No More Budget Overspending?

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By Mbatjiua Ngavirue WINDHOEK The introduction of the Integrated Financial Management System (IFMS) means overspending by government departments should become a thing of the past. Minister of Finance Saara Kuugongelwa-Amadhila held out this hope when officially launching the new IFMS system on Friday. She said IFMS has in-built mechanisms for financial monitoring and control that will make overspending an issue of the past. “In other words, no payments will be issued for any activity when money for such an activity is not available,” she vowed. The new IFMS is based on software developed by Oracle Corporation, and was specially customised to meet the unique requirements of the Namibian government. The system was developed together with Oracle’s Middle East and Africa headquarters in Dubai, local implementing partner Silnam and had significant input from Namibian government employees. According to Kuugon-gelwa-Amadhila, the old system was not designed to empower government offices, agencies and ministries to efficiently manage public expenditure. From a control point of view the fragmented funds control system did not have in-built mechanisms to control expenditure with the result that overspending was commonly experienced. The old system did not generate management reports for informed decision-making, and expenditure information only became available long after the event. In 2002 the decision was therefore taken to develop an integrated financial management system, leading to the start of the IFMS project in 2003. The implementation of IFMS made such significant progress that some government agencies were able to start a pilot scheme to test the functioning of the system in 2005. Between November 2005 and March 2006 pilot tests were carried out at the Office of the Auditor-General, and ministries of Agriculture, Defence and Finance. The pilot exercises proved by and large successful, making it possible for all other offices, ministries and agencies to start using the system from April 2006. Other highlights of the new system mentioned by Kuugongelwa-Amadhila include providing timely and reliable information useful for monitoring and evaluating patterns of public expenditure. Real-time data will enable offices, ministries and agencies to reconcile their accounts, as well as the Ministry of Finance to close the books, on time. “I look forward to the day when the Auditor-General’s reports are tabled more speedily so as to improve our accountability in parliament,” she remarked. The system will also enable Cabinet ministers to hold accounting officers accountable for current expenditure performance, rather than historical records. The IFMS is said to have security features that make it difficult for staff members to manipulate the system. Deputy Minister of Finance Tjekero Tweya also emphasised the IFMS system was customised to suit the size and unique requirements of the Namibian government. According to Tweya, these unique requirements resulted in the Namibian government adopting 15 modules, of which eight are custom-developed modules while the other seven are standard Oracle applications. The Namibian input into the system came from so-called Core-team member public servants from across the government system. Tweya said it was the core-team members who defined the requirements of the system, and made sure it adheres to the State Finance Act and Treasury Instructions. Auditor-General Junius Kandjeke said the previous financial management information system used for both managing public financial resources and decision-making in government was inadequate. The system failed to sufficiently support controls and transparency in financial management processes and reporting. This had undermined government’s ability to strategically manage public financial resources. He therefore thanked government for deciding to implement the IFMS to alleviate these shortcomings.