This training activity will be delivered as part of the Strategic Planning and Budgeting (SPB) project, funded by the European Union. The overall objective of the project is to contribute to strengthening of beneficiary countries’ capacity to design and implement medium-term macro-fiscal policy.

Workshop description

Many budget decisions have impacts that extend well beyond the current budget year or that even arise mostly in later years. To make rational budgetary decisions, decision-makers must focus on the medium- and long-term implications. Most importantly, new spending initiatives kick in only after the budget year in which they are taken. Similarly, important saving measures usually take longer than a year to take effect. It is increasingly becoming standard practice for countries to introduce medium-term budget frameworks to extend the time horizon of their budget management processes. While specific mechanisms and terminology vary, the most successful approaches to development of medium-term budgeting incorporate a medium-term budget framework (MTBF) which includes revenue forecasts and expenditure ceilings for subunits of general government and individual ministries and agencies; as well as baseline estimates for expenditures, which indicate the future costs of current policy.

The potential benefits of effective medium-term budgeting are well documented. A well-designed and well-managed framework for medium-term budgeting should contribute to improved fiscal discipline and control, allocative efficiency and cost-effectiveness of service delivery, through increased clarity of policy objectives, greater predictability in budget allocation, increased comprehensiveness of budget information and enhanced accountability and transparency in the use of resources.

What you will learn

The following topics will be discussed during this three day workshop:

Introduction to medium-term budgeting: theoretical background, key concepts and definitions
Medium-term budgeting reforms: international experiences
The role of fiscal rules
A practical model for South East Europe to build a medium-term budget framework from a top down perspective
Challenges and bottlenecks for medium-term budgeting
Medium-term budgeting in practice

How you will benefit

The objective of the course is to help participants to better understand objectives and features of multi-year budgeting, to identify the challenges and bottlenecks in these reforms and to share experiences with colleagues in other South East European countries about how to overcome these challenges.

After attending this workshop, participants will be able to:

Explain different dimensions of medium-term budgeting;
Understand the relationship between the annual budget and the medium-term budget framework; and how the two are linked;
Describe the implementation challenges and the factors that are necessary to make medium-term budgeting work in practice;
Explain the role of fiscal rules in the budget process.

Who should attend

The workshop has been specifically designed for mid to senior level officials at line ministries in South East Europe and Turkey who actively deal with budget formulation, strategic planning and budget decision-making.

Your contributions

The workshop will be highly participatory. Participants are encouraged to be active in discussions and exercises throughout the three days. Participants will work in groups to discuss country specifics in medium-term budgeting reforms and will take part in simulations of medium-term budget preparation and negotiation exercise.

Faculty

Mr. Dirk-Jan Kraan, Public Financial Management Advisor for South East Europe of the IMF

Dirk Kraan is a Dutch citizen. He holds MA degrees in Law (1970) and Economics (1976) from Erasmus University in Rotterdam and a PhD degree in Economics from the same university (1989). He worked in several positions in the Directorate General of the Budget of the Dutch Ministry of Finance from 1980 to 2002, lately as head of the Division of Policy Review of the Inspectorate of Finance (Expenditure Division). He joined the Organisation for Economic Co-operation and Development (OECD) in 2002 as a senior economist in the Budgeting and Public Expenditures Division of the Directorate of Public Governance and Territorial Development. At the OECD he was among other things responsible for the Eastern European program of the Budgeting and Expenditure Division and for the OECD Value for Money Study on the organization of central government. He recently joined the International Monetary Fund (IMF) to work as a Regional Public Financial Management Advisor for South East Europe based at the CEF in Ljubljana, Slovenia.

Mr. Peter Van Den Berg, Budget Director, Ministry of Finance, the Netherlands

Peter van den Berg holds an MA degree in Econometrics. He is Director of Budget Affairs and Deputy Director-General of the Budget in the Dutch Ministry of Finance. Previously he held the position of Director of the Inspectorate of Finance (Expenditure Division) in the same ministry. Prior to that, he served as a Deputy Director of the Bureau for Economic Policy Analysis (Central Planning Bureau) of the Dutch government.

Mr. Boštjan Vasle, Director, Institute of Macroeconomic Analysis and Development, Slovenia

Boštjan Vasle holds an MA degree in Economics from Central European University, Budapest (1997). He started his professional career at the Ministry of Finance’s Treasury Department in Ljubljana. In 2001 he joined the Institute of Macroeconomic Analysis and Development, where he was involved in price and monetary policies. In 2006 he was engaged at the Government Office for Growth where he supervised the implementation of economic reforms. After the implementation of the first package of reforms, he returned to IMAD and assumed its leadership in December 2007.

Mr. Bojan Paunović, Senior Advisor, Ministry of Finance, Montenegro

Bojan Paunović is a Head of the Directorate for Coordination and Management of EU own resources and Senior Advisor at the Directorate General Budget at the Ministry of Finance of Montenegro. He is, among other things, responsible for managing budget planning, and supervision of the budget execution of different budget users; and preparation and implementation of annual state budget law. Prior to joining the Ministry of Finance of Montenegro he also worked for different Montenegrin NGOs and was also a Trainee at the European Commission, DG Budget. He is an Economist by profession, holding a Bachelor degree from the Faculty of Economics of Podgorica, University of Montenegro, where he is currently pursuing his Master’s degree.

Mr. André Lundvall, Ministry of Finance, Sweden

André Lundvall serves as desk officer in the Budget Department at the Swedish Ministry of Finance. Currently he is working with short and medium-term revenue and expenditure forecasts for the central government budget. Furthermore he is involved in revenue forecasting steaming from dividends from state-owned companies. Mr. Lundvall has formerly worked at the structural division at the Ministry of Finance on issues related to investments and productivity.

Mr. Thomas Wilhelmsson, Ministry of Finance, Sweden

Thomas Wilhelmsson holds an MA degree in Economics from Stockholm University. He currently serves as desk officer in the Budget Department at the Swedish Ministry of Finance, where he is mainly working with short- and medium term expenditure forecasts in various expenditure areas. He is furthermore involved in work with the Swedish fiscal policy framework, e.g. assessing the levels of the expenditure ceiling. Prior to joining the Ministry of Finance, Thomas was a trainee at the Budgeting and Public Expenditures Division of the Directorate of Public Governance and Territorial Development at the Organisation for Economic Co-operation and Development (OECD).

Medium-Term Budgeting