FreeBalance predicts Government 2.0 will transform Public Financial Management

FreeBalance Vice President hosting Government Performance Management session at ICGFM Winter 2009 conference in Washington, DC

Ottawa, Canada(December 2, 2009) - FreeBalance, a For Profit Social Enterprise (FOPSE) software company that helps governments around the world to leverage robust Government Resource Planning (GRP) technology to accelerate country growth today announced participation in the International Consortium on Government Financial Management (ICGFM) 2009 Winter Conference conference. The event takes place from December 2nd to 4th at the Inter-American Development Bank (IDB) Enrique Iglesias Conference Center at 1330 New York Ave. in Washington, D.C. The theme for the conference is “Performance. Results. Outcomes. Understanding Impact in Managing Public Finance”.

Doug Hadden, Vice President of Products at FreeBalance will host an interactive session on Thursday, December 3rd at the Enrique Iglesias Conference Center detailing how Government 2.0 will transform the practice of government performance and public financial management. The session will focus on the limitations of current practices and the linkages between performance management and Government 2.0. This presentation will demonstrate practical approaches to improve performance in government.

“Government 2.0 equips governments with the tools needed to provide a 360 degree view of government performance and public financial management,” said Doug Hadden, Vice President of Products at FreeBalance. “Government 2.0 enables governments to evaluate the overall effectiveness and societal impact of government initiatives.”

The practices of private sector performance management is narrow focused and lacks crucial aspects of government performance. Government 2.0 is a new trend in government transformation. Government 2.0 will transform the practice of performance management and public financial management.

Doug Hadden also serves as ICGFM Vice President of Communications. Media coverage of the ICGFM 2009 Winter Conference will also engage social networking for knowledge transfer and collaboration. Real time event updates will be broadcast by twitter, blogging, video, presentation sharing, document sharing and social networking. Access ICGFM 2009 Winter Conference event coverage using the following social media services:

• Event blog at http://icgfm.blogspot.com/
• Picture gallery at http://www.flickr.com/photos/icgfm/
• Videos at http://www.youtube.com/user/icgfmconference
• Presentations at http://www.slideshare.net/icgfmconference
• Documents and Journal Articles at http://www.scribd.com/icgfmconference
• Social Networking at http://www.linkedin.com/groups?gid=1677477

The ICGFM Winter 2009 conference includes workshops, presentations and interactive sessions which focus on the use of performance frameworks in Public Financial Management (PFM). Senior level government financial managers from more than 30 countries including Poland, China, Brazil, Benin, and Bosnia will present PFM case studies. Limited to 130 representatives from the range of government finance – budget, audit, accounting, IT, policy, and treasury -- the conference serves as a global forum to share successes and lessons learned in public financial management.

About ICGFM
Working globally with governments, organizations and individuals, the ICGFM is dedicated to improve financial management by providing opportunities for professional development and information exchange. More information about ICGFM is available at www.icgfm.org.

About FreeBalance
Founded in 1984, FreeBalance is a For Profit Social Enterprise (FOPSE) software company that helps governments around the world to leverage robust Government Resource Planning (GRP) technology to accelerate country growth. Proven FreeBalance GRP products and focused methodology supports financial reform and modernization to improve governance, transparency and accountability. Good governance is required to improve development results.

FreeBalance is headquartered in Ottawa, Canada, with sales and support offices in Washington, DC (United States), Lima (Peru), Lisbon (Portugal), London (Great Britain), Pristina (Kosovo) and St. John (Antigua and Barbuda). FreeBalance solutions have been implemented in countries across the globe, including Canada, United States, Sierra Leone, Guyana, Pakistan, Mongolia, Afghanistan, Antigua & Barbuda, Timor-Leste, Republic of Kosovo and Panama.

Lessons Learned from Performance Based Budgeting in Latin America

From the Culture of Control to Culture of Performance
Mario Saginés, Senior Advisor, Institutional Capacity and Finance Sector, Inter-American Development Bank described Performance Based Budgeting for government. Mr. Saginés provided insight from experience in Latin America.

PBB does not mean that countries always allocate based exclusively on results. He described four necessary components are: performance information, the use of information in budgetary exercises, incentives for managers to reach goals, and increasing management skills. Management in government can be restricted by rules from making decision. That way, managers can be held accountability.

The benefits of PBB include improved accountability, government services, and efficiencies. PBB brings budgeting in line with government objectives. Mr. Saginés showed graphs that showed how countries with a lower income tend to collect revenues at a lower ratio to GDP. Many Latin American countries spend more than many countries yet achieve poorer results.

Mr. Saginés pointed out that many PBB initiatives are started by bad reasons. For example, PBB should not be used to increase controls because it limits the ability to manage based on performance frameworks. Excessive detailed management is often legally required. This reduces flexibility. He recommends a more macro approach. PBB has become fashionable in the donor community. Mr. Saginés suggests that this should the only reason to implement PBB. He questioned whether accrual budgeting is required to have effective performance based budgeting.

There is a broad menu of PBB framework options. Some countries use more performance measurements to set budgets than others. There is no established model. Mr. Saginés suggested that a practical middle ground is appropriate for most countries. He recommended against using allocation formulas based on performance results.

Many countries use program-based performance budgeting. He cautioned that the concept of “program” is not universally understood. Program budgeting can be complex to manage.

Budget execution for PBB requires culture change. It can be a long and painful process. Mr. Saginés presented details from PBB experiences in Latin America.

Many countries focus on indicators but not on using these to determine resource allocation. A radar graph showing 5 measurements for results-based management was shown. Performance based budgeting and monitoring in Latin America is not as advanced as general financial management.

Monitoring and evaluation is required for effective PBB. Mr. Saginés recommends the use of performance results during budget deliberations. This does not mean that allocations should be directly related to performance. Performance is one of the characteristics that must be used during budget preparation.

1.30 2.30pm Embarking On Perf Mgmt Latin America (Mario Marcel)

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1.30 2.30pm Embarking On Perf Mgmt Latin America (Mario Sangines) English

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1.30 2.30pm Embarking On Perf Mgmt Latin America (Mario Sangines) French

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International Government Performance Management Conference Kicks-Off

Performance - Results - Outcome

The International Consortium on Governmental Financial Management (ICGFM) Winter Conference starts shortly at the Inter-American Development Bank (IDB) in Washington DC. The conference focus is on government performance management - understanding impact in managing public finance.

Conference speakers include:

• Mario Sangines of the Inter-American Development Bank
• James Brumby of the World Bank
• Jean-Baptise Sawadogo of Leader One Inc.
• Edouard B. Houssou and Gabin Mehou of the Government of the Republic of Benin
• Dr. Piotr Perczynski and
  Dr. Marta postula of the Government of the Republic of Poland
• Doug Hadden of FreeBalance
• Jerome Dendura of Quistron Inc.
• Lelia Aridi Afas and Steve Clyburn of Grant Thornton LLP
• Pokar Khemani of the International Monetary Fund