Financial Management & Implementation Program

The Department of Finance together with the Department of Treasury is undertaking enhancement of the financial framework and the redevelopment and replacement of the financial systems of government. A Programme funded with the assistance of door agencies has been created to manage this major initiative. The mission of the Financial Management Improvement Programme is to implement best practice and transparency in government financial management within and between national, provincial and local level governments in PNGThe Department of Finance together with the Department of Treasury is undertaking enhancement of the financial framework and the redevelopment and replacement of the financial systems of government. A Programme funded with the assistance of door agencies has been created to manage this major initiative. The mission of the Financial Management Improvement Programme is to implement best practice and transparency in government financial management within and between national, provincial and local level governments in PNG

The goals of the Financial Management Improvement Programme are:

• Sound fiscal management.
• Effective decentralisation of financial management.
• Allocation of resources in accordance with government priorities.
• Utilisation of resources to achieve value for money.
• Enhanced accountability and transparency

Operating Environment

The implementation of Financial Management Improvement Programme is being undertaken in accordance with the conditions of the Loan Agreement that outlines the different categories of activities to be funded under the Loan.

Reporting requirements are very fundamental to donors in particular and hence complying with submitting monthly Project Performance Reports and the Quarterly Progress Reports is of paramount importance. The Reports summarise the implementation of the project and risks identified. Strategies are developed to address issues both by Asian Development Bank (ADB) and the Government of Papua New Guinea (PNG).

Through the Programme structure, the FMIP is fully supported and controlled by the Project Steering Committee. The regular monitoring and supervisory role played by the FMIP Implementation Committee on a monthly basis through its meeting is proving successful with various stakeholders involved.

The Government of PNG counterpart funds, through the development budget, are very limited due to other government priorities. Even the release of funds through monthly Warrant Authority for the Project coordinated by the Department of National Planning and Monitoring is based on the cash ceiling set by the Public Debt Committee (PDC).

In summary the key challenges are:

• The Department through FMIP is making every endeavour to agree in principle a suitable platform for the Project to move forward the implementation of a sound communication infrastructure that is reliable and efficient to enable transmission of financial data from provincial site into the General Ledger in headquarters. The Department through FMIP is making every endeavour to agree in principle a suitable platform for the Project to move forward the implementation of a sound communication infrastructure that is reliable and efficient to enable transmission of financial data from provincial site into the General Ledger in headquarters.
• The need to expand the roll out of District Treasury Offices to provide accounting services functions for LLGs is now becoming more urgent than before due to the amendment of the Public Finances (Management) Act 1995.
• Present policy direction of the Government to improve expenditure control in all Departments and Provincial Government Administrations including Local-level Governments with support from donors to examine capacity of agencies to managed and sustain this new initiative.

View the FMIP Management Structure [pdf].