Filenews 18 February 2022
Government and public service are increasing speeds to reform the management of public funds, the first phase of which is expected to take effect from 2023.
During a workshop titled "Reform of public resource management in the Republic of Cyprus, prospects and challenges in decision-making", organized on Friday by the Cyprus Academy of Public Administration in cooperation with the Treasury of the Republic, the Minister of Finance, Konstantinos Petrides, stressed the Government's commitment to the effective management of public funds.
"The Government remains committed and has invested resources, will and energy with the ultimate goal of improving the management of public resources in a way that provides high quality and rewarding public services to all citizens," Mr. Petrides said in his speech.
He noted the importance of focusing on the principle of "limited resources" and what effect can be achieved with them, something that he said politicians often want to forget. He said a good technocratic, bureaucratic backbone ensures the long-term effectiveness of policies.
He added that only through this change in commitment and culture will it be possible to achieve horizontal comparability between programme areas and regions that will help to make decisions on the basis of evidence, in order to maximise the benefit to the citizen and ensure that the last euro is used appropriately for the benefit of society.
"We want as a state to learn to think and plan on a deeper horizon, to make better decisions by explaining in an understandable way where citizens' money is spent and why. We want to show the importance of accountability by presenting the overall results and impacts of each policy and action," he said.
He added that they also want to give the tools and information to the citizen to be able to judge the performance of each one, giving credit or criticising a governance according to the actual results and the overall real picture of the country.
The Minister of Finance also mentioned that sound public financial management, fiscal transparency, the accountability of the Government and the involvement of civil society strengthen the citizens' trust in the state. This trust, he added, is a very important issue, since it can encourage investment and growth, accelerate the improvement of credit and risk ratios and have a catalytic role in trying to retain new minds in the country.
This reform, he also noted, reflects the commitment of the public administration to transparency and accountability to the citizen, as expressed in the continuous and undivided support of the present Government towards the reform work of public financial management.
"We want this to be a positive message to all those who are in good faith interested and want to know that the respective rulers manage their public wealth, their money, their shortfall," he said.
Rea Georgiou: In two phases the implementation of the reform
The Accountant General of the Republic, Rea Georgiou, presented the Strategic Reform Project promoted by the Treasury, in collaboration with the Ministry of Finance, the Public Service Committee, the Department of Public Administration and Personnel and the Department of Informatics.
As he said, the reform revolves around the introduction of a new Enterprise Resource Planning (ERP) information system. The project is divided into two parts: financial management, which is expected to be operational from 1 January 2023 and concerns all accounting work, budget preparation and implementation, market management, revenues and receipts and the management of fixed assets.
The second part concerns payrolls and human resources management and includes the calculation and payment of payrolls and pensions, the management of human resources, leave, placements, promotions, etc. as well as the consolidated database of information for each civil servant. The second phase has an implementation plan in 2024.
As far as the implementation of the accruals base is concerned, as mentioned by the Accountant General, with the introduction of the new system, manual procedures are expected to be computerized and it will be automated by repetitive and time-consuming procedures. In this way, he explained, human resources will be released, which are expected to be exploited in a way that adds value. Additional benefits expected from the reform include better planning capacity for decision-makers, greater transparency in transactions and how the public interest is served, he said.
Finally, he noted that experts from the International Monetary Fund and the OECD, as well as the European Commission and the Deputy Ministry of Research, Innovation and Digital Policy, provide expertise for the project.
In his presentation on the reform of the budget, the Permanent Secretary of the Ministry of Finance George Pantelis referred in particular to the new way of drawing up the budget on the basis of activities through which the objectives and priorities of each economic operator and the activities for the achievement of the objectives are determined.
He noted that the ongoing reform in public finance management is a modern tool for addressing and managing the ongoing challenges.
He also said that the reform is a tool to enhance transparency and more importantly to effectively manage public funds with the ultimate goal of responding to the needs of society and citizens, as well as providing high-quality services.
Red: Towards a holistic digital transformation of the state
In his presentation on the holistic digital transformation of the state, the Deputy Minister of Research, Innovation and Digital Policy, Kyriakos Kokkinos, mentioned that major projects for e-government and investments of €170 million are before the Republic of Cyprus. funded by the Resilience and Recovery Plan. At the same time, he presented the plans of the Deputy Ministry and in particular the plan "the whole public on one screen" for electronic access to all public services which is in the works.
At the same time, he said that at the moment Cyprus ranks 21st in terms of the European Digital Economy and Society Index (DESI) despite the improvement of 3 positions achieved in the 2021 index and the 19th place in e-government out of a total of 27 states.
He said that what keeps Cyprus stuck is the low performance in focusing on e-government towards the user, on simplifying the procedure for the citizen, on the ability of the citizen to access his data and the design of the service for the benefit of the citizen.
At the same time, he noted that the public service has all the ingredients to succeed and increase its performance in this area, while the long journey of reform continues.
Christos Staikouras referred to the experience of Greece
On his part, the Minister of Finance of the Hellenic Republic Christos Staikouras, in an online presence at the conference, referred to the experience of the reform of the Greek public administration. As he mentioned, in 2012-2014 the foundations were laid for a modern approach to public finances in Greece. Since then, he said, significant progress has been made in the country's fiscal budget system, in the areas of long-term planning and budgeting.
The result of the reform was an update of the financial controls, the quantitative and qualitative strengthening of the control mechanisms, strengthening the services of the Treasury that carry out the financial controls, he said.
In addition, the Minister noted that regular, timely and valid information on the progress of the implementation of the budget was established. The institutional shielding of the fight against fraud was established through initiatives and cooperation and, finally, the role of the budget office was upgraded, ensuring its institutional status.
Mr. Staikouras added that the 2022 budget reflects a series of innovations aimed at increasing the efficiency of the state, with the introduction of performance indicators, cost control and increased information and transparency.
"From 2022 citizens will know the total spending per area of operation of the state," he said. He added that with the new innovations, the expenditure and revenue review, which is a key priority of the government, is being implemented in a more prudent way. This is a key fiscal tool for managing the available resources, he said.
He referred to the positive impact of reforms that have been implemented or are to be implemented, such as improving information and supporting more effective control, strengthening accountability in financial management, strengthening information to Parliament and supporting the improvement of parliamentary dialogue on budgetary matters.
In addition, according to him, the reforms will lead to the support of better coordination of the government's work, to the enhancement of the transparency of the budget sectors and, finally, to the strengthening of Greece's international image, for the long-term sustainability of public finances.
