Title Page
PIMA HANDBOOK
Public Investment Management Assessment
1ST EDITION
Copyright Page
© 2022 International Monetary Fund
Cover design: IMF CSF Creative Solutions Division
Cataloging-in-Publication Data
IMF Library
Names: International Monetary Fund. | International Monetary Fund, publisher.
Title: PIMA handbook : public investment management assessment, 1st edition.
Other titles: Public investment management assessment.
Description: Washington, DC : International Monetary Fund, 2022. | 1st edition. | Includes bibliographical references.
Identifiers: ISBN 9798400202131
Subjects: LCSH: Public investments. | Economic development projects -- Evaluation.
Classification: LCC HC79.P83 I44 2022
DISCLAIMER: The views expressed in this book are those of the authors and do not necessarily represent the views of the IMF’s Executive Directors, its management, or any of its members. The boundaries, colors, denominations, and any other information shown on the maps do not imply, on the part of the International Monetary Fund, any judgment on the legal status of any territory or any endorsement or acceptance of such boundaries.
Recommended citation: International Monetary Fund. 2022. PIMA Handbook: Public Investment Management Assessment, 1st edition. Washington, DC: International Monetary Fund.
ISBNs: 979–8-40020–414-2 (paper)
979–8-40020–415-9 (ePub)
979–8-40020–416-6 (PDF)
Please send orders to:
International Monetary Fund, Publication Services
PO Box 92780, Washington, DC 20090, USA
Tel: (202) 623–7430 | Fax: (202) 623–7201
E-mail: publications@imf.org
Internet: www.elibrary.imf.org
Contents
Acknowledgments
Acronyms
Executive Summary
PART 1. PIMA Overview
1 Introduction
2 Public Investment Trends and Efficiency
Public Investment Trends
Public Investment Outputs, Outcomes, and Efficiency
3 PIMA Findings
What Do PIMAs Tell Us About the Strength of Infrastructure Governance Institutions?
How Are PIMAs Used?
PART 2. PIMA Practitioners’ Guide
4 Assessing PIMA Institutions: General Issues
How Are Institutional Design and Effectiveness Assessed in Practice?
What Data and Data Sources Are Typically Available?
How Are Externally Financed Projects Assessed?
How Do We Define Major Projects?
How Do We Apply the Indicative Scoring Thresholds?
What is the Scope of the PIMA?
5 Planning Sustainable Levels of Public Investment
Institution 1: Fiscal Targets and Rules
Institution 2: National and Sectoral Planning
Institution 3: Coordination between Entities
Institution 4: Project Appraisal
Institution 5: Alternative Infrastructure Financing
6 Allocating Investments to the Right Sectors and Projects
Institution 6: Multiyear Budgeting
Institution 7: Budget Comprehensiveness and Unity
Institution 8: Budgeting for Investment
Institution 9: Maintenance Funding
Institution 10: Project Selection
7 Delivering Productive and Durable Public Assets
Institution 11: Procurement
Institution 12: Availability of Funding
Institution 13: Portfolio Management and Oversight
Institution 14: Management of Project Implementation
Institution 15: Monitoring of Public Assets
8 Cross-Cutting Issues
Legal Framework
Capacity
Information Systems
Appendix I: PIMA Questionnaire
Appendix II: Indicative Scoring Thresholds
Appendix III: Conducting a PIMA
Appendix IV: Outline of a PIMA Report
Appendix V: Glossary
References
Index
Acknowledgments
The Public Investment Management Assessment (PIMA) Handbook was produced by the Fiscal Affairs Department (FAD) staff under the supervision of Manal Fouad (Assistant Director and Division Chief, Public Financial Management II division), Carolina Renteria (Division Chief, Public Financial Management I division) and Torben Hansen (Division Chief, Resource Management Division).
The main drafting team included Nicoletta Feruglio, Isabel Rial, Eivind Tandberg, Ha Vu (all FAD staff) and David Gentry (FAD expert). Inputs were received from FAD public financial management staff and field advisors. The overall production process was coordinated by Nathalie Carcenac. Khaled Eltokhy provided excellent research assistance. The editorial team consisted of Rumit Pancholi from the Communications Department. The handbook has also benefited from comments from World Bank staff.
This handbook was developed with financial support from the IMF-Japan Infrastructure Governance Facility and the EU-IMF Public Financial Management Partnership Program.
Acronyms
| ADB | Asian Development Bank |
| AE | advanced economy |
| CIPFA | Chartered Institute of Public Finance and Accountancy |
| CL | contingent liability |
| COFOG | Classification of the Functions of Government |
| DP | development partner |
| EBE | extra-budgetary entity |
| EBRD | European Bank for Reconstruction and Development |
| EME | emerging market economy |
| EP | expenditure pollicy |
| EU | European Union |
| FAD | Fiscal Affairs Department |
| GDP | gross domestic product |
| GFSM | Government Finance Statistics Manual |
| ICT | information and communications technology |
| IFAC | International Federation of Accountants |
| IFI | international financial institution |
| IPF | investment project financing |
| IPSAS | International Public Sector Accounting Standards |
| IPSASB | International Public Sector Accounting Standards Board |
| IT | information technology |
| LIDC | low-income developing country |
| MAPS | Methodology for Assessing Procurement Systems |
| MoF | ministry of finance |
| MTBF | medium-term budgetary framework |
| MTEF | medium-term expenditure framework |
| MTFF | medium-term fiscal framework |
| OECD | Organisation for Economic Co-Operation and Development |
| PC | public corporation |
| PFM | public financial management |
| PIM | public investment management |
| PIMA | Public Investment Management Assessment |
| PIP | public investment program |
| PPP | public-private partnership |
| SAI | supreme audit institution |
| SNG | subnational government |
| SOE | state-owned enterprise |
| TSA | Treasury Single Account |
| UK | United Kingdom |
| UN | United Nations |
Executive Summary
This handbook is aimed at anyone who is involved in a Public Investment Management Assessment (PIMA) or who has a practical interest in public investment management. It is intended to be useful for country authorities, IMF staff, staff of other financial institutions and development organizations, and anyone who is interested in exploring different aspects of public investment management to understand how country systems are designed and how they work in practice.
Part I (sections 1 through 3) of the handbook gives a concise overview of the PIMA framework. Section I explains the importance of public investment and describes the PIMA framework. Public infrastructure is a key driver of inclusive economic growth and development, and the reduction of inequalities. The need for stronger infrastructure governance for quality investment is widely recognized. Yet, creating quality infrastructure has often been challenging. Losses and waste in public investment are often systemic.
PIMA is a comprehensive and standardized framework to assess public investment management for countries at all levels of economic development. PIMAs evaluate 15 institutions, or practices, involved in the three key stages of the public investment cycle: planning, allocation, and implementation. Each institution is analyzed along three dimensions that reflect the key features of the given institution, resulting in a total of 45 dimensions. A key feature of the PIMA is that it makes a clear distinction between institutional design (what is on paper) and effectiveness (what is in practice).
Section 2 discusses how to describe and analyze public investment trends and efficiency. It describes the datasets that are used and gives examples of how these are presented. It also outlines the methodology for analyzing the public investment efficiency and presenting efficiency gaps.
Section 3 of the handbook gives an overview of usefulness of the framework to identify key bottlenecks in public investment management and develop an action plan for reform. It describes the key issues and challenges identified in PIMAs and the main recommendations that have been made to improve public investment management, then gives examples of action plans proposed in previous PIMAs.
Part II provides a detailed practitioners’ guide to apply the PIMA framework. A detailed description, explanation, and discussion of each of the 15 PIMA institutions and 45 dimensions are included in sections 4 through 8. Section 4 discusses key general issues that are common for many of the institutions and dimensions. Sections 5 through 7 provide detailed discussions of the institutions and dimensions under each of the three main pillars: planning, allocation, and implementation. Section 8 discusses how to analyze and assess the cross-cutting enabling factors.
The appendixes provide additional guidance on the PIMA framework. Appendix I contains the questionnaire that guides the PIMA assessments. Appendix II summarizes indicative scoring thresholds for institutional design and effectiveness for each of the 45 PIMA dimensions. Appendix III provides an overview of the PIMA assessment process. Appendix IV outlines a PIMA report, and Appendix V comprises a glossary of commonly used terms.