The Public Expenditure and Financial Accountability (PEFA) report is a performance measurement framework that helps assess the strengths and weaknesses of each country's public financial management system. It is an important support tool to promote sustainable development.
Vietnam first conducted a national PEFA assessment in 2013. Since then, public financial management reform has achieved many remarkable achievements, especially in institutional reform. Important legal documents have been issued synchronously, such as: State Budget Law, Accounting Law, State Audit Law, Bidding Law, Public Debt Management Law, Public Asset Management and Use Law, along with a series of tax laws and other documents.
In order to assess the results achieved over the past 10 years and identify the strengths and weaknesses of the public financial management system according to international standards, the Prime Minister assigned the Ministry of Finance to preside over the re-evaluation of PEFA. This process has technical and financial support from the PEFA Secretariat, the Government of Switzerland, the Government of Canada and the World Bank, within the framework of the Public Financial Management Advisory and Analysis Support Program in Vietnam.
PEFA Assessment Results 2023
This PEFA report recognizes Vietnam’s significant progress in public financial management. Some notable results include:
Improved fiscal discipline, contributing to reducing outstanding spending;
Manage budgets more efficiently, thanks to better information on spending commitments;
Increasing budget transparency, improving access to fiscal information;
Comprehensive budget coverage, in compliance with international practices;
Increased efficiency in budget use, thanks to the application of modern public financial management tools;
However, the report also pointed out some limitations that need to be overcome, including:
The scale of revenue and expenditure outside the central budget is still large.
Fiscal risk monitoring in the public sector is not yet fully implemented.
The link between medium-term financial planning and medium-term public investment planning is still weak.
Reform orientation in the coming time
The Ministry of Finance said that it will continue to coordinate with ministries, central and local agencies to study and overcome the limitations mentioned in the PEFA Report. Solutions will focus on:
Strengthen management and effective use of financial resources.
Ensure national financial security and safety.
Stabilize the macro economy, improve the national credit rating.
Improve business and investment environment towards sustainable growth.
Implementing these reforms will not only help Vietnam improve the efficiency of public financial management but also contribute to the goal of sustainable and comprehensive socio-economic development.
