OPINION: Some of the least developed African nations are leading the way with budget transparency using what is known as “citizens budgets”. These documents, while not the official papers of government, help to translate government fiscal policy into a simple and digestible format that ordinary citizens can engage with.
“Citizen budgets” are often created as a collaboration between civil society groups and government departments. One example of this is in Ghana, where the fiscal process is made more understandable to the general public by producing abridged and user-friendly versions of the budget.
According to the Open Budget Index,the most comprehensive international budget transparency survey, some of the best improvements in budget transparency reform are happening in the weakest ranking countries such as Benin, Burkina Faso, Cameroon, and the Democratic Republic of Congo.
A small amount of improvement in budget transparency can create very large positive impacts for developing nations, in terms of reducing the misuse of money by powerful interests, enhancing the level of trust in government, labelling government priorities and persuading citizens to contribute to the tax base.
Budget transparency is important for several reasons, including fostering higher levels of trust in government, reducing corruption and misuse of public funds, providing greater clarity on policy priorities and creating opportunities for citizens to influence decision-making.
The Open Budget Index shows governments worldwide are increasing the amount of budget information available to the public. If the public is more engaged in the budget process, it encourages and drives economic development, and so this sort of pro-transparency trend bodes well for better economic growth via better institutions.
Some of the best improvements in budget transparency reform are happening in the weakest ranking countries such as Benin, Burkina Faso, Cameroon, and the Democratic Republic of Congo.
But despite the index’s extensive coverage and rigour, it has some glaring limitations. For one, it doesn’t rank Australia, Canada or Japan for budget transparency.
However, in Australia, there has been a longstanding commitment to budget transparency. It’s enshrined in documents such as the Charter of Budget Honesty (1998). Although today considered by some to be a bit out-dated, at the time the charter was at the very forefront of pro-transparency budgetary thinking.
In 2012 Australia created an important political budget institution in the form of a well-staffed Parliamentary Budget Office (PBO). In contrast to other countries, like Canada where the PBO had been brutalised by the former Conservative government, Australia’s budget office has strong institutional arrangements (such as memorandums of understanding) which allow it to undergo costings work without coming into the political line of fire.
Although Canada’s progressive government is thought to be a model for other countries on issues ranging from the treatment of refugees and indigenous people to feminism and citizenship reform; one odd area in which this government has fallen surprisingly short is budget transparency. According to the former head of Canada’s PBO, Kevin Page, the current Trudeau government is actually less transparent than its predecessors about budgeting and its big spending plans.
My previous work shows that PBOs can play an important role in making the budget process more efficient and participatory, and that the PBOs of advanced democracies can play a mentor role to similar offices in developing countries.
The difference between Australia and Canada in budget transparency, countries that are otherwise share a lot of similarities, demonstrates that there is a lot of variation globally.
There is still a great deal to be done worldwide to make national budgets more transparent and accessible for the general public. In many countries, including surprisingly wealthy ones, budget information is simply not shared.
As of yet, the vast majority of the world’s people live in countries that have inadequate systems for ensuring accountable budgets. As a result, much of the fiscal decision-making in the world happens outside the knowledge of citizens, to the detriment of society.
Usman W. Chohan is a Doctoral Candidate, Policy Reform and Economics, UNSW.
This opinion piece was first published in The Conversation.