The Role of Estimating the Risks in the Costing of Structural Reforms
Structural reforms are an important part of the countries’ Economic Reform Programmes (ERPs). The main objective of this workshop was to learn how to identify and analyze the risks that can endanger the successful implementation of structural reforms, by significantly underestimating their cost. The learning initiative provided also insights into sound planning of public expenditures, effective risk analysis and integration of risk in the design of medium-term fiscal frameworks.
How did you benefit?
All EU candidate countries and potential candidates prepare on an annual basis their ERP, in which they provide the macroeconomic and fiscal policy framework, as well as structural reform plans. The latter are defined as measures that support economic growth while promoting social fairness. Their aims may be versatile, such as: increasing productivity, employment and investment, as well as encouraging innovation, but still considering social aspects, such as inclusion and equality.
The implementation of structural reforms is not a simple task. In the process of executing reforms, significant risks may materialize. Identifying and managing these risks which may lead to delayed implementation and additional costs of reforms; was the main topic that was discussed during this learning initiative.
In that sense, this workshop provided a better understanding of the variety of ad hoc risks that may jeopardize or make costlier the execution of structural reforms i.e. their sources, cause and types. Moreover, we provided insights into the tools that are used as measures to quantify the potentials treats, analyze their potential impact and design mitigating approaches at the design stage and during costing of reform measures. We tackled issues such as planning of public expenditure, performing risk analysis and mitigation measures and integrating these risks into the design of medium-term fiscal frameworks.
What did you learn?
Upon completion of this workshop, participants were able to better:
- understand the complexity of prioritizing and implementing structural reforms
- identify and recognize risks that could threaten the successful implementation of structural reforms
- apply the latest tools and techniques for identifying, analyzing, managing and mitigating risks in implementing public policies
- quantify the potential impact of risks when producing realistic cost estimates of structural reforms
This learning initiative was organized in a highly participatory and interactive manner. Thus, the participants were actively engaged in discussions through Q&A sessions and team work on case studies. Moreover, they were strongly encouraged to exchange their national experiences, good practices and challenges.
Public officials from countries across South East Europe, in particular the countries under the EU’s 2014-2020 Instrument for Pre-Accession (IPA), working in the following institutions:
- Ministries of Finance (Budget and Macro-fiscal departments)
- line ministries (officials dealing with policy impact assessment)
- state agencies dealing with risk issues
Applications need to be submitted no later than February 5 via the online application form. Candidates will need to be approved by the CEF; selection outcomes will be communicated by February 17.
The workshop was delivered in English and no translation was be provided.
No fee will be charged for officials in the public sector. Meals and refreshments during the event will be provided.
Travel and accommodation costs will be funded for up to 3 officials per country covered under the EU’s 2014-2020 Instrument for Pre-Accession (IPA). Officials from other CEF constituency countries and beyond would have to obtain funding from their sending institution (or another donor) to cover these costs. Applications of additional self-funded candidates will be considered, as far as space permits.
Mateja Vraničar Erman is participating to the workshop in her personal capacity though her expertise in fiscal rules development derives from her work at the Ministry of Finance of the Republic of Slovenia. The Ministry of Finance is her employer since February 1993. From September 2016 until September 2018 she served as a Minister of Finance. Before that, since 2010 she was appointed several times as State Secretary, responsible for fiscal policy, public accounting and public revenues policy and administration. In that capacity she participated in development and implementation of fiscal rules in Slovenian public finance framework. Since 1993 until 2010 she held different positions within the Ministry of Finance, dealing primarily with broader tax and customs policy issues. She was a member of different teams, negotiating agreements with EU countries, membership of Slovenia to WTO etc. Before joining the Ministry of Finance, she was a junior official working at the Ministry of Foreign Affairs. She holds a master degree (MPA) from Harvard University, JF Kennedy School of Government and bachelor in law degree from Ljubljana University, Faculty of Law.
Gonzalo Caprirolo is the Chief Economist of the Ministry of Finance of the Republic of Slovenia and heads the Policy Analysis Unit, which also monitors revenue forecast against unexpected changes in macroeconomic trends and external shocks. Prior, he served as senior economist at the Institute of Macroeconomic Analysis and Development (IMAD); consultant at the IMF, UNDP and the Central Bank of Bolivia; Assistant Director at the Mexican Ministry of Trade; and senior analyst at a Mexican/Canadian government contractor in charge of managing public sector information systems. As delegate and in several leading roles, he has been representing Slovenia in a range of working groups and (sub) committees of the Council of Europe (CoE).
He holds a master’s degree from Columbia University (MIA), New York and master degree in economics from El Colegio de Mexico, Mexico City. His research and publications cover various topics such as: Euro area crisis and policy response, fiscal multipliers, fiscal framework, tax reform, monetary integration, the impact of pension reform on fiscal stance, impact of capital inflows, current account sustainability, fiscal stance and debt sustainability, public sector debt management framework, government’s debt portfolio management, banking system and minimum wage.
Eivind Tandberg has more than 30 years of experience in public finance, public administration, advisory services and research. He has a master’s degree from the Norwegian School of Economics and Business Administration. Mr. Tandberg has been deputy director general in the Norwegian Ministry of Finance, unit chief at the World Bank, deputy division chief at the IMF, IMF Regional PFM Advisor for South-East Europe (2005 – 2008) and director general in the Oslo City Government. He is currently a partner in Norwegian firm Vista Analysis. Eivind Tandberg has contributed to evaluation and development of public management and governance in 140 countries and has worked in 80 of these. In recent years, he has been particularly engaged in issues related to public investment, to governance of public institutions and public corporations and to management of fiscal risks.
Valmira Rexhebeqaj, has over twelve years’ experience working with the Kosovo Government and international organizations, on macroeconomics, fiscal policy and other public finance issues. For almost four years she was assigned as Managing Director at UBO Consulting, responsible for developing appropriate strategies and action plans taking into account the goals and objectives of the company, organizing and managing the operations of the agency to fulfill the expectations of clients, and ensuring that the services offered by the agency contribute to the mission of the agency. Prior to this, Ms. Rexhëbeqaj was Director of Economic and Public Policy Department, Ministry of Finance, Kosovo. In particular, her experience was focused on drafting Mid-Term Budget Expenditure Framework, Public Finance Analyses and Sectoral Resource Allocation and Budgeting.
Ms. Rexhebeqaj, has a proven track record of working at policy advisory level to devise strategies, monitoring measures, performance indicators and costing strategies. She has been involved as a PFM expert in a number of EU funded projects in supporting the Strategic Planning Office (SPO) of the Prime Minister’s Office (OPM), towards refining proposed ERP structural reform priorities to ensure consistency with other documents, including also support to line ministries for costing of reform measures, and their integration in the fiscal framework as well as elaborating in detail their expected outcome or impact. Further, she was engaged on caring out an assessment of progress of the PFM in Kosovo for FY 2012-2014, based on the existing 2011 PEFA methodology, ensuring a comparison of the results of the previous assessment (2009), established a baseline using the indicators from the new proposed PEFA methodology. Since 2015 she has been contracted by SIGMA/OECD in providing support to the Ministry of Finance of Kosovo in drafting the PFM Reform Strategy, defining indicators and objectives, targets actions and costs, provided comments to the draft versions of the PFM Reform Strategy and the Action Plan. During the 2017, Ms.Rexhebeqa,j was contracted by OECD for conducting a Small Business Act (SBA) Assessment Report for Kosovo.
This learning initiative was supported by: