Those who are familiar with my work know that I find common gaps in governance systems in developing countries. My work has focused particularly on public financial management (PFM) systems, where I find that governments often pass budgets better than they execute those budgets.
I have recently been looking closely at India and see this gap between what budgets look like and what kind of spending the budgets actually result in. The gap is most evident when looking at public expenditure and financial accountability (PEFA) data about the quality of legislative engagement (see below and at http://www.pefa.org/en/assessment/mar10-pfmpr-public-en).
- These data show that the Indian legislature does an awesome job reviewing the budget proposal and passing the annual budget law (scoring 'As' on a range of indicators shown below as PI27 i-iv).
- But the legislature does a much worse job in reviewing actual expenditures and holding the executive accountable for its spending (scoring a D+ for PI 28 which assesses the quality of legislative scrutiny of audit reports.
So, the two sides of legislative engagement in India are simple: One side involves the legislature providing amazing analysis of budget proposals, with pomp and ceremony. The other side involves shabby and short-sighted analysis of actual expenditure--the more boring and less flashy side of making sure that government works.
The size of this gap is amazing, and unfortunately reflects the major gap between political promises and government delivery in India. I am pleased and impressed that the PEFA data show this gap. Evidence from assessments like this can help us make governments better...if we use it well.