Overview of Public Financial Management
The term “public financial management” (PFM) describes the procedures, guidelines, and organizations that governments and other public sector organizations employ to manage public funds. In order to guarantee that public monies are raised and spent in a way that is open, accountable, and consistent with policy aims, it covers the full budget cycle, from planning and budgeting to execution, monitoring, and auditing. Macroeconomic stability, efficient service delivery, and good governance all depend on a functional PFM system.
Achieving fiscal restraint, effectively allocating resources, and guaranteeing the efficacy of public spending are the main goals of PFM. Effective financial management may help governments save waste, fight corruption, and boost public confidence. To increase performance and accessibility, contemporary PFM systems also include components like digital financial systems, results-based planning, and participatory budgeting.
PFM is essential in helping governments meet the demands of their constituents while preserving economic viability in a time when the public has high expectations for accountability and transparency. In addition to assisting with the execution of policies, it also improves economic growth, institutional capacity, and poverty alleviation. Therefore, governments, development partners, and organizations dedicated to inclusive development have made investment in strong PFM systems a strategic priority.
Author: Mohamed Yasin
