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    Outcome Based Budgeting in Malaysia

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    This document provides an overview of Outcome Based Budgeting (OBB), an integrated approach to public sector performance management and budgeting implemented in Malaysia. It discusses factors considered in OBB such as linking national priorities to ministry activities using a results framework. OBB aims to improve accountability, flexibility and delegation through an integrated approach that aligns planning, budgeting, monitoring and evaluation. The implementation of OBB in Malaysia involved various phases from 2010-2015 to fully roll it out across ministries and refine related systems and processes. Key challenges in implementing OBB included changing organizational culture and roles, as well as developing sustainable capacity and IT systems to support performance management.

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    Outcome Based Budgeting in Malaysia

    Uploaded by

    keysp
    2K views22 pages
    This document provides an overview of Outcome Based Budgeting (OBB), an integrated approach to public sector performance management and budgeting implemented in Malaysia. It discusses factors considered in OBB such as linking national priorities to ministry activities using a results framework. OBB aims to improve accountability, flexibility and delegation through an integrated approach that aligns planning, budgeting, monitoring and evaluation. The implementation of OBB in Malaysia involved various phases from 2010-2015 to fully roll it out across ministries and refine related systems and processes. Key challenges in implementing OBB included changing organizational culture and roles, as well as developing sustainable capacity and IT systems to support performance management.

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    This document provides an overview of Outcome Based Budgeting (OBB), an integrated approach to public sector performance management and budgeting implemented in Malaysia. It discusses factors considered in OBB such as linking national priorities to ministry activities using a results framework. OBB aims to improve accountability, flexibility and delegation through an integrated approach that aligns planning, budgeting, monitoring and evaluation. The implementation of OBB in Malaysia involved various phases from 2010-2015 to fully roll it out across ministries and refine related systems and processes. Key challenges in implementing OBB included changing organizational culture and roles, as well as developing sustainable capacity and IT systems to support performance management.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    2K views22 pages

    Outcome Based Budgeting in Malaysia

    Uploaded by

    keysp
    This document provides an overview of Outcome Based Budgeting (OBB), an integrated approach to public sector performance management and budgeting implemented in Malaysia. It discusses factors considered in OBB such as linking national priorities to ministry activities using a results framework. OBB aims to improve accountability, flexibility and delegation through an integrated approach that aligns planning, budgeting, monitoring and evaluation. The implementation of OBB in Malaysia involved various phases from 2010-2015 to fully roll it out across ministries and refine related systems and processes. Key challenges in implementing OBB included changing organizational culture and roles, as well as developing sustainable capacity and IT systems to support performance management.

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    At a glance
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    The key takeaways from the presentation are that it discusses Outcome Based Budgeting (OBB) as an integrated approach to public sector performance management in Malaysia. It outlines the factors considered under OBB, describes how OBB uses the Logic Model for an integrated approach, and discusses the implementation journey and challenges of OBB.

    The main budgetary reforms discussed in the presentation include the shift from incremental line item budgeting to program performance budgeting, increasing accountability, flexibility and delegation through disaggregated budgets and budget ceilings, and integrating the approach through alignment of budgeting and results reporting.

    The presentation describes using the Logic Model as part of an integrated approach to OBB, where planning for outcomes leads to budgeting for outcomes which then enables monitoring and evaluation and results reporting in an ongoing strategic cycle.

    Outcome Based

    Budgeting
    an integrated approach to public
    sector performance management in
    Malaysia

    National Budget Office


    Ministry of Finance
    Malaysia
    28 August 2014

    www.themegallery.com

    LOGO

    Outcome Based
    Budgeting
    an integrated approach to public
    sector performance management

    Presentation
    outline
    1
    2
    3
    4
    5

    Performance management & budgetary


    reforms
    Factors taken into consideration under
    OBB
    Integrated approach to OBB using Logic
    Model
    OBB implementation journey
    Critical Success Factors & Challenges in
    implementing OBB
    2

    Performance Management in Public Sector


    Setting National
    Priorities &
    Goals

    Revenue
    policy
    Macroeconomic
    Planning
    MTF

    Debt
    policy

    Summative
    Evaluation
    Formative

    Program
    Rectification

    Program
    Delivery

    Results
    Based
    Budget
    Formulation

    Program
    Implementation
    Performance
    Monitoring
    & Reporting

    Outcome
    planning
    Performance
    Budgeting

    Delegation and
    accountability
    Expenditure
    Management

    Budgetary Reforms in Malaysia

    l
    a
    n
    o
    i
    t
    Tradi57 19
    1969

    Detailed
    Controls &
    Discipline
    Incremental
    line item
    budgeting

    P P BS

    1969
    1990

    Programs &
    Performanc
    e
    Program
    Performance
    ProgramActivities
    Performance
    Indicators
    Monitoring
    & Evaluation

    MBS-

    1990
    2013

    Accountabili
    ty,
    flexibility &
    delegation
    Disaggregat
    ed Budget
    Budget
    Ceilings
    Program
    Agreements
    Exceptions
    Reporting
    Monitoring
    & Evaluation

    OBB

    a te
    d
    3
    201
    Integrated
    Approach
    Integration
    Alignment
    Budgeting
    for results
    Results
    Reporting
    Monitoring
    & Evaluation

    Presentation
    outline
    1

    Introduction

    Outcome Based Budgeting


    Integrated approach to OBB using Logic
    Model
    OBB implementation journey

    Challenges in implementing OBB

    Why Change was required??


    Greater demand for quality results
    Need to rationalise government expenditure &
    improve public sector services delivery
    Government has identified six transformation
    levers:
    Systematic
    monitoring and
    evaluation
    system
    Accountability
    in the public
    sector and
    authority over
    resources

    Focus on
    outcomes

    SIX
    LEVE
    RS
    Coordination
    of operating
    and
    development
    budgets

    Vertical
    alignment of
    national
    priorities and
    ministry
    activities
    Managing cross
    cutting
    initiatives

    OBB Strategic Cycle


    Planning
    for
    Outcome

    Performance
    reporting and
    policy
    formulation

    Results
    Reporting
    Managing
    information for
    monitoring,
    evaluation and
    decision support
    system

    Developing
    the strategic
    Results
    Framework
    for the
    Ministry

    Budgeting
    for
    Outcome

    Monitoring
    &
    Evaluation

    Preparing the
    resource
    requirements
    to drive the
    ministry
    results

    OBB plays a key role in linking the national


    transformation pillars from implementation
    to RESULTS
    TRANFORMATION
    PILLARS
    Governmen
    t
    Transforma
    tion
    Programme

    OBB ENVIRONMENT

    RESULTS

    Planning
    Planning for
    for
    Economic
    outcome
    outcome
    Transformati
    on
    Budgeting
    Budgeting
    Results
    for
    for
    Programme
    Reporting
    Reporting
    Outcome
    Outcome

    Strategic
    Reform
    M&E
    M&E
    Initiatives
    National Key
    Economic
    Strategic
    Areas
    management

    tool
    for managers at all
    levels
    Structured
    mechanisme linking
    national planning to
    Malaysias
    Medium-term
    implementation at
    Plan
    (10th &
    agencies
    11th Plan)
    Vertical
    alignments
    Horizontal

    VISION 2020

    National Results Framework


    STR. THRUST 1

    Creating the
    Environment for
    Unleashing
    Economic Growth

    STR. THRUST 2

    Moving towards
    Inclusive SocioEconomic
    Development

    STR. THRUST 3
    Developing and
    Retaining a FirstWorld Talent Base

    TERAS
    STR. THRUST 4
    STRATEGIK
    Building an4
    Environment that
    Enhances Quality of
    Life

    TERAS
    STR. THRUST 5
    STRATEGIK 5

    Transforming
    Government to
    Transform Malaysia

    KRA 1
    KRA1

    KRA 1

    KRA 1

    KRA2

    KRA 2

    KRA 2

    KRA3

    KRA3

    KRA3

    KRA4

    KRA4

    KRA 4
    KRA 5

    KRA5

    KRA 1

    KRA 2

    KRA 2

    KRA 3

    KRA3

    KRA 4

    KRA 4

    KRA5
    KRA 6

    5 National
    Outcomes

    4 National
    Outcomes

    5 National
    Outcomes

    6 National
    Outcomes

    4 National
    Outcomes

    5 National
    Programmes

    6 National
    Programmes

    5 National
    Programmes

    10 National
    Programmes

    4 National
    Programmes

    Source: EPU

    Programme-Activity Structure

    10th

    National
    Results
    Framework

    10th

    Strategic
    Thrusts
    Malaysian Plan
    KRAs
    Malaysian Plan
    Outcomes

    National Programmes

    Outcome
    1
    Min. Prog. 1

    Activity
    1

    S/Activi
    ty

    Activity
    2
    Proje
    ct

    Outcome
    2

    Outcome
    3

    Min. Prog. 2

    Activity
    3

    Outcome
    n

    Min. Prog. 3

    Activity
    5

    Activity
    4
    SubActivity

    Activit
    yn

    Activity
    7
    Activity
    6

    Proje
    ct

    Mini. Prog. n

    Activity
    8
    SubActivity

    Proje
    ct

    Ministry level Results


    Framework

    Ministry

    Integrated approach under OBB


    Vertical alignments
    Horizontal linkages
    Integrated budgets

    National level
    National Strategic Thrusts
    National Outcome
    Key Performance Indicator
    National Programme

    Ministry level
    Ministrys Outcome
    Key Perf. Indicator
    Programme
    Programme level
    Prog. Outcome
    KPI
    Activity

    Programme level
    Prog. Outcome
    KPI
    Activity

    NRF

    Ministry level
    Ministrys Outcome
    MES Key Perf. Indicator
    Programme
    Programme level
    Programme level
    Prog. Outcome
    Prog. Outcome
    KPI
    KPI
    PPM
    Activity
    Activity
    F

    Activity level
    Activity level
    Activity
    Activity level
    re level
    e level
    a
    r
    Activity
    level
    Activity
    Activity
    level
    Activity
    level
    s
    Activity Outcome
    Activity
    Outcome
    Activity Outcome
    tActivity
    s a Outcome
    e
    t
    Activity
    level
    Outcome
    Outcome udg ilActivity
    Outcome
    Activity
    Outcome
    t
    Activity

    ge Activity
    KPI
    KPI
    KPI
    KPI
    t
    d
    l
    B
    APM Activity
    Outcome
    buActivity
    ui KPI Output
    KPI Output
    KPI Output
    Activity
    KPI Output
    Bu b
    Activity
    Activity
    KPI Output
    F Activity
    Output
    Output
    Output
    Activity
    Activity
    Activity
    PI
    PI
    PI
    PI
    Output
    PI
    PI
    PI
    Activity
    PI
    PI
    1

    Presentation
    outline
    1

    Introduction

    Outcome Based Budgeting


    Integrated approach to OBB using Logic
    Model
    OBB implementation journey

    Challenges in implementing OBB

    Linear Logic Model

    Implementation
    Outcomes are the
    changes we bring to a
    problem or need
    situation

    INPUT
    We have a
    tendency to
    focus on
    Inputs

    PROCESS

    OUTPUT

    and outputs
    are
    assembled
    based on
    inputs

    OUTCOME
    The focus
    should be
    on
    Outcomes

    When Planning
    1

    Outcome Needs/Problem Triangulation

    NEEDS &
    PROBLEMS
    ANALYSIS

    OUTCOMES

    Addressing Needs and


    Problems
    1

    FEDERAL TREASURY
    (NATIONAL BUDGET OFFICE)

    NOVEMBER
    Determination of ET by Treasury

    JANUARY
    Call Circular
    for New Year
    Estimates

    BUDGET CYCLE

    March

    Receive submissions
    and BRO makes
    Individual Study

    Agencies Prepare
    and Submit New
    Year Estimates

    MAY-JULY
    Budget
    examination

    APRIL
    Preliminary
    Analysis

    JULY - AUGUST
    Approval of New Year
    Estimates by the Minister of
    Finance and Cabinet

    SEPTEMBER
    Budget Document
    Printed and submitted
    to Parliament

    Disbursement/Reporting
    by Accountant General

    Budget Execution
    by Agencies

    END OF DECEMBER
    Minister of Finance issues
    Warrant of Expenditure

    SEPTEMBER-DECEMBER
    Parliament Debates and
    Approves New Year Budget

    Presentation
    outline

    Performance management & budgetary


    reforms
    Factors taken into consideration under
    OBB
    Integrated approach to OBB using Logic
    Model
    OBB implementation journey

    Challenges in Implementing OBB

    1
    2
    3

    OBB Implementation Journey


    2014 - 2015
    Continuous data
    quality
    2012-2013
    refinement
    OBB Policy
    Focus on
    Circular
    2010 - 2011
    monitoring &
    Roll out of OBB
    performance
    Developed OBB to all ministries
    reporting
    Conceptual
    (Parallel in 2012) Initiate COE &
    Framework
    evaluation cycle
    Data validation
    Awareness
    to be
    & refinement
    operational
    Programs
    (selected Min
    Budget prep. for
    Capacity
    initiative)
    2016 to be fully
    Building
    Strengthening
    OBB compliant
    (Trainers and
    the role of MOIC
    Integrated
    RLs)
    in Planning
    performance
    Developed
    monitoring &
    Initial Results
    PHASE 1
    reporting to be

    Framework for

    2016 >
    Full
    implementation
    of OBB
    recommendation
    s including full
    systems and
    institutions

    PHASE 2

    Presentation
    outline
    1
    2
    3
    4
    5

    Performance management & budgetary


    reforms
    Factors taken into consideration under
    OBB
    Integrated approach to OBB using Logic
    Model
    OBB implementation journey
    Critical Success Factors & Challenges in
    Implementing OBB

    Critical Success Factors


    OUTCOMES

    Performance information must


    be demand driven by
    stakeholders
    OUTPUTS
    Leaders must empower their
    team and execute strategy
    BROs must focus on program
    performance and accountability
    PROCESS
    Sustainable capacity building
    Report on performance through
    effective monitoring and
    INPUTS
    evaluation
    1

    Challenges in implementing OBB


    Understanding the concepts
    Role of management in strategy
    building
    Quality of information in the results
    framework
    Culturalising performance
    Redefining the roles of budget review
    officers focus on performance &
    accountability
    Sustainable capacity building and
    frequent movement of OBB trainers
    Identifying the right IT solution and
    translating business requirements into
    an IT system
    2

    MyResults: Performance Management


    System
    Ministry/Agency

    Planning
    Budget
    ing
    Monitorin
    g
    Evaluat
    ion
    Reportin
    g

    Demand
    Analysis
    2

    thank you
    terima kasih

    myresults@treasury.gov.my

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