligned with international public sector accounting standards.

2. Capacity Building

• Strengthen oversight committees in the legislature through training and awareness programs.
• Modernize financial management practices by updating expenditure classification, accounting systems, and internal controls.
• Formulate an Institutional Development Plan for the Auditor General's Department, including recruitment, training, and career development.
• Implement the Public Finance Bill through policies, procedures, and training for personnel involved in financial information dissemination.

Conclusion

The CFAA study highlights the urgent need for institutional and capacity reforms to improve public financial accountability in Sri Lanka. While political will exists, bureaucratic inertia, outdated procedures, and lack of performance-oriented frameworks continue to hinder progress. The proposed action plan includes new legislation, enhanced audit independence, and modernized financial reporting, with a focus on transparency, public engagement, and sustainable reform. The World Bank and other development agencies are expected to support the implementation of these reforms through technical assistance and donor funding.

Annexes and Additional Information

• The study includes technical annexes on NGO involvement in donor projects and financial management practices.
• The PEMS project has made significant contributions to improving financial management through diagnostic studies, budgeting reforms, and modernization efforts.
• The State Accounts for 2002 were published in a user-friendly format, marking a positive step towards international standards.

Challenges and Opportunities

• Challenges: Weak parliamentary control, outdated financial regulations, lack of performance monitoring, and insufficient resources for audit and internal control.
• Opportunities: Strong political will, existing reform initiatives, and the potential for e-governance and modern accounting systems to enhance transparency and accountability.

Implementation Support

• The GOSL has requested donor support for a full-time National Program Coordinator to oversee the implementation of the action plan.
• The World Bank and other agencies are expected to provide technical assistance and funding for the development and execution of the reform agenda.