Implementing Results-based budgeting in the Ministry of Defense of Peru
Webb, Natalie J.
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Leaders of the Peruvian Ministry of Defense (MINDEF), at the direction of national lawmakers and the Ministry of Economics and Finance (MEF), have begun a process to implement a results-based budget (RBB). A change in national law prompted the current transition from an input (cash)-based, one-year, non-transparent budgeting system with few links between strategy and execution, to a system linking measurable results to corresponding budgets. Current efforts are underway to structure processes and information systems to assist in linking defense expenditures to goals and desired outcomes. This paper evaluates the Peruvian MINDEF’s efforts to implement RBB. We argue that the current processes of planning and budgeting in the MINDEF and military institutions have significant problems in several areas; if MINDEF leaders are unsuccessful in overcoming these obstacles then the benefits normally attributed to implementing RBB may not occur. We examine strategic guidance from the government and the MEF’s implementation of RBB in all government organizations, neither of which focus on defense actions and outcomes. We note that no centrally coordinated effort or “champion” exists within the MINDEF to implement RBB, which leads to significant disparities in comprehension, organization, and implementation among the defense institutions. We also observe no consistent method, data collection and information tracking within the MINDEF, and little communication among officials. With continued pressure on national and especially defense budgets, and pressure on the armed forces to show their value, continuing an unsound implementation could have national and international ramifications given the increase in Latin America’s security concerns.
The article of record as published may be located at http://dx.doi.org/10.2139/ssrn.2084784
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