The Government of the Republic of Serbia continued to pursue the Public Administration Reform (PAR) agenda at an accelerated pace and worked towards improving accountability and further rationalizing the use of public resources. In order to underpin fiscal consolidation and strengthen governance, the Government committed to implementing structural fiscal policy measures as part of Public Finance reform, aiming to increase fiscal transparency, introduce fiscal impact assessments of new legislative initiatives, strengthen cash management, internal control, and external audit and to raise the efficiency of revenue collection by further strengthening Tax and Customs administrations.
As a successor to the previous strategic framework in this area, the new Public Finance Management Reform Programme for the period 2021-2025 (PFM RP) was adopted by the Government on Serbia in late June 2021. It complements the Public Administration Reform Strategy 2021-2030 (PAR Strategy) of April 2021 and bases its premises on the conclusions of the recently conducted Public Expenditure and Financial Accountability (PEFA) , the SIGMA Monitoring Report , the key recommendations of the 2021 EU Progress Report for Serbia and pillar specific requirements which derive from the EU accession process and set five key medium term reform priorities which aim to contribute to ensuring effective financing of Government policies through a sound system of public internal financial management and control and a sustainable public debt.
The new PFM Reform Program relies to a great extent on the obligations that Serbia has assumed as part of EU accession negotiations under relevant chapters and even though Public Finance Management Reform is classified in the Fundamental cluster according to the new methodology for EU accession, it extends beyond encompassing several other horizontal issues which include macroeconomic stability, good governance, business environment and transparency. In that sense, it is an overarching framework which fundamentally integrates functional and EU accession requirements under chapters 5 – Public Procurement, 16 – Taxation, 22 – Regional Policy and Structural Instruments, 17 – Economic and Monetary Policy, 29 – Customs Union, 32 – Financial Control and 33 – Financial and Budgetary Provisions. The obligations assumed as part of the accession negotiations as well as the closing benchmarks (where they have been defined to date) will navigate the implementation of the PFM RP and serve as the fundamental source for the verification of the results that are anticipated to be achieved.
The EU Public Financial Reform (PFM) Facility aims to provide effective technical support and assistance to the beneficiary institutions in Serbia in line with the draft IPA 2021 Action Document in key areas of Chapter 5 – Public Procurement, Chapter – 16 Taxation, Chapter – 29 Customs Union, and Chapter 32 – Financial Control of Serbia’s EU accession negotiations with a focus on strengthening IT systems of Tax and Customs Administration and Public Internal Financial Control issues.
The overall objective of the PFM Facility Action is to enhance the efficiency of budget execution, public Finance Management and Public Internal Financial Control in line with EU standards and best practices. In order to achieve this objective, a set of focused activities will be defined during the inception phase and will be implemented under the following five outcomes:
As the backbone in the functioning and management of the public sector, Public Internal Financial Control (PIFC) was introduced in the Serbia through amendments to the Law on the Budget System in 2009. Its introduction represents a crucial milestone in PAR as it requires a fundamental change in the organizational culture and management of public sector bodies – a transition from bureaucratic management to managing for results.
Almost 15 years after its inception and over five years after a positive assessment of the national regulatory framework which enabled the opening of accession negotiations under Chapter 32 – Financial Control, Serbia is still struggling to ensure full compliance of public sector bodies with the regulatory framework in this area.
PIFC has always been in the spotlight of external assessments due to its specific horizontal role in ensuring the normal functioning of the public sector. As such, achievements in this area impacted several other functional areas of PAR and several accession negotiation chapters, which build on the achievements in the field of PIFC.
The 2021 EU Progress Reports states that good progress was made when it comes to PIFC and the Commission’s recommendations from 2020 were largely implemented. It commends Serbia for the pilot projects on Managerial Accountability and the initiation of quality reviews on internal controls. It also states that efforts are needed to embed managerial accountability in the administrative culture, to ensure full coherence of the PIFC legislation with the horizontal legal framework, that it needs to start implementing peer reviews of IA arrangements in public sector bodies and establish an effective internal audit function in all central level institutions.
The strategic framework for Public Procurement Reform (PPR) was put in place in 2014, two years prior to the opening of negotiations under Chapter 5 – Public Procurement and significant progress was achieved during the first phase of reform. The preparation and adoption of a revised legislative framework contributed to increasing transparency and the efficiency of public procurement by introducing mandatory publication of procurement plans by contracting authorities on the Public Procurement Portal (Portal), and the initial steps taken to align the national legislation with the relevant EU directives where complemented by further efforts of the Public Procurement Office (PPO) with the adoption of the new Law on Public Procurement which came into effect in mid-2020 together with the applicable secondary legislation.
The 2021 PEFA Report confirms that the new legislative framework of 2019 has enabled the application of competitive procedures and increased transparency to the highest level and the World Bank positively assessed the content of the new Portal which provides an insight into procurement plans, contract award notices as well as annual statistics on public procurement procedures. The PPO has prepared numerous model bidding documents in recent years to assist contracting authorities in the preparation and execution of procurement procedures and the institutional and administrative capacities of implementing procurement procedures in the public sector have increased through the certification Public Procurement Officers across the board with the support of the EU and other relevant international partners. Despite this continuous positive trend, significant efforts are still needed to further improve competition, efficiency, and transparency in public procedures
A consecutive Public Procurement Development Program for the period 2019-2023 (PP DP) was adopted in late 2019 encompassing four specific objectives contributing to the further development of a modern and efficient public procurement system in Serbia. The overall objective stated in the PP DP is to develop a modern and efficient public procurement system through the creation of conditions for free competition, which will enable the state to procure goods, services and works of adequate quality under the most favourable conditions and thus making the most economical use of taxpayers’ money (“best value for money”). Ensuring the efficient conduct of public procurement procedures, through downsizing of administrative requirements is the basis for the proper application of regulations with a reduced risk of irregularities.
UNDP has been actively supporting Public Administration Reform and in particular, Public Finance Management Reform since 2000. The activities increased and intensified over the years as UNDP’s relationships with the institutions which were established after the first democratic elections in Serbia strengthened, coupled with the need to modernize public sector management, and ensure a fully functioning and accountable public finance management system based on the highest international standards, and since 2014, EU accession requirements.
The UNDP CO in Serbia has implemented a total of 37 technical assistance projects in the field of PFM reform from 2004 to date, with an overall budget of 23.449.392,00 USD.
The EU PFM Facility will be implemented by the UNDP Public Finance Portfolio of the Good Governance Cluster.
In light of the abovementioned and the project document, the UNDP is seeking to engage the Technical Analyst for Public Internal Financial Control (PIFC) and Public Procurement, under the project Outcomes 3 and 4.
The Technical Analyst for Public Internal Financial Control (PIFC) and Public Procurement will be responsible for the provision of technical expert support in the implementation of project activities under two assigned project Outcomes (3 and 4), regular liaison with project beneficiary staff, provision of support with mobilizing senior and junior experts, reporting on implementation of project activities with the assigned project Outcomes and other technical support to the Policy Specialists (for Public Internal Financial Control; Public Procurement; Taxation; Customs) and Policy Analyst – Public Finance Management. S/he will report directly to the Policy Analyst – Public Finance Management.
The Technical Analyst for Public Internal Financial Control (PIFC) and Public Procurement will work under the overall guidance and supervision of the Policy Analyst – Public Finance Management.
Cross-functional and Technical Competencies
The following documents shall be required from the applicants: