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Public Expenditure Management Handbook

This handbook provides a framework for thinking about how governments can attain sound budget performance and gives guidance on the key elements of a well-performing public expenditure management (PEM) system. The multiple purposes that budgeting serves - legislative control of the executive, macroeconomic stability, allocations to strategic priorities, managerial efficiency - make budget reform an ongoing task, a pilgrimage more than a destination. For any reform agenda, the handbook highlights the importance of the budget’s interaction with other systems and processes of government. The handbook therefore focuses attention on three key principles that underpin a well-performing public sector: clarity in who has the authority to make what decisions, the matching of authority (flexibility) and accountability, and the capacity and willingness to reprioritize and reallocate resources.