Capacity Building for Local Governments in South-East EuropeInnovative Solutions for Sustainable Cities
MFSA workshop Sarajevo
On September 12th, 2017, Urban Partnership Program (UPP) gathered representatives from Bosnia and Herzegovina (BiH) cities and municipalities (municipalities of Novo Sarajevo, Odžak, Orašje, Žepče, and cities of Tuzla and Zenica) in Sarajevo, Bosnia and Herzegovina, to discuss municipal finances and share experiences, challenges and best practices with their peers from other cities and municipalities.
Focus of the workshop was to present the Municipal Finance Self-Assessment (MFSA) tool to new participating municipalities. Two cities that joined MFSA family in July 2017- Tuzla and Zenica (two of the largest cities from BiH) expressed their interest to critically analyze their own financial performance with support of the UPP and by using MFSA tool. During the workshop, it was identified that one of the biggest obstacles and issues for the participating municipalities is data collection and reliability of data sources needed to carry out MFSA. Also, lack of disaggregated socio-economic data for municipal finance assessments and reviews represents significant concern for the municipalities. There are several available sources that publish consolidated data for local governments, such as Central bank of BiH, and Ministry of Finance FBiH. It was mutually agreed by all participants to use most reliable socio-economic disaggregated data published by the Federal Institute for Development Programming in order to have unified MFSA data for all local governments. With sufficient data, cities and municipalities will be able to determine the level of efficiency and effectiveness of their spending of public funds, determine priority of public investments, and be prepared for dialogue with higher level of governments (i.e. Cantons or Federation), citizens, donors, investors in public private partnership schemes (PPPs), creditors.
Second part of the Workshop was dedicated to public expenditure and financial accountability of local governments (PEFA) tool for assessing the status of public financial management (PFM) and thorough, consistent and evidence-based analysis of PFM performance. Participants expressed their interest to prepare Action Plans on how to improve their financial condition and appreciate UPP technical and capacity support to perform ratio analysis and to draft the Plans.
The cities and municipalities were very satisfied with the outcomes of this workshop and valued the opportunity to share and discuss important issues of joint interest as well as receive strategic and technical support from UPP team.
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This program is being led by the World Bank Institute in cooperation with NALAS and local government associations from South East Europe. The program is supported by the Austrian Ministry of Finance and other partners active in the region.