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MTEF Documents

The documents collected and presented in this section are real examples of MTEF documents prepared and used by countries in the world. They are examples of technical MTEF documents produced by the governments implementing MTEF.

Abstract

Provisional Institutions of Self-Government, Ministry of Economy and Finance. 2006. Kosovo 2006-2008 Medium-Term Expenditure Framework.

The Government of Kosovo and the Special Representative of the Secretary General (SRSG) are pleased to present the Kosovo 2006-2008 Medium Term Expenditure Framework. Unlike previous Government economic documents, this document seeks to reconcile the Government’s budget plans and policies with its economic and social policies and needs. That is, it seeks to integrate the Government’s top economic and social priorities with the fact of severe budget restraint as the Government engages in status talks with the international community. The Medium Term Expenditure Framework is, effectively, an expanded version of the Medium Term Budget Framework. It seeks to establish an economic and social context for the preparation of the Kosova budget in the next three years, 2006-2008. In addition to providing Government-wide budget expenditure targets for the next three years, it provides a context for preparation of future Government budgets by placing all spending in the context of five sectors: economy/infrastructure, public security, education and culture programs, health and welfare, and public services. The Medium Term Expenditure Framework includes a comprehensive list of capital projects from the public investment program (PIP) for each of the above five sectors.

 


Republic of Albania, Ministry of Finance. 2000. Medium-Term Expenditure Framework 2001-03. Revised Version. Tirana, Albania.

The MTEF is an initiative of the Government of Albania to strengthen budget planning and achieve a more effective use of public resources. It aims to ensure aggregate fiscal discipline over the medium term, to provide a framework for the strategic prioritisation of public expenditure that links government policies to expenditure plans, and to facilitate technical efficiency in the use of budget resources. By making proposals in the context of a three-year forward budgetary planning period, the MTEF also focuses on the strategic shifts in resource allocations that will need to be implemented over the medium term while providing a stronger basis within which line ministries can plan their expenditure programmes. The preparation of the MTEF is closely linked with the preparation of the Growth and Poverty Reduction Strategy (GPRS). The MTEF both provides the framework against which the public expenditure implications of the GPRS can be evaluated, and provides the mechanism for ensuring the resulting expenditure proposals are integrated into the budgetary process. The MTEF analysis covers both recurrent and investment expenditure, including public investment projects financed from external sources. The recently completed 2000-03 Public Investment Programme (PIP) therefore forms an integral part of the MTEF, and its approval by the Government is sought concurrently with approval of the MTEF. The MTEF presents a rolling programme that will be revised and updated annually during the first half of each year as an integral part of the annual budget planning cycle. This initial MTEF was prepared against a tight deadline that severely limited the scope and depth of its analysis. Consequently, the resource allocation proposals for 2001-03 are relatively conservative. Further detailed analysis is required so that more specific and far-reaching recommendations can be made. In future years, therefore, the Ministry of Finance (MoF), in co-operation with line ministries, plans to start work on preparation of the MTEF considerably earlier and to commit increased staff resources to the exercise.


Republic of Armenia. 2006. 2006-2008 Medium Term Public Expenditure Framework. Yerevan, Armenia.

Budgeting in the Republic of Armenia has been implemented, as a rule, on an annual basis. However, for a higher-quality definition of public expenditure policy, there is also need for considering the expected developments in the macroeconomic environment, the scope of available budgetary resources, and the expenditure needs of Government programs over the medium-term (and over the long-term, if possible). In terms of public expenditure management, budgets developed and executed on an annual basis have certain limitations. In particular, they are based on short-run macroeconomic forecasts; there is no clear-cut linkage between the implemented policies and the annual budgetary expenditure due to the timing inconsistency and, as a rule, supervision is focused not on the anticipated outcomes (and the quality of provided services), but on the amount of expenditure. The practice of including application and development of the medium-term public expenditure framework into the budgeting process appears to be a relevant instrument for improving the situation. The main objective of the medium-term public expenditure framework is enhancement of the efficiency of the public expenditure management system.


Republic of Armenia. 2002. Medium Term Expenditure Framework 2003 – 2005. Yerevan, Armenia. or Ministry of Finance and Economy website

As part of the government’s objective to reduce poverty, the Armenian Government developed a strategic program with participation of different level of public officials, various NGOs and independent experts, and introduced the medium-term expenditure programming into the budgetary process as an important step towards comprehensive solution of the problem. The development of the 2003-2005 MTEF was closely associated with the budgetary process focusing mainly on such strategic areas of economic development as education, health, social safety net, and water resources. The clear identification of the medium-term expenditure framework within the overall budgetary process also indicates the political importance of this document, the improvement of transparency of the authorities’ policies in the sphere of public finances. The comprehensive and coordinated medium-term expenditure framework should become a core strategic document, on which major negotiations on contraction of foreign financing could be based.


Republic of Namibia. (no date) Medium Term Expenditure Framework for 2005/06 – 2007/08, and Revenue, Income and Expenditure Estimates for the Financial Year 2005/06 Presented to Parliament. Ministry of Finance. Namibia.

The MTEF is the key budget document that sets out Government’s expenditure plans for the next three financial years. The prospective revenues available, the Government’s fiscal stance and its debt management together determine the overall expenditure limits for the coming three years. Within these expenditure limits, resource allocations to Ministries and their respective programmes are then determined by expenditure policies and priorities. Each of the Ministries produces a Medium Term Plan (MTP) setting out the total resources allocated to each programme, the main activities to be undertaken and how those will help meet the Government’s objectives. The document provides the basis for greater transparency and accountability by demonstrating what the Government seeks to achieve. The Medium Term Plans (MTPs) set out the total resources allocated to each programme, the main activities to be undertaken and how they will help to achieve Government’s objectives. The MTPs also link expenditure to changes in outcomes in terms of socio-economic variables, as recorded in the Performance and Effectiveness Management Programme. Through MTPs Government is able to prioritise spending over the medium term. Section 8 contains the MTPs for each vote.


Republic of Namibia. (no date) Medium Term Expenditure Framework 2003/04 – 2005/06. Ministry of Finance, Namibia.

This is Namibia’s third Medium Term Expenditure Framework (MTEF) and the first to be based on cash (nominal) expenditure ceilings set in the previous year’s Budget. As such, it represents an important step on the road towards budgetary reform by making government financial planning more accountable and transparent. The design of Namibia’s Medium Term Expenditure Framework reflects the duty placed on the Cabinet by our Constitution to “formulate, explain and assess” the Budget. The MTEF enables Parliament and the Namibian people to understand the Budget and the contribution it makes to the realisation of the country’s development objectives. The MTEF sets out: the macro-economic context within which the Budget is determined; the fiscal policies underpinning the Budget; central government revenue projections for the next three years; cash (nominal) expenditure ceilings for the next three years; and outcome and performance measures for each Ministry.


Republic of Namibia. 2002. Medium Term Expenditure Framework 2002/03 – 2003/04. Ministry of Finance. Namibia.

The MTEF document sets out Government’s fiscal policy, in the context of global, regional and local economic developments. It outlines revenue and expenditure policies underlying the budget and the MTEF formulation process and presents aggregate estimates for Government revenue, expenditure, budge deficit and debt developments for the medium term. A Performance and Effectiveness Management Programme underlies the Government’s endeavour to strengthen public expenditure management by improving links between planning, policy formulation and budgeting and enabling strategic and responsible resource allocation.


South Africa, Financial and Fiscal Commission. 2003. “Towards a Review of the Intergovernmental Fiscal Relations System” Submission Medium-Term Expenditure Framework 2004-2007. Midrand, South Africa.

The Commission in this submission discusses key issues for consideration in the review of the functioning of the intergovernmental Fiscal Relations System (IGFRS) which will obviously be on the agenda in 2004. This submission builds on previous recommendations for the 2001/04 MTEF cycle and the subsequent submission on the Division of Revenue for 2002/03 and 2003/04 and responds to various comments by the Minister of Finance, Parliamentary Committees and the Budget Council.


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