1887

OECD Environment Working Papers

This series is designed to make available to a wider readership selected studies on environmental issues prepared for use within the OECD. Authorship is usually collective, but principal authors are named. The papers are generally available only in their original language English or French with a summary in the other if available.

English

Integrating Public Environmental Expenditure within Multi-year Budgetary Frameworks

Medium-term approaches to budgeting are now common in OECD countries and are being adopted increasingly by developing countries. This reflects a realisation that the annual approach to budget making actually undermines budgetary performance, contributing to fiscal instability and, perhaps even more fundamentally, to resource misallocation and the inefficient and ineffective use of resources. The purpose of this study has been to analyse how multi-year budgetary processes work in practice in both high income OECD countries and in aid-receiving countries, with a view to identifying the opportunities for, and limits to, financing environmental management. It also provides suggestions to the donor community on how to make better use of multi-year budgeting when providing general support to the budgets of developing countries in order to ensure that environment is included in this process. In this context, the report may be of interest to various audiences. On the one hand, representatives of the ministries of environment and other relevant government agencies with responsibilities for environmental and natural resource management who struggle to prepare medium-term budgets may find this analysis useful. On the other hand, the report is targeted at experts from the ministries of finance and economy who are charged with assessing environmental programmes and taking decisions for their financing. The third target group are those donors who even if they are moving to direct budget support, may still be concerned that the environment sector is adequately funded.

English

Keywords: medium-term budgeting, budget systems, environmental management, environmental investment programmes, development cooperation, direct budget support, medium-term expenditure frameworks, environmental public expenditure management
JEL: O19: Economic Development, Innovation, Technological Change, and Growth / Economic Development / International Linkages to Development; Role of International Organizations; H61: Public Economics / National Budget, Deficit, and Debt / National Budget; Budget Systems; Q01: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / General / Sustainable Development; Q56: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth; O13: Economic Development, Innovation, Technological Change, and Growth / Economic Development / Economic Development: Agriculture; Natural Resources; Energy; Environment; Other Primary Products; Q57: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Ecological Economics: Ecosystem Services; Biodiversity Conservation; Bioeconomics; Industrial Ecology; E61: Macroeconomics and Monetary Economics / Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook / Policy Objectives; Policy Designs and Consistency; Policy Coordination
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