Weaknesses in public financial management (PFM), such as fragmented public accounts and inadequate capacity in budget monitoring and execution, posed risks to governance and anti-corruption efforts in the Philippines. The Government of the Philippines had worked with the World Bank and other donors – notably AusAID – to strengthen PFM by helping officials develop a PFM reform roadmap. Initial pillars of the reform agenda were to create a Government-Integrated Financial Management Information System (GIFMIS) for real-time control and reporting of financial transactions, and to establish a Treasury Single Account (TSA) for consolidated control of funds and automated fund transfers. However, Filipino officials lacked the know-how to develop a TSA, and feared making mistakes. Filipino officials had heard about Russia’s experience of transitioning to a TSA at a Bank-supported regional workshop in Manila in 2010, and chose to engage in a study tour to Russia. On this tour, they explored how a mature TSA system operates, whether it can work in the Philippines, and how to build a consensus on next steps.
During a five-day study tour in October 2011, nine officials from the Philippines’ Department of Finance, Bureau of the Treasury, Department of Budget and Management, and Commission on Audit visited Moscow to learn about Russia’s TSA and core PFM functions, including budget preparation and execution, treasury cash management, revenue administration, and reporting and auditing. Delegates also met with the Federal Treasury Department in the Vladimir Region to understand how the TSA supported local government operations.
The visit was crucial in reinvigorating a stalled reform process. It enhanced delegates’ confidence and commitment to reform and allowed them to envision what was possible in the Philippines. After the exchange, delegates established a Working Group to promote reforms and developed an Action Plan outlining next steps for supporting a TSA.
Participants praised the visit for its transfer of know-how and role in building ownership over reform. Gil Beltran, the Undersecretary of the Department of Finance, noted after the visit that “A TSA would make for easier decision-making and would make the job for the Bureau of the Treasury much easier,” and suggested that “If Russia with its population of 150 million could do it, why can’t we?”