Fiscal Openness

Make more of the proposed budget transparent to include the following (in order of difficulty):

• Estimated expenditures, revenue, and debt for the upcoming year
• Historical data on recent years and projections for the future
• Macroeconomic estimates, non-financial data on performance, and explanations on the link between proposed policies and budget estimates
• Extra-budgetary funds, future liabilities, and tax expenditures

Increase the level of detail in budget reporting for mid-year and year-end reports. Mid-year reports should contain updated estimates on expenditures, revenue, and macroeconomic indicators. Year-end reports should contain information on debt, macroeconomic estimates, and non-financial performance.

Assign roles and responsibilities to permanent staff to manage the process to create, publish, and promote public use of budget documents each year, ensuring that the recommended elements above are included.

Ensure that the eight key documents are published in an ongoing, timely manner each year for each part of the budget cycle. Consistent presentation aligned with international standards across the planning, approval, and implementation documents allows data generators and users to track spending and revenue collection. These documents are as follows, adapted from guidance from the International Budget Partnership (IBP).

• Pre-Budget Statement
  • Assumptions and understanding of future macroeconomic conditions at the domestic and international level (such as real output growth, composition of GDP growth, employment, prices, the current account, and interest rates)
  • Long-term economic and fiscal policy objectives for at least two fiscal years
  • Broad policy strategy for different sectors based on budget allocations and how such allocations might be influenced by new policy initiatives, such as in South Africa
  • Broad estimates for tax and revenue, including potential developments in the economy that could affect revenue collection
  • Estimates for the cost of important, new policy initiatives
• Executive’s Budget Proposal and Supporting Documents
  • Estimates of expenditures, revenue, and debt for the upcoming year, aligned to international standards and in an open data format
  • Specific data for revenue: debt contracted, other financial instruments, donor assistance (and whether each funding source is international, national, or private), and implications on the deficit
• Citizens Budget
  • Written in everyday language, with a focus on clear data visualizations to make the content easier to digest for the general public
  • Standalone document to explain the objectives and content of the budget
    • Such an explanation could also include a discussion of the social and gendered impacts of different budget allocations, as examples from Albania and North Macedonia show.
• Enacted Budget
  • Final, approved estimates for expenditures, revenue, and debt (balance and gross), aligned with international standards and in an open data format, including a presentation of significant differences between the Proposed Budget and the Enacted Budget
  • Description of how the Enacted Budget impacts other areas of government performance, such as the government’s financial assets and liabilities, non-financial assets, and employee pensions
  • Relevant non-financial data, such as performance targets for expenditure programs
• In-Year Reports
  • Periodic (often monthly) reports on top-level trends in revenue collection and spending for the principal components of the budget (by month and year-to-date calculations)
  • Should also contain information on the government’s borrowing activity
• Mid-Year Review
  • Comprehensive assessment of fiscal performance six months after the beginning of the budget year, including updates on how the macroeconomic context may have changed since the budget year began and whether the fiscal policy needs to be updated
  • Detailed information on expenditure and revenue, including an explanation for significant differences between original estimates and the mid-year data
  • Discussion of the impact of policy decisions on the budget
• Year-End Report
  • Aggregate spending and revenues, the overall budget balance, and its financing at the end of the budget year to compare actual spending against original estimates
  • Information on the level of public debt (a balance sheet of assets and liabilities)
  • Information on budget outcomes, classified by sector and ministry
  • Updated analysis of the macroeconomic context to draw lessons on how well fiscal policies addressed challenges and unexpected developments
• Audit Report 
  • Independent audit to assess the accuracy of the government’s reported revenue and expenditure, as well as the level of compliance with financial management laws and regulations (scope depends on the legal mandate of the auditing institution)
  • May also comment on the efficiency and efficacy of government spending

Publish data on budget performance (such as comparing budget projections to actual revenue and tax expenditures) and the functioning of the budget oversight mechanism(s) in line with international standards.

Ensure the readability of budget documents beyond the Citizens Budget, such as providing narrative explanations for the public to better understand the content and context of such documents. For details, IBP published a framework for providing and assessing explanations.

Where relevant, provide disaggregated data in all documents to show the impact of the budget on different demographic groups. For example, including alternative displays of expenditure by different categories (such as gender or age) can illustrate discrepancies in funding.

Link relevant planning and spending data (including public procurement transactions) to ensure the identification of gaps in spending, including spending through extrabudgetary funds. The Global Initiative for Fiscal Transparency (GIFT) Open Fiscal Data Package provides guidance on publishing this data.

Increase public participation, including of vulnerable and marginalized groups, throughout the budget cycle, which covers planning, execution, and oversight. This means enabling engagement between the public and the executive (such as national and subnational governments, line/sector ministries, and departments and agencies), the legislature, and (sub)national audit offices. For example, the Citizen Participatory Audit process in the Philippines evaluates the effectiveness of government spending on public services across different thematic areas and feeds the results into future policy-making.

• Provide training for the public (particularly vulnerable or underrepresented groups) and groups such as civil society organizations (CSOs) and journalists to cultivate the technical expertise necessary for effective participation.
• Engage a broadly representative section of the public on key topics in a timely, open, and accessible manner.
  • In budget formulation, relevant topics for consultation include macroeconomic issues, revenue forecasts, policies and administration, social spending policies, deficit and debt levels, public investment projects, and public services.
  • In budget implementation, relevant topics for consultation include changes in macroeconomic circumstances, public services delivery, revenue collection, implementation of social spending, changes in deficit and debt levels, and implementation of public investment projects.
• Provide comprehensive information on the consultation process before engagement begins, so that the public can participate in an informed manner. Comprehensive information must include at least three of the following elements: purpose, scope, constraints, intended outcomes, and the process and timeline.

Provide the public with clear, timely feedback on how public inputs have been used for each stage of the budget process.

Conduct and publish gender-responsive budget reviews in consultation with expert groups, such as civil society representatives (for example, organizations focused on women’s empowerment and gender equality). Gender-responsive budget reviews ensure that the allocation of public resources promotes gender-equitable spending and represents the interests of all members of the public.

Create or strengthen independent audit and legislative oversight mechanisms to ensure government funds are spent effectively and equitably.

• Publish audit reports in an easy-to-find location (such as a central portal) and a structured format. Consider conducting a campaign to amplify the reach of the reports with users of such data (such as CSOs and journalists) and the general public. For example, the Court of Auditors in France has hosted hackathons with civil society and tech organizations by making public various datasets on budgets and spending by government agencies.
• Make any responses to the audits publicly available, particularly by CSOs, journalists, and other infomediaries who analyze the data for advocacy purposes.

Create feedback mechanisms for the public to provide input on the efficiency and effectiveness of government spending. This is especially important to oversee spending of emergency and other quickly dispersed funds.

• Enable members of the public to submit suggestions during audit planning (such as ideas on what public projects should be audited) and the actual audit (such as submitting reports on misconduct or fraud). CSOs and journalists, in particular, should play a role in conducting spot-checks to ensure that funding and services reach intended beneficiaries, particularly those from marginalized groups.
  • For example, Colombia conducts “articulated audits,” where a CSO or citizen oversight body centralizes public inputs for review by the Office of the Comptroller Delegate for Citizen Participation. In another example, Georgia created a budget monitoring portal that includes the ability to submit suggestions or complaints through an OGP action plan.
• Create a whistleblower hotline for anonymous submission of complaints. (For more information on corporate whistleblower protections, see Keeping Good Company: How Financial Regulation is Helping Reduce Corruption in Market Economies, part of a series on the private sector and open government.)
• Provide training for the public on how to participate in the audit process, with dedicated outreach to communities who may be less likely to participate, such as women or youth.
  • In Costa Rica, the audit institution runs an online training course for the public on participating in audits and hosts capacity-building training before running local problem-solving initiatives between local governments and communities.