In the past, public finance systems were judged effective if they were successful in controlling and reporting on financial resources. Modern public finance systems have expanded well beyond traditional controlling and reporting, with functionalities that enable decision makers to allocate publically available resources to the most important social goals of society. In Jordan, these goals have been clearly articulated in the National Agenda: The Jordan We Strive For: 2006–2015. To achieve the objectives and targets of the National Agenda, the Government must raise revenues and financing from taxation, non-tax fees, grants, and debt financing and then allocate these financial resources along with the government’s capital assets and its human resources in ways that will most effectively serve the national good.
Over the past five years, the Government implemented a number of important financial management reforms. The Ministry of Finance operates a computer model of the economy that it uses to forecast where the economy is heading and for plotting the overall course of the country’s public finances for the coming three years. The General Budget Department has implemented a country-wide system of “results-oriented budgeting,” a methodology that attempts to link public spending with public policy goals. The recently concluded new bylaw on internal financial control promises to lead to better control over budget execution and strengthened financial oversight. The Audit Bureau is in the process of introducing “performance auditing” to supplement its traditional financial audits, a process that will help close the loop on results-oriented budgeting and government performance. Finally, after several years of design and development, the Ministry of Finance rolled out its new Government Financial Management Information System (GFMIS), a financial and accounting system that automates many aspects of budget planning, execution, accounting, treasury operations, and reporting. All of these advances promise better control over public finances and more efficient and effective use of public resources.
To support the design and implementation of these modernization efforts, donors and others have undertaken numerous evaluations and diagnostic studies. The United States Agency for International Development (USAID), the French Government, and the European Commission have provided financial assistance to encourage the timely implementation of these modernization efforts. The International Monetary Fund (IMF), World Bank, the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), and USAID, especially through its Fiscal Reform projects, have provided technical assistance to support implementation of these reforms. GIZ and the USAID-funded Fiscal Reform Project II (FRP II) have provided on-the-ground technical assistance, while USAID-FRP II has provided training, organizational design, equipment, systems development and rollout, and all round capacity building assistance, to ensure that these modernization efforts achieve their objectives and serve the people of Jordan well.
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