Good Financial Governance in Sector Ministries
Guidance Note and Tool
Support for Good Financial Governance (GFG) is an important objective and a key strategic element of German Development Cooperation (GDC). GFG is a value-based, holistic and systemic approach, which integrates all subsystems and actors in the public finance arena. According to the GFG approach, support for public finance reforms should not only focus on strengthening ministries of finance, tax administrations, Parliamentary budget or public accounts committees and their secretariats and SAI. It must also take into account sector ministries, which play an important role in the budget process, in particular in the budget implementation.
At the same time, each sector ministry needs a budget in order to implement their respective sector strategies. Thus, sector ministries must be able to carry out budget planning in order to obtain the necessary funds and disburse funds in an efficient and development-oriented manner. In this context, the application of GFG within sectors takes on particular significance. Many challenges remain if sector reforms and service delivery are to be effective, such as communication with the Ministry of Finance, budget preparation, procurement, etc.
Against this background and taking into account the international discussion on sector governance and/or governance in and with sectors, the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), on behalf of the Federal Ministry for Economic Cooperation and Development (BMZ), has drafted this guidance note, entitled ‚GFG in Sector Ministries‘. This guidance note has been produced for development advisors working in sector ministries, but it should also speak to a broader audience of development cooperation professionals and government officials.