VZCZCXYZ0015
PP RUEHWEB

DE RUEHLGB #0935/01 2881211
ZNR UUUUU ZZH
P 151211Z OCT 07
FM AMEMBASSY KIGALI
TO RUEHC/SECSTATE WASHDC PRIORITY 4790
INFO RUEHBS/AMEMBASSY BRUSSELS 0148
RUEHJB/AMEMBASSY BUJUMBURA 0160
RUEHDR/AMEMBASSY DAR ES SALAAM 0969
RUEHKM/AMEMBASSY KAMPALA 1729
RUEHKI/AMEMBASSY KINSHASA 0302
RUEHLO/AMEMBASSY LONDON 0120
RUEHNR/AMEMBASSY NAIROBI 1027
RUEHFR/AMEMBASSY PARIS 0342
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS KIGALI 000935 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON EFIN RW
SUBJECT: IMF ON PUBLIC FINANCE MANAGEMENT EFFORTS IN RWANDA 
 
REF: A. KIGALI 743 
 
     ¶B. KIGALI 209 
 
¶1.  (SBU)  Summary.  On October 12 a visiting International 
Monetary Fund (IMF) team described for local diplomatic 
missions its efforts to assist the Ministry of Finance and 
other Rwandan ministries and agencies in improving Public 
Finance Management (PFM --the effective and efficient use of 
public funds by the government). The team described budget 
offices at the Finance Ministry as well as program 
implementing ministries and agencies as understaffed and 
undertrained, despite being expected to use complicated 
financial procedures and a new Organic Budget Law most 
officials have never seen and do not understand.  Better 
coordination between the Auditor General's office, the 
Finance Ministry and line ministries, and direct policy 
linkages between individual ministry plans and directives 
(which are often multi-year initiatives) and the annual 
budget process, would improve the effective use of pubic 
funds.  According to the team, small concrete steps would do 
much to improve PFM in Rwanda.  End summary. 
 
¶2.  (SBU)  Mission officers attended the October 12 briefing 
by a visiting two-person IMF team at the local IMF offices. 
The visiting team described a financial management system 
that was overly complicated for Rwanda's needs, and operated 
by small staffs who lacked proper training and oversight. 
For example, the team said, line ministries typically had 
only two PFM officers, an accountant and a budget execution 
officer, to oversee large public programs with extensive 
expenditures.  The officers usually had only limited 
qualifications for their duties.  The Ministry of Finance and 
the Auditor General's Office typically had staff assigned to 
each line ministry, but they too lacked proper training, and 
had limited linkages with their home offices. 
 
¶3.  (SBU) According to the team, the recently passed Organic 
Budget Law was a solid piece of legislation, but was little 
understood by those expected to implement it.  A complicated 
set of financial procedures further compounded the 
difficulties these under-trained officers faced in carrying 
out their legally prescribed duties.  Said one IMF staff 
member, regarding the four volumes of financial procedures, 
"they are too long, and almost no one has been properly 
trained in their use.  They are fine for London or 
Washington, but Kigali needs a simpler set of regulations." 
The team noted that the Government of Rwanda's (GOR) 
extensive decentralization plans put added pressure on 
district budget offices, who had even less training and 
smaller staffs to contend with increasing financial 
responsibilities.  (Note: last October a report by the 
Auditor General expressed considerable concern at the lack of 
proper documentation and auditing of the use of public funds 
-- see ref B.  The Prosecutor General this spring launched a 
broad probe of 46 government entities, with several criminal 
prosecutions begun, and some offices cleared of any 
wrongdoing -- see ref A.  End Note). 
 
¶4.  (SBU)  The IMF team offered a series of small concrete 
steps toward better PFM, including revised and simplified 
financial regulations, focused training in those simplified 
procedures, better coordination between the Auditor General's 
Office, the Ministry of Finance, and line ministries, better 
integration of line ministries plans (often multi-year) and 
the annual budget cycle managed by the Ministry of Finance, 
and more staff with higher qualifications.  They described 
Rwandan budget staff at various ministries and agencies as 
"willing and enthusiastic," and noted these modest 
improvements would be of "enormous" help to them.  The IMF 
team had formally presented these proposals to the Minister 
of Finance, said the team, and the Minister had agreed with 
many of them.  At the conclusion of the meeting, the 
assembled diplomatic missions agreed upon an informal 
"policy" group of economic officers to track GOR efforts to 
improve PFM. 
 
¶5.  (SBU)  Comment.  This IMF effort, coupled with assistance 
from the European Union and other missions (ref A), are the 
soft hand of advice and training, as an accompaniment to the 
formal criticism of the Auditor General and indictments by 
the Prosecutor General.  Better training, better procedures, 
and more staff should mean less errors and less temptation to 
stray by government officers.  End comment. 
 
 
SIM