This paper provides details of Public Expenditure and Financial Accountability (PEFA) Assessment report for Niger. The measurement of the public financial management performance indicators shows that progress has been insignificant. Reform programs in progress in the area of oversight and external auditing are moving ahead; as this trend continues, the progress will be reflected in the scores of subsequent assessments. However, the progress of the external audit will continue to depend on positive trends in the area of accounting, information recording, and financial reporting.


This paper provides details of Public Expenditure and Financial Accountability (PEFA) Assessment report for Niger. The measurement of the public financial management performance indicators shows that progress has been insignificant. Reform programs in progress in the area of oversight and external auditing are moving ahead; as this trend continues, the progress will be reflected in the scores of subsequent assessments. However, the progress of the external audit will continue to depend on positive trends in the area of accounting, information recording, and financial reporting.


The following quality assurance arrangements have been established in the planning and preparation of the PEFA assessment report for the Niger final report dated February 19, 2013.

The assessment oversight team was established on June 26, 2012 by the finance minister. It was chaired by Mr. Abdou Maidagi, Cheif of Cabinet at the finance ministry (MoF) of Niger, and comprised of key stakeholders from various ministries and institutions, including:

  • Messrs. Mahaman Sani Kanta andHamza Mayata, General Directorate of Financial Reforms, MoF

  • Mr. Maissa Djibo Diouf, General Directorate of Budget, MoF

  • Mrs. Souleymane Gambo, General Directorate of Treasury and Public Accounting, MoF

  • Mrs. Aissa Miginyaoua, General Directorate of Tax, MoF

  • Mr. Labo Mamane Souley, General Directorate of Customs, MoF

  • Mrs. Fatimata Falalou, Ministry of Planning

  • Mr. Hamidou Garba, Court of Accounts

  • Mr. Farouk Abdoulkarim, Inspectorate General of State.

  • Mr. Maman Sani Zakari, Inspectorate General of Finance, MoF

  • Mr. Daouda Chaibou, General Directorate of Control of Public Procurement, MoF

  • Mr. Ango Issa Zango, Central Bank of West African States

  • Mrs. Gambina Garba Sahabi, General Directorate of Finance Control, MoF

  • Mr. Adamou Moussa, Directorate of Material and Financial Resources, Ministry of Agriculture

  • Mr. Garba Moussa Abdoulkader, Ministry of Interior

  • Mr. Yaou Seini, Directorate of Material and Financial Resources, Ministry of Education

  • Mrs. Fatouma Ali, Agency of Public Procurement Regulation, Prime Minister’s Office

  • Mrs. Mariama Soumana, Directorate of Material and Financial Resources, Ministry of Public Health

  • Mr. Ismael Zaneidou, Ministry of Public service

The assessment team consisted of:

  • Mr. Jean Pierre Nguenang (Team Leader, Fiscal Affairs Department (FAD), IMF)

  • Mr. Gregory Allen Horman (FAD, IMF);

  • Mr. Abdelali Benbrik (FAD expert)

  • Mr. Mario Dehove (FAD expert)

  • Mr. Jean-Marcel Warnier (FAD expert).

PEFA assessment report Niger, February 19, 2013

The quality assurance process followed in the production of this report satisfies all the requirements of the PEFA Secretariat and hence receives the ‘PEFA CHECK’.

PEFA Secretariat, March 7, 2013

Summary of the Assessment

At the request of the Minister of Finance of the Republic of Niger, the IMF Fiscal Affairs Department (FAD) performed an assessment of the systems, procedures and public financial management institutions for the 2009–2011 period according to the revised “public expenditure and financial accountability” methodology or PEFA. The assessment was performed in Niamey from October 3 to 17, 2012, in close cooperation with the PEFA dedicated study working group (WG), coordinated by the Director of the Cabinet of the Minister of Finance, consisting of the representatives of the key ministries and institutions. This assessment reports on the progress that has been made since the last PEFA assessment in 2008. Thus, it establishes a new benchmark to monitor progress in implementing the public financial management reforms. It is used as a basis for the work of fine-tuning the current Public financial management Reform Plan (PRGFP) of the authorities.

Key findings of the PEFA assessment

Overall, the measurement of the public financial management performance indicators shows that progress has been insignificant. Of the 31 indicators, 21 were ranked the same or lower than their 2008 level. Only ten indicators improved slightly. The progress that was observed was obtained mainly in areas that received foreign technical assistance, namely public policy-based budgeting owing to the introduction of the medium-term expenditure frameworks and the preparation of a government debt strategy, and the improvements of the revamped procurement system.

Reform programs in progress in the area of oversight and external auditing are moving ahead; as this trend continues, the progress will be reflected in the scores of subsequent assessments. However, the progress of the external audit will continue to depend on positive trends in the area of accounting, information recording and financial reporting. The persistent weaknesses observed in the area of accounting also limit the extent of progress in policy-based budgeting. The budgetary and financial information required for analysis and decisions is incomplete, unreliable and irrelevant. The production of quality budgetary information is hampered by the fact that the information generated by the Directorate General of the Treasury and Accounting does not reach the database managed by the Directorate General of the Budget. In the end, these results are reflected in the poor credibility of the budget.

The summary of the results of the assessment in each of the six dimensions of the performance measurement framework and of donor practice is as follows.

Credibility of the budget. The credibility of the budget continues to be unsatisfactory despite efforts to limit the creation of new payment expenditure arrears (PI-1 to PI-4). The poor mobilization of domestic resources has a negative impact on credibility, and is in part the reason for the changes in the level and composition of spending by agency in the 2009-2011 period. This contributes to the accumulation of domestic arrears, albeit limited (1.7 percent of total expenditures), and are added to the older stock, a portion of which was cleared.

Comprehensiveness and transparency. Progress in comprehensiveness and transparency was insignificant (PI-5 to PI-10). Public access to key information continues to progress insufficiently after the public was provided with an increasing quantity of budgetary and financial information. The budgetary documentation submitted to the National Assembly has been improved, in particular with the information on tax exemptions and the public debt strategy paper. By contrast, there has been no change in the transparency of the annual budget since 2008, and the information is incomplete because a substantial percentage of the revenue collected by some ministries, such as Justice, Foreign Affairs or Health, is not included in the reports. The budgeting of projects financed by donors has improved, but is still insufficient. Relations between the central government and sub-national authorities continue to lack transparency due to the absence of rules for the horizontal allocation of resources from the central government for their use. The oversight of budget risk in government agencies and enterprises has remained unchanged since 2008, primarily because there is no unit that oversees and/or consolidates their budget and financial statements.

Budgeting based on national policies. Budgeting based on national policies has improved, although it is weakened by the poor quality of budget execution data (PI-11 and PI-12). Even though the draft budget laws were submitted to the National Assembly on time, the sectoral ministries, by contrast, had an average of less than four weeks to prepare their budgets. The circular letter is not exhaustive, because it fails to differentiate between information on authorized services [services votés] and new measures. Since 2010, the budgetary procedure introduced the components of a medium-term expenditure framework that is linked to the macroeconomic and budgetary model known as AYOROU. However, the budget estimates are used for forecasting and not for execution. The links between the budget estimates and the subsequent setting of annual budgetary ceilings do not appear clearly and discrepancies are unexplained. An analysis of debt sustainability is produced each year, and sectoral strategies for priority sectors that account for more than one-third of total expenditures exist and are updated. However, investments are relatively unaligned with existing sectoral strategies.

Predictability and control of budget execution. Regarding the predictability and control of budget execution, with the exception of the procurement system, little progress was observed (PI-13 to PI-21). The highlight of the recent period was the preparation of a General Tax Code, enacted in June 2012. However, progress was slower in the area of simplifying the system of tax and customs exemptions, in formalizing and disseminating administrative procedures, and in improving the settlement of tax disputes. The registration process improved somewhat in 2010 and 2011, in terms of the requirement of being registered in order to bid on government contracts or to engage in import activities. There are programs for tax audits based on findings from previous reviews of taxpayer returns and/or crosschecks, but they are not based on real risk assessment criteria. The funds that are collected are transferred regularly to the Treasury, but the time frame for mobilizing them is not optimized. For the execution of expenditures, a quarterly budget regulation system is in place. The data on the internal and external debt is relatively complete and is reconciled every year. The results of the 2012 survey of government accounts show that there is considerable data, which results in fragmenting the government’s cash into accounts whose balances, calculated monthly, are not consolidated. Budget adjustments during the year are made by regulation are used if there are constraints on financial resources, but also by legislation. The procedures for nonrecurring expenditures are significant and reduce the scope for executing expenditures using the normal procedure, which also limits the effectiveness of internal controls of nonwage expenditures. The audit of the payroll statement based on crosschecking it against the personnel database kept by the civil service continues to have only partial coverage due to the existence of the autonomous status provisions introduced beginning in 2010 and managed directly by the agencies concerned. The survey operation carried out in 2009 was not followed by a tabulation of these results. The implementation of the revamped procurement framework has improved. The internal control system has not improved, other than an improvement in following the recommendations; this continues to be below international standards, in particular with regard to the independence of systems programming and control.

Accounting, information recording and financial reporting. In the area of accounting, recording information and financial reporting, there was an overall deterioration compared to the 2008 assessment (PI-22 to PI-25). Although the systems that provide the central government with information on the resources that the local health centers and schools receive continue to suffer from constraints, expenditure reviews and annual surveys have been carried out in these sectors. Bank accounts, suspense and prepayment accounts are settled every year, but delays are significant, at more than a year. In-year and end-year reporting on budget execution remains poor. The quarterly reports are unclear, incomplete, and insufficiently reliable. In the annual financial statements, there are significant delays of more than a year for finalizing and submitting them to the Audit Office. At the time of the assessment, the last draft budget review law that was finalized and submitted to the Audit Office was the one for 2007, and the latest end-year treasury account dated back to 2008; after the assessment, the draft 2008 and 2009 budget review laws were finalized and sent to the Audit Office. The draft budget review laws and end-year treasury accounts for 2010 and 2011 are being finalized. Consequently, the draft finance law for year (n+1) is being examined, but the budget review law for year (n-1) has not been submitted to the Assembly.

External oversight and audit. External oversight and audit have improved, but their effectiveness is hampered by weaknesses in government accounting (PI-26 to PI-28). The external audit has been strengthened, inasmuch as the Audit Office was established in 2010 and began operating vigorously and authoritatively. However, the Audit Office considered that the current legal framework made it impossible for it to perform its judicial review in the area of tax and customs revenue. Its work is hampered by the delays caused by the Ministry of Finance in producing the accounts and draft budget review laws, and its effectiveness is weakened by the insufficient attention that the executive pays to its recommendations. Although it does not hold a debate before the fact on the major budgetary policies and the status of public finance, the National Assembly does have procedures and methods to review the draft budget law and they are clear, precise and effective. The Assembly holds hearings of officials and key figures and has the time needed to perform the review so that it is fully informed. The rules for reallocating funds during the year by the executive are adequate, but the practice of supplementary budget laws limits the real extent. Relations between the National Assembly and the Audit Office have made insignificant progress: (i) at the time of the PEFA assessment, there had been no debate on the 2007 budget review law; (ii) after the assessment, in December 2012, the 2007, 2008 and 2009 budget review laws were enacted; and (iii) the Assembly has not yet received the results of the Audit Office judicial and administrative audits which, nonetheless, were sent to it recently. The National Assembly put in place a framework for having the executive monitor its recommendations.

Donor practice. There was no progress in donor practice (D-1 to D-3). There were in fact lags in the quarterly disbursement of direct budget support agreed upon with donors that surpassed 50 percent in 2009 and 2010. Some key donors only provide annual estimates of disbursements of project aid and program aid, and the estimates are not disaggregated according to the economic categories of the government budget classification. Even though some donors use the national procedures, the amounts of the funds paid using this procedure remain low.

Consequences of the findings of the PEFA assessment on meeting the public financial management objectives

Fiscal discipline and the strategic allocation of resources were negatively affected by the lack of budget credibility. This lack of credibility generated negative baseline budget balances and significant funding shortfalls during the period under review. A portion of these deficits was funded by continuing to establish new domestic expenditure payment arrears (albeit on a limited scale). Due to finite budget resources, the leeway of the authorities was reduced, creating funding shortfalls for some priority expenditures. The reallocations of expenditures that ensued changed the original resource allocations somewhat.

These issues are exacerbated by the weaknesses in the internal controls of nonwage expenditures, in part due to the significant use of procedures for payments without authorization, which weakens the production of budget and accounting reports. In this context, no relevant information was available to establish the costs of services or to measure the actual use of resources by the beneficiary units.

Prospects for preparing and implementing the reforms

The results of the current PEFA assessment confirm the evaluations of the public financial management systems summarized in the public financial management reform program (PRGFP2), implemented beginning in December 2011. The implementation of these reforms is facilitated by putting in place a monitoring-evaluation system around two key entities: (i) a steering committee chaired by the Minister of Finance and consisting of donor representatives; and (ii) a technical committee, chaired by the secretary general of the Ministry of Finance, consisting of representatives of the partner entities in the preparation and execution of the reforms.

Table 1.

Summary of the PEFA 2012 assessment compared to the 2008 assessment

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I. Introduction

1. The purpose of this report on public expenditure and financial accountability (PEFA) is to provide a common framework of information on the current status of public finances in Niger. The 2012 PEFA assessment measures the progress since the previous PEFA assessment in 2008 and identifies the areas in which public financial management performances have changed in the last four years, and the reform programs or other factors that contributed to these changes. The assessment will serve as a basis for fine-tuning the public financial management reform program.

2. This PEFA assessment is being conducted in a context highlighted by the adoption in September 2012 of an Economic and Social Development Plan (PDES) for 2012 to 2015. The PDES is the successor to the General Declaration of the President (DPG).

3. With financing from Japan, and at the request of the authorities, the IMF Fiscal Affairs Department (FAD) performed the current PEFA assessment. A team led by Mr. Jean Pierre Nguenang, FAD Technical Assistance Advisor, with Messrs. Gregory Allen Horman (FAD), Abdelali Benbrick, Mario Dehove and Jean-Marcel Warnier (FAD experts), carried out this assessment. The dedicated working group for this study coordinated the assessment under the supervision of Mr. Abdou Maidagi, Cabinet Director of the Ministry of Finance, along with representatives from the ministries and institutions.

4. The working group held meetings and collected and submitted the documents to the assessment team while the assessment team was in Niamey. The working group organized, as scheduled, two workshops. The first was an introduction and assisted in familiarizing the Nigerien party with the new 2011 PEFA methodology, while the purpose of the second workshop was to present the preliminary assessments of the 31 indicators. The assessment team held two working sessions with the donor dialogue framework on fiscal management. The first was an introduction and the second was a debriefing: (i) a summary of all the preliminary results of the assessment; and (ii) more in-depth on the three indicators that deal with donor practice.

5. The 2012 PEFA assessment was performed based on the January 2011 revised PEFA framework, the highlight of which was the revision of three out of the 31 indicators (PI-2, PI-3 and PI-19). All of the methodology guides the PEFA Secretariat provided were used, including the guides for the repeated assessments. The assessment covered the 31 indicators in the PEFA framework. In particular, the assessment period for indicators PI-1 to PI-4 covers the three fiscal years from 2009 to 2011. The key sources of information were the texts of laws, decrees and decisions, as well as reports, some of which are public, while others were made available to the mission.

6. The assessment covered revenue operations as well as expense operations in the general government budget, extrabudgetary expenses, as well as project aid from donors. The central government commits a significant percentage of public expenditures, including the funds delegated to the regions, which vary between 10 and 15 percent of government expenditures (see Table 2). Expenditures for grants to government agencies, of which there are roughly 63, account for approximately two percent of government expenditures. There are no transfers to local governments, which consist of 255 communes. However, for the 2012 budget, the government planned to allocate an amount equal to less than one percent of total government spending to the eight regions of the country.

Table 2:

Number (and percentage of expenditures) of government public entities

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Includes the ministries, directorates and deconcentrated entities

Source: Nigerien authorities, January 2013.

7. All the stakeholders were interviewed, including the officers of the working group, the Ministry of Finance, and the other ministries and partner institutions such as the Audit Office, the Office of the Government Inspector General, the National Assembly and its Finance Committee, as well as civil society. The list of names of the people we met is in Annex 2.

8. In addition to the government of Niger, three other institutions took part in the review of the preliminary PEFA assessment report. The government prepared its comments on the preliminary PEFA report based on the internal work of the expanded working group that was mobilized at a one-day workshop held in Niamey on January 21, 2013. Its comments were taken into account for producing the final report. The World Bank, a member of the Niger donor dialogue framework, prepared and submitted its comments on the preliminary version of the PEFA report. The PEFA Secretariat reviewed the preliminary report and submitted its comments; in accordance with its terms of reference, it refrained from checking the quality of the data that was submitted and analyzed. Finally, the FAD internal review committee performed the internal review and quality control of the preliminary PEFA report. The report was enhanced by comments that were provided and by a separate annex of the final report, which includes the responses to the comments. The report was delivered to the institutions that reviewed the report.

9. This final performance report followed all of the steps of the advanced quality assurance procedure, known as “PEFA CHECK,” which led the PEFA Secretariat to issue the disclosure that appears before the Summary of the Assessment. In addition to this introduction (Section I), the performance report consists of the following sections: country background (Section II), assessment of the systems, procedures and public financial management institutions (Section III), and the government reform process (Section IV). The Minister of Finance, His Excellency Gilles Baillet, authorized the publication of the final 2012 PEFA report on January 30, 2013.

II. Niger Background

A. Economic situation of the country

10. The country is vast and landlocked, and the population is growing rapidly. Niger covers an area of 1,267,000 km2. The closest port to the country is the Port of Cotonou in Benin, located about 1,000 km away. Thus, most of Niger’s foreign trade is over land, and the main corridors are Benin, Togo and Côte d’Ivoire via Burkina. According to the estimates of the National Statistics Institute (INS), the population of Niger is roughly 15,203,822 in 2010, and the growth rate is 3.3 percent—one of the highest in the sub-region.

11. Recent economic activity has been affected primarily by political events and significant fluctuations in agricultural production. After a year of food shortages, economic activity recovered in 2010 and was brisk in the first half of 2011, pulled along by a very good farm harvest (see Table 3). However, a new period of drought interfered with growth in late 2011, although the country recovered quickly after that. In periods of food shortages, half of the population suffers from malnutrition. Growth was steady in 2011 thanks to sizeable investments in the mining and oil sector. Despite the fluctuations in farm production, inflation on the average was under control and below the regional limit of three percent. The external debt is sustainable due to the various restructuring arrangements obtained from the creditor members of the Paris Club as part of the Heavily Indebted Poor Countries Initiative and the Multilateral Debt Relief Initiative.

Table 3.

Key macroeconomic data

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Source: IMF Request for a New Three-Year Arrangement under the extended credit facility-staff report, May 2012.

12. In September 2012, the government enacted the Economic and Social Development Plan (PDES) for 2012-2015, which is the current reference framework for economic and social development policy. After the new government took office in 2011, the Accelerated Development and Poverty Reduction Strategy (SDRP) that covers the 2008-2012 period was replaced by the General Policy Declaration of the Government (DPG). The current PDES superseded the DPG in September 2012, and became part of the international commitment to the Millennium Development Goals (MDGs) for 2015. The strategic policies in the PDES are based on five pillars: (i) bolster the credibility and effectiveness of the public institutions; (ii) create the conditions for sustainable, balanced and inclusive development; (iii) food security and sustainable agricultural development; (iv) a competitive and diversified economy for accelerated and inclusive growth; and (v) promote social development. A priority action plan was prepared, taking into account the government’s desire to increase the funds consumption rate and the rate of resource mobilization. The PDES takes into account the existing strategic sectoral policies, and in particular the food and nutritional security and sustainable agricultural development policy, known as the 3N Initiative, or “Nigeriens Feed Nigeriens.”

13. To support macroeconomic stability, in December 2011 the government enacted a public financial management reform program (PRGFP) for 2011 to 2014. This PRGFP is part of the series of reforms in the PDES and, in particular, pillar 5 on bolstering the credibility and the effectiveness of the public institutions, which contributes to strengthening the public financial management systems, procedures, and institutions.

B. Budgetary objectives

14. During the period from 2009 to 2011, the financial operations of the central government posted significant deficits. The primary balance continued to be negative, between 3 percent and 4.2 percent of GDP (see Table 4). Situated between 7.5 percent and 11.5 percent of GDP, the deficits of the total balance of government financial operations (cash basis) were financed in large part through external budget support, between 4.9 percent and 7.8 percent of GDP, and this included a significant proportion of grants. However, the government improved the level of this revenue in 2011 as a result of the better performance of the directorates general of taxes and customs. Revenue from natural resources (uranium) vacillated between 1.7 percent and 2 percent of GDP and was relatively limited. To restore its credibility, the government steadily reduced the stock of its older domestic arrears by an amount equal to between 0.3 percent and 0.6 percent of GDP. However, the government posted new domestic arrears, illustrating the difficulties it has in reestablishing fiscal discipline.

Table 4.

Financial operations of the central government (as a percentage of GDP)

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15. Between 2009 and 2011, the composition of expenditure by economic category remains dominated by current expenditures (Table 5). On average, they amounted to 55.5 percent of total central government expenditures, versus 45.5 percent for capital expenditures and net loans. Subsidy expenditures and transfers (averaging 19.4 percent), exceed expenditures for wages and salaries (averaging 16.5 percent). In particular, subsidies for the distribution of oil products explain these changes, due to the rigidity of the prices charged in an international context, characterized by price increases. We further note that the share of capital expenditures financed externally exceeded expenditures financed domestically in two years (2010 and 2011).

Table 5.

Central government expenditures by economic categories (as a percentage of the total)

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16. Between 2009 and 2011, the government allocated its resources based on the priorities identified in its poverty reduction strategy paper. The priority sectors are rural development, education, and health and social protection, to which significant resources were given during the period. Expenditures for these sectors accounted for over a third of total government spending (Table 6). In 2011, allocations to the rural sector were more significant due to considerable financing from donors to support programs, and especially food for the people.

Table 6.

Budget allocations by sector (as a percentage of total expenditures)

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Source: Budget execution statements and calculations by the assessment team

C. Legal and institutional framework for public financial management

17. Since 2009, Niger has experienced political instability and it adopted a new constitution in 2010. Following the highly contested constitutional referendum of August 4, 2009 of the President of the Republic, the purpose of which was to extend his term, and with legislative elections boycotted by the opposition and condemned by the international community, a coup d’état took place on February 18, 2010. The military regime at the head of the government dissolved the institutions and set up a High Council to restore democracy and manage the transition. A new government was named on March 1, 2010. Following a smooth transition, a new constitution was adopted by referendum on October 31, 2010, and the Seventh Republic was proclaimed on November 25, 2010. The new President of the Republic was inaugurated on April 7, 2011, following democratic elections that the international community considered free and transparent.

Legal framework

18. The directives of the West African Economic and Monetary Union (WAEMU) still very largely determine the legal and institutional framework for managing public finances. The transposition to internal law of the new 2009 directives is still incomplete and has been slow. In addition to the Constitution, which sets forth the general rules of a system in which parliament adopts the budget, thereby ensuring the preeminence of the Minister of Finance in budget and fiscal management, and that institutes a specific legal order for the judicial review of the rules of fiscal management, the fundamental statute governing fiscal management during the period continued to be Law 2003–11 of April 1, 2003 on the organic budget law (LOLF).

19. A new LOLF was adopted in 2012. This LOLF is practically the same as the WAEMU directive (it is the transposition of that directive). It introduced six new main points:

  • Performance-based management and adoption of program budgets and the principle of autonomy and accountability of the program officer;

  • Decentralization in the technical ministries that authorize payments;

  • The adoption of the multiyear budget program (including the requirement to prepare overall and sectoral medium-term expenditure frameworks (MTEF);

  • Drastic strengthening of reporting requirements;

  • Preparation of the budget debate by a budget policy debate beforehand;

  • Adoption of accrual basis accounting.

20. The implementation of this law should be gradual over a five-year period from January 1, 2012 to December 31, 2016. Two additional years could be added for the newest and most restrictive provisions (which are in fact the six major new points listed above).

21. New codes were adopted in 2011 and 2012. They pertain to taxes, the sub-national authorities, and procurement.

22. The basic legislation on the Audit Office has been enacted. The Audit Office was established legally in 2007 by law 2007-022 of July 2. It addressed the functions of the Accounts Section of the Supreme Court pursuant to the WAEMU directives. However, this law was not implemented. During the transition period, a new Office was established by Order 2010-05 of March 30, 2010, which modified Order 2010-01 of February 22, 2010 on the organization of the central government. Order 2010-017 of April 15, 2010, which establishes the composition, organization, duties and operation of the Audit Office, authorized the Office to be seated on May 18, 2010. It was modified and further detail was provided in organic law 2012-08 of March 26, 2012, which sets forth the duties, composition, organization and operation of the Audit Office in the following key areas: the appointment of the First President was expanded to categories of officers other than magistrates; the length of the term of the First President (five years renewable one time), the President of the section (three years and renewable), and of the counselor, were changed; Judicial Service Commission (CSM) approval for appointments was established; provisions were made to establish a budget and financial discipline section (CDBF) and regional account sections; the right to oral defense and access to files for persons on trial under the CDBF procedure were established; the Office was given the authority to audit property declarations; details were provided on the notion of debit balance; a general definition of a management offense according to current financial law was introduced (“any damage caused by the officers to the government agency in which they exercise responsibilities due to gross negligence in the controls they are required to carry out or by omissions or negligence in their management role”).

Institutional framework

23. Niger has a presidential-type political system. The President of the Republic is elected through universal suffrage with two rounds for a five-year term that may be renewed one time. He appoints the prime minister, who is the head of the government and chairs the Council of Ministers. He may dissolve the National Assembly. He is the head of the government and signs the Council of Minister’s orders and decrees. A single house, known as the National Assembly, exercises legislative authority; it is elected for five years and is responsible for enacting laws and overseeing the government’s action. The government may be held accountable to the National Assembly either by voting a censure motion or by a vote of no confidence. The National Assembly meets in two sessions. The second, known as the budget session, begins in October and may not exceed 60 days.

24. Judicial authority is independent of the legislative and executive authority. The Constitutional Court, the Court of Cassation, the Council of State, the Audit Office, and the upper and lower courts exercise judicial authority. The President of the Republic appoints the judges with the approval of the Judicial Service Commission. Judges may not be removed. The Audit Office is the highest jurisdiction for the supervision of public finances.

25. The Constitution requires that natural and mineral resources be used transparently and that the use takes into account the preservation of the interests of present and future generations. Prospecting and development agreements, as well as revenue paid to the government, are disaggregated company by company and are published in the Official Gazette in their entirety. In March 2011, the International Board of the Extractive Industries Transparency Initiative ranked Niger among the countries that are in compliance with this initiative.

26. The sub-national authorities are established by an organic law and are freely administered by elected boards. They consist of 255 communes and eight regions. The levels of deconcentration are the region and department (36 prefectures).

Key features of the public financial management system

27. The management of public finances in Niger remains highly centralized. The sub-national authorities receive no grants from the central government. Although the budget of the Ministry of Health is executed at the district (department) level, the budget for national education is executed at the central level. According to its 2010-2011 public report, the Audit Office indicates that it surveyed 41 public enterprises and government-owned companies, 1,000 nongovernmental organizations (NGOs), and 300 projects. The survey of government administrative agencies (GAAs) is deficient. There are 63 that receive a grant from the government greater than CFAF 100 million according to the Directorate General of the Treasury and Public Accounting (DGTCP).

28. The Ministry of Finance plays a key role in the public financial management system. The Ministry prepares the drafts of the budget law that the Council of Ministers enacts. The right of the deputies to amend draft laws is limited by the rule that renders inadmissible any amendment that would result in increasing the deficit of the draft budget. The Minister is responsible for implementing the budget laws and for complying with budgetary and financial balances it identifies. In this regard, he has budgetary regulatory authority and cash management authority. Before the March 26, 2012 organic budget law, the Minister of Finance was the single payment authorization officer for the government budget, the special treasury accounts, and the annex budgets, and the ministers were the administrators of appropriations. In the long term, this law provides that the ministers will become the principal payment authorization officers for the appropriations, programs and annex budgets of their ministry. The Minister of Finance is in charge of centralizing the budget operations of the payment authorization officers for reporting on the accounts that pertain to the implementation of the budget laws.

29. In April 2011, the Ministry of the Economy and Finance was broken up into two ministries: the Ministry of Finance and the Ministry of Planning, Land Use and Community Development (MPATDC). The latter coordinates development planning activities and in particular the mobilization of external funding to finance them. In this regard, the Ministry plays a role in preparing the draft public investment budget.

30. A major reform of the administrative and accounting organization of the Treasury was put in place through the Order of April 15, 2010. This reform separates the functions of the government as principal accounting officer and regulation, partitions the General Treasury of Niger into three principal government accounting items: (i) a Central Treasury Accounting Agency (ACCT); a General Paymaster’s Office of the Treasury (PGT); and (iii) a General Treasury Revenue Agency (RGT). The reform improves mission integration by broadening the scope of authority of the Government Treasury Management Directorate and the financial and accounting management of the sub-national authorities and the GAAs.

31. The Audit Office was established on March 30, 2010 to replace the accounting office in the Supreme Court; it exercises judicial authority, supervisory authority, and advisory authority. The accountant debit balance system is based on formal regularity and is disconnected from the damage sustained by the public entity and the fault of the accounting officer. The Audit Office has no express certification mission. It assists the National Assembly in supervising the execution of the budget law, in particular by reporting on the execution of the budget law that is sent to the National Assembly along with the draft budget review law. A budget and financial discipline section of the Office, which has yet to be established, takes disciplinary action against management offenses by civil servants.

III. Assessment of the Public Financial Management Systems, Procedures and Institutions

32. The assessments of the indicators are presented in sequence. Each score is presented before it is substantiated by the comparative analysis of the current status of the public financial management systems, procedures and institutions relative to the one that was in effect during the previous assessment in 2008. The analysis of the 31 indicators is divided into Sections A to G.

A. Budget credibility

33. The data analyzed for the assessment of indicators PI-1 and PI-2 cover the budgets of the ministries and institutions, including the special treasury accounts. The data is included in the 2009 draft review law that was finalized on October 8, 2012. For fiscal years 2010 and 2011, the assessment is based on the interim budget execution statements (authorization basis) extracted on October 11, 2012 from the database of the budgetary information system of the Directorate General of the Budget (DGB) known as CEGIB (Government Accounting and Integrated Budget Management) used to prepare the drafts of the review law. The closing of posting budgetary operations in the CEGIB-Budget system is delayed because payment authorization letters have not been systematically regularized or there are payments without prior authorization and because all the manual summary statements that show the execution of the appropriations delegated to the deconcentrated entities in the regions are not routinely processed. The processing of the summary statements incorporates the delegated appropriations into the CEGIB-Budget system. The automatic upward flow of this available information that takes an average of one month to arrive at the CEGIB-Treasury system (managed by the DGTC) to the CEGIB-Budget system was not in effect during the period from 2009 to 2011. The development of the interface between the two aforementioned applications, a structural benchmark of the FEC program with the IMF, so that its entry into operation subsequently is now pending. These reserves are primarily the budget execution statements for 2011, whose subsequent modifications are not expected to be such that they change the assessments of indicators PI-1 and PI-2, since the rating criteria is for two fiscal years.

34. In 2010, Niger experienced political instability that extended into early 2011 and it interfered with the preparation and execution of the original budgets. The original 2010 budget was changed by presidential order. The original 2011 budget came into effect through a presidential order and was amended by supplementary budgets. There were wire and other transfers of appropriations as well.

PI-1. Total actual expenditures compared to the original approved budget

35. This indicator measures the extent of the difference between actual primary expenditures and primary original approved expenditures. The purpose of this indicator is to assess the extent to which the public financial management system has the mechanisms necessary for preparing and agreeing upon a realistic budget based on accurate revenue projections and executing expenditures during the course of the year in a manner consistent with the original approved budget. The better the tools of a public financial management system are, the more predictable the budget execution process will be and the more credible the budgeting process will be.


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36. The discrepancies in the actual expenditures compared to the expenditures projected in the original budgets were greater than 15 percent during the three fiscal years (Table 6). The score for this indicator is D, and it fell compared to the previous assessment, for which the score was a C. The total level of expenditures changed significantly and reflected the poor mobilization of domestic revenue (see indicator PI-3) and external revenue (indicator D-1). For example, in 2010, the first change in the order on the budget law decreased appropriations by 13 percent compared to the original budget law and the second increased them by eight percent compared to the first supplementary order. The late release of appropriations that was observed in the period also justifies the lower score. The results of the previous 2008 PEFA assessment indicated that the discrepancy between actual expenditures and the expenditures that were initially approved was significant in only one year (2006) during the reference period, at 20.8 percent, while this discrepancy was relatively insignificant in 2004 and 2005.

Table 7.

Central government budget allocation and execution

(in millions of CFA francs, unless indicated otherwise)

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Sources: Original budget laws, 2009 draft budget review law and annual execution statements for the 2010 and 2011 budgets.

PI-2. Composition of actual expenditures compared to the original approved budget

37. This indicator describes the extent to which the composition of expenditures differs from the composition projected in the original budget. The first criterion used, which is the first component of this indicator, is the change in the composition of expenditures compared to the total discrepancy of primary expenditures not including provisional appropriations. There is a new component for this indicator, namely the level of actual expenditures posted to the contingency reserve. The change in the composition of expenditures for calculating the indicator is assessed for the 19 principal ministries, while all the others are combined into a single twentieth item. The indicator used is the ratio between the sum of the discrepancies in absolute terms between the projections of the original budget law and the outturn for the budget of these 20 entities and the total discrepancy of these same magnitudes for the entire budget. Moreover, the methodology for calculating the change in the composition of the actual expenditures improved compared to the methodology that was in effect during the previous assessment.


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(i) Extent of discrepancies in the composition of expenditures over the last three years, including provisional appropriations.

38. The discrepancy in the composition of expenditures compared to the original approved budget was greater than 15 percent in one year only (2010) (Table 8). This indicator was down compared to the previous assessment in 2008 using the same methodology. In 2010, the high level of the change in the total amount of expenditures in the original budget illustrated by indicator PI-1 resulted in a significant change in the composition of expenditures (reallocations between ministries) (see Annex 3), which reflects the instability the country has experienced. The delayed release of appropriations, in addition to the slow execution of the budget during the year, explain the drop that was observed.

Table 8.

Matrix of results of indicator PI-2

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(ii) Average amount of expenditures actually charged to the contingency reserve over the last three years.

39. Provisions established to deal with spending contingencies were limited to 0.1 percent on average during the 2009-2011 period. The provisions are provided for in the budget laws and are under the budgetary reserve designation in Title 4 of the transfers and grants that the Directorate General of the Budget administers. During the year, they are transferred to the budget line items for executing the appropriations based on beneficiaries. The budgetary reserve coexisted with a budget line item entitled “provisions and contingencies,” which is a budget line item for executing sundry expenditures. To eliminate confusion, beginning with the 2012 budget, the name of the “provisions and contingencies” line item was changed to sundry expenditures.

PI-3. Total actual revenue compared to the original approved budget

40. This indicator measures actual revenue collected compared to the revenue projections in the original approved budget. It excludes the funds received from budget support but includes all the categories of tax and nontax revenue, including nonrecurring revenue. In Niger, this nonrecurring revenue includes resources from debt relief and sundry revenue from the Directorates General of Taxes and Customs and from bonuses paid directly to the DGTCP. The methodology for assessing this indicator has changed since the previous assessment in 2008. Excess revenue collection is also considered a change in budget credibility.


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41. Actual revenue accounted for less than 92 percent of domestic revenue originally approved in 2010 and 2011 (Table 9). The score for this indicator remained unchanged at a D, as it was during the 2008 PEFA assessment. We note than in 2009, the total level of actual revenue collection was higher than the projection in the original draft budget law, which was progress, relatively speaking, compared to the previous assessment, in which the collection level was systematically below projections. The execution of domestic and foreign reserves (see D-1) that was below projections illustrates in part the discrepancies found in the expenditures indicators (PI-1 and PI-2). The assessment of this indicator was based on the 2009 end-year treasury accounts that were submitted to the Audit Office and the provisional trial balances of the 2010 and 2011 accounts that were published on October 9, 2012, for which the settlement of the suspense accounts in the estimated trial balances for 2010 and 2011 is ongoing.

Table 9.

Summary of results: outturn rate for revenue projections

(in billions of CFA francs, unless indicated otherwise)

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Sources: Original budget laws, 2009 draft end-year treasury accounts and estimated general trial balances for the 2010 and 2011 accounts.

42. Despite recent efforts, the use of revenue forecasting techniques has not been mastered. Forecasts of domestic revenue are obtained using the AYOROU macroeconomic and budgetary model, and are supplemented with specific projections of revenue from the mining and oil sector. This model forecasts the nature of revenue based on an unchanged policy, based mainly on the elasticities taken from the economies of comparable countries. In addition to these forecasts, there are the assessments of the impact of new tax measures and new administrative measures that the Directorates General of Taxes and Customs prepare each year. No tools for projecting revenue from natural resources from mining or oil are used in the Ministry of Finance.

43. The authorities are aware of these issues and have undertaken to obtain more reliable forecasting tools. With support from the United Nations Development Program (UNDP), they have begun a study to improve budgetary projections of revenue that will be used to implement revenue forecasting tools and methods, to include the training of the appropriate stakeholders as well. The IMF initiated support in the area of mining and oil, and plans to continue it with the trust fund from wealthy countries with natural resources that finances technical assistance.

PI-4. Stock and monitoring of expenditure payment arrears

44. This indicator assesses the existence and extent of the stock of arrears and whether the systemic problem has been harnessed and addressed. Arrears in the payment of government expenditures is a type of nontransparent financing. A stock of arrears reflects problems, some of which are caused by insufficient commitment control, liquidity constraints, overestimating of revenue, or underestimating of expenditures. During the period from 2009 to 2011, the indicator examines: (i) the stock of expenditure payment arrears (expressed as a percentage of total actual expenditures for the corresponding fiscal year) and any recent change in the stock; and (ii) the availability of data for monitoring the stock of expenditure payment arrears.

45. The concept of payment arrears is understood here according to the WAEMU definition. For this assessment, the arrears consist of expenditures that are regularly executed, which the accounting officer pays, but that remain unpaid after a period of 90 days. This definition is similar to the definition used in the 2009 WAEMU directive on the Table of Government Operations (TOFE), according to which arrears consist of all validated expenditures not settled in three months.


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(i) Stock of payment expenditure arrears (expressed as a percentage of total actual expenditures for the corresponding fiscal year) and any recent change in the stock

46. The accumulated stock of payment arrears accounted for more than 10 percent of expenditures (Table 10). This resulted in a D, so that this score did not change from the previous assessment, even though there was some progress. In fact, the stock of old arrears, managed by the Autonomous Government Domestic Debt Amortization Center (CAADIE), gradually decreased from CFAF 106.5 billion at the end of 2009 to 92.8 billion at the end of 2011. Moreover, during 2009, 2010 and 2011, the annual accumulation of new arrears was low, at less than two percent of actual annual expenditures.

Table 10

Stock of payment expenditure arrears

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(1) The cleared amounts do not include reductions due to the reclassification of civil servants because these reclassifications are not part of the stock.

Sources: DGTCP, CAADIE, mission calculations

(ii) Availability of data for monitoring the stock of payment expenditure arrears

47. The data for monitoring the stock of arrears is available, but may be incomplete for a small number of expenditure categories. This score is a B, and was unchanged from the previous assessment in 2008. In Niger, the total amount of arrears includes the old arrears and arrears attributable to more recent fiscal years. The former are managed through CAADIE, while the others are the responsibility of the DGTCP. Although they are fragmented between the DGTCP and CAADIE, the data on the stock of arrears (including aseniority profile) is generated at the end of each fiscal year. This data may be incomplete as there is no systematic procedure for monitoring it. The amounts of payment arrears should increase if the amounts of the hospital invoices (for which no payment order was issued) are included. No precise status of these invoices is available. These pending invoices are the result of an allocation of insufficient funds to cover the commitment of invoices that were the result of the implementation in 2007 of the policy of free health care adopted by the authorities.

B. Comprehensiveness and Transparency

PI-5. Classification of the budget

48. Using fiscal year 2011 as the baseline, this indicator assesses the quality of the classification system used to prepare, execute and report on the central government budget.


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49. The budget for fiscal year 2011 is prepared and executed using the administrative and economic classifications as a baseline, but government expenditures are not prepared or executed according to the functional classification. The score for this indicator remained the same at a C, as it was for the previous assessment in 2008. The current government budget classification was implemented in 2003. It was established by Decree 2002-197/PRN/MF/E of July 26, 2002, and was based on WAEMU Directives 04/98 and 04/99. The classification system of WAEMU directives is consistent with the international standard in the 1986 Government Finance Statistics Manual (GFSM). This budget classification system consists of the following key classifications: (i) administrative (section, sector, principal location, structure), (ii) geographical (region), (iii) donor (group, donor), (iv) type of financing; and (v) economic (article, paragraph, line). The classification by economic nature of the government budget classification system is the classification of the government chart of accounts adopted by Decree 2002-198/PRN/MF/E of July 26, 2002. Government revenue is presented and executed based on the classification system by economic nature. Expenditures are presented and executed according to the administrative and economic classifications.

50. Government expenditures are not prepared or executed according to functional classification. The classification of the functions of government (COFOG) in its revised version that is consistent with the 2001 MSFP is provided in the annex of the decree on the budget classification system. This classification addresses the three levels of COFOG (division, group, class). However, no segment of the codification of a budget line item is set aside for codifying functions. No aggregate summary of government expenditures based on the ten key functions of the COFOG is presented in the budget documentation. However, the budget documentation does present a list of poverty reduction expenditures based on the COFOG using a bridge table developed between chapters (and sub-chapters) of the administrative classification and the first two levels of the COFOG.

PI-6. Comprehensiveness of information included in budget documentation

51. The purpose of this indicator is to assess the extent to which the budget documentation submitted by the Minister of Finance to the Parliament for scrutiny for approving the 2012 draft budget law is comprehensive.


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52. Three of the nine documents the PEFA methodology requires were on the list of documents, as opposed to just one for the previous assessment (Table 11). The score for this indicator is a C and illustrates progress compared to the previous assessment in 2008. Based on the 2012 budget law (BL) and its annexes adopted in late November 2011, Table 11 below illustrates the three documents provided in the budget documentation and the others that are not provided, and indicates their sources.

Table 11.

Status of documents required by PEFA

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Source: 2012 budget law

53. The budget documentation submitted to and adopted by the National Assembly for the 2012 budget law consisted of three notebooks. The first notebook was mainly the presentation of the purposes of the draft budget law, Annex I on the details of the revenue (Title 0) and Annex II on the details of the expenditures, which begins with Title 1 on the amortization of the debt, followed by Title 2 of personnel expenditures by ministry section and by structure. The second notebook continues with the presentation of Annex II and indicates (in Title 3) the operating expenditures. Finally, the third notebook contains Annexes III and IV in addition to the continuation of Annex II. Annex II continues with the presentation of Title 4 on grants and other current transfers, and Title 5 deals with investments made by the government. Annex III deals with the title on special treasury accounts. Annex IV provides a revised public debt strategy paper and two tables: (i) the first deals with the summary of expenditure forecasts by title for all sections; and (ii) the other provides a single list of expenditures to fight poverty.

54. The progress for this indicator is explained in large part by the introduction of the public debt strategy paper. For fiscal year 2012, this paper presents estimates of the government’s gross financing requirements, sets the level of gross debt (external and internal), and culminates with debt projections for the new fiscal year. In addition, it includes components of debt sustainability.

55. By contrast, the budget documentation for 2012 does not include a statement of execution of 2010 and 2011 the budgets. There are very substantial delays in preparing the execution statements. The last budget review law enacted was for 2008. The draft budget for a new fiscal year is scrutinized with no information on the status of budget execution for the previous fiscal year or the outturn estimates for the current fiscal year, which is inconsistent with current regulations. This is a major weakness that affects other indicators of the public financial management system. Although the summary of the 2011 budget data is provided, by contrast, no information is provided on the 2010 and 2011 budgets by budget line item using the same format as the 2012 budget.

PI-7. Extent of unreported government operations

56. This indicator measures the relative extent of extrabudgetary expenditures relative to total expenditures that are not included in the budget reports in 2010 and/or 2011.


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(i) Level of extrabudgetary expenditures (other than projects financed by donors) that are not included in the budget reports.

57. The level of extrabudgetary expenditures that are not reported other than projects financed by donors is insignificant. The GAA operations that are shown in the trial balances of the treasury accounts include the amounts of subsidies that are in account 42; 63 GAAs each receive subsidies in the amount of more than CFAF 100 million per year. The 2009 end-year treasury accounts show operations in the special accounts, which is noteworthy progress. Likewise, the reporting of nontax expenditures began with the budget documentation in 2011. Reviews during the previous assessment failed to identify extrabudgetary funds. The current assessment identified a source of extrabudgetary expenditures, namely expenditures made using administrative revenue collected by certain government agencies. For example, the authorities mentioned: the Ministry of Justice (a portion of fines and orders to pay costs), the Ministry of Health (a portion of immunization costs and other revenue), and Foreign Affairs (visa costs). No assessments of this administrative revenue are available since the ministries involved do not prepare reports for the MF. However, the estimated amount of this revenue is less than CFAF 15 billion, or less than one percent of total expenditures in 2011. Beginning in 2012, two revenue agencies became operational in the International Immunization Center in Niamey and the National Health and Reproduction Center respectively.

(ii) Information on revenue/expenditures related to projects financed by donors that is included in the budget reports

58. Comprehensive information on revenue and expenditures for all projects financed through loans is included in the budget reports, and about 56 percent (in value) for the projects financed through grants. The score for this indicator is stable at a B, as it was for the previous assessment in 2008. According to the UNDP report published in late December 2011 on development cooperation in Niger, the level of disbursements for grants was roughly CFAF 122.2 billion in 2010. Only 68.85 billion was reported in the budget, or 56.3 percent of the total grants the country received. Extrabudgetary operations are for grants that finance the projects managed directly by donors.

59. In May-June the Ministry of Planning organizes a review with the principal donors on the status of execution of the projects that are part of the government investment program (PIE), and the information that originateds from the ministries is deemed to be very incomplete. The review in question pertains more to the physical aspects than the financial aspects of the outturns. Difficulties in project execution are due to both the lack of the administration’s capacity in the area of donor procedures as well as reduced private-sector capacities, in particular in terms of infrastructure construction.

PI-8. Transparency of inter-governmental fiscal relations

60. This indicator shows the relations between the government and the sub-national authorities. This indicator determines the extent to which: (i) the current systems are transparent and based on rules for horizontal allocation between the decentralized governments of unconditional and conditional transfers from the central government; (ii) the central government sends timely information to the decentralized governments on their budget allocations for the coming fiscal year; and (iii) the degree of consolidation of fiscal data from the central government according to the sectoral categories. The assessment of this indicator is for fiscal year 2011.

61. The system for dividing up subsidies from the general budget to the sub-national authorities is now being put in place by establishing the National Financing Agency for the Sub-national Authorities (ANFICT). No subsidies were paid to the sub-national authorities before 2011. The consolidation of fiscal information from the sub-national authorities continues to be partial and lagging.


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(i) Transparent rule-based systems for the horizontal allocation between the decentralized information for unconditional and conditional transfers from the central government. (This allocation is included in the budget and actual allocation).

62. Transparent mechanisms based on transparent and objective rules in the horizontal breakdown of assets among the decentralized governments have not been established. No progress was noted compared to the previous assessment in 2008. However, some advances were noted. Based on Law 2008/38 of July 10, 2008 on the establishment of the “National Financing Agency for Sub-national Authorities” (ANFICT), a system for distributing subsidies from the general budget is now being put in place for the sub-national authorities. This entity is in charge of managing and distributing the resources allocated to the sub-national authorities (Article 3). ANFICT’s resources are primarily “government subsidies to the sub-national authorities as part of decentralization support and the equalization fund” (Article 5). The regulation that deals with the agency was supplemented by Decree 2008/360/PRN/MI/SP/D/ME/F of November 6, 2008, on approving the ANFICT rules of procedure. Finally, with Decision 478/MI/SP/D/AR/DGAT/CL of July 17, 2012 on appointing the members of the ANFICT board of directors, the work of the agency should begin. Its management bodies were appointed in 2012, but the agency is not operational.

63. All of the legislation that applies to the local governments was changed in 2011 and took on the form of a General Code of Sub-national Authorities. The administration of local governments (255 communes, four of which have a special status: Niamey, Maradi, Tahoua, and Zinder) is governed by Law 2008/42 of July 31, 2008 on the organization and administration of the Republic of Niger. The sub-national authorities have their own tax resources or resources provided by the government as well as nontax resources (Article 224 of the 2008 law). A fund to support decentralization was established, the funding is supplied by the government (Article 225), and there is an equalization fund to be used to provide extra support to the budgets of the sub-national authorities to ensure their harmonious development based on national solidarity (Article 226). The procedures for funding and managing these accounts are set by decree of the council of ministers. These texts do not exist.

(ii) The central government sends timely and reliable information to the decentralized governments on their budget allocations for the coming fiscal year

64. According to the Ministry of the Interior, the central government paid no subsidies to the local governments. The local governments took office in 2011 following the elections that were held at the same time as the elections for the communes. Due to the lack of resources for the regions, in Title III of the 2012 budget, the government added amounts by regions under the item entitled “miscellaneous operating expenditures for the operation of the regional councils,” established according to the demographic criterion, in the amount of roughly CFAF 740 million.

(iii) Degree to which the consolidated fiscal data (that pertains to at least to revenue and expenditures) is collected and reported to the central government according to the sectoral categories.

65. For fiscal year ended 2011, the fiscal and accounting information of the sub-national authorities was not consolidated (Table 12). For fiscal year 2009, 30 sub-national authorities failed to produce budget projections. The Urban Community of Niamey failed to submit its budget projections for 2009. The entity in charge of the financial and accounting management of the local governments in the Local Finance Directorate received 134 sets of municipal financial statements for fiscal year 2009, 122 for 2010, and 177 for 2011 (see Table 12). The share of consolidated expenditures is 19.88 percent in 2009 (Table 10). Due to a deterioration of the financial and accounting reporting system, data production is seriously lagging and is more than 24 months late for the 2010 sets of financial statements.

Table 12.

Summary of sets of financial statements produced and expenditures reported

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Source: Local Finance Directorate, Ministry of the Interior

PI-9. Oversight of aggregate fiscal risk from other public sector entities

66. This indicator measures the conditions under which the central government exercises its formal oversight function over other entities in the public sector, its controls, and the management of national-scale budget risks as a result of the activities of the decentralized levels of government, the autonomous public agencies, and public enterprises. The assessment for this indicator is for fiscal year 2011.

67. The lack of an entity in charge of oversight of government agencies and, consequently, the lack of data consolidation, results in the same score, a C+. The lack of risk for the central government from the local governments is confirmed.


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(i) Extent of oversight exercised by the central government over the autonomous public agencies and public enterprises.

68. Most of the key autonomous public agencies and public enterprises submit budget reports to the central government at least once a year, but no consolidated statement of budget risks is produced. The score for this category remained the same, at a C. The regulatory framework continues to be the 1986 orders that address the general system, oversight and control, with the procedures for exercising them over government agencies, government-owned companies and semi-public companies. This legislation indicates the conditions under which general oversight is carried out (the agency in charge is not specified), direct supervision (by the ministry in charge of the establishment’s activity), oversight by the Ministry of Finance (occasionally with upper limits and for certain operations). In practice, central government oversight of government agencies and public enterprises and companies is diffuse. The financial comptrollers, appointed on May 30, 2012, perform an audit of the expenditures of certain government agencies and offices at the front end:1 The year-end accounts are prepared routinely for all public enterprises in Niger, albeit with delays for some. They are submitted to financial control or statutory auditors for auditing and are approved by the board of directors. The Directorate General of Government Property, an entity in the MF, does not manage the government portfolio and restricts its activities to monitoring the government’s immovable and movable assets. The DGTCP is considering establishing an entity in the DGTCP to remedy the status quo, under which no entity in the MF or elsewhere has consolidated data on the budget risks of government agencies and public enterprises.

(ii) Extent of central government control over the fiscal situation of the decentralized agencies.

69. The sub-national authorities may not make commitments that generate obligations for the central government. The score for this dimension is stable, at an A. The governors and/or prefects exercise oversight over the sub-national authorities. The Office of the Inspector General of Territorial Administration is in charge of auditing the management of the sub-national authorities and performs on-site audits. The Office of the Inspector of Finance also performs audits. The sub-national authorities do not generate risks for the central government. The supervisory authorities oversee the balance of local government draft budgets and approve them. In addition, although Decree 2003-178/ PRN/MI/D of July 18, 2003 sets the conditions under which a region, department, commune or urban community may contract loans, Article 7 provides that “these loans” may under no circumstances obtain government guarantees. Since one savings bank that extended loans to communes has ceased doing business, only the Urban Community of Niamey contracted a loan from the banking sector without a government guarantee during the transition period in 2010.

PI-10. Public access to key fiscal information

70. This indicator measures the transparency of information on projections, monitoring budget execution and access to information by the public and relevant groups using the end of fiscal year 2011 as a benchmark.

71. The agency supplies the public with two of the six information components that PEFA requires (Table 13). This indicator, with a score of C, was unchanged from the previous 2008 assessment (C). However, positive advances are observed in making the INS sites operational, as well the sites of the Audit Office and the Government Procurement Regulatory Agency (ARMP), in terms of making information available online for consultation by the public.

Table 13.

Access to key fiscal information

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Source: Ministry of Finance, + ARMP, Audit Office


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72. In addition, representatives of civil society participated in the budget process for preparing the 2013 draft budget law and received a copy of the documentation when it was submitted to the office of the National Assembly. Finally, the creation of a documentation directorate in the Ministry of Finance is helping to gradually implement a charter for public access to information.

73. However, public access to information is limited by the low literacy rate and rate of the use of French. Fiscal information written in national languages is nearly or totally nonexistent. The National Assembly debates on the budget law are broadcast on the national radio station. The website of the Office of the President of the Republic of Niger has no budget information. A website of the Ministry of Finance, without documentation, was established on October 5, 2012.

C. Budgeting based on public policies

PI-11. Orderliness and participation in the annual budget preparation process

74. This indicator assesses the budget preparation process and the effectiveness of participation by ministries and political leaders.


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(i) Existence of a budget fixed budget schedule and compliance with the schedule.

75. The annual budget schedule is fixed and clear, yet slight delays were found in its implementation; it gives the ministries two weeks for a theoretical reaction, which is less than the actual deadline, and this gives them insufficient time to prepare their budget proposals. The score for this indicator is C, which is better than in the previous assessment. The budget preparation procedure is set by Decree 2003-243/PRN/MF/E of September 30, 2003. It details the key stages necessary for preparing the detailed budget estimates adequately and on time. This schedule provides for sending letters indicating expenditure ceilings to the institutions and line ministries before June 15. This was done but was slightly delayed (less than a week), on June 21 and June 19 for the 2012 draft budget respectively. However, this schedule gives the institutions and line ministries only two weeks to prepare and submit their draft budgets to the Ministry of Finance, i.e. June 30. In practice, according to several persons with whom we met,2 the amount of time given was three weeks for the 2012 draft budget. The budget conferences and decision-makingdecision-making sessions were held in July-August for the 2012 draft budget, and the Council of Ministers reviewed the preliminary draft budgets in September as scheduled. Finally, the draft budget law is to be sent to the National Assembly before October 1, and this was done for the 2012 draft budget.

(ii) Directives regarding the preparation of budget proposals (Fiscal year 2012 Budget Circular).

76. For the preparation of the budget proposals for 2012, the letter from the Prime Minister sets the applicable ceilings by economic titles for each institution and ministry, but it is not comprehensive. The content of the circular letter indicates the principal actions that are to guide the preparation of budget proposals based on the General Policy Declaration of the Government (DPG). The letter sets target ceilings by economic titles for each institution and ministry. Before it is signed, the letter is discussed in the council of the cabinet, chaired by the Prime Minister. However, the expenditure ceilings by title and by agency do not distinguish the authorized services [services votés] from the new measures. They do not include the components for calculating project and program costs (price indices) that are essential for assessing them. Finally, the ceilings do not take into account spending on projects and programs financed by external sources.

77. The budget proposals of the institutions and ministries were reviewed and approved by the Council of Ministers only once the ministries had painstakingly examined all the details. The Council of Ministers reviews the draft budget law in September, after the budget conferences and decision-making sessions are held in July and August with the institutions and ministries. The Council of Ministers makes relatively limited adjustments to the draft budget.

(iii) Timely approval of the budget by the legislative authorities (From 2009 to 2011).

78. Between 2009 and 2011, the National Assembly approved the budget before the beginning of the fiscal year, except for the 2011 budget, approved by a presidential order one month after the fiscal year began. During the last three fiscal years, the dates the draft budgets were approved and the authority that approved them were: (i) November 2009, by the National Assembly, for the 2010 draft budget; (ii) January 2011 by an order of the President of the Republic, for the 2011 draft budget; and (iii) November 2011 by the National Assembly, for the 2012 draft budget. The late approval by order of the 2011 budget occurred in a context in which the National Assembly, dissolved by the military regime in place, had not been reinstated.

PI-12. Multi-year perspective in fiscal planning, expenditure policy and budgeting

79. This indicator measures the extent to which medium-term public expenditure policies are aligned with available resources. It is important to determine how the deficit will be financed and to obtain analyses of the tolerable debt threshold. These policies should be predicated on medium-term projections based on sectoral strategies, along with corresponding costs.


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(i) Budget projections and multiyear functional allocations. (Benchmark fiscal years 2010 and 2011)

80. Using multiyear programming tools, sliding aggregate budget projections (based on a breakdown according to the main economic classification categories) have been prepared for three-year periods since 2009. The medium-term expenditure framework (MTEF), prepared by the Financial Reform Directorate (DRF), is a budget forecast over three years, theoretically prepared during the macroeconomic framework operation, and the government account is one of the framework accounts. The purpose is to align the medium-term frameworks with the budget policy documents that are described in Box 1 below. However, today the production of these frameworks faces institutional organization issues and changes in methodology as shown in Box 2 below.

Budget policy documents

To guide public policies, the country prepared medium and long-term strategy papers. The Niger horizon 2035 Sustainable Development and Inclusive Growth Strategy plans the long-term vision that is used as a frame of reference for short and medium-term public policies. The Accelerated Development and Poverty Reduction Strategy (SDRP), which covers the period from 2008 to 2012, was superseded beginning in June 2011 by the General Policy Declaration (DPG), whose action plan that covers the period from 2011 to 2015 is the basis for intersectoral resource allocations due to the computation of the programs by ministries that it contains. In September 2012, the government adopted an economic and social development plan (PDES) for the period from 2012 to 2015 to supersede the DPG.

The Priority Action Plan (PAP) presented by sector and expected outcomes is a basis for preparing the annual budget, but there is still no connection between them. The PAP consists of 86 programs (series of programs to achieve a result). The agency was informed of the difficulties in incorporating the “support expenditures,” 50 billion in operating appropriations, that the Ministry of Planning considers investment expenditures. There is no linkage table between the PDES and the budget, but the ministries are apparently placed in the 43 “sectoral effects.” Some ministries are in several effects. Several ministries share results, as is the case for education. The ministries appear clearly in the PAP as entities in charge of implementing programs. The deadline for approving the plan made it impossible to use for the 2012 budget. According to the Ministry of Planning, the amounts in the PAP can be different than the amounts in the 2013 draft budget, but the operation is still in the “startup phase.”

The Mission

Medium-term frameworks: Institutional issues and change in methodology

Macroeconomic and macrobudgetary forecasting is scattered today and there is duplication. There are three entities that prepare three macroeconomic forecasting documents: (1) macroeconomic framework, by the Directorate of Analysis and Economic Reform in the Ministry of Planning, Land Use and Community Development (MPATDC); (2) the Multi-year convergence, stability, growth and solidarity program, to be submitted to the WAEMU by the National Economic Policy Committee, which is an interministerial entity; (3) the program with the IMF, with which the aforementioned entities are involved to varying degrees; the program is run by the Directorate of Financial Reform in the Ministry of Finance. These three documents present similar yet different figures, explained only in part by the different dates they were prepared. Macroeconomic as well as macrobudgeting forecasting capacities are limited. They would be put to better use if the forecasts were combined, including the program with the IMF. The revision of the macroeconomic forecasting model should be the opportunity for combining them.

The MPATDC, in cooperation with the DRF, is faced with a difficulty caused by an overhaul of the macroeconomic model, and not yet grasped by the managers involved, and may be overly ambitious in terms of the number of macroeconomic variables to be projected. In addition to this difficulty, there is the problem of coordination between macro and budget economists due to the separation of the former Ministry of the Economy and Finance into two ministries. Despite that, the DGB produces the aggregate MTEF with a single software package known as “AYOROU,” which has two iterative modules. These documents are used to determine the expenditure ceilings that are submitted to the ministerial departments, and these ceilings serve as a basis for the budget law.

The Mission

81. The Ministry of Finance does not analyze the links between the estimates of years N+2 and N+3 of the MTEF and the next setting (in other words, for the following years) of the annual budget ceilings. The Directorate General of the Budget does not yet carry out this work. A coordinating committee, put in place in 2009 and renewed in 2011, is in charge of supporting the preparation of the aggregate MTEF. The members of this committee were trained in France. The committee meets to finalize and validate the proposals of the MTEF envelopes and submits them to the Minister of Finance for approval.

82. An intersectoral allocation was prepared taking into account the inertia in implementing public policies, which resulted in adopting 80 percent of the current budget law + 20 percent of the DPG. However, after a debate in the MTEF Committee, the viewpoint was repeated that the intersectoral allocation was to be explicit and not sought implicitly in the strategy documents. There was a proposal that the intersectoral allocation should be an essential contribution of the preparatory document in the budget policy debate. Regardless of the difficulties, the Budget Directorate submits to the ministries, at the same time as the budget circular, expenditure ceilings by ministry and by title.

(ii) Scope and frequency of the debt sustainability analysis

(Benchmark years 2009, 2010 and 2011)

83. A sustainability analysis of the external and internal debt is prepared each year. The Public Debt Directorate produces a “revised public debt strategy paper” each year that is attached to the budget law. These analyses of the viability of the internal and external debt are prepared with external expertise support. The Public Debt Directorate, which received training support, is planning to have Nigerien managers perform analyses each year, the first of which was in progress during the current assessment.

(iii) Existence of sectoral strategies, along with multiyear statements of operating expenditure and investment costs (Benchmark year 2011)

84. Sectoral strategies were prepared for the health and education sectors, and for the sector covered by the “3N” Initiative, and they account for 36 percent of primary expenditures in 2011 and include complete cost statements that are not always consistent with budget projections. Only a few ministries prepare sectoral MTEFs, and their characteristics are different. The pilot ministries that prepare MTEFs are Health, National Education, Infrastructure and Rural Sector.3 The weight of these ministries in the entire government budget is significant, at 36 percent of primary expenditures in 2011 (see Table 14). Complete costs consistent with the fiscal strategies are produced. The documents that are produced are complex and detailed, and are actually intended for sector specialists and not the Budget Directorate. The preparation methodologies are inconsistent, and the presentations in particular are not the same, so that the documents are difficult to use for discussion purposes during budget conferences and even less likely to be consolidated for the purpose of proposing a transparent and unified presentation of all the sectoral MTEFs. The budgetary constraint (of the aggregate MTEF) is in some cases not observed, even though efforts along these lines were noted, following the realization that the MTEF procedure is budgetary in nature. Budget and nonbudget finances are not always kept separate. However, the documents that are produced attest to considerable efforts made by the ministries involved, as well as the mastery of their sector and the preparation of programmatic computations.

Table 14.

Actual primary expenditures in the priority sectors

(In thousands of CFAF, unless indicated otherwise)

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Source: 2009, 2010 and 2011 budget law and mission calculations.

85. However, rural development has evolved somewhat since a High Commission for the “3N” Initiative (Nigeriens Feed Nigeriens) was created and since the former executive secretariat for rural development was eliminated. The High Commission prepared a sectoral strategy before the PDES was approved. The entire 2012-2015 investment plan that stems from is found in pillar 3, and a portion in pillar 2 for environmental programs.

(iv) Links between the investment budgets and medium-term expenditure estimates (benchmark year 2011)

86. Important investment decisions that are largely unrelated to the sectoral strategies and the consequences they entail for recurring expenditures in terms of sectoral allocations, are adopted and yet are not included in the budget estimates. Investments, which are Title 5 of the budget, are scheduled by the Ministry of Planning as the government investment program (PIE). This document, despite a few flaws, is a rather good predictor of government investments. The crux of the link between the PIE and the strategies—ministerial or central level—is essentially the matter of donor involvement in financing the strategies, as Title 5 projects (excluding investments funded using the government’s own resources) are essentially executed with external funding. Domestically funded investments are decided without regard to the strategies. For externally funded investments, although an effort to link them with the sectoral strategies was observed, investment decisions that were not aligned with these strategies were also found. However, periodic revisions of these strategies have begun to include the negotiations with donors, and a government-donor dialogue framework is being implemented. The question that arises is not so much the consistency between investments and strategies, but rather the lack of prioritization of the strategies to ensure an optimal choice of investments.

D. Predictability and Control in Budget Execution

PI-13. Transparency of taxpayer obligations and liabilities

This indicator measures the degree of transparency that characterizes taxpayer liability, mainly in terms of the clarity and comprehensiveness of the legislation and administrative procedures, access to relevant information, and the opportunity to dispute administrative decisions regarding tax owed with the independent institutional entities. This indicator is measured at the time of the assessment, in October 2012.


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(i) Clarity and comprehensiveness of tax and customs obligations.

87. The legislative and regulatory framework for taxes is complete and relatively clear; it limits the discretionary authority of the agency. Tax legislation is combined into a document entitled “Republic of Niger Tax and Government Property Regime,” now in effect. A General Tax Code was adopted on June 1, 2012 and takes effect on January 1, 2013. Although the finalization of the General Tax Code was delayed, while the 2008 PEFA assessment was being finalized for 2009, these key provisions were in effect based on the budget laws for the years 2009 to 2012. This new statute is the culmination of efforts to adjust tax laws and regulations. Consequently, it represents a major step forward. This code introduces greater consistency in the presentation of the tax system, incorporates the supranational provisions based on the WAEMU directives, and is a unique framework. While the General Tax Code was being prepared, the representatives of the professional organizations were consulted and a dialogue with the Chamber of Commerce began. A national workshop on the draft general tax code was held in 2010 and included the DGI, government administrations and agencies, the Chamber of Commerce, civil society, and the sectoral professional organizations. However, the circulars and implementation notes for the new tax code are not yet ready. The DGI indicated that they are being prepared and will be available at the end of the current year.

88. Some procedures for implementing the tax provisions complicate tax management for taxpayers. For example, regarding the value added tax (VAT), some large enterprises and government agencies are authorized to withhold the tax and pay their suppliers without tax and pay the withheld tax to the Treasury. This is an infringement of the fundamental principle of the VAT. It causes a breach in the deduction chain and increases the volume of VAT credits from enterprises that are subject to withholding with no certainty that the VAT will be reimbursed, despite the fact that, although this is the principal objective of this measure, there is no full guarantee. Taxpayers who are eligible for exemption regimes sometimes consider that they are exempt from the requirement to file returns under ordinary law, and the agency’s supervision and control capacity is insufficient; this is especially true for NGOs.

89. Regarding customs, the legislative and regulatory framework is complete and clear. The customs regime is governed by:

  • Law 61.17 of May 31, 1961, which establishes the customs system of the Republic of Niger, updated in July 2000, and the relevant regulations;

  • The Investment Code, the Oil Code and the Mining Act;

  • Rule 05/99/CM/WAEMU of August 6, 1999 on the customs value of goods. This rule enshrines the transaction value as the primary basis for customs valuation;

  • Rule 09/2001/CM/WAEMU of November 26, 2001 on the adoption of the WAEMU Customs Code.

90. This customs legislative and regulatory framework limits the agency’s discretionary authority. The large number of exemptions granted based on the legislation and conventions in effect, the codes to promote investment, or sundry other conventions further complicate efforts to manage the customs system. Surveys performed by customs revealed cases of abuses. These customs systems are problematic from the standpoint of interpreting and implementing the regulations and they make it difficult to ensure that exempt goods were truly used for their ultimate purpose, based on which they were made eligible for these customs arrangements.

(ii) Taxpayer access to information on tax and customs obligations and the relevant administrative procedures.

91. Taxpayers have access to information on tax and customs obligations and on relevant administrative procedures, but it is not very extensive. Taxpayer access to information exists, but the channel of information is intended more for economic operators, mainly through the Chamber of Commerce, as opposed to all taxpayers. With regard to taxes, there are communication projects carried out by the public relations unit, which falls under the director general of taxes. Communication projects are organized for taxpayers, but there are no widely disseminated pamphlets or brochures to support them. Regarding customs, operators are informed through notices to importers and instruction manuals. The implementation circulars are disseminated to tax and customs units and to the Chamber of Commerce. But the DGI and DGD websites, which could facilitate broader dissemination of tax and customs information, are not active.

92. The customs circuit for declarations, which was relatively cumbersome, has recently been streamlined now that scanners are in use in the three largest offices of the customs clearance offices. The commissioners have access to the customs computer system to enter the data into their declarations. They use the ASYCUDA++ common terminal provided to them in the customs offices to enter the various data in the declaration; the data is validated by the authorized customs officer. The declaration is entered in ASYCUDA and assigned to an inspector in charge of paying the duties. Scanning is a procedure that takes place at the beginning of the process, and the results are immediately available; if no suspect data is reported, the payment of the duties is authorized and a release voucher is issued.

93. The work of the customs commissioner has been regulated more transparently since 2011. Measures to correct the constraints encountered in the execution of the work of the customs commissioners resulted in the implementation of a transparent authorization procedure formalized by Decision 0002/MEF/CCRI/DGD of January 1, 2011. In accordance with the current regulation, only the authorized customs committees are authorized to carry out customs procedures for others. The implementation procedure bolsters transparency and compliance with the commitments and obligations of customs operators.

(iii) Existence and operation of a system to appeal decisions by the tax agency and customs.

94. There is a procedure for disputing the implementation of the provisions or the valuation of taxable bases with tax and customs units, but it should be reviewed in detail to ensure that it is fair and transparent. Regarding taxes, as in 2008, the procedure is the same, for disputing both matters of law and matters of fact. Taxpayers may dispute their tax bill by filing complaints with the operational units. The unit that reviews the complaint (Dispute Unit) is separate from the unit that established the tax base (Tax Base Unit). A taxpayer who disputes the decision of the operational units may file an appeal with the Director General of Taxes. The Legislation and Dispute Directorate conducts the review and submits its proposals to the Director General of Taxes, who decides whether or not the complaint is valid. A taxpayer who still disagrees with the decision may appeal to the Minister of Finance. However, there is no entity that represents both parties (the agency and the taxpayer). After exhausting the prior administrative remedy, it is still possible to file an appeal with the courts, but there are very few tax disputes at this level, as the data in Table 15 below shows.

Table 15.

Number and type of appeal

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Source: DGI

95. In customs, there is no formalized appeal procedure. However, complaints may be filed with the office manager, the regional director, or the director general of customs. Appeals to the courts are possible as a matter of right, but such appeals are rare and customs has no statistics on disputes.

PI-14. Effectiveness of measures for taxpayer registration and the assessment of taxes, fees and customs duties

96. This indicator measures the effectiveness of the taxpayer registration system in effect and the use by the agency of the risk-based approached for auditing. The benchmark period for this indicator is October 2012.


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(i) Control of the taxpayer registration system

97. A Taxpayer Identification Number (NIF) is in effect and is entered in a database with no link to the other tax functions of granting licenses and/or the National Social Security Fund database. This identifier is unique, exclusive and invariable, and is the same for customs and taxes; it is used for taxation or customs clearance operations. The NIF is helpful in certain crosschecking operations; however, it is not linked to other registration systems, for example, the National Social Security Fund database. The registration for the NIF takes place in the DGI. A system that involves the Chamber of Commerce is also in place to facilitate the registration procedure through the Business Procedures Center, which assists merchants in completing tax procedures.

98. There has been a relative improvement in registrations over the last two years. There were 16,256 NIFs as of 12/31/09, with 2,098 new registrations in 2010 and 2,839 in 2011. The NIF must be entered on documents taxpayers issue as part of their business dealings.

99. Access to procurement and carrying out certain operations are contingent on producing the registration number. The NIF is compulsory for bidding on a government contract, engaging in import operations or activities of a business nature.

100. Despite the registration requirement, the taxpayer database is far from covering all potential taxpayers and the system has some limitations. The fact that the award procedure is centralized in Niamey, that the award lead times are occasionally lengthy, and that inspections are infrequent, are the main factors that explain the failure to comply with the registration requirement. Occasional importers that do not have an NIF may appear on the single customs declarations (DDUs) under an anonymous code: 9999.

(ii) Effectiveness of penalties for cases of noncompliance with registration and reporting obligations.

101. Breaches of the registration and tax reporting requirement are subject to penalties, but these penalties are not systematically enforced. Failure to present the NIF upon the request of tax or customs officers renders the perpetrator liable to pay a fine of CFAF 100,000 and the fine for fraudulent use is CFAF 500,000. These penalties could be a disincentive if they were systematically enforced, but they are not, because of poor controls and the existence of a degree of flexibility. Discretionary behaviors are condoned, for example, the acceptance by the agency of the deductibility of income tax expenses for invoices for small amounts, even though there is no NIF on them.

(iii) Planning and monitoring of tax supervision and fraud review programs

102. There are tax auditing and review programs, but they are not based on clear risk assessment criteria. Risk indicators must take into account the frequency of corrections to original returns and tax reminders after auditing. In the area of taxation, there are programs based on a manual review of individual files for auditing, and findings are based on an offsite audit of the files by tax base staff and/or review staff. Contrary to the statement made during the 2008 assessment, these auditing programs are not based on a risk-based approach tailored to the sector or area of activity, to the size or the organization of the business, or to business behaviors in order to categorize the entities according to risk level. Moreover, the lack of identification of the factors that make possible breaches of tax discipline, fraud or tax evasion, makes it impossible to improve the level of compliance with tax obligations. The risk-based approach allocates available resources as efficiently as possible in terms of revenue and preventive effects. In customs, audits of valuation performed by Société de contrôle et de certification commerciale (COTECNA) and the very recent implementation of scanners reduce the risk level, but customs still faces difficulties in terms of controlling and checking exemptions. In this area there is no database on the risks inherent in the exemption system that could improve the effectiveness of the audits. Moreover, goods in transit on roads pose difficulties for inspection because of problems with customs escorts.

103. Customs uses the services of COTECNA staff; they provide inspection support before goods are loaded or, if that is not possible, when the goods are offloaded, and then they issue an inspection certificate (ADV). They manage the scanners, which were placed in service in September 2012. Moreover, COTECNA was to inspect quality and standards, but at this time only the value is checked. The framework for the intervention of the specialized inspection entity, mandated by the government for this purpose, is governed by Decree 2011-248/PRN/MF of August 11, 2011. The data processing interconnection among the customs offices that could improve the effectiveness of the inspections is incomplete; other than the offices in Niamey and two regional customs posts, the others are not connected.

PI-15. Effectiveness in collection of tax and customs payments

104. This indicator measures the level of arrears in taxes and fees and the agency’s capacity to collect the arrears. The benchmark period is October 2012.


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(i) Collection rate of gross tax/fee arrears, calculated as a percentage of tax arrears at the beginning of the fiscal year, that were collected during the given fiscal year (average of the last two fiscal years).

105. The tax agency does not produce a statement that shows the arrears for each fiscal year from the previous fiscal year, the new outstanding amounts to be collected, or the tax arrears that were collected. This was also found in the 2008 PEFA assessment.

106. The tax system is declaration-based and payment is spontaneous for the large taxes (VAT and income tax). The outstanding amounts to be collected are thus insignificant, except for taxes levied previously by the agency, of which the taxpayer was notified, and that are to be paid by the statutory deadline. This is the case of tax reminders after a tax audit. There is no complete statement that summarizes spontaneous payments, collections following a previous issuance of revenue securities, cancellations) or outstanding amounts to be collected. The analysis of the specific statements in the Directorate of the Tax Audit and Reviews (DCFE), for each of the fiscal years (2009, 2010 and 2011) shows the poor efficiency of collections compared to the tax reminder following the adjustments [redressement] to the taxable bases. The scores issued after a tax audit show low collection rates during the issuance exercise, as shown in the table below on DCF revenue (Table 16).

Table 16:

Status of collections and outstanding amounts to be collected from issuances after a tax audit for each fiscal year (2009, 2010 and 2011)

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Source: Tax Audit and Review Directorate

107. For each year, the DCFE receiver prepares a statement of acceptances, cancelations, collections and outstanding amounts to be collected. But the outstanding amounts to be collected, determined at the end of a fiscal year, are not included in the statements prepared for the next year and there are no comprehensive statements on the settlement of acceptances that summarize the amount of these acceptances, settlements due to cancelations, collections, or outstanding amounts to be collected. Settlements due to cancelations are occasionally very high, and this reduces the credibility of the audits and related acceptances. In 2010, acceptances amount to CFAF 62.7 billion, 47.9 billion of which was canceled in 2011, and the statement of cancelations that the staff submitted was incomplete.

108. There is a special procedure for the immediate or direct removal of goods in customs, subject to an adjustment period, for which there are risks in terms of settlement and the actual collection of duties. This procedure applies in special cases such as fresh products, spare parts, and imports under the exemption system. However, cases of the illegal use of this procedure have occurred and jeopardize the collection of duties. A guarantee system has been put in place to improve the management of this procedure.

(ii) Effectiveness of the transfer into the treasury account of amounts for taxes, fees and customs duties collected by the tax agency and customs.

109. Transfers to the RGT account of funds collected are made regularly through the DGI and the DGD revenue office, but the time frames for mobilizing the funds are not optimized. The RGT account is reconciled with the ACCT account daily, at the end of the day. The tax is paid to the Taxes and Customs Revenue Office in cash or by check. The checks are presented for clearing. At the BCEAO branch in Niamey, the value date of the checks for clearing is D+1. For customs revenue, the cash is released regularly, but the time frame for reimbursing the revenue that the regional posts collect may be as much as ten days, and the maximum level is three percent of total customs revenue.

(iii) Frequency of a full reconciliation of valuation accounts, collections, arrears files and amounts received by the Treasury.

110. The collection account reconciliation operations are carried out at the end of the month based on a summary statement of revenue along with payment notices that the customs receiver submits to the appropriate treasury accounting officer, with discharge. Authorized operators are eligible for the facility for phased withdrawal of goods from customs [crédits d’enlèvement]. The funds are available after they are audited (this is the Treasury’s responsibility). The Treasury must collect the corresponding duties by the due date.

PI-16. Predictability in the availability of funds for commitment of expenditures

111. The indicator pertains to the information the ministries received regarding the actual availability of the funds, and how the government manages its cash, in particular from the standpoint of cash flow forecasting. The benchmark year for the measurement of this indicator is 2011.


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(i) Degree of predictability and monitoring of cash flows.

112. A cash plan is prepared for the fiscal year and is updated each quarter, but there is no guarantee that it is reliable. A cash committee is in charge of preparing an annual cash plan and monitoring cash management. Annual estimated cash plans are prepared using the month as a basis. Quarterly cash plans are prepared (projected and actual). The cash committee meets once a week to review the execution of expenditures and revenue for the previous week and to determine expected revenue for the coming week before determining expenses payable as a result as well as the amount to be secured for paying wages. However, the randomness of some nontax revenue (dividends) and difficulties in controlling the schedule for disbursing external budget aid (loans and non-repayable aid – NRA) lessen the predictability of funds and the ability to prepare the annual schedule for floating loans. The nonrecurring expenditures procedures (30 percent of Titles 3, 4 and 5) also lower predictability and leeway for paying expenditures that arrive via the standard procedure, and this is a source of accumulation of arrears.

(ii) Reliability and frequency of periodic information supplied during the fiscal year to the ministries, directorates and other administrative entities on ceilings for expenditure commitments.

113. To align the pace of consumption of funds for expenditures using cash [disponibilités financières], since 2009 a budget regulation has been in use and reports are submitted to the ministries. Instruction 000549/ME/F/DGB of February 20, 2009 governs the practical procedures for executing government expenditures. The first type of regulation is by releasing funds in equal quarterly installments. The second type of regulation is the release of a percentage of funds broken down into expenditure categories to take account of the seasonal nature of expenditures for some ministries. The third type is the monthly distribution of funds authorized for certain categories of expenditures for the remaining period by limiting monthly commitments to the released allocation. Allocations released under these procedures are reported by ministerial circular letters to the fund administrators and to the IT director. Within the limit of the envelope reported for each title: 3 (operation), 4 (transfer and subsidies) and 5 (investments), the fund administrators propose to the payment authorization officer, based on their priorities, a detailed breakdown of the commitment proposals. However, since there are no commitment plans that are harmonized with the procurement plans, the effectiveness of the regulation procedure is diminished.

(iii) Frequency and transparency of adjustments of budget allocations, the decision for which is made at a management level above the ministries and other administrative entities.

114. Insignificant adjustments using legislative means through the supplementary budget laws or by regulation through wire or other transfers are used if there are constraints on financial resources. Regulatory changes in the budget (wire and other transfers) continued to be limited in 2009. In 2010, regulatory changes were unnecessary due to the two supplementary budget laws (LFR): the first LFR lowered funds by 13 percent compared to the original budget law, and the second increased funds by eight percent compared to the previous LFR. However, the organic budget law strictly controls the movements of these funds.

PI-17. Monitoring and management of cash balances, debt and guarantees

115. This indicator assesses the monitoring and management of cash balances, debt and guarantees. Debt management (procedures for setting it up, service and repayment) and the granting of government guarantees, are the major components of budget management. Thus, to avoid borrowing and paying interest unnecessarily, the cash balances of all the government bank accounts (including the balances of extrabudgetary funds and accounts of projects controlled by the central government, must be identified and consolidated. In three dimensions, the indicator measures: (i) the quality of data recorded on the debt and reporting; (ii) the status of consolidation of the central government’s cash balances; and (iii) the lending system and the system for extending guarantees.


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(i) Quality of recording data on the debt and reporting (as of the time of the assessment).

116. Several entities are involved in managing Niger’s debt. The Public Debt Directorate (DDP) is in charge of recording and administering the medium and long-term external and internal debt using the CS-DRMS software, and for establishing a strategy to manage the public debt approved by the National Public Debt Management Committee (CNGDP). The Directorate General of the Treasury and Public Accounting (DGTCP) is responsible for the treasuries issued in the regional market. The CAADIE is in charge of managing domestic arrears prior to 2010 and for clearing them. The Ministry of Planning identifies the sources of external financing and negotiates loans with creditors.

117. The data on the internal and external debt is complete and up-to-date and is reconciled every year. Practices regarding the debt are sufficient to obtain the score of C, which is better than the previous assessment in 2008. Complete management reports and statistics (on debt service, the stock and operations) are produced: (i) the public debt strategy paper is produced annually and is annexed to the annual budget; (ii) statistical reports on the external debt are produced twice a year. The data is of good quality, but there are problems in terms of the time it takes to record new loans and some drawings. The external debt data is reconciled with creditors at the end of each year.

(ii) Consolidation statement of central government cash balances

(As of the time of the assessment).

118. The consolidation of cash balances is incomplete. The cash balances are calculated daily for the revenue transit accounts and monthly for all the administration accounts (including the accounting item accounts). Bank balances, such as the balances of the special treasury accounts with the BCEAO, are not consolidated with the principal ACCT accounts. There are three types of these special accounts: (i) the government agency accounts, such as the Postal Service, the National Social Security Fund (CNSS), and some GAAs; (ii) the accounts kept by the DGTCP (largely for historical reasons); and (iii) the project accounts at the request of the donors. Although the authorities surveyed the bank accounts in order to close some of them, the number of government agency accounts in commercial banks increased from 1,147 in July 2010 to 1,954 accounts in June 2012. According to the results of the survey, performed in late June 2012, the GAA accounts with the BCEAO held cash equivalent to two and a half times the cash the Public Treasury held.

(iii) System for loans and granting guarantees

(Status as of end-2011).

119. The Minister of Planning signs loans, but there are no rules, criteria or ceilings for granting guarantees. The new organic budget law enacted in 2012 established that only the Minister of Finance grants loans and guarantees. The Minister of Finance delegated this authority to the Minister of Planning. The time frames for disclosing information on loan agreements between the two ministries generate uncertainty regarding the consolidation of data on the debt for the forecasting requirements of its service under the draft budget law. Moreover, the guaranties are not granted on the basis of clear criteria laid out in an instruction. In addition, there is no specific or single oversight system. However, new guarantees were seldom granted in recent years, and the sole recipient was Société de raffinage de Zinder in the amount of US$352 million, and prior to that, Hôtel Gaweye, in the amount of CFAF 2.3 billion.

PI-18. Effectiveness of payroll controls

120. This indicator assesses the payroll control mechanisms and their level of effectiveness


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(i) Degree of integration and reconciliation of payroll and personnel database data (As of the time of the assessment)

121. The personnel database is not kept up-to-date due to the lack of integrated staff and payroll management; reconciliations do occur, albeit sporadically. There is no integration of government employee management with the joint data of the Ministry of the Civil Service and the Payroll Directorate under the MF and the DRHs of the sectoral ministries; this would facilitate a systematic update of the personnel database in the civil service. The civil service database is updated monthly based on appointment and promotion documents prepared at the central government level, as well as the deconcentrated documents, prepared in the sectoral ministries. The Payroll Directorate database includes all the changes brought about by the decisions for which Ministry of the Civil Service is responsible, as well as changes brought about through the documents prepared by the sectoral ministries for the management of staff that have autonomous status. This autonomous status applies to personnel in customs, water and forest, judges, the National Police, the Niger National Guard, and the Military Corps.

(ii) Timely changes made in the personnel database and payroll statement (As of the time of the assessment).

122. Some changes in the personnel database and payroll statement are often made more than three months late. The ministries are not connected to the payroll application. They forward the relevant decisions and receipts to the Ministry of the Civil Service. The civil service employees who input data go to the Ministry of the Civil Service website to enter payroll changes. The Payroll Directorate thus updates the file monthly, up to the 24th of the month, in order to begin processing the payroll and auditing the statements that are edited after the changes. Some changes in the personnel database and payroll statement are often made three months late.

(iii) Internal controls of changes made in the personnel database and payroll (As of the time of the assessment)

123. Control measures are in place, but they do not guarantee the total integrity of all the data because the management of staff with autonomous status that is not under civil service control is separate. The audit of the payroll based on crosschecking it with the personnel database kept by the Ministry of the Civil Service is still partial. The personnel database only manages staff that falls under the general regulation, and employees with autonomous status are managed directly by the appropriate agencies. The update of the database depends on the speed with which the ministries update the files for their employees. The financial and Treasury audits are not part of the process of checking changes made in the payroll. The 2008 assessment overestimated this component by restricting it to the ability to show the changes made in the personnel database and payroll statement database.

(iv) Existence of measures to audit the payroll to find failures in the internal control system and/or ghost workers

(Status over three years, from 2009 to 2011).

124. In 2009, a staff count was taken, but has not been followed by tabulating the results to update the database of civil servants. In addition, IGF performed an audit of the payroll system in May 2011, but the report prepared for this purpose and its main findings were not tabulated.

PI-19. Procurement: transparency, competition and systems for filing complaints

125. This indicator examines the procurement system based on which much government spending is executed. It consists of four dimensions: (i) the legal and regulatory procurement framework; (ii) the use of competitive procurement methods; (iii) public access to procurement information; and (iv) processing of procurement complaints. The structure and method of assessment of this indicator have changed since the previous assessment in 2008.


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(i) Promotion of transparency, comprehensiveness and competition through the legal and regulatory framework (Situation as of end-2011).

126. The legal and regulatory framework in effect since 2011 is consistent with best practices (Table 17). To improve governance and optimize resources, reforms were begun in 2006. The Directorate General of Procurement Oversight (DGCMP) and the Procurement Regulatory Agency (ARMP) were established. More recently, in 2011, a new law and decrees and decisions that implement it were adopted. In particular, a system for reviewing complaints was implemented and included an independent administrative body. The legal and regulatory procurement framework meets all the requirements of the PEFA methodology: a clearly established hierarchical organization is freely and easily accessible; use open competitive procurement as the default method of procurement; provide public access to procurement information; provide independent administrative procurement review process for handling procurement complaints by participants before the contract is signed. However, there is room for improvement in the procurement system since some of the DGCMP’s duties continued to be carried out by certain units of the Ministry of Finance. Procurement data is fragmented between the ARMP and the Directorate General of Financial Control (DGCF). Visibility in procurement below the threshold of CFAF 10 million is more limited.

Table 17:

Summary of the features of the legal and regulatory framework for procurement according to the baseline PEFA criteria

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(ii) Use of competitive procurement methods

(At the time of the assessment in October 2012)

127. In recent years, the operation of the procurement system has been strengthened as well. All government contracts of a value greater than CFAF 10 million are awarded based on open competition. According to the average quality database in Table 18b, in 2011, about 90 percent of the value of contracts awarded were open (international tenders, domestic tenders and short-list tenders). A request for exemption was filed for the use of special methods such as short lists and direct agreements, which the DGCMP reviewed in accordance with legal requirements. The DGCMP refused to approve roughly 20 percent of procurement projects by other methods from 2009 to 2011 because they did not meet the requirements. To avoid tenders, splitting contracts is prohibited, and the DGCMP ensures compliance with this for contracts worth more than CFAF 10 million. Below that amount, government procurement follows the internal control procedure of the contracting entity. However, the DGCMP has not yet prepared period reports.

Table 18a.

Breakdown of procurement modes by number and percentage

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Sources: ARMP, mission calculations
Table 18b.

Breakdown of procurement modes by amount

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Source: ARMP, mission calculations

(iii) Public access to procurement information that is comprehensive, reliable and timely

(At the time of the October 2012 assessment)

128. About 90% of the information on procurement that is published pertains to contracts awarded in 2011. Important procurement information is available to the public. This information includes forward-looking procurement plans, bidding opportunities, contract awards and information on dispute resolution. This information which, for example, is disseminated to the ministries and other contracting entities such as city governments and professional associations in the private sector, is published in the Official Gazette and in the media. The public may obtain the information at a nominal cost. Ninety percent of the information on procurement that is published pertains to contracts awarded in 2011. In January the DGCMP publishes a forward-looking annual procurement plan of the government entities, and this plan is periodically updated. Thus, it reviews the tenders before they are released. There is an independent audit of procurement every other year. The most recent covers 2007 and 2008 and was published in 2010; the next one, covering 2009 and 2010, was in preparation.

(iv) Existence of an independent administrative body in charge of reviewing procurement complaints

129. An administrative body that complies with optimal standards reviews complaints (Table 19). Implemented by Decree 2004-192/PRN/MEF of July 6, 2004, the Dispute Resolution Committee is comprised of six (6) professionals who are not involved in procurement operations. The ARMP appoints half of the committee members, while the socio-professional organizations appoint the others. Its decisions are handed down in a reasonable amount of time and are binding on all parties. The committee may suspend the procurement process if necessary. The cost of this complaint process is reasonable, and the process is accessible to all. It is implemented using procedures known to the public.

Table 19.

Analysis of the existence of an independent administrative body in charge of reviewing complaints

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PI-20. Effectiveness of internal controls for non-salary expenditures

130. This indicator measures the effectiveness of the internal control system and the risk-based approach dimension for implementing it. The assessment is based on the situation as of October 2012.


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(i) Effectiveness of expenditure commitment control measures

131. The single payment authorization officer for expenditures determines the envelopes to release in terms of quantitative and time limits based on expected revenue; this system is relatively reliable. The expenditure execution procedures are carried out through the computerized expenditure chain using the principle of the single payment authorization officer. The Minister of Finance is the lead single payment authorization officer for expenditures from the general government budget, annex budgets, and special treasury accounts, and the other ministers are the fund administrators. The lead payment authorization officer and the fund administrators may delegate their authority. Based on expected revenue, the payment authorization officer determines the quantitative and time limits of the envelopes to be released; this is relatively reliable. The excessive use of exemption procedures limits somewhat the effectiveness of the measures to control expenditure commitments.

(ii) Comprehensiveness, relevance, clarity and other internal control rules/procedures.

132. The internal control system is relatively well structured. The fund administrators, accredited by the payment authorization officer or their delegates, propose expenditure commitments and prepare the validation. The financial comptroller must sign all commitment proposals. The payment authorization officer instructs the public accounting officers with whom they are accredited to pay the expenditures. The computerized administrative accounting shows by budget posting the amounts of funds open, expenditures for which there are commitments, available funds and authorized expenditures. The payment authorization officer and their delegates alone are empowered to authorize government expenditures, documented by the issuance of an order. The payment order that is issued is forwarded to the accounting officer, who accepts it and pays it by cash voucher, check or transfer order.

However, rejections in financial operations are not determined,, although the number must be insignificant because available data can apply only to expenditures based on the standard procedure, and in such cases, the electronic circuit of expenditure execution reduces the risks of rejection. In fact, the fund administrator who introduces the commitment proposal is required to observe the limit of the amount to be committed that the system displays, the limits of the price list, and ensure that the NIF matches the beneficiary of the commitment.

However, system effectiveness is reduced to expenditures using the standard procedure, at just over 70 percent of total expenditures.

133. The organization of the expenditure chain is characterized by the intervention of accounting controls prior to the payment authorization phase; this is another factor of redundancy. Orders are issued only for expenditures actually signed by the accounting officer in his role as payer to avoid having to cancel orders already issued, signed and recognized by the payment authorization officer.

(iii) Degree of compliance with the rules of processing and recording transactions

134. The organization of the expenditure chain is characterized by unjustified exemption procedures that jeopardize its effectiveness. The large number of procedures heightens the complexity of the expenditure chain and raises recurring problems of adjustments and settlement of the suspense accounts with the assignee accounting officer. Exemption procedures account for roughly 30 percent of expenditures in Title 3 (operations excluding wages), Title 4 (transfers and subsidies) and Title 5 (investments). The use of exemption procedures for expenditures weakens the control of budget execution and of the entire budget and accounting system. In the economic and financial program that the FEC (IMF) supports, the authorities are required to limit expenditures using exemption procedures to five percent of total expenditure commitments. Finally, the authorities estimate that now that a committee that monitors expenditures without prior authorization has been seated (on March 30, 2012), it will be possible to harness and bring the procedures into compliance promptly.

PI-21. Effectiveness of the internal audit system

135. This indicator assesses the extent to which the authorities are kept adequately informed of the performance of the internal control systems by an internal verification system. Based on recent available information, no progress was observed compared to the previous assessment.


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136. The scope of authority of the Directorate General of the Office of the Finance Inspector (DGIF) and the Office of the Inspector General (IGE) is interministerial and covers all public financial entities and activities, including the projects. The statues that address these inspections are still Decree 85-120/PCMS/ of September 12, 1985 and Decree 97-272/PRN of July 18, 1997. The DGTCP has an internal inspection section that audits the services of the Directorate General and, in particular, all accounting items and the Office of the Inspector General of Treasury Units (IGST). The IGST was reorganized by Decision 0295/ME/F/DGTCP of July 27, 2010, which sought to strengthen it (in the past there was only a small unit). The technical ministries have inspection units. Their staffs are small and their main duty is technical control. They are coordinated by the Office of the Inspector General of Administrative Governance, which is under the cabinet of the Prime Minister. It was not possible to inspect the reports that the DGIF and IGE prepare.

(i) Coverage and quality of the internal audit

137. The internal audit is operational, at least for the most important entities of the central government and partially reviews the systems (at least 20 percent of staff time), but it is not fully compliant with accepted professional standards. The DGIF has 25 inspectors who are former senior civil servants (m