Dldp achievements during 2017 in Local Finance Management

SDP&MTBP is fully mainstreamed into the sub legal frame-work of planning and budgeting, achieving an important target of Decentralization Strategy.

Consolidation of new strategic documents has been an important feature of this reporting period, due not only to recurrent documents that have been prepared, but as well as Annual and Medium-Term Budgets or Fiscal packages.

Dldp has contributed to create a model for establishing Accountability and Transparency as basic principles of local democracy exercised at LGU level, by creating the e-Transparency platform on PFM for Municipalities of Shkodër and Durrës and making it accessible for citizens.

Thematic working groups in local finances have been carried forward in a very good cooperation with donors (GIZ and PLGP/USAID) producing concrete results. In PFM sector dldp continued to provide inputs in various consultation platforms for the draft of law on local finances until approval of the law by the parliament in May 2017. To aid Municipalities to prepare MTBP by using the Financial Planning Tool, dldp supported establishment of a help-desk, as a new mechanism established in agreement with MoF, which assures replicability and sustainability of this product.

There have been organized two national events focusing on public finance management: One has focused on the local government annual budget preparation, while the other event was dedicated to the new law on local finances.

Dldp successfully and significantly brought knowledge from both local government practical experience and international expertise into the policy-making processes. In 2017 the Albanian Parliament approved the Law on Local Finances, which was a very successful contribution of dldp and the partner program PLGP.

Achievements during 2014 in Public Finance Management

In the first semester dldp achieved to share and discuss together with experts of Local Government Units two important documents on Local Finance Management compiled in collaboration with local and international experts started from second semester of 2013.

These two important Reports are:

Dldp Evaluation and Monitoring Report regard the support given to LGUs during 2013 in drawing the fiscal package. The report resulted from a thematic evaluation and the impact of related assessment considered only one component of the program, the one of fiscal package. In the frame of fiscal package, the Dldp impact on Strategic Planning and Mid-term Budget Plan relates to respective indicators that serve to monitor these aspects that in the report are stated as indicator of global change

Dldp shared with experts the Revenue Predictability and Sustainability of Local Governments in Albania.  The purpose of this report is to examine the predictability and sustainability of local government revenues in Albania, to identify patterns of income distribution and the potential impacts of structural changes in the intergovernmental tax system.

Findings of these two reports drafting dldp presented in roundtable discussions and drafting national policies in collaboration with the Ministry of Local Affairs and other relevant important actors. Some of the findings and suggestions of the report were reflected in the cross-cutting decentralization strategy.

SDPeMTBP has been shared with IMF, in the frame of IMF engagement in the process of drafting Albania’s PFM country strategy.

During the 2014 dldp 3 regional training on Financial Planning Tool (FPT) with SDPeMTBP for the new Qarks (Durrës, Kukës and Dibër) have been held. A Memorandum of Understanding between ASPA and dldp, and the joint plan of activities has been signed. The training curricula and methodology as well as the list of experts that conducted these training sessions has been approved by ASPA and curricula has been recognized by MoF.

FPT have been filled for Municipality of Shkodër and LGU experts were coached on job during the last 3 months (after TAR is implemented, 12 LGUs will benefit from the FPT of Municipality of Shkodër). 2 FAP concepts will be linked MTBP in the area of Malësi e Madhe (integrated MTBP for 6 LGUs) and Lezhë (integrated MTBP for 10 LGU).

Achievements of dldp phase II

In the area of PFM, dldp developed in its 2nd phase the SDPeMTBP approach, where “SDP” stands for strategic development planning, “MTBP” for medium-term budgeting based on a performance oriented program structure and “e” represents the excel-based financial planning tool (FPT) elaborated to facilitate coherent financial plans for the medium term in a combined top-down and bottom-up process. The SDPeMTBP approach was elaborated in full compliance with the legal budgeting requirements of Albania, especially taking into account law No. 9936, enacted in 2008, “On the management of budgetary system in the republic of Albania”. However, at the beginning of dldp2, the concept of MTBP, required by low No. 9936 in its article 26, was rather unclear for most of the stakeholders at local level.

• The SDPeMTBP approach was fully tested and applied in 8 LGUs up to 2013
• It is noticeable that LGUs supported by dldp fulfil the requirements on the comprehensiveness to a great extent (90% compared to 38% to non-dldp), are clearly better ranked in the identification of planning risks in the MTBPs (dldp LGUs 89% / non-dldp 38%), and information on the debt stock (dldp LGUs 90%, non-dldp 55%), while there is even a bigger difference in available program information (dldp 100% / non-dldp 18%).
• Transparency and participation in policy planning and budgeting: The results from the thematic evaluation for transparency in policy planning and participation ranked more than 60% of the LGUs supported from dldp as good or even excellent with rates A or B on a scale from A-D.
• SDPeMTBP approach is increasingly used in the LGUs of Shkodra and Lezha. New SDPs were elaborated or updated with support of dldp, the formal quality of the MTBP improved considerably and in addition, the financial planning tool FPT was finalized and successfully used.
• dldp is regularly consulted by the directorate of inter-governmental fiscal relations of the MoF before the budgeting guidelines are issued, and the input of dldp is taken into consideration in many cases. Furthermore, the MoF fully stands behind the financial planning tool FPT, and is promoting its application countrywide. Finally, the directorate for intergovernmental fiscal relations crosschecked and supported the finalization of the training handbook on strategic development planning and performance-based budgeting in the medium-term.