Digitalization for Public Expenditure Accountability and Transparency (d4PEAT)

A re-engineered framework for Public Finance Management in India

Abstract

Reforms in public expenditure management in India, especially in accounting and administrative processes, have lagged behind the reforms in public revenue management. Lack of uniform accounting codes, limited data standards, and standalone systems across different tiers of governments have led to issues related to data comparability, data aggregability, and misclassification of data. In addition, lack of a single source of truth and inadequate end-to-end digital data capture limits the efficiency, tractability, and accountability of public funds. Limited just-in-time fund-flows, where fund disbursals and actual expenditures are not in tandem, further increases the uncertainty in government transactions. This study identifies the touchpoints where mainstreaming digitalization could address these fundamental challenges of public expenditure management through an actionable roadmap in the form of d4PEAT framework. A composite score under d4PEAT framework for each level of government is calculated, which can be used to rank their performances and assess the progress made in mainstreaming digitalization of public expenditure management.  The framework charts a process for debate, suggest areas where policy reforms can be initiated in India, leading to enhancing accountability and transparency in public spending.