Gender Budgeting in G20 Countries
  • 1 0000000404811396https://isni.org/isni/0000000404811396International Monetary Fund
  • | 2 0000000404811396https://isni.org/isni/0000000404811396International Monetary Fund

Achieving gender equality remains a significant challenge, that has only deepened with the on-set of the COVID-19 pandemic. Gender budgeting (GB) can help promote gender equality by applying a gender perspective to fiscal policies and the budget process. This paper takes stock of GB practices in G20 countries and benchmarks country performance using a GB index and data gathered from an IMF survey. All G20 countries have enacted gender focused fiscal policies but the public financial management (PFM) tools to operationalize these policies are far less established. We find that notwithstanding heterogeneity across countries, the average G20 level of GB practice is relatively low. More progress has been made establishing GB frameworks and budget preparation tools than with budget execution, monitoring and auditing. Too few countries assess the upfront impact of policies on gender and/or evaluate ex-post the effectiveness of policies and programs. Where GB features are in place, they tend to operate as an ‘add-on’, rather than a strategic and integral part of resource allocation decisions. Progress with GB does not appear to be dependent on the level of country development. Key to future efforts will be harnessing opportunities for integrating GB tools into existing PFM systems and more closely linking GB initiatives with PFM reforms.

Abstract

Achieving gender equality remains a significant challenge, that has only deepened with the on-set of the COVID-19 pandemic. Gender budgeting (GB) can help promote gender equality by applying a gender perspective to fiscal policies and the budget process. This paper takes stock of GB practices in G20 countries and benchmarks country performance using a GB index and data gathered from an IMF survey. All G20 countries have enacted gender focused fiscal policies but the public financial management (PFM) tools to operationalize these policies are far less established. We find that notwithstanding heterogeneity across countries, the average G20 level of GB practice is relatively low. More progress has been made establishing GB frameworks and budget preparation tools than with budget execution, monitoring and auditing. Too few countries assess the upfront impact of policies on gender and/or evaluate ex-post the effectiveness of policies and programs. Where GB features are in place, they tend to operate as an ‘add-on’, rather than a strategic and integral part of resource allocation decisions. Progress with GB does not appear to be dependent on the level of country development. Key to future efforts will be harnessing opportunities for integrating GB tools into existing PFM systems and more closely linking GB initiatives with PFM reforms.

I. Introduction1

Achieving gender equality remains a major challenge and important gaps persist – which the COVID-19 pandemic has only exacerbated. Governments have adopted a combination of policies and instruments to help tackle gender inequalities.2 The COVID-19 pandemic’s impact on women has ignited calls for governments to tailor pandemic and recovery policies to address the augmented challenges women face. Beyond legal and regulatory changes to promote equality in the public and private sector, these include fiscal policies to improve access and opportunities particularly in health and education and to enhance labor market participation.

Gender budgeting (GB) recognizes that government budgets impact men and women differently. Policy decisions made by governments can serve to either promote gender equality or reinforce existing inequalities. GB uses fiscal policies and public financial management (PFM) tools to promote gender equality (Stotsky 2016). It incorporates a gender lens into the budget process to ensure that governments are acutely aware of the impact of their choices on gender outcomes. GB is not just about funding explicit gender equality initiatives. It also entails analyzing fiscal policies and budgetary decisions to understand their impact – intended and unintended – on gender equality and using this information to design and implement more effective gender policies.

International recognition for GB as an instrument to enhance gender equality continues to grow. The United Nation’s 1995 Beijing Platform for Action called for integrating a gender perspective into government budget processes. More recently, the UN’s 2015 Sustainable Development Goals (SDGs) called for adequate resources and tools to track budget allocations for gender equality (SDG indicator 5.c.1). The 2015 Addis Ababa Action Agenda for Development recognized the importance of tracking resource allocations for gender equality and strengthening capacity for GB. In 2020, G20-Women, an official engagement group to the G20, called for greater investment in GB to ensure that fiscal policies advance gender equality in the short and long-term recovery from the COVID-19 crisis.3

This paper examines the status of GB in G20 countries using data obtained from an IMF survey. The remainder of this paper is divided into the following sections. Section II discusses trends in gender equality and highlights G20 countries’ gender responsive fiscal policies. Section III provides a brief history of the GB approaches and presents the holistic IMF GB framework. Section IV examines G20 countries GB PFM practices and benchmarks them using a Gender Budget Index (GBI). Section V compares G20 countries’ GB practices with those of other countries. Section VI discusses challenges and key success factors with implementing GB. Section VII examines opportunities to improve GB implementation. The final section provides some conclusions.

II. Trends in Gender Equality and Gender Responsive Fiscal Policies in G20 Countries

Since the Beijing Declaration called for the empowerment of women, progress has been made on many fronts. There has been progress on economic participation, political opportunity, health and education including significant improvements in the enrollment of girls in primary education, enhancement of women’s legal rights and reductions in maternal mortality ratios.

However, substantial gender gaps persist and much remains to be done – with COVID-19 only serving to widening these gaps. Despite progress in most G20 countries4 in the last fifteen years, women’s participation rate in the workforce on average still remains below that of men (Figure 1). Women are significantly over-represented in the total number of hours spent on unpaid work (Figure 2). The average gender pay gap has narrowed but remains substantial (Figure 3) and women’s managerial leadership remains below 50 percent in all G20 countries (see Figure 4). Appendix 1 provides more information on other gender gaps in G20 countries. The 2021 World Economic Forum Gender Gap report highlighted that at the present pace it will take another 267 years to close the gender gap for economic empowerment.

Figure 1.
Figure 1.

Women’s labor participation rate remains below men’s

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: World Bank
Figure 2.
Figure 2.

and the burden of unpaid work falls on women

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: UN Global SDG Debase
Figure 3.
Figure 3.

The gender pay gap is substantial

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: OECD, 2020.
Figure 4.
Figure 4.

and women’s managerial leadership remains below 50%

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: ILO.

Closing gender gaps is complex and government policies play an important role – but achieving gender equality also requires progressively shifting cultural and societal norms. Governments can change legislation to improve gender equality and help to end discrimination, introduce public employment practices to encourage the hiring and promotion of women and change government machinery including budget processes. But government action alone cannot succeed in achieving gender equality, especially if countries have strong cultural and social barriers which reinforce inequality. Shifting cultural views and perceptions of women’s role in society, can be as influential as government actions in either promoting or blocking gender equality (Fabrizio et al, 2020, UNDP 2020). Formal and informal mechanisms are interconnected and can work together to promote gender equality (figure 5). Addressing these barriers is key to achieving successful and sustained change.

Figure 5.
Figure 5.

Selected Instruments that Can Work Together to Promote Gender Equality

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: IMF staff.

GB is an important instrument that governments have at their disposal to help promote gender equality and close gender gaps. GB helps to operationalize fiscal policies that promote gender equality. GB can help examine the impact of government policies on gender – and drive more informed decisions. The success of government policies and therefore the impact that GB can have is influenced by many factors including political support for gender equality, the consistency of GB reforms as well as the country’s cultural attitudes and social norms.

Targeted fiscal policies are a key mechanism through which governments seek to achieve their gender equality goals and address the gender gaps discussed above. GB can help to operationalize these policies. Table 1 summarizes the most common gender responsive fiscal policies in G20 countries on the expenditure and revenue sides.5

Table 1.

Gender-Related Fiscal Policies Introduced by G20 Countries

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Sources: IMF Staff and IMF Survey 2017 and 2019.

Expenditure policies aimed at improving women’s labor participation and health and educational outcomes are common among G20 countries. To support the development of women, almost all G20 countries have policies designed to improve women’s health needs, provide protection against domestic violence and promote women’s educational attainment. Moreover, a majority of countries encourage women to specialize in technical areas which were historically dominated by men, such as science, technology and mathematics. Most countries also provide financial support to help low-income women who face economic difficulties including labor market barriers and single-parent households. Most G20 countries have also made changes to pension systems to make some allowance for contribution gaps as a result of workplace absence due to childcare responsibilities.

For emerging market G20 countries, policies related to secondary and university education, infrastructure and transportation investments have helped more women to enter into paid employment (Fabrizio, Fruttero and Gurara et al 2020). In addition, all G20 donors, except for one, have incorporated gender equality considerations into their foreign cooperation and aid programs.

Tax policies are widely used by G20 countries to help encourage labor market participation. The majority of G20 countries have individual taxation or tax incentives to correct for labor supply distortions stemming from joint family taxation arrangements that disincentivize the second earners’ labor participation within households (Bick and Fuchs-Schündeln 2017). Tax relief for single parents has been adopted by around half of countries. However, gender-targeted in-work credits or incentives are only reported by a few countries. For example, in Spain there is a tax deduction for working mothers with children less than 3 years old.

While the majority of G20 countries have policies actively seeking to increase women’s participation in the labor market, only a few have policies to promote women into leadership positions. A vast majority of countries promote part-time work, childcare support and paid parental leave for both parents. Promoting childcare is even more important for low-skilled workers, taking into account the higher weight of this cost in their incomes. In the US, families in the bottom quartile of income distribution spend 17.4 percent of their income on childcare compared to 7.8 percent for the top quartile (Herbst 2015). In terms of remuneration, most countries have passed equal pay legislation. Only nine countries, however, have set quotas for women’s inclusion in public sector managerial and board positions and only six have quotas for the inclusion of women on private sector boards.

III. Trends and Approaches in Gender Budgetingt

A. The Evolution of Gender Budgeting

Countries’ interest in GB has grown over time as GB practices have been endorsed in international fora. It was first introduced in the 1980s by the Australian Government and was subsequently adopted in Canada and South Africa and other Commonwealth countries with the help of the Commonwealth Secretariat. The impetus for GB increased with the 1995 Beijing Platform for Action and in the late 1990s and 2000s the application of GB grew, especially in emerging and developing countries with the support of donors and UN Women. In 2002, at least 40 countries had some form of GB (Budlender 2002) and by 2017 this number doubled to 80, albeit with diverse approaches and varying levels of scope, depth and commitment. GB has also been applied extensively at the state and local levels (e.g. Germany, India, Uganda, Spain and Sweden). The number of OECD countries implementing GB has increased from 12 in 2016 to 17 in 2018.

Since its initial development in the 1980s, the concept of GB has evolved. It has moved from focusing mostly on allocations to “women’s issues” or women’s programs, towards a broader approach that stresses the importance of bringing a gender perspective and awareness to all government policy, planning and budgeting (Hofbauer 2003; Budlender et al 2002). While there are several definitions in the literature, GB is now widely seen as focusing more on understanding the impacts of public expenditure and revenue policies on women and girls, compared to men and boys and addressing whether they reduce, increase or leave unchanged gender equality. For example, does a pension reform impact women and men differently? If so, how can policies reduce the gender bias? More broadly, GB is about analyzing the gender effects of all public programs and policies and how to improve them.

GB is not about the radical reform of existing budgetary procedures, nor is it about creating a new or parallel budgeting system (OECD 2014 and Sarraf 2003). Rather, it involves integrating additional tools into the existing budget system to analyze the differential impact of governments’ budget on women and men, thereby translating the government’s commitments on gender equality into budgetary commitments (Budlender Sharp and Allen 1998). In sum, GB is simply good budgeting which can improve outcomes and impact in terms of the efficiency and gender equity of the overall budget process.

Countries have adopted different approaches to GB, there is no single model. Countries have employed a wide variety of GB approaches. These initiatives usually vary in their origin, scope, objectives, institutional arrangements, entry points to the budget process, legal basis, analytical tools and players involved (Kolovich 2018). Some countries have formally adopted GB initiatives into their legal framework, while others have directly incorporated GB tools and processes into the budget for example by improving budget classification.

GB practices and frameworks continue to evolve, highlighting emerging perspectives on its application over time. GB continues to evolve with experiences from country case studies, research and technical assistance undertaken by a range of donors, non-governmental organizations, academia, and multilateral organizations. Some emerging views are discussed below:

  • The application of GB waxes and wanes over time and progress is not necessarily linear. Even in some early reformers (Australia and South Africa), GB has faded or is no longer applied systemically. Other PFM reforms such as performance budgeting have experienced similar fates in some countries. Several factors can contribute to this including poor implementation strategies, lack of capacity and data, resistance from key stakeholders (Polzer, Nolte and Seiwald 2021), difficultly in assigning responsibility for GB reform to any specific ministry and in obtaining coordination between ministries. In addition, GB requires a good understanding and quantification of gender equality needs and the best PFM tools to address these elements are those that are most often lacking. The vacillating fortunes of GB highlights the importance of promoting wide societal and political support for GB and formalizing requirements in legislation to ensure reforms endure changes in governments.

  • The application of GB appears not to be related to a country’s level of development. This reflects several factors, including different starting points for gender equality, strong donor and international organization support for GB implementation and GB’s contribution to achieving the gender aspects of the millennium goals and SDGs. GB is part of a wider development agenda supporting women’s empowerment which is seen as key to reducing poverty and achieving development goals. International organizations, like UN Women, have played a key role in promoting the integration of a gender lens into the budget process particularly in developing countries and emerging economies.

  • There is a recognition of the important role of the ministry of finance (MOF) in the successful application of GB. Historically, GB has been confined to ministries of women or similar institutions. With ministries of women having little direct spending responsibilities and little power to influence or direct other ministries without central support, this has often resulted in its marginalization from central budgetary decision making. It has been a constant struggle to convince MOFs of GB’s importance and of their role in the driver’s seat in its successful implementation. There is now growing awareness, within wider government and among MOFs themselves, of their key role in successfully executing GB.

  • There is more awareness of GB’s importance in increasing transparency on the design and monitoring of government’s gender equality policies and budget allocations. By improving reporting on budget allocations and impact assessments, GB provides a platform for citizen engagement in gender policies. In this regard, the involvement of parliamentary commissions and civil society helps to draw attend to gender equality issues and gaps and more recent GB initiatives (e.g., Mexico, Argentina) have helped to promote better transparency and public discussions.

  • There is a growing consensus on the need for an integrated GB approach which incorporates a gender perspective into the whole budget cycle. The IMF, the OECD and the PEFA Secretariat’s approaches to GB emphasize the inclusion of GB tools across the whole budget cycle. Some countries apply GB tools on an ad-hoc basis or just to one part of the budget cycle. For example, including gender in the budget circular but not incorporating GB tools in the budget execution and reporting phases. While this may allow countries to fund gender programs, it does not provide any information on how a program’s money is spent, if gender objectives are achieved or how programs could be improved. An integrated approach to GB also calls for linking planning to budgeting. Many countries include gender equality goals in national or sectoral plans, but they are not costed or translated into the budget.

B. The IMF Gender Budgeting Approach and Framework

The IMF approach to GB encourages the holistic integration of a gender perspective across each phase of the budget cycle through gender-responsive fiscal policies and gender-specific PFM practices. This holistic approach builds on the conceptual framework articulated in the assessment of GB practices in G7 countries (IMF 2017). Figure 6 shows its four main pillars and highlights the gender specific PFM tools that can be used in each phase of the budget cycle.

Figure 6.
Figure 6.

A Holistic Approach to GB Throughout the Budget Cycle

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: IMF staff.

The design of these tools involves applying a gender lens throughout the policy making, budget preparation, execution, monitoring, and evaluation process. It is also important that lessons learned from the evaluation and assessment of programs/policies feed into a new cycle of policy design. The key features of gender-specific PFM tools that are relevant to each phase of the budget cycle are explained in more detail in Appendix 2 and Appendix 3 provides an example of how to apply GB tools throughout the budget cycle. The IMF approach focuses on the integration of GB PFM tools and practices across all phases of the budget cycle to get the most benefit from the implementation of GB reforms. However, a sequenced approach that helps to appropriately prioritize reform actions should be taken. Further guidance on appropriate sequencing, based on country experience is discussed in later sections and Appendix 7.

Based on this framework the IMF developed a survey to capture governments’ GB practices.7 The survey covers gender-related fiscal policies, the implementation of PFM practices across the four GB pillars mentioned above and a section on GB benefits and implementation challenges. The survey captures not only the existence of the most relevant PFM tools but also tries to capture aspects of the quality of their application. Government officials in all G20 countries plus Spain (permanent G20 guest) and Austria (G20 guest) completed this online multiple-choice survey. Beyond the G20, the survey gathers data on GB practices from 72 other countries around the world. More details of this survey are provided in Box 2 and Appendix 6.

The IMF Survey of National GB practices

The survey aims to capture countries’ progress in the implementation of policies and PFM institutions that support the gender-responsiveness of the budget. It comprises 38 questions structured in 5 blocks (1. Gender policies and fiscal policies, 2. Legal and institutional framework, 3. Budget preparation, 4. Budget execution minoring and audit and 5. Benefits, challenges and impact). The survey asks questions around the four pillars of the IMF GB Framework, and about gender equality policies, and GB benefits, implementation challenges and facilitating factors. The questions not only aim to reflect whether GB tools are in place and actively used, but also tries to capture their most relevant characteristics and how they are used (to the extent possible). For some responses, countries are asked to provide links to relevant documents, which have been verified, and where information is available answers have been scrutinized to detect and remove inconsistencies as much as possible. Appendices 4 and 6 provide further details on the survey.

Building on the responses to the survey, FAD has set up a database of GB practices, which currently includes 93 countries from all income levels and world regions. Most of this information reflects national practices during 2019, and in a few cases in 2020. This database has not only provided an analytical basis for this paper, but it also constitutes a valuable tool for the IMF’s capacity development (CD) activities on GB, as it maps countries’ main potential weaknesses and helps benchmark them against regional or income comparators. For the purpose of this paper, the 19 G20 countries, plus Spain (permanent G20 guest) and Austria (guest) have been studied. The European Union is also a member of the G20.

Source: IMF staff.

IV. Status of Gender Budgeting in G20 Countries

This section benchmarks GB practices in G20 countries against the holistic approach to GB described above using the results of the IMF survey. This section is divided into two parts. The first provides an overview of GB practices in G20 countries using a gender budgeting index (GBI) which compares countries relative performance and analyzes overall G20 countries practices. The second, examines in detail the performance of G20 countries against each of the four pillars in the GB framework and uses a heat map to convey performance.

A. Overview of GB practices in the G20 Countries- Gender Budgeting Index

Using the data collected from the IMF survey, this paper constructs a gender budgeting index (GBI) to benchmark country GB practices against the IMF GB framework. The GBI is calculated by assigning a score (from zero to three) to 23 key questions within the survey. These questions relate to 12 PFM instruments throughout the budget cycle. The unweighted average of the 23 questions is equal to the overall country GBI.8 Appendix 6 summarizes the GBI methodology. In Figure 7, individual country indexes have been ranked at three levels of practice according to their average GBI, high (between 1.47 and 2.25), medium (0.75 and 1.46) and low (0.03 and 0.74).9 From this perspective, the cluster of countries characterized by the highest score in relative terms comprises Canada, Austria, Mexico, France, Spain, South Korea and Japan. Note that the highest country average GBI score is 2.24 and the lowest is 0.03 for this group of countries, while the GBI can have values from 0 to 3 according to the level of practice for each GB tool (see Heatmap Table 3). 10

Figure 7.
Figure 7.

G20 Gender Budgeting Index (GBI) Scores by Countries 11

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: IMF Survey and IMF Staff. Note: The boundaries, colors, denominations, and any other information shown on the maps do not imply, on the part of the IMF, any judgment on the legal status of any territory or any endorsement or acceptance of such boundaries.
Table 2.

Average GBI Indexes for the G20+ and by Income Group (Rank 0–3)

article image
Source: IMF survey and IMF staff.
Table 3.

Heat Map: Level of GB Practices in G20 Countries Across the GB Cycle

article image
Source: IMF staff. Note: The information has been drawn from the IMF survey.
article image

Overall across G20 countries, GB practices are significantly better for developing a GB institutional framework and integrating a gender perspective into budget preparation than in budget execution and auditing. The highest scores within the two first pillars can be observed in the institutional framework and the use of performance indicators. In budget execution, both execution reports and ex-post gender impact assessments (GIAs) have low scores, and in audit and external oversight it is mainly the first one which lowers the average.

The average for advanced economies in the G20 (AEs) is higher than for emerging markets (EMEs) in the overall index, however there are significant intra-group differences. The largest differences are found in ex-ante GIA and statistics where AEs perform higher, but EMEs are stronger in performance indicators and budget classification. In terms of intra-group differences, Canada, France, Austria and Spain exhibit significantly better averages than other advanced economies. Likewise, the distance between Mexico and other emerging countries is also noticeable.

Countries are at different stages of adopting GB and have a range of approaches suggesting there is no linear path for implementation. Some have a relatively advanced level of practice and have formally integrated GB into their legal and institutional settings and throughout almost all facets of their budget cycle. In others, key instruments have been adopted and implementation plans are ongoing, reflecting relatively good or substantial levels of practice even though a comprehensive GB framework is not yet in place. In another group of countries, the adoption of GB tools in the budget cycle has been ad-hoc and more limited. GB initiatives in the US, Germany and China are implemented at the subnational level, which is beyond the scope of the survey, whereby GBI scores only capture the federal level. Furthermore, convergence towards best performers has proved to be a gradual process, which involves mobilizing key stakeholders, adapting existing budget tools and developing new ones.

The analysis of correlations between the GBI elements sheds further light on the possible inter-linkages of GB tools and enablers. Appendix 5 shows the correlation coefficient between the GBI components for the whole set of 21 countries, with correlations higher than 0.4 highlighted. The main findings from this analysis are as follows.

  • The legal and institutional framework seems a probable enabler.12 This is valid for upstream GB (budget call circulars and gender statements), but also for incorporation of gender goals into the budget classification and development of linkages between gender goals and performance indicators.

  • Some upstream budget activities (budget preparation) appear significantly correlated. This is the case of gender budget statements, budget circulars and ex-ante GIAs. This may be partly explained by the complementarities between these tools.

  • The availability of gender-disaggregated statistics can foster gender impact assessments (GIAs). As could be expected, this is also positively correlated with parliamentary oversight, perhaps because the former provides a quantitative basis for discussion and performance monitoring. Interestingly too, the existence of these statistics does not appear to bear any clear relation with ex-post GIAs, which may be more related to the feasibility of tracking gender-sensitive expenditure.

  • The overall correlation of budget execution and auditing tools with other components of the GBI tends to be weak. This could be due to the fact that the use of downstream tools may be constrained by factors not captured by the GBI, such as the inability to track gender expenditure through information systems or quality issues in performance indicators design or overall weakness with the budget execution system.

B. Detailed Analysis of GB Practices in G20 Countries

This section examines in detail the GB practices of G20 countries across all four pillars of the IMF PFM framework. The results are summarized by country in the heatmap in Table 3 and discussed in detail below.

Pillar 1: Gender Budgeting Framework: Legal and Institutional Framework

Over half of G20 countries have formalized GB requirements within a comprehensive framework13, providing a firm foundation for integrating a gender perspective into the budget process. These frameworks can include laws that enshrine the incorporation of a gender perspective into the budget process, but also lower-ranking regulations, directives and methodologies, that deliver detailed instructions and technical guidance on GB implementation. In a majority of countries integrating GB requirements into the legal and technical framework has been a relatively recent phenomena, occurring over the last decade. This is the case even where GB practices have existed for some time. For example, in Canada, some of the GB tools which had been introduced in mid 1990s were only enacted in legislation in the 2018 Gender Budgeting Act.

Less than half of G20 countries have GB requirements enshrined in the constitution or high-ranking laws despite this being cited as a key success factor.14 Only Austria has a GB requirement in their constitution which is advanced practice. Eight other countries use high-ranking laws, that cannot be easily modified and so remain stable over time. Other countries just use annual budget laws or other regulation to ensure that policy design embeds gender aspects, but their ad-hoc character renders them less effective than other laws with permanent status and overarching nature (Appendix 8).

Institutional responsibility for leading GB reforms involves the Prime Minister’s Office or the MOF in the majority of countries.15 In addition, to comprehensive legislative frameworks, advanced GB practice is reinforced by assigning institutional responsibility for implementing GB reform to powerful central agencies. The involvement of the President’s/Prime Minister’s Office and the MOF elevates the importance and priority of the reform. In 40 percent of countries, the MOF is responsible for ensuring the integration of GB practices into PFM legislation and processes. Coordination by MOFs facilitates a richer technical and financial discussion of gender policies, when setting budget policy proposals and expenditure envelope, as is the case in Canada.

The collection of gender-disaggregated statistics has become widespread among G20 countries, but in general they are not fully integrated into the budget processes.16 Gender-disaggregated statistics can enhance the soundness of GIAs (both ex-ante and ex-post) and help with the construction of credible performance indicators. Practically all countries which compile gender-disaggregated statistics, also publish them, however a key challenge is to integrate them into decision making. In terms of the frequency of the use of gender statistics, Australia reported using them very frequently to inform budget decisions and gender analysis and Canada also reported using them frequently in decision making.

Pillar 2: Gender Budgeting: Budget Preparation

Nearly all countries have gender equality goals which are most often incorporated into medium-term strategic plans.17 When gender goals are embedded in national and/or sectoral plans and incorporated into the budget and medium-term frameworks, they have a better chance of being funded and therefore actually being delivered. Similarly, international commitments for example to support the SDGs for gender equality require integration into sectoral objectives and holding political leaders accountable for results.

Linking gender goals to program objectives and assessing the fiscal impact of proposals within a medium-term budget framework is an advanced practice, however it is not frequently applied.18 Framing spending proposals within a multi-year fiscal constraint helps to refine and prioritize priorities within sector strategies through cost-benefit analysis. Nonetheless, only three countries (Saudi Arabia, South Africa and Turkey) reported to apply this approach. In another six countries (Argentina, Brazil, France, Indonesia, Japan and Mexico) gender equality goals are also linked to programs, and costings are done on an annual basis. Without adequate costings of proposals prioritization within allocated expenditure ceilings can be compromised, even if gender goals are linked to programs. In eight G20 countries plus Austria, gender goals exist but are not linked to programs or costed.

More than half of governments have performance measures in place to monitor their progress in achieving gender goals.19 Setting gender-related performance targets against government programs is an advanced practice that allows program performance to be assessed at government-wide level however only six countries are performing at this level. Targets can be quantitative or more qualitative in nature. Argentina, Germany, Italy and UK report on the performance of gender policies, but no targets are set during budget preparation, and in Indonesia only a few ministries have performance targets.20 In the US, some agencies or program offices set their own gender targets.

Only one third of G20 countries produce and publish an annual gender budget statement to raise awareness of the differential impacts of budget policies on women and men.21 Gender budget statements help governments better understand their gender priorities, their financial implications and the estimated impact of policies on gender outcomes. They also enhance transparency for citizens on the government’s gender policy priorities, commitments and plans for delivery. Eight of the respondents reported producing and publishing a gender statement (Canada, France, India, Japan, Mexico, South Korea, as well as Austria and Spain). Most of these statements flesh out government’s gender policies, how they relate to gender objectives and gender gaps and some provide details on the content and costing of flagship initiatives and their expected impact on gender equality. Further, these statements are included in budget documentation and posted on the websites of the respective governments or ministries of finance.

Only half of G20 governments have guidelines in budget circulars to help ensure a comprehensive and coordinated approach to GB during budget preparation.22 Incorporating GB guidance for agencies into MOF budget circulars helps to set clear operational procedures for effective coordination and GB implementation. This approach is taken in ten countries where instructions usually deal with the identification of gender-sensitive programs or policies (e.g. by means of classifiers), requirements and/or templates for the presentation of GIAs (Canada and South Korea), or the inclusion of gender objectives in existing programs.23 In India and South Africa, budget circulars instruct on how to allocate resources to specific gender initiatives. In Italy, there is a specific gender circular. Almost half of G20 countries have no budget circulars in place to guide GB implementation.

Forward looking tools such as ex-ante GIAs are only actively deployed in five countries. Ex-ante GIAs24 are highly beneficial to effectively understand the potential impact of new policies on gender and improve their design. Only Canada, France, and UK plus Austria and Spain conduct ex-ante GIA for all or most new policy initiatives, while Australia, Japan and South Korea do so for some proposals. Ex-ante GIA may also analyze the multi-dimensional effects of gender policies, like the Canadian GBA+ methodology.

Relatively few G20 countries have an agreed and consistent GIA methodology.25 Developing a common methodological basis for GIAs is an advanced practice that enhances comparability across ministries and allows for quality checks. Nonetheless, a common methodology is only in place in five countries (Austria, Canada, France, South Korea and Spain). Quality assurance over assessments are conducted by MOFs, ministries of Women or both. In some countries (Canada, France and Spain) gender-specialized units in line ministries carry out a first validation of the quality of GIAs. However, the capacity of these units within line ministries could be uneven and quality assurance checks should also be performed by MOFs to ensure consistency across government.

Given the importance of tracking gender policies over the budget cycle, a majority of G20 countries have integrated them into their budget program structures.26 Tracking gender-related expenditure can enhance medium-term planning, improve prioritization in budget requests and facilitate the monitoring of the performance of gender policies. One pre-condition for tracking is that gender activities can be traced in the programmatic structure of the budget, where this is in place, or as line items. A third of countries follow an advanced practice where gender is incorporated into program classification both in stand-alone gender programs and within other programs. Nine countries lack a programmatic structure in the budget.

However, specific gender classifiers and markers to identify gender-relevant programs and activities are used in eight countries. Attaching codes or labels to gender-sensitive programs in budget documentation can help to more easily identify them. This is especially useful when gender-related activities coexist with others within programs or sub-programs. For instance, in Canada programs are tagged to the pillars of the Gender Results Framework, when relevant for gender equality objectives. Italy has coded public expenditure using three digits, 0, 1 and 2, where 0 denotes gender-neutrality, 1 implies gender-sensitivity (i.e expenditures which have different impact on men and women) and 2 is used for those expenditures whose goal is reducing gender inequality. Argentina tags gender-sensitive programs with the acronym PPG, denoting an intended gender impact. Some countries have incorporated other tracking methodologies with similar functionalities to classifiers, in order to identify gender-relevant initiatives during budget preparation.

Pillar 3: Gender Budgeting: Budget Execution, Reporting and Monitoring

Gender information is rarely included in in-year execution reports or in the government’s annual financial reports.27 Monitoring of gender programs needs to be underpinned by information on their financial and non-financial performance. In-year budget execution reports that monitor progress against gender goals are produced only by two counties – Italy and Mexico. Only Canada, Mexico and South Korea report annual performance against gender goals. Other countries table their reports in their Parliaments and publish annual reports on gender policy actions by sector or clusters of objectives. These reports provide information on the financial impact of gender policies and, for some of them, their non-financial performance against observable indicators. For example, the Italian Gender Budget Report.

Ex-post GIAs are performed in a handful of cases but are rarely used to improve gender policy design.28 Ex-post GIA goes beyond monitoring non-financial performance indicators, as it provides a multi-dimensional view of the effects of revenue and expenditure initiatives on gender equality, as well as the factors explaining these results. However, only seven countries (Brazil, France, Germany, Italy, Mexico and South Korea, plus Austria) reported to conduct ex-post GIA. When it comes to the use of ex-post GIAs only in France is it used frequently, and there it is used for gender gap analysis and occasionally as an input into the design of new gender goals and policy or for making amendments on existing policies.29 This is a lost opportunity to harness a powerful tool that can assess the effectiveness of current policy and use these finds to shape future policy interventions.

Pillar 4: Gender Budgeting: Audit and Oversight

Oversight of gender equality objectives by legislative bodies is present in half of the G20 countries but several still have deficits in this area.30 Greater involvement of the legislature reinforces accountability on gender policies and reforms. Legislatures most common roles include publishing reports on gender equality issues, reviewing information on gender equality goals and performance targets, and conducting hearings on gender equality issues. Although Gender Committees are not widespread yet, they are already active in nine countries (e.g. in Canada, where the House of Commons Standing Committee on the Status of Women has issued Calls for Action in numerous gender-related areas). In Austria several committees oversee gender topics. In some countries, such as Argentina, parliamentarians have received training to better assess the gender perspective in legislative and budgetary discussions. In other countries like Australia, the legislature, can ask the Parliamentary Budget Office to produce a costing that reveals the gender impact of particular government policies.

Summary of Advanced GB PFM Practices and Tools in G20 Countries

In Austria the constitution requires that all levels of government undertake GB. New or amended laws and regulations, and major investment or procurement contracts, must include a mandatory ex-ante impact assessment on gender equality. GB guidelines are complemented by an annual budget circular with details and instructions. The government publishes a gender statement and reports achievements against gender equality outcomes. The Austrian Court of Audit analyzes the impact of budget programs and tax and sectoral policies on gender.

Canada has integrated forward-looking GB PFM tools into the budget preparation stage. The ex-ante GIA (GBA+) is applied to assess the potential impact of policies based on gender and other identity factors to develop more inclusive budget measures. The Gender Statement accompanying the Budget reflects the government’s efforts to understand the differential outcomes of policy choices, outlines the main gender gaps and provides an overview of the progress made towards achieving the government’s equality objectives.

In France the Gender Budget Statement assesses fiscal policies and the budget from a gender perspective and presents the programs that contribute to gender equality with their budgets and contains some performance indicators. The 2020 budget circular instructs all ministries to integrate a gender dimension when defining or revising the performance indicators that are annexed to the Budget Law, setting a basis for monitoring progress in the annual performance reports.

In Japan the Council for Gender Equality in the Cabinet Office, headed by the Prime Minister, leads and promotes the gender equality agenda. Since 2015, each year, the Japanese government prepares the Intensive Policy to Accelerate the Empowerment of Women, which aims to incorporate a gender perspective into the annual budget requests of ministries and agencies.

In South Korea the Gender Impact Analysis Assessment’ (GIAA) law requires a GIA assessment for policies which influence the rights, interests and social participation of women. Ministries are required to prepare and submit to the National Assembly a gender budget statement and balance sheet showing information on budget allocation, execution, performance evaluation and management. The Ministry of Strategy and Finance issues budget guidelines which require every ministry to report gender equality goals that will be considered in budget allocations discussions.

In Mexico by law the National Development Plan must be formulated with a cross-cutting gender perspective. The Federal Budget and the Financial Responsibility Law provide guidelines on how gender-oriented considerations should be incorporated into the budget, stipulating that resources assigned to budget programs and investments earmarked for addressing equality between women and men cannot be removed or diminished. A gender perspective has been incorporated into the program structure, and gender-related indicators into the performance evaluation system with in-year and end-year reporting.

In Spain the Law on Equality for Men and Women requires that the government prepares a gender budget statement and a gender impact assessment for each new policy proposal, together with an assessment of the policy’s economic and budgetary impact. In Parliament, both the Congress and the Senate have established a Commission on Equality.

Source: IMF staff.

Supreme audit institutions still play a very limited role in assessing the performance of gender programs and activities.31 External scrutiny of gender activities is critical for detecting design and implementation gaps, that can be used to strengthen policy design in future proposals. In many countries, this role is assigned to Supreme Audit Institutions. Austria is the country with the longest experience and the most advanced practices, the Supreme Audit Institution published 55 audit reports in the last three years on tax and sectoral expenditure policies, as well as individual programs. In Mexico, UK and India the scope of audits is somewhat narrower and focuses on the expenditure side of the budget.32 Box 2 provides a summary of selected advanced GB practices in G20 countries. More details on individual G20 countries GB practices are provided in Appendix 9.

V. Beyond the G20 – Comparing G20 GB Public Financial Management Practices with Other Countries

Globally countries are experimenting with a range of GB PFM tools, but deployment is uneven and average levels of practice are relatively low. Beyond the G20, Spain and Austria, the survey gathered data on GB PFM practices from 72 other countries around the world.33 Using this broader IMF survey data we place the GB practices of G20 countries in a wider context. What we find is that the average GBI scores of countries outside of the G20 is also relatively low (0.88), with no country yet reaching an overall advanced level of practice (average GBI score higher than 2.5) though some individual tools rank at the advanced level. Figure 8.1 compares the average level of GB PFM practices across the budget cycle of other countries surveyed, with that of G20 countries.

Figure 8.1.
Figure 8.1.

PFM Tools Used to Support GB – Comparison of G20 Countries with Other Countries Surveyed

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source IMF Staff.Note: Differentials are calculated by looking at the difference in GBI scores between the G20 and other countries.

The trends in strengths and weaknesses of GB PFM practices observed in G20 countries are also true for those surveyed outside of the G20. Although overall GBI scores are lower, average GBI scores for non-G20 countries for each PFM practice, broadly mirror trends observed for G20 countries, with few exceptions (Figure 8.1). Consistent with the analysis for the G20 countries, areas of strengths for countries outside of the G20 are within the GB supporting framework (institutional and gender disaggregated data), select elements of budget preparation (budget circulars, linking goals to programs and indicators) and parliamentary oversight. Typical weaknesses are in budget execution reports, gender audits and ex-post and ex-ante GIA. This shows that the application of some GB tools presents challenges across all countries.

Scores of non-G20 countries are most significantly lower than G20 countries in the areas of ex-post and ex-ante GIA and gender budget statements (Figure 8.2). G20 countries on average score at least more than double that of other countries in these GB PFM practices. Surprisingly, integration of gender into budget execution reports is one area where countries outside of the G20 score on average higher than G20 countries but still at basic practice level.

Figure 8.2.
Figure 8.2.

Relative Strengths and Weaknesses of GB Tools Comparing G20 to other Countries1

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source IMF Staff.Note: Differentials are calculated by looking at the difference in GBI scores between the G20 and other countries.

Strong performance in the GB implementation does not appear to be heavily dependent on income level or development of the country. Consistent with the literature, the survey data shows that the contribution of donors towards supporting GB initiatives is particularly noticeable. This is especially the case in low income countries (LICs), with a spike in utilization of certain tools in these countries. This is related to some LICs facing severe challenges in gender inequality and provision of support by international organizations and donors to improve capacities and to help achieve the millennium goals and SDGs. In this regard, as shown in Figure 9, LICs outscore emerging market economies surveyed across all GB PFM practices, with one exception (parliamentary oversight). In addition, LICs are on par, or even outscore, advanced economies in a few areas including in linking gender goals to programs and performance indicators and budget execution reports. This adds further weight to the finding that progress can be made in implementing GB PFM tools irrespective of income level.

Figure 9.
Figure 9.

PFM Tools to Support Gender Budgeting GBI Scores by Income Group and Region

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: IMF Survey and IMF Staff.

VI. Implementation of Gender Budgeting – Challenges and Success Factors

A. Major challenges Encountered by Countries in GB implementing

Technical challenges are highlighted as the key hurdle to implementing GB. Survey responses34 show that key challenges to effectively implementing GB are shared across both G20 and non-G20 countries, and broadly include lack of guidance, coordination and expertise, insufficiently disaggregated data and low quality of GIAs. Figure 10 highlights these findings. These challenges, which are largely technical in nature, are reported to weigh much more heavily on a country’s ability to implement GB than lack of political support, suggesting that there is considerable opportunity to strengthen GB practices through increased technical guidance and assistance. While political support for gender equality is not one of the major impediments to the technical implementation of GB practices, it is overwhelmingly viewed as one of the most critical factors when it comes to the success of GB in influencing decisions and policy outcomes.

Figure 10.
Figure 10.

Major Challenges Encountered in Successfully Implementing Gender Budgeting

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: IMF Survey and IMF Staff.

While challenges are broadly shared among countries, G20 countries are more acutely concerned about the poor quality of GIAs and the lack of clear guidance in the budget process. Nearly 60 percent of G20 countries are concerned about the quality of GIAs, which may reflect the concerns about data and specialized staff. This could also explain the relatively small reliance on GIAs as an input to decision making. Nearly 50 percent of G20 countries, identify the lack of clear instructions on how to incorporate gender considerations into the annual budget as one of the most important challenges to successful GB implementation.

This is relatively unsurprising when put together with the finding that more than half of G20 countries indicate that guidelines for GB do not currently exist.35 Where circulars do exist, they may need to be more granular and be accompanied by guidelines for methodologies for analyzing the gender impact of proposals. The failure of key ministries to coordinate and provide clear guidance may be symptomatic of a need for clearer lines of accountability and leadership on GB issues. Further, 40 percent of other countries surveyed and a quarter of G20 countries indicate that there is no specific entity that coordinates gender issues during budget preparation.

In addition to survey results, IMF capacity development activities have revealed two main types of challenges faced by countries in GB implementation. These are:

  • Difficulties related to specific institutional and technical requirements of GB. Line ministries often lack the expertise necessary to undertake a full diagnostic of gender gaps, design adequate policy measures and assess the financing needs to close these gaps. This complicates the development of meaningful targets and performance indicators. Relatedly, countries often point out to their inability to track gender-sensitive policies over their implementation cycle, due to lack of budget classifications or failure to incorporate gender classifiers in the financial management information systems (FMIS). On the institutional side, when MOFs are not fully involved in GB implementation, this results in lack of coordination, lack of GB instructions and weak accountability on budget formulation and execution of gender-related policies.

  • Difficulties related to shortcomings in PFM. The absence of key PFM tools hinders GB. One frequent example is the lack of an operational medium-term budget framework (MTBF), which facilitates the strategic deployment of gender policies within a common resource envelope. Others are a poor definition of annual budget priorities and/or their deficient transmission to line ministries during budget preparation, low capacity to cost policies and monitor their execution, or the lack of a performance-based framework. On the contrary, good PFM practices may contribute to enhance GB, and synergies have been reaped between PFM reforms and GB mainstreaming, as evidenced in Austria.

B. Important Success Factors to Implementing Gender Budgeting

The survey finds that political support, binding legislative requirements and active support of MOFs are universally identified as key drivers of GB success. This is clearly illustrated in Figure 11. In addition, gender policies are more likely to succeed when governments adopt a comprehensive approach to integrating the gender perspective into the budget process. There are two factors that G20 countries consider to be much more important success factors than other countries – having clear gender equality goals that are linked to programs and securing the support and engagement of line ministries. These factors may reflect the tendency for G20 countries to have experimented more with performance budgeting and with devolved budgetary procedures leading to stronger coordination needs vis-à-vis line ministries. By the same token, G20 countries do not see that support from the international community or increased funding playing a particularly big role in the success of gender budgeting, while other countries do see these factors as important in GB success.

Figure 11.
Figure 11.

Most Important Factors that Explain the Successful Implementation of GB

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: IMF Survey and IMF Staff.

Political support for gender equality is identified as the most important factor in successfully implementing GB. Survey responses present a unified picture about the importance of political support for improving gender equality, across practically all countries, with more than 50 percent of all responses identifying this as a key success factor. This is consistent with the literature that high-level political commitment for gender equality and strong leadership is a requirement for successful GB (OECD 2020) and for progressing reforms to improve gender equality outcomes.

Legal requirements are needed for sustaining GB efforts over time. Having binding legislative requirements to implement GB comes in as a close second behind having strong political support. EMEs and LICs view political support and a legal requirement of almost equal importance. The importance of a binding legal requirement for implementing GB is also well documented in the literature (Kolovich 2018). A legal framework, which provides a consistent and articulated basis to develop and prioritize gender policies, helps to progress the discussion of gender-related policies in a systematic way rather than an ad-hoc fashion and ensures continuity over political administrations.

The engagement of MOFs is a key factor to successful GB. This is evident across all country groups although very significantly in low-income countries. More broadly, support from the MOF scores much more highly than the support of other ministries, for example the ministry for women. This likely reflects the traditional stewardship that MOF have over budget processes, while relevant line ministries (in this case for women) can in some countries have limited control and authority over the budget process. Significantly in 40 percent of G20 countries and more than half of non-G20 countries, the MOF is the institution with primary responsibility for GB reform.

GB has increased the awareness of the impact of policies on gender equality and sharpened the focus on attaining gender equality goals. Both G20 and non-G20 countries reported having received important benefits from the implementation of GB including a better understanding of the intended and unintended impact of the budget on gender equality (see figure 12). This leads to better informed policy choices, meaning policy makers are more aware of the potential impact of decisions on gender. Countries have also reported a greater focus on the achievement of gender equality goals. In addition, more than a quarter of G20 countries have reportedly altered rules and regulations, and more than a third of advanced countries have increased their analysis of gender issues, as a result of GB implementation.

Figure 12.
Figure 12.

Impact of Gender Budgeting on Gender Equality

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: IMF Survey and IMF Staff.

Gender equality is ultimately about changing societies, which entails changes in not just government policy and actions, but also in the private sector and in the behavior of citizens. Evidence connecting GB tools to measurable changes in gender equality outcomes is scarce. This reflects a wider issue with linking government policies and activities to wider societal outcomes, which goes beyond GB. Directly attributing progress made towards gender equality to the implementation of GB is challenging because there are many other factors that impact the achievement of gender equality, including most importantly, societal attitudes and behaviors. However, it is clear from the survey that GB practices can make a difference in the way governments consider policy in respect to gender and lead to more conscious and better-informed decision making.

A recent review of GB literature highlights the need for countries to evaluate more the outcomes of GB reforms in a timely manner (Polzer, Nolte and Seiwald 2021). This is consistent with the survey results which confirm some countries need for more information on GB outcomes. This gap needs to be addressed to gain a more in-depth understanding of GB’s impact on gender equality and to adjust GB reforms as needed to improve outcomes.

VII. Implementation of Gender Budgeting- The Way Forward

Opportunities exist to enhance the way that GB PFM tools are used to better design and operationalize gender responsive fiscal policies. Based on the analysis of the IMF survey results, country experiences and GB practices as documented in the literature, considerable opportunities exist to improve the implementation of GB PFM. This paper identifies five important opportunities that could be leveraged to improve GB implementation:

  • 1. Focus fiscal policies on areas where gender gaps persist. A number of GB PFM tools can support efforts to not only design, but re-design fiscal policies, adjusting resources to better address persistent gender gaps. For instance, GIAs help to better understand the gender impact of current and alternative policies; tracking and reporting spending and performance helps to evaluate their effectiveness; and ex-post GIA is used in redesigning policy interventions. Further strengthening of gender disaggregated statistical products and tools will also help to underpin improvements in GIAs. Understanding where gaps exist encourages a forward-looking approach to designing and adjusting policies, ultimately providing better alignment between the gender impact of a particular policy and the government’s gender goals.

  • 2. Reinforce PFM foundations to support GB practices. Strong PFM systems are needed for the effective implementation of GB PFM tools. Gaps in GB PFM tools are highly correlated to areas where there are gaps in PFM foundations. Evidence from the IMF survey shows that without guidelines or a common methodology for impact assessments it is difficult for line ministries to implement a common approach to GB analysis. Similarly, countries that cannot produce timely budget execution or performance reports cannot get a good grasp of the impact that spending is having on gender. Strengthening PFM tools can enhance the prioritization, design and impact of gender policies.

  • 3. Synchronize GB reforms with PFM reforms to leverage progress. Fundamental improvements to PFM institutions will help to improve GB PFM tools and systems and can act as a catalyst for progressing GB reforms. As GB is concerned with integrating gender tools into existing PFM systems, addressing gaps in PFM offers an opportunity to more closely linking PFM reforms with GB initiatives. This is happening in countries transitioning to program and performance budgeting, where GB is gaining traction as PFM pillars are built.

  • 4. More deeply integrate GB PFM into the budget preparation processes. While survey results present a picture of relatively stronger GB PFM practices in the budget preparation phase, there are still a number of areas where integration can be improved. In particular, a stronger connection between gender needs analyses, gender strategies and available resources can help to ensure that fiscal policies designed to improve gender outcomes can be prioritized and delivered within an overall expenditure envelope. Clear priorities will help coordination between ministries (especially Finance and Women ministries) on the implementation of GB tools.

  • 5. Improve GB practices in budget execution, monitoring and ex-post evaluation, including by enhancing program and performance-based budgeting. Evaluating the effectiveness of gender policies in delivering gender outcomes is not widespread and is usually related to the implementation of program and performance-based budgeting. There are three specific elements that can help to improve GB practices: i) Ensuring that gender-sensitive programs and/or line items can be identified and spending can be tracked in the FMIS or using other markers, both if the gender impact is complete or partial; ii) Improving and developing the use of performance indicators to track and monitor program performance against specific outcomes; iii) Developing granular ex-post analysis which requires strong analytical capacity and resources. This practice is crucial to allow for better transparency and monitoring of the effectiveness of policies to inform changes in future decisions.

Solutions must be tailored to individual country circumstances depending on the stage of implementation, level of practice and available resources. A sequenced approach can be especially advantageous where no previous GB practices exist, stakeholders are not yet sufficiently engaged, technical capacity is still developing, or there are PFM limitations. Although some countries, like Austria, have succeeded at introducing GB through a “big-bang” strategy, a gradual approach is more common. In these cases, sequencing should be based on a credible timeline, be structured around monitorable milestones and be underpinned by clear legal norms and methodological principles. Based on our learning from the status of country efforts generated from the survey and IMF involvement with CD activities, a possible approach to the sequencing of GB reform implementation is highlighted in Figure 13 and discussed in detail at Appendix 7.

Figure 13.
Figure 13.

Proposed Sequencing of GB Implementation

Citation: IMF Working Papers 2021, 269; 10.5089/9781616354510.001.A001

Source: IMF staff.

VIII. Summary and Conclusions

Despite progress in most G20 countries in the last fifteen years, achieving gender equality remains a significant challenge that has been only exacerbated by the COVID-19 pandemic Women’s participation rate in the workforce on average still remains below that of men, the average gender pay gap remains substantial, women’s leadership remains below 50 percent and women are significantly over-represented in the number of hours spent on unpaid work.

GB is an important instrument for tackling gender inequality and closing these gaps – yet – the overall average level of GB practices in G20 countries is low. Policy decisions made by governments can serve to either promote gender equality or reinforce existing inequalities. And while progress towards gender equality depends on many factors, such as changes in societal attitudes and behaviors, GB can play an important role to identify gaps in fiscal policies and provide the tools needed to address them.

All G20 countries have enacted gender focused fiscal policies but the PFM tools to operationalize these policies are far less established. While there is significant variation across individual country GB practices, there is no country that achieves an overall average level of advanced practice. Across the budget cycle, clear strengths and weaknesses in GB practices emerge. GB practices are significantly stronger within institutional frameworks and budget preparation processes, than for budget execution and auditing practices – but opportunities for improvement exist in all areas. The trends in strengths and weaknesses of GB practices observed in G20 countries are also true for those surveyed outside of the G20.

Where GB features are in place, GB PFM tends to operate more as an ‘add-on’, rather than as an integral part of strategic and resource allocation decisions. Countries are at various stages of adopting GB and have a range of approaches, suggesting there is no single model and no linear path for implementation. Future efforts should focus on where policy gaps exist and strengthening the implementation of GB tools that can make a difference to addressing these gaps. PFM foundations should be reinforced to support GB implementation and future GB efforts should be synchronized with PFM reforms to catalyze progress.

All countries can do more to integrate a gender perspective throughout the budget cycle to get the biggest ‘bang-for-their-buck’ in terms of GB reform efforts. For example, including gender in the budget circular but not incorporating GB tools in the budget execution and reporting phases, may allow countries to fund gender programs – but does not provide any information on how a program’s money is spent, if gender objectives are achieved or how programs could be improved.

A more integrated approach to GB also requires better deployment of GB tools in the planning phases of the budget cycle to improve the sustainability of gender policies. Sectoral gender strategies are often highly imprecise, unevenly costed and disconnected from medium-term budget envelopes. Success is promoted by a medium-term strategy, appropriately sequenced and synchronized with envisaged PFM reforms. In most countries gender strategies need to be better linked to medium-term budget frameworks and the financial implications of different initiatives within these strategies need to be better assessed and prioritized. Many countries include gender equality goals in national or sectoral plans, but they are not costed or translated into the budget – and therefore lack realism about their implementation.

Globally, support for GB is broadening and there are considerable opportunities for countries to do more to improve – regardless of a country’s level of development or income. Strong performance in GB implementation does not appear to be heavily dependent on the level of development or income group of a country.

Powerful GB tools are being underutilized and countries are missing out on valuable opportunities to drive policy change and fight gender inequality. Too few countries assess the upfront impact of policies on gender and/or evaluate ex-post the effectiveness of policies and programs. This analysis helps to raise awareness of where the gender gaps are and how policies and programs influence gender equality. However, this analysis needs to be integrated into budget decision making if it is to result in better targeted policy. Policy makers need to be made aware of the impact of their choices on gender upfront – to make better informed decisions. And as policies are implemented, future decisions should be informed by a policy’s track-record of impact. Further efforts to improve GB budget execution practices, and ex-post evaluations are necessary, including by enhancing program and performance-based budgeting efforts.

Strong political backing for improving gender outcomes, a MOF who is firmly in the ‘driver’s seat’ and binding legislative requirements are key to successful GB reforms. The vacillating fortunes of GB highlights the importance of promoting wide societal and political support for GB and formalizing requirements to ensure reforms endure changes in governments. Empowering the MOF to develop common methodological guidelines, including gender considerations in budget circulars and strengthening quality checks would help improve GB analysis and help to overcome major implementation challenges.

GB has helped to shape and influence societal views by providing transparent information on government gender policies, or lack thereof. Countries report that implementation of GB has translated into an increased focus on gender equality goals in budget allocations and awareness of the impact of fiscal policies on gender. This provides a platform for raising awareness about the costs of inaction where civil society is called to play a stronger role. More research is needed on the direct effectiveness of GB tools in terms of their contribution to improving gender equality outcomes and the levers by which this is achieved.

Effectively responding to the pandemic means transitioning to GB practices that are more influential in shaping and changing policy decisions. The COVID-19 pandemic has highlighted how the failure to consider gender aspects in the design and implementation of policies can have an unintended impact. It is important that GB PFM tools help disentangle the gender impact of policies during the design and budgeting phases, help to track expenditure effectiveness and improve accountability. Making the impact of policies on equality more visible through better analysis and reporting will help to promote implementation and improve results. The COVID-19 pandemic presents new challenges for the implementation of GB, while underscoring the urgency and importance of progress in this area.

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Appendix 1. Stylized Data on Gender Equality Gaps in G20 Countries

Decision Making:

  • Globally, as of 2019, women represent less than one-third (on average 25%) of members of parliaments in G20 countries.

  • Almost half of the G20 countries have established quotas, incentives for political parties to include women on candidate lists, or other special measures at the national level to promote women’s political participation and representation.

Labor Inclusion:

  • Globally, in 2019 the gender pay gap persists. In 18 of the G20 countries, women earn 15% less than men.

  • Less than half of the economies analyzed in the latest World Bank report “Women, Business and the Law” have legislation mandating equal remuneration for work of equal value.

  • Globally, only 55% of women (aged 15–64) are engaged in the labor market as opposed to 78% of men.

Financial Inclusion:

  • The legal framework of all G20 countries provides women with the same rights as men to open a bank account at a formal financial institution and guarantees women’s equal access to credit.

  • Despite this framework, on average, 22% of women in the G20 countries lack access to formal bank accounts

Source: W20 – Women’s official engagement group of the G20. – About W20 — Women20.

Appendix 2. Gender Budgeting PFM Tools embedded within the Budget Cycle

Pillar 1 – Gender Budgeting Framework – Legal and Institutional

Legal and institutional gender responsive budgeting framework: This includes strong legal frameworks or institutional settings that outline and reinforce the requirement to implement gender budgeting.

Gender disaggregated statistics: In key areas, statistics are collected disaggregated by gender. For example, the number of women and men that receive a given government service, macroeconomic, labor market and socio-demographic statistics. These are used in gender related analysis and impact assessments.

Pillar 2 – Gender Budgeting – Preparation and Approval

Gender budget statement: A gender budget statement is a gender-specific policy and accountability document produced by a government to show how the annual budget aims to improve gender equality. It can be produced before the outset of budget preparation (Pre-Budget Statement) or be a part of the annual budget documentation. These statements are traditionally tabled in the legislature.

Ex-ante gender impact assessment (GIA): An ex-ante GIA provides an assessment of the potential impact (direct or indirect) of a policy proposal on gender to inform decision makers of the potential impact of their next policy decisions on gender outcomes before the decisions are taken. The assessment can be quantitative or qualitative.

Gender budget circulars: They are part of the budget guidelines or rules circulated by the ministry of finance at the beginning of the annual or multiannual budget process to help the spending ministries to operationalize a gender perspective into their budget proposal. This usually includes instructions on how to classify and track spending on gender, guidelines for gender impact assessments (usually ex ante) and templates to be used in the budget submissions.

Linking gender goals to program and performance: Program and performance-based budgeting helps to introduce gender budgeting from the budget preparation phase of the budget cycle by linking gender related policy goals to specific programs and to performance indicators. This also facilitates monitoring during execution.

Gender budget classification and tagging: a budget program or line item can be tagged or marked according to its gender impact. This helps to identify expenditure proposals according to their gender impact during budget preparation (such as OECD or UNICEF markers) and also facilitates monitoring of budget execution. Budget classifiers can also incorporate gender codes to identify the allocations with gender impact, usually embedded in the finance management information system.

Pillar 3 – Gender Budgeting – Execution, Reporting and Monitoring

Gender budget execution reports incorporate a gender perspective: in-year and end-year execution reports produced by the ministry of finance that identify the year-to-date gender related spending against gender programs. The report may also cover non-financial performance information.

Ex-post gender impact assessments (GIAs): They assess the impact of policies after a program has been delivered to evaluate whether the policy was effective in achieving the desired policy outcomes, including examining how the policy impacted both men and women. It could also usefully be compared with the ex-ante GIAs, to improve the quality of future ex-ante policy assessments.

Pillar 4 – Gender Budgeting Audit and External Oversight

Gender related audits: Generally conducted by the supreme audit institution, these are independent, external, usually performance audits that examine how gender objectives are mainstreamed into public policies and budgetary processes, and how the use of public funds in selected programs and/or sectors has impacted gender equality.

Parliamentary oversight: This involves oversight by the legislature of how effectively public resources have been used on gender-related policies to deliver gender outcomes. Oversight mechanisms include annual reports that are tabled and discussed, as well as parliamentary committees, hearings and research or costings by parliamentary budget offices commissioned by members of the legislature.

Appendix 3. Illustrative Example of Specific Gender Budgeting PFM Tools in Action Throughout the Budget Cycle

Appendix 4. Questionnaire Used to Assess Gender Budgeting in G20 Countries

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Note: These 23 questions are the core questions of the full GB survey and these questions and the 12 indicators are used to produce the gender budgeting index.

Appendix 5. Table of Correlations Between GBI Components (n=21)

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Source: IMF Survey and IMF Staff. Note: GB tools and institutions highlighted in red reflect correlations greater than 0.4. Green reflects the correlation of a GB tools and institutions with themselves showing a score of 1 given they are perfectly correlated with themselves.

Appendix 6. Methodology for the Gender Budgeting Index

The IMF’s Fiscal Affairs Department (FAD) developed an online gender budgeting survey, to help assess countries’ gender budgeting practices. The key purpose of the survey is to obtain comparative data on the current status of GB practices in G20 countries and beyond.

The paper is based on the data generated using responses from the self-assessment survey completed by government officials to a close ended multiple-choice questionnaire. The survey was sent to all G20 governments in 2019. The respondents are government officials, mainly at the ministry of Finance or/and the ministry of women or related entities responsible for gender issues in a given country. The data collection for this study took place in 2019 and 2020 with follow up and quality check of responses taking place in late 2019 and 2020. During the analysis, in order to assure the quality of the data, the team contacted the respondents whenever there was a need for an explanation or to verify responses. For some responses, countries are asked to provide links to relevant documents, which have been verified, and where information is available answers have been scrutinized to detect and remove inconsistencies as much as possible.

The sample understudy comprises of twenty-one (21) countries; nineteen (19) G20 countries (being the 20th the European Union) and two guests G20 countries, namely Austria and Spain. The survey only assesses the gender budgeting practices at central government level.

The study assessed the status of GB practices in G20 countries using twelve (12) indicators comprised of twenty-three (23) questions (see Appendix 4). Each question is scored, ranging from 0–3 based on the level of GB practices in the country. The scores capture not only the existence of the most relevant PFM tools but also the design quality and soundness of GB tools and PFM practices and some aspects of their application. For example, in addition to assessing if governments produce impact assessments, scores are higher for those countries where a common methodology is in place, and the assessment is used in decision making. The quality aspect is determined by awarding higher scores for better practices.

The scores of the twelve indicators have been calculated by taking the arithmetic mean of the scores of the questions under each indicator. Each indicator is ranked based on their level of performance, scores between 2.5 and 3 are considered advanced practices, values between 1.1 and 2.4 are associated with good practices, values between 0.1 and 1 denote limited practices. For the G20 countries these are presented in Table 3 of the paper. Further, the overall country score of the ‘Gender Budgeting Survey’ is calculated by taking the arithmetic mean of the scores of the twelve indicators. In terms of relative ranking of overall country performance, scores between 1.47 and 2.25 are considered high, 0.75 and 1.46 are medium and scores between 0.03 and 0.74 denote low. The overall GBI score explains the relative position of a country with GB tools, in comparison to other G20 countries. The paper provides countries’ comparative overall gender budgeting scores in Figure 7.

Acknowledgement

Thanks are due to the respondents of the G20 countries and Austria and Spain for taking time to provide quality data for the survey.

Appendix 7. A Possible Sequencing of GB Reforms

At a first stage, countries could prioritize establishing supporting frameworks and institutions by:

  • Enshrining gender equality as a principle informing PFM. This may involve legislative amendments, preferably in high-rank laws (at least Organic Budget Laws and PFM laws), which can be subsequently supplemented by changes in technical and sectoral regulations. Legislative changes should clearly define the departments responsible for the mainstreaming of GB reforms and the coordination of gender discussions during budget preparation. Considerable benefits can be drawn from the MOF playing a central or prominent role in these coordination arrangements.

  • Ensuring the availability of gender-disaggregated statistics and gender needs diagnoses in critical sectors. The production of comprehensive statistics by gender is a medium-term process that involves line ministries and sectoral agencies, national institutes of statistics and private producers. In a first stage, these statistics can be confined to basic variables, such as employment, education enrollment, access to health services or monthly earnings. Only on the basis of these data, which in some countries can be generated with the support of donors, is it possible to diagnose major gender gaps and develop basic tools to address them. In order to raise social awareness about these gaps and the importance of reducing them, consideration can be given to the publication of an annual report on the status of gender equality and the evolution of the main gaps. This report can be discussed in Parliament. It also can be part of the annual budget execution performance report where they exist.

  • Strengthening, where needed, the alignment between national gender equality goals, sectoral strategic objectives and programs targeted to women. Gender equality targets should cascade from national strategies and development plans to specific sectoral plans, adequately broken down and costed by programs and activities. In a first stage, countries can focus on programs specifically targeted at women, the objectives and impact of which are easier to define. A coordinating entity with technical expertise within the government can oversee the broad alignment of these programs with government’s priorities. At this stage, a formal ex-ante GIA may not be necessary to underpin program proposals, but only a brief assessment of their intended effects on gender equality in view of their beneficiaries and their linkages with sectoral strategies. Additionally, the MOF should verify the financial viability of these plans and the consistency with resources. Technical capacity and statistics permitting, a few annual performance indicators can be piloted in these programs.

  • Ensuring that in-year and annual budget execution reports capture gender equality programs. In the same vein, those ministries managing programs with pilot performance indicators can produce a written assessment, as soon as statistical information is available, on the non-financial performance of these programs, to be circulated at government level. If these analyses are deemed to have some quality, they can be incorporated into the annual report on gender equality.

  • Producing and publishing a set of GB guidelines, with clearly defined objectives, processes, responsibilities, and sequenced milestones. Good practice is that these guidelines are produced jointly by the ministry of finance, which has the most comprehensive view of the budget process, and another specialized ministry, such as women or social affairs in consultation with the rest of line ministries. The guidelines can differentiate several levels of practice and set a clear timeline for the application of each of them in view of the starting position of the country and technical capacity of line ministries. As part of the basic level of practice, the guidelines should describe at a minimum: i) the information line ministries are expected to provide to the MOF during the strategic phase of budget preparation, when annual budget priorities are decided; ii) the guidance that budget call circulars will provide to help line ministries to integrate their gender priorities and programs in their budget requests and how to track and report them (decide on the use of gender budget classifiers and gender markers); iii) some technical criteria for the definition of performance indicators, and the content of the assessment reports to be produced by line ministries.

Transitioning to the second stage can be facilitated by the gradual development of ex-ante GIA and an enhanced identification of gender-sensitive programs in the budget. This can be done by:

  • Expanding the statistical base of gender-disaggregated statistics to new sectors and improving databases of beneficiaries of expenditure policies by gender.

  • Piloting ex-ante GIAs in a number of line ministries. Ex-ante GIAs could include at this stage those programs not exclusively targeted at women. Starting from a reduced number of pilot ministries and programs, they could be gradually rolled-out to other departments and supported by a training agenda. These efforts should be underpinned by the development of a common methodology eventually annexed to the GB Guidelines. Complementarily, ex-ante GIAs should be accompanied by a two-pronged quality control, involving ministries of women when it comes to their technical content and MOFs regarding its budgetary side. As long as the pilot phase yields satisfactory outcomes, GIAs can begin to be used in bilateral budget discussions between the MOF and line ministries.

  • Extending performance indicators to all gender-sensitive programs and sub-programs. These indicators should differentiate between outputs and outcomes, cover the whole life of the sub-program and activity and include numerical targets.

  • Developing a system of markers for gender-sensitive programs, in parallel to the implementation of ex-ante GIAs. To be fully effective, these markers could be incorporated in the Chart of Accounts or budget classifiers and the FMIS -in this phase or the third one-, which would ensure a complete monitoring of their financial performance, and budget execution reports. If not possible, they can be reported in other systems.

  • Discussing gender gaps and gender-sensitive policies in the annual budget statement, where this exists. This discussion should reflect gender policy priorities and the flagship initiatives of the government in this area. When the statement is published together with the budget proposal rather than as a pre-budget statement, it could also include quantitative and performance information about the proposed appropriations to gender-sensitive programs. The use of budget classifiers or tagging in budget proposals will help the compilation of the gender budget statement making visible the policies objectives and allocations.

  • Publishing an annual report compiling and analyzing the financial and non-financial performance of gender-related programs, eventually as part of an annual gender equality report or annual performance report. For the sake of accountability, gender performance information should be discussed in parliament, for instance in a distinct hearing session.

Countries moving to the third stage could consider action in the following areas:

  • Expanding statistics by gender to the entirety of sectors and developing tax statistics by gender. Together with expenditure, such as social transfer statistics by gender, tax statistics can be used to analyze combined incentives of fiscal policies on labor supply and human capital accumulation.

  • Developing and discussing multi-annual projections of gender-related expenditure in key programmatic and budgetary documents. The latter include sectoral strategies. Medium-Term Budget Frameworks (MTBF) and budget/gender statements. Gender budget classifiers could also be reflected in MTBF, to facilitate the identification of gender-sensitive initiatives among government’s strategic priorities. To raise the impact of these projections, the parliament can debate them in a separate session/hearing.

  • Gradually rolling-out ex-ante GIA to all ministries. Ex-ante GIA should become an integral part of regulatory impact assessment for all ministries during this phase. The ministry of finance would verify that, material, GIAs are included in all budget submissions and assessments of infrastructure projects, and then used as a tool for framing discussions with line ministries during bilateral hearings.

  • Actively using performance information during budget preparation, especially in the course of medium-term expenditure planning and bilateral hearings subsequent to the submission of budget requests. Budget call circulars can support this approach, by requesting the inclusion of this information in budget requests and clarifying that it will be discussed during bilateral hearings and taken into consideration to determine final expenditure ceilings by department.

  • Enriching the qualitative analysis of performance reports. Beyond monitoring quantitative performance indicators, these reports could also dwell on the reasons why some programs may fail to deliver their objectives, or if they have surpassed expectations or produce beneficial effects of an unexpected kind.

  • Undertaking non-financial performance audits and ex-post GIA of selected gender-sensitive policies and publishing their results. Then feeding the results of these assessments into new policy decisions. Like performance information, this analysis should be utilized to inform budget preparation and improve gender markers decisions.

Appendix 8. Q9: Legal Provision for Gender Budgeting in G20 Countries

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