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2 Out Of 3 Countries Go To A Lot Of Effort To Hide How They Spend Their Money

But they’re probably doing totally legit things with it, don’t worry.

2 Out Of 3 Countries Go To A Lot Of Effort To Hide How They Spend Their Money
[Top Photo: klublu via Shutterstock]

Public budgets have a central place in any functioning democracy. Even if few people ever read the final documents released by governments, the budgeting process forces officials to account for themselves, and eventually allows citizens to engage in a discussion about how resources are allocated.

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Today, many governments aren’t living up to minimal standards set by organizations like the International Monetary Fund and the OECD. As the latest survey from the International Budget Partnership (IBP) shows, a “large majority…provide insufficient information for civil society and the public to understand or monitor the budget.”

Of 102 countries assessed, 78 countries get scores of below 60 points out of a possible 100 (meaning they’re providing insufficient information). IBP rates countries across 140 questions–and eight different types of report they’re expected to release–with the results submitted by in-country experts, and then reviewed anonymously.

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New Zealand, Sweden, South Africa, Norway and the United States come out at the top of the rankings, with Brazil, France, and the U.K. next. Twenty-four countries (in green) provide “extensive” or “sufficient” information. At the other end, 34 (in dark red, or red) provide either “scant or none” or “minimal” detail. These include Saudi Arabia (at the very bottom), China (a measly 14 points), Vietnam (18 points) and several African countries, like Chad and Equatorial Guinea. The average is 45 points; governments below 60 points represent two-thirds of the globe.

Weak public budgeting is an issue not only for citizens, but also for outsiders such as donor agencies and foreign governments. IBP argues that a lack of transparency makes following incoming aid more difficult, and thus it’s harder to see if development assistance is paying off. It wants to see tougher standards in the next round of United Nations development goals, when they’re negotiated this fall. “A key weakness of the current development goals has been the absence of sufficient budget information to monitor the investments necessary for their pursuit, and to hold government and donor agencies accountable for the results,” the report says.

Vivek Ramkumar, who leads IBP’s Open Budget Initiative, notes that governments with greater transparency win better rates of interest in international debt markets. He says open budgeting avoids a Greece-like situation where a government accrues unsustainable levels of debt. Transparency also empowers the poor the most. “Public participation pressures governments to make their budgets more responsive to the needs of citizens. If you want to alleviate poverty, you need that money to reach the beneficiaries. All of that is more likely to happen in an environment of transparency,” he says.

Governments might complain that they don’t have the resources to gather and publish in-depth information. But Ramkumar doesn’t have a lot of sympathy for that excuse. What’s often missing isn’t complex information that you need to hire an army of accountants to produce. It’s basic information like revenues and expenses, and how governments plan to finance their debt. Often, in fact, governments have the information but choose to classify it.

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Indeed, several poorer countries are higher up the ranking, including Malawi (65 points) and Uganda (62 points), showing that resources aren’t necessarily the issue. “Any government can reach a desired level of budget of transparency with political will,” Ramkumar says.

About the author

Ben Schiller is a New York staff writer for Fast Company. Previously, he edited a European management magazine and was a reporter in San Francisco, Prague, and Brussels.

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