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North Macedonia

Open Treasury (MK0126)

Overview

At-a-Glance

Action Plan: Macedonia Action Plan 2018-2020

Action Plan Cycle: 2018

Status: Active

Institutions

Lead Institution: Ministry of Finance

Support Institution(s): International Republican Institute Address: 11 October 8-2 /3 The City of SKOPJE iri_mk@t-home.mk

Policy Areas

Access to Information, E-Government, Fiscal Openness, Open Data, Publication of Budget/Fiscal Information, Sustainable Development Goals

IRM Review

IRM Report: North Macedonia Design Report 2018-2020

Starred: Pending IRM Review

Early Results: Major Major

Design i

Verifiable: Yes

Relevant to OGP Values: Access to Information , Technology

Potential Impact:

Implementation i

Completion:

Description

Open treasury
Start and end date of the commitment: August 2018 – August 2020
Lead implementing agency
Ministry of Finance
Description of commitment
Status quo or problem addressed by the commitment
There is no publicly available base in Macedonia or an Open Treasury, where review and analysis of the budget revenues and expenditures of the budget users can be performed on a regular basis. The absence of such an open base for the current budget execution by a budget user often raises the public's doubt about the real spending of budget funds by budget users. This problem leads to the need to open the treasury for the general public.
Main objective
Publicly available data base for Budget execution of the budget of the Republic of Macedonia and the budgets of the of local self-government units, which would be included in the projects in the second phase along with the healthcare institutions.
Brief description of the commitment In order to increase transparency and achievieve greater approximation of the information regarding RM’s budget expenditrure to the citizens and all interested parties, and at the same time to use the data for analytical, scientific and research purposes, the Ministry of Finance decided to open the data to the public. This commitment will allow the the Ministry of Finance in cooperation with the International Republican Institute15 to implement the concept of "Open Treasury" or "Open Funds" as part of the transparency for RM’s Budget expenditure. The data that should be presented through the “Open Treasury” system will be extracted from the existing financial information system, by enabling the data exchange at a database level between the new solution and the existing state IT system. The application will offer: - data search after a certain time interval, period and after a certain date, by name/natural or legal entity or budget user, - the data will be published in a machine readable format in accordance with the Law on public sector data application, - organizing the transaction/payer data, recipient, expenditure unit, payment order, group of taxpayers (for example, cultural and university institutions), a group of recipients (natural or legal entities) above or below a certain value, - data search by time of publication, allowing the user to determine the time range in searches, - advance definition of user options, for example, transactions only to legal entities, only to physical entities, etc., or transactions over a certain amount of money, expenses, etc.,
- an option to disable the publication of certain transactions or to modify them prior to publication, such as covering the name and surname with "Unknown Person (UP)" or excluding all or some of the transactions of certain budget users that are considered and classified as confidential. Such exclusions can be made from the Unique Registry Number (URN) according to the budget program, type of account, account of the recipient and expenditure items, - graphical visualization of the searched data with automatic update, - the realization is expected to create a database with current data for RM’s budget execution in the first phase and the budgets of the local self-government units in the second phase. In addition to serving as a tool that enables categorization of data from transaction databases, this solution will allow the data to be set according to the specifications for budget user’s spending in different format and from other databases, where aggregated data will display Comparison of the approved budget and the budget executed at user level, in different time periods, but always limited by seperate fiscal year (from 01.01.YY to 31.12.YY). Various comparative reviews will also be generated, for example, the largest spenders (at fiscal year level) or the expenditures of a particular budget user or group of users, per item, per period, etc
OGP challenge addressed by the commitment - Incresing the public integrity - More effective public resource management Additional information Link to Goal 17, "Partnership for Objectives" Target 17.1: Strengthen domestic resource mobilization, including through international support to developing countries to improve domestic capacity for tax and other revenue collection and Goal 16, "Peace, Justice and Strong Institutions" Target 16.6: Develop effective, accountable and transparent institutions at all levels. This commitment contributes to improving the transparency and accountability of public finance management institutions through greater transparency and accountability in public resource management.
Milestone
3.1.1 Analysis and creation of database with current data for the execution of the Budget of the Republic of Macedonia and its update on 15 days Ongoing 6.2019 3.1.2 Analysis and creation of database with current data for the execution of the Budget of the local self-government units and its update on 15 days 6.2019 6.2020 3.1.3 Preparation and initiation of the “Open Treasury” Web application 10.2018 6.2019
Contact information
Name of responsible person from implementing agency Branko Dimchevski – Treasury Sector Maria Kitanska – IT Sector Goran Mojanoski – Sector for Financial system (co-ordinator of the working group in the Ministry of Finance for OGP) Title, Department Treasury Sector and IT Sector
Phone and e-mail branko.dimchevski@finance.gov.mk; 02 3255 586 marija.kitanska@finance.gov.mk; 02 3255 329 goran.mojanoski@finance.gov.mk 02 3255 538
Other actors involved
International Republican Institute Address: 11 October 8-2 /3 The City of SKOPJE iri_mk@t-home.mk

IRM Midterm Status Summary

Theme III: Fiscal Transparency

3.1. Open treasury

Language of the commitment as it appears in the action plan: [34]

In order to increase transparency and achieve greater approximation of the information regarding RM’s budget expenditure to the citizens and all interested parties, and at the same time to use the data for analytical, scientific and research purposes, the Ministry of Finance decided to open the data to the public. This commitment will allow the Ministry of Finance in cooperation with the International Republican Institute to implement the concept of "Open Treasury" or "Open Funds" as part of the transparency for RM’s Budget expenditure.

The data that should be presented through the “Open Treasury” system will be extracted from the existing financial information system, by enabling the data exchange at a database level between the new solution and the existing state IT system. The application will offer:

  • data search after a certain time interval, period and after a certain date, by name/natural or legal entity or budget user,
  • the data will be published in a machine readable format in accordance with the Law on public sector data application,
  • organizing the transaction/payer data, recipient, expenditure unit, payment order, group of taxpayers (for example, cultural and university institutions), a group of recipients (natural or legal entities) above or below a certain value,
  • data search by time of publication, allowing the user to determine the time range in searches,
  • advance definition of user options, for example, transactions only to legal entities, only to physical entities, etc., or transactions over a certain amount of money, expenses, etc.,
  • an option to disable the publication of certain transactions or to modify them prior to publication, such as covering the name and surname with "Unknown Person (UP)" or excluding all or some of the transactions of certain budget users that are considered and classified as confidential. Such exclusions can be made from the Unique Registry Number (URN) according to the budget program, type of account, account of the recipient and expenditure items,
  • graphical visualization of the searched data with automatic update,
  • the realization is expected to create a database with current data for RM’s budget execution in the first phase and the budgets of the local self-government units in the second phase.

In addition to serving as a tool that enables categorization of data from transaction databases, this solution will allow the data to be set according to the specifications for budget user’s spending in different format and from other databases, where aggregated data will display Comparison of the approved budget and the budget executed at user level, in different time periods, but always limited by separate fiscal year (from 01.01.YY to 31.12.YY). Various comparative reviews will also be generated, for example, the largest spenders (at fiscal year level) or the expenditures of a particular budget user or group of users, per item, per period, etc.

Milestones:

3.1.1 Analysis and creation of database with current data for the execution of the Budget of the Republic of Macedonia and its update on 15 days

3.1.2 Analysis and creation of database with current data for the execution of the Budget of the local self-government units and its update on 15 days

3.1.3 Preparation and initiation of the “Open Treasury” Web application

Start Date: August 2018

End Date: August 2020

Context and Objectives

This commitment intends to make national and local-level budget expenditure data in North Macedonia more accessible to the public. In the International Budget Partnership’s 2017 Open Budget Survey, North Macedonia received 37 out of 100 possible points in transparency, a score that was below most other Western Balkan countries. [35] Under Commitment 5.1 from North Macedonia’s 2016-2018 action plan, the Ministry of Finance improved public scrutiny over the budget, including the publication of citizens’ budgets for 2017 and 2018, [36] a projection of revenues and expenditures of the state budget, and a semi-annual report on the implementation of the state budget. [37] In addition, the European Commission reported in 2019 that budget transparency in North Macedonia had improved due to the publication of the citizens’ budget and increased budgetary data. [38] The 2018 budget was also subject to public consultations. [39]

However, prior to the action plan, available data on the execution of the budget was aggregated and was not presented in an open data format. In order to obtain more detailed information held by the Treasury on the execution of the state budget, citizens often had to submit freedom of information requests, which was a time-consuming and inefficient process. [40] In addition, detailed data on the budget execution at the local self-government level was largely unavailable or not easily accessible to the public. [41]

To further improve budget transparency, the Ministry of Finance, with support from the International Republican Institute (IRI), plans to develop an online database and web application for the public to access data on all transactions disbursed by the Treasury (called "Open Treasury" or “Open Finance”). The data for the Open Finance database will be extracted from existing information systems and will be published in machine-readable format where users will be able to easily cross-compare the approved budget against the executed budget. According to the action plan, users will be able to organize the data according to transaction/payer, recipient, expenditure unit, payment order, group of taxpayers (for example, cultural institutions or universities), group of recipients (natural or legal entities), and above or below a certain value. In addition, under the second phase of the Open Finance project, the Ministry of Finance plans to include data on the realization of the budgets for local self-governments. The budget data for the national and local governments will be updated automatically every 15 days.

The publication of detailed data on budget transactions makes the commitment clearly relevant to the OGP value of access to information. The commitment’s planned activities are verifiable, particularly the creation of the database with the aggregated data, the subsequent updates every 15 days, and the creation of the corresponding web application. If implemented, the Open Finance portal could transform access to budget data in North Macedonia. Opening budget data to public access at the national and local levels with the frequent updates would be a significant step toward increasing transparency in government expenditure. The action plan specifies that the new publication format would make it possible to search published data and provide a basis for analysis and comparison of resource consumption across enterprises, in machine-readable format, which was not possible previously. The portal could provide interested citizens, civil society, and media outlets with detailed and disaggregated data on all transactions paid by public institutions in North Macedonia, much of which was previously unavailable or only available by submitting a freedom of information request. [42] Finally, the portal could provide citizens with more detailed data on public spending at the local self-government level than before the action plan.

Next steps

The Open Finance portal has been developed and launched in November 2020. [43] The Ministry of Finance and IRI are currently working on expanding the portal to include budget data on all transactions by local self-government units from 2010 onwards. The IRM recommends:

  • Evaluate the results and use of the web-portal to identify improvements and changes that may be implemented. This could be done by involving stakeholders and end users of this information, such as watchdog groups and journalists.
  • Specify a detailed level of information on expenditures (e.g. the general expenditure article or the costs, the vendor, etc.).
  • Take measures to ensure that the number of public bodies reporting to the portal increases.

[34] The texts for all the commitments are an abridged version of the commitment texts. For the full commitment texts, see the Republic of North Macedonia 2018-2020 National Action Plan, https://www.opengovpartnership.org/wp-content/uploads/2018/09/Macedonia_Action-Plan_2018-2020_EN.pdf

[35] Open Budget Survey 2017, Macedonia, https://www.internationalbudget.org/wp-content/uploads/macedonia-open-budget-survey-2017-summary.pdf

[36] Ministry of Finance, https://finance.gov.mk/mk/node/6597#overlay-context=

[37] Commitment 5.1 in North Macedonia’s 2016-2018 action plan, p 39, https://www.opengovpartnership.org/wp-content/uploads/2019/11/Macedonia_End-of-Term_Report_2016-2018_EN.pdf

[38] European Commission, p 12, https://ec.europa.eu/neighbourhood-enlargement/sites/near/files/20190529-north-macedonia-report.pdf

[39] Ibid.

[40] Ilina Mangova, International Republican Institute, email correspondence with IRM, 23 January 2019.

[41] Ibid.

[42] Ibid.

[43] Available at https://open.finance.gov.mk/mk/home


Commitments

Open Government Partnership