Ernesto Jeger

1
How Governments and Development Partners Can Work
Effectively to Achieve ResultsWorking with SAIs
in Brazil to improve accountability through
performance audit

• Ernesto Jeger
• Governance Adviser DFID
• June 2007

1 Palace Street, London SW1E 5HE Abercrombie
House, Eaglesham Road, East Kilbride, Glasgow G75
8EA
2
Reasons for development partners working with SAIs
Since 1993, the WB and the IDB have designed 15
loans to strengthen external audit agencies in
Latin America

• Starting point for co-operation on broader PFMA
  reforms
• The Lima Declaration of Guidelines on Auditing
  Precepts (1977) DFID WP (2006) DFID Governance
  Paper (2007), IDB MOS(2003) and WB SAI Strategy
  (2004) and WB GAC Strategy (2006).
• Aid Effectiveness Agenda Harmonization and use
  of country systems
• Institutional architecture within which SAI
  reform can be set
• Resources and goodwill to be involved in capacity
  development initiatives exist across the
  international SAI community.

3
A Decade of Working with SAIs in Brazil

• DFID TC (1998-2001) Development of Performance
  Audit Techniques TCU
• DFID TC (2002-2006) Improving External Control
  with Focus on Reducing Social Inequalities TCU
  and TCEs Bahia and Pernambuco
• IADB (2003 - ) Programme to Support
  Modernization of the TCU U 5 million loan
• IADB (2005 - ) Programme for the Strengthening
  of External Control of States and Municipalities
  (PROMOEX) U 38.6 million loan
• World Bank grants (2006 - ) AAA Brava and AAA
  Good Governance

4
First Step Understanding the wider reform
context in which the SAI operates

• A Federal country Decentralised policy,
  management and service delivery provide an
  important opportunity for local participation and
  strengthened accountability
• The role of social control
• The need for better quality of public expenditure
• The new public management (1995)
• Privatization and creation of regulatory agencies
  (1996)
• Law of Fiscal Responsibility (2000) and
  Multy-Year Plan (PPA)
• Commitment with poverty and inequality reduction
  through new social programmes (2003) and the Plan
  for Accelerating Growth (PAC 2007)

5
Second Step Obtaining a good understanding of
the SAIs current situation

• Constitution 1988 performance or value for
  money audit
• TCE-Bahia accredited by WB (1987) and IDB (1994)
  to carry out audit on multilateral lending.
• TCU creates SEFID (1998) and SEPROG (2001)
• Improving diagnosis and analysis
• Institutional appraisal to select TCEs Bahia and
  Pernambuco to join DFID project
• IDB Promoex diagnosis (stakeholders perception's
  survey)
• WB SFAA (Ceara) and planned subnational PEFA in
  selected states

6
Third Step Support the Brazilian SAIs in
developing practical ways to take forward reform

• Focus on performance auditing (DFID)
• Development of innovative audit techniques
  Environmental auditing Audit of regulatory
  agencies, Audit of social programmes, Audit of
  multilateral lending (DFID, WB, IDB)
• Focus on improving administrative efficiency
  Strategic and organisational development
  Information technology Equipment and
  infrastructure Human resource management
  Capability building and training (IDB)
• Emphasis on social oversight (DFID)
• Sub-national auditing (DFID, WB, IDB)
• Integrated initiatives addressing the ME system
  and the entire budget cycle revenue, spending,
  control, and accountability (WB)

7
Easy wins

• Civil Society participation in the planning stage
  of the audit work
• TCU has published more than 60 reports in user
  friendly formats Internet disclosure
• Dialogo Publico events (IDB)
• Evaluation of flagship programmes Cadastro
  Unico, Zero Hunger and Bolsa Familia
• The importance of getting stakeholders to take up
  and act on the findings of SAIs audit work. Key
  elements in the SAIs approach which encourage
  this are
• Inclusiveness
• Positive messages
• Accessibility
• Monitoring and follow up

8
Successful reform techniques undertaken in Brazil

• DFID Resident Adviser
• Study visit to UK (NAO and Audit Commision)
• Train the trainers approach
• Distance learning training (IDB)
• Shadow training
• Twinning projects (WB Ceara SWAp)