PEFA is a methodology for assessing public financial management performance. It identifies 94 characteristics (dimensions) across 31 key components of public financial management (indicators) in 7 broad areas of activity (pillars).
The PEFA program provides a framework for assessing and reporting on the strengths and weaknesses of public financial management (PFM) using quantitative indicators to measure performance. PEFA is designed to provide a snapshot of PFM performance at specific points in time using a methodology that can be replicated in successive assessments, giving a summary of changes over time.
The Strengthened Approach to Supporting Public Financial Management Reform
The PEFA Program builds on the principles of the Strengthened Approach to Supporting Public Financial Management Reform which is embodied in three components and closely aligned with the Paris Declaration on Aid Effectiveness; the Accra Agenda for Action; the Busan Partnership Agreement, and the Addis Ababa Action Agenda:
- A country-led agenda: a government-led reform program for which analytical work, reform design, implementation and monitoring reflect country priorities and are integrated into governments' institutional structures;
- A coordinated program of support from donors and international finance institutions in relation to both analytical work, reform financing and technical support for implementation;
- A shared information pool on public financial management: information on PFM systems and their performance which is commonly accepted by and shared among the stakeholders at country level, thus avoiding duplicative and inconsistent analytical work.
The goals of the PEFA Program are to strengthen capacities to assess the status of country PFM systems and develop a practical sequence of reform and capacity development actions, in a manner that:
- Encourages country ownership;
- Reduces the transaction costs to countries;
- Enhances donor harmonization;
- Allows monitoring of progress of country PFM performance over time;
- Better addresses developmental and fiduciary concerns;
- Leads to improved impact of reforms.
Evaluation of the PEFA Program
During 2016, the PEFA Program went through a rigorous evaluation covering the governance of the program but also its impact and relevance. Click here to read the report in full and click here for the management response to the evaluation.