Future strategic direction of the Public Expenditure and Financial Accountability Programme

The Public Expenditure and Financial Accountability (PEFA) programme provides a framework for assessing and reporting on strengths and weaknesses of a country’s Public Finance Management (PFM) systems, using quantitative indicators to measure performance. The programme was initiated in 2001 by the European Commission and seven other donors. As the PEFA recently entered its fifth phase, DG DEVCO, on behalf of the PEFA Steering Committee, commissioned Ecorys, in partnership with Mancala Consultores, to conduct a study on the possible future strategic direction of the PEFA programme. 

As the global development finance landscape is changing, with countries increasingly relying on their own domestic resources to finance their development agenda, the study aimed to provide strategic guidance to the PEFA Steering Committee to assess how to adapt the PEFA to this new context, and to the 2030 Addis Ababa Agenda for Action. 

The study combined quantitative survey data with qualitative data from surveys, semi-structured interviews and focus group discussions. A total of around 600 individuals took part in the study. The experience of six countries with the PEFA framework was analysed in great detail through field visits (South Africa, Kenya, Burkina Faso, Tunisia, Peru and Vietnam).

Overall, the study found that PEFA as an instrument has fulfilled most of its objectives and is considered a success. The PEFA framework is viewed as a highly relevant PFM diagnostic tool, with its relevance strongly related to its comprehensiveness. Moreover, the framework is not perceived as competing with other diagnostic tools, but rather complementing them. Among challenges identified for the future, the study highlighted the need to improve the value for money of the instrument and reduce the cost of the assessments, especially in view of the need to diversify PEFA’s donor base. 

Going forward, the study presented five high-level strategic recommendations for the programme to pursue:

  • Broadening participation in governance structures and extending actions through partnerships. 
  • Strengthening learning and feedback loops. 
  • Strengthening outreach and visibility. 
  • Broadening the financial base to enhance financial sustainability.
  • Strengthening the link between PEFA and the sustainable development agenda and revamp the PEFA intervention logic.

For more information, please contact Ferry Philipsen or Jonathan Wolsey