Saturday | 5 October 2024 | Reg No- 06
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Saturday | 5 October 2024 | Epaper
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Our fiscal transparency in the report of USA

Published : Saturday, 5 October, 2024 at 12:00 AM  Count : 219
MS Siddiqui
Since 2008, in consultation with other relevant US agencies, the US Department of State has been conducting fiscal transparency assessments of governments that receive US foreign assistance.The Fiscal Transparency Report to US Congress on update of the Fiscal Transparency as per "The Department of State, Foreign Operations, and Related Programs Appropriations Act". It is annual review of the fiscal transparency of governments that receive U.S. assistance help ensure U.S. taxpayer funds, are used appropriately and provide opportunities to dialogue with governments on the importance of fiscal transparency. These annual reports are useful for the citizens of Bangladesh and other countriesto assess how transparency of income and expenditure of these nations. 

Fiscal transparency report (FTR) assesses how the government and tax revenues are spent and is a critical element of effective public financial management. Transparency provides citizens a window into government budgets and those citizens, in turn, hold governments accountable. It underpins market confidence and sustainability. FTR is a tool to identify deficiencies and support needed changes. The report describes the minimum requirements of fiscal transparency developed, updated, and strengthened prepared by the Department in consultation with other relevant federal agencies. 

Fiscal transparency is a critical element of effective public financial management, helps build market confidence, and underpins economic sustainability. It fosters greater government accountability by providing a window into government budgets for citizens, helping citizens hold their leadership accountable, and facilitating better-informed public debate.It helps build market confidence, and underpins economic sustainability.  Fiscal transparency fosters greater government accountability by providing a window into government budgets, helping citizens hold their leadership accountable, and facilitating better-informed public debate.

As directed by US Congress, The Office of Macroeconomic Affairs (OMA) of State's Bureau ofEconomic and Business Affairs (EB)evaluates data on fiscal transparency collected of 141 countries(and the Palestinian Authority) those eligible to receive U.S. foreign assistance against minimum requirements and publishes the results on the Department's website annually prepares in consultation with State's Bureau of Energy Resources (ENR) and the U.S. Agency for International Development (USAID) .They assessed the fiscal transparency of the listed governments identified in the 2014 fiscal transparency report plus Equatorial Guinea, determined whether each country met the minimum requirements, and identified measures governments that failed to meet the minimum requirements implemented in order to make significant progress toward meeting the requirements.


The Department of State, Foreign Operations, and Related Programs Appropriations Act, 2022 (SFOAA) defines "minimum requirements of fiscal transparency" to mean the public disclosure of:
"    National budget documentation (to include income and expenditures by ministry) and
"    Government contracts and licenses for natural resource extraction (to include bidding and concession allocation practices).
"    
The 2022 fiscal transparency review process evaluated whether the government publicly disclosed key budget documents, including expenditures broken down by ministry and revenues broken down by source and type.  The review process also evaluated whether the government had a supreme audit institution that meets international standards of independence and audits the government's annual financial statements, and whether such audits are made publicly available.  The review further assessed whether the process for awarding licenses and contracts for natural resource extraction is outlined in law or regulation and followed in practice, and whether basic information on such awards is publicly available.  The Department applied the following criteria in assessing whether governments met the minimum requirements of fiscal transparency.

Fiscal Transparency Report is the latest report of 2022 released in September 2022, 72 countries met minimum requirements and 69 did not. Of those 69, the FTR identified 27 countries that made significant progress towards meeting requirements.It assesses those that did not meet the minimum fiscal transparency requirements and indicates whether those governments made significant progress toward meeting the requirements during the review period of January 1 - December 31, 2021. 

While a lack of fiscal transparency can be an enabling factor for corruption, the report does not assess corruption.  A finding that a government "does not meet the minimum requirements of fiscal transparency" does not necessarily mean there is significant corruption in the government. Similarly, a finding that a government "meets the minimum requirements of fiscal transparency" does not necessarily reflect a low level of corruption.In South Asia, India, Nepal and Sri Lanka met the minimum requirements of fiscal transparency while Afghanistan, Pakistan, Maldives and Myanmar did not.

In the report of 2022, Bangladesh failed to meet minimum requirements of fiscal transparency in the Fiscal Transparency Report (FTR) 2022 published by the US state department.Bangladesh was, however, bracketed among the 27 nations which made significant progress toward meeting the minimum requirements of fiscal transparency but "A determination of 'significant progress' indicates a government satisfactorily addressed a key deficiency in meeting the minimum requirements of fiscal transparency during the review period," said the report.

In government-by-government assessment, the report praised the Bangladesh government for significant progress by publishing its end-of-year report within a reasonable period, making its executive budget proposal and enacting budget widely and easily accessible to the public, including online.

On the other hand, the Comptroller and Auditor General of Bangladesh, failed to meet international standards."The government's supreme audit institution reviewed the government's accounts, but its reports did not contain substantive findings and were not made publicly available within a reasonable period. The supreme audit institution did not meet international standards of independence. The government specified in law or regulation and appeared to follow in practice the criteria and procedures for awarding natural resource extraction contracts and licenses. Basic information on natural resource extraction awards was not consistently made publicly available."

"Information on debt obligations was publicly available. Budget documents provided a reasonably complete picture of the government's planned expenditures and revenue streams, including natural resource revenues."Financial allocations to and earnings from state-owned enterprises were included in publicly available budget documents, the US report further says on the advances made.That information in the budget, it adds, was considered generally reliable, although budget documents were not prepared according to internationally accepted principles.Fiscal transparency fights corruption, fraud and waste, and it facilitates economic growth.

The report proposed four recommendations for Bangladesh to improve the fiscal transparency. These are-- preparing budget documents according to internationally accepted principles, ensuring the supreme audit institution meets international standards of independence and has sufficient resources, publishing timely audit reports that contain substantive findings, recommendations, and narratives and making basic information about natural resource extraction awards publicly and consistently available.

The writer is a Former Non-Government Adviser, Bangladesh Competition Commission and Legal Economist & CEO, Bangla Chemical



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