PAGEFIP 2 – Public Finance Management Support Project (Phase 2)

It follows on from the first phase of PAGEFIP (2017-2020), which assessed the performance of the public finance management system and trained Mauritanian Government officials to give them the skills required to implement this reform and future reforms.

PAGEFIP 2 is strengthening the support for the public finance reform and the implementation of the Organic Law on Finance Laws (LOLF) in Mauritania. In this respect, it is taking action to mobilise public resources, increase the efficiency of public management and improve budgetary transparency and accountability.

This second phase is supporting:

• The main budgetary and accounting projects for the implementation of the various components of the LOLF reform;

• Capacity building for the Mauritanian administration for the implementation of the LOLF;

• The system for the mobilisation of domestic resources through the implementation of appropriate tools and capacity building.

More specifically, it will benefit the internal control system and officials (Inspectorate-General for Finance, Inspectorate-General for the State, etc.) and external system (Court of Auditors, Parliament, etc.) in order to increase their efficiency and optimise their mandate.

The project is based on six areas:

1) Support for the coordination, management and implementation of the reforms of the Ministry of Finance: establishment of management and monitoring tools, public financing of social policies, macro-fiscal forecasting, training and change management.

2) Support for the budget reform: improvement in the preparation of budgets, modernisation of financial control, definition of new classifications, budgetary references and the budgetary information system, capacity building, implementation of functional and organisational changes at the Directorate-General for the Budget, reform of the pay and pensions functions, improvement in IT applications…

3) Support for the accounting reform: establishment of the prerequisites for the LOLF, preparation of the opening balance sheet of the State, management of the accounting and budgetary risks, consolidation of the Single Treasury Account.

4) Support for the accrual accounting of the State for the implementation of the LOLF: preparation and analysis of the laws and regulations on accrual accounting, strategy for the valuation of State property, strengthening of officials from the State Accrual Accounting Directorate.

5) Strengthening the control system: capacity building for the Inspectorate-General for the State, the Inspectorate-General for Finance and the Court of Auditors, strengthening parliamentary and citizen oversight.

6) Support for the system for the mobilisation of domestic resources: creation of an integrated information system for the ministry’s various directorates, integration of the remote payment system associated with online declarations, revision of regulations, classifications and legal texts, training of officials in the mobilisation of domestic resources, development of a mapping of processes and risks.

1. What is the importance of the new LOLF for Mauritania?

Over the last 15 years, Mauritania has been trying to reform the management of its public finances. In 2005, the country initiated a project to develop a new budgetary system. This initiative began materializing in 2012 with the launch of an effort to create a blueprint for reforming the public finances management system. At the same time, the authorities were working on the first version of the LOLF. Significant progress was made, but it turned out to be tenuous. In 2014, a Public Expenditure and Financial Accountability (PEFA) evaluation showed that management of public funds had regressed since 2008. Adopted in 2018, the LOLF establishes new norms for preparing, voting on and implementing finance laws. It provides more clarity in public affairs, greater accountability for managers and better parliamentary oversight.

2. What steps has PAGEFIP taken to date?

First, we conducted a diagnostic assessment of the situation. We observed that certain prerequisites for implementing a new organic law were absent. For example, there weren’t really any tools in place for preparing budgets. This situation led to a systematic renewal of the previous budget and the adoption of an amending law midway through the year. We also realized that the administrations were not sufficiently communicating among themselves. While the will to achieve better governance of public finances truly existed, technical support was absolutely necessary. Following this diagnostic assessment, we took on the task of training government officials. The goal was to provide them with the skills necessary to carry out the reform in such a way that they would be able to undertake future reforms independently. What’s more, the implementation of a performance-based budgetary system entailed a real change in administrative culture. Previously, the management of Mauritanian finances was guided more by a rationale of means.

3. What remains to be done?

The LOLF will go into effect in 2021. In agreement with the European Union and our partners, we will continue our technical support for 24 months (PAGEFIP 2). That will allow us to work on skills management planning for government officials and develop the new information system for public finances.