Linking Structural Reforms to Budget Processes: Focus of New CEF Book

The CEF has published Fiscal Impact Assessments of Structural Reforms: Case Studies on South East Europe. Covering nine countries, this new book presents an in-depth needs assessment on a key issue that has not been sufficiently addressed: how the costs of these reforms are integrated within countries’ budget processes.

Working closely with Montenegro’s Ministry of Finance and with support from the World Bank’s SAFE trust fund, the CEF identified local experts with the right knowledge to assess the situation and offer recommendations for improvement. The Fiscal Impact Assessment of Structural Reforms project is part of a long-term CEF program, Building Capacities for Policy Design and Implementation. The capacity development needs that the case studies identify will be addressed through a series of CEF learning events entitled Strategic Planning and Budgeting starting in 2013.

Studies were prepared for seven countries of the western Balkans, as well as Slovenia and Turkey, in the second half of 2012. Each author outlines the country’s annual budget preparation and medium-term fiscal programming, and how fully the costs of structural reforms are incorporated. Studies identify issues to be addressed, with a focus on the role and capacity needs of ministries of finance, line ministries, and other budget users. Each study has been revised to incorporate comments that authors received from their regional counterparts and international experts at a seminar that the CEF convened in Danilovgrad, Montenegro, in October 2012.

Building on the seminar as well as the case studies, the book offers conclusions and policy implications for the region. In addition to proposing the initial series of learning events, the CEF anticipates that a more extensive agenda for capacity development will be defined through further discussions with beneficiaries and the donor community.