Good Financial Governance, I and II

IP Wave

Country: Mozambique

Client: GIZ

Project Duration: 01/2015 - 06/2019

Value of Service: 5,701,237 €

Territory wise, Mozambique is a state predominantly with rural characteristics. Therefore, a decentralized and functioning system of public finances is an important prerequisite in order to provide the population in remote areas with public services and infrastructure for economic development. An effective system of public finance at the sub national level is still under developed. Districts and municipalities are lacking financial resources. They often exceed their budgets and do not implement the budget according to the plans. The social control of local government by civil society organizations is still weak. Existing opportunities for political participation are underused.

The system of internal control is fragmented and responsibilities are distributed among various institutions without a clear division of functions. Furthermore, the Court of Auditors (Tribunal Administrativo) insufficiently communicates the results of auditing only to Parliament, the media and citizens in general. This state of affairs results in the following core problem: The districts and municipalities show deficits in their financial management, as they neither manage their resources sustainably, nor sufficiently accountable. The program’s module objective is: Districts and municipalities manage their resources according to the principles of Good Financial Governance, they are more effective, economically more sustainable and more accountable.

The GIZ-Program for “Good Financial Governance” develops capacities at district, provincial and national levels (multilevel approach). Advise will be provided along the following three fields of activity, at the different intervention levels: i) increase in availability of resources at the local level, ii) improvement of the effectiveness and efficiency in the use of resources and iii) Strengthening of the capacity of the internal and external control on individual, organizational and structural levels. The project operates in the capital city of Maputo and in the focal provinces of German development cooperation namely Sofala, Inhambane and Manica.

Main Services Provided:

  • Advice on institutional reform and development of Supreme Audit Institution, strengthening of external control, linkage between internal and external control system, communication of audit results
  • Assistance to responsible ministries in revising and updating policies, strategies and other legal instruments relevant for the procurement of public infrastructures, goods and services
  • On-the-job training and technical advice in the areas of local revenues, budget planning and execution as well as procurement
  • Strengthening of dialogue between relevant institutions at central and local level regarding fiscal decentralization
  • Development of training curricula and capacity development of public training institute