Africa Region Working Paper Series No. 28 Medium Term Expenditure Frameworks: From Concept to Practice. Preliminary Lessons from Africa Philippe Le Houerou and Robert Taliercio February 2002 Abstract   Medium Term Expenditure Frameworks (MTEFs) are receiving renewed attention in the context of the formulation of Poverty Reduction Strategy Papers (PRSPs). Conceptually, MTEFs are the ideal tool for translating PRSPs into public expenditure programs within a coherent multiyear macroeconomic and fiscal framework. But do MTEFs work in practice? With a view to drawing preliminary lessons from experience, this paper undertakes a comparative assessment of the design and impact of MTEFs on public finance and economic management in nine African countries. Based upon this assessment, it offers recommendations and practical guidelines for improving both design and implementation of MTEFs, and sets out a framework for further evaluation. The paper concludes that MTEFs alone cannot deliver improved PEM in countries in which other key aspects of budget management, notably budget execution and reporting, remain weak. The study, therefore, recommends that comprehensive, detailed diagnoses of budget management systems and processes precede MTEFs, in order to ensure appropriate design of reform programs. In countries with weak capacity, in which a full-fledged MTEF, which should be seen as a package of bundled reforms, cannot be introduced all at once, the paper proposes guidelines for sequencing the overall PEM reform program and phasing in its MTEF-specific components. It further recommends that in order to have an impact, the MTEF should be integrated with the budget process from the start, with the MTEF outer year projections published as part of the budget document. Though each country’s situation is distinct, it suggests that these reforms are best managed by a set of overlapping, mutually reinforcing organizational structures, some of which should be specifically established to handle the MTEF, though the Ministry of Finance should have ultimate responsibility. And lastly, it stresses that political motivations and incentives for launching MTEFs explain in part why the MTEF has been more successful in some African countries than others.   Full text of paper. (158KB, In Adobe Acrobat format. Requires Acrobat PDF viewer)

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