Strengthening Participation in Public Expenditure Management: Policy Recommendations for Key Stakeholders

• Participation by civil society in public expenditure management promises to improve social and economic outcomes while increasing confidence in public institutions. • Participatory budgeting (PB) programmes depend on the effective engagement of three key domestic stakeholders: governments, civil society and legislatures. Participatory budgeting cannot be imposed. • The successful execution of participatory programmes is hampered by serious capacity gaps among key domestic stakeholders. The introduction of PB programmes should be sequenced to reflect different national conditions and policy settings. • Citizen-led participation in budget policy has the potential to improve the effectiveness of nationally driven development strategies such as Poverty Reduction Strategy Papers (PRSPs). • Donors should focus their efforts on investing in increased capacity among all stakeholders, while encouraging political engagement among governments in particular. In its research activities, the Development Centre aims to identify and analyse problems the implications of which will be of concern in the near future to both Member and non-Member countries of the OECD. The conclusions represent a contribution to the search for policies to deal with the issues involved. The Policy Briefs deliver the research findings in a concise and accessible way. This series, with its wide, targeted and rapid distribution, is specifically intended for policy and decision makers in the fields concerned. Widening citizen participation in the process of government is one of the responses to perceived shortcomings in governance in developing and emerging economies. Achieving such broadened involvement, however, is complex and difficult. One effort which is of particular interest is participatory budgeting: the active promotion of citizen involvement in the process of budget design and management. According to this approach, civil society joins with the organs of government and legislatures to set and monitor public spending targets. This simple idea will require goodwill and active cooperation from all partners to be successful. One result could well be renewed faith in the integrity of government and the efficiency of public administration, thus strengthening democracy. Thindwa for sharing their expertise and for helping shape the direction of this brief. Warm thanks are also extended to Helmut Reisen, Colm Foy, Kiichiro Fukasaku and Kenneth Ruffing, and especially to Ulrich Hiemenz, who was a much-valued source of support, ideas and intellectual input. Introduction Participation in public expenditure management — by poor people themselves, or by the civil society organisations and parliaments who represent them — is emerging as a major new arena for …