Covid crisis. War context. Stagflation maybe. What a context to speak about Public Funds Management (PFM) and to consider whether or not we are changing paradigm. Changing times as well with new generation of EU funds, the 2021-2027 financial perspectives. So are we influenced by these funds or just moving forward at National level on our own ? 3 main components to consider:

Performance management

If there’s for sure a breakthrough coming from EU is the use of indicators. Not indicative indicators but driving indicators to consider first. No more ‘activity-input-based’ approach but more results-oriented and outputs-based financing. In short, we don’t finance because it’s eligible and hopefully sustainable but because it’s efficient and effective here and now. Hence the use of common and core indicators from EU with the idea to contribute all together to some strategies and even, to make it a pre-condition of financing. A shift also in the definitions : no more “results” in general but a clear distinction between outputs and results with the idea to start by the end : the change we can bring for people, in terms of use and situation, before considering what king of products and services we are going to finance. That could be a mindset change if everybody from top political to beneficiaries level is accepting the idea that we are financing not “good” or “innovative” projects but the achievement of a change, a concrete one, that we are all able to document. To document it means data, data collection before, during and after implementation. Hence a different culture of programming and communication : indicators and targets first, data then, reporting and collective communication using… IT tools.

The digital way

E-services are all over the place: e-health, e-commerce, e-governance…but have we really changed our set of mind or is-it just business as usual put online? To make really a change, it would mean that IT systems are functioning in an interactive, not to say proactive, way : to inform, to get answers, to provide and get data both ways and to communication on achievements. By opposition to IT tools to get documents and signatures, who is still signing by the way, and store them. At the end of the day, more portals and platforms and less financial management systems. It means also to integrate all dimensions in one : the distinction between administration, financial, technical and indicators systems are a killer : no direct interconnection, vision of the achievements, follow-up of the key deliverables, just list of projects and for each of them documents, costs and administrative data… The big revolution would be to think that the change is brough together, decision makers, civil servants and beneficiaries – with clear allocation of responsibilities and tasks – and not only en chambre by some clever high-level experts.

The participatory approach

At the end of the day that’s the degree of participation and interaction that matters. And it’s a paradox, new PFM is both top-down and bottom-up, it’s more like the song : “upside down, inside out and round and round”. Upside down, because we need a strategy, clear targets, and not wishful thinking, to show a direction. That could be discussed, negotiated, but at one point there must be a direction of change. Inside out, because it needs communication, reporting and sharing of results and gaps to be bridged. Round and round, because the point is not to find some excuses, to blame the context or some particular actors but to move forward, again and again. Hence the importance of advisory groups, focus groups, local action groups and not only syndicates or classical intermediary bodies. It means to involve more at all levels and at all time but directly in line with the strategy.