STRENGTHENING BUDGET INSTITUTIONS AND REVENUE ADMINISTRATION FOR CLIMATE CHANGE ACTION AND GENDER EQUALITY

Interest in green and gender budgeting, as well as revenue administration gender equality initiatives, is increasing worldwide. To develop a holistic approach that encompasses both gender and climate considerations, officials from Ministries of Finance must understand the underlying concepts, identify driving factors, and familiarize themselves with strategies to address challenges.

From October 3 to 5, 2023, senior public officials representing Ministries of Finance and Tax Administrations from nine countries, —namely Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyz Republic, Mongolia, Tajikistan, Turkmenistan, and Uzbekistan— convened at the IMF Caucasus, Central Asia, and Mongolia Regional Capacity Development Center (CCAMTAC) in Almaty, Kazakhstan. This gathering was for a three-day workshop titled “Strengthening Budget Institutions and Revenue Administration for Climate Change Action and Gender Equality.” The event was facilitated with the support of the Swiss State Secretariat for Economic Affairs (SECO).

The workshop covered three core areas for finance ministries: Climate Public Financial Management (PFM), Gender Budgeting, and Revenue Administration (RA) Gender Equality.

• For the PFM component, the goal was to strengthen the gender budgeting strategies already established in 6 of the 9 participating countries. Participants were also introduced to climate budgeting and the IMF's green PFM framework. The workshop highlighted both the similarities and differences between gender and climate budgeting, paying special attention to practices like gender impact assessments, and climate and gender tagging. Adopting either a Green PFM or a Gender budgeting framework is a gradual, customizable process, and the finance ministries should play a principal role in the process.
• Under the RA component, participants explored revenue administration principles and practices that support gender equality from two perspectives: (i) achieving gender equality in the RA workforce, and (ii) the RA’s role in boosting women’s economic participation by applying a gender lens when administering tax laws and facilitating trade.

There were also some joint discussions, on the roles of finance ministries, strategies to address implementation challenges, key highlights, and next steps to explore ways to get the countries engagement.

The IMF Gender Budgeting framework emphasizes a comprehensive and integrated gender perspective throughout the budget cycle. Gender Budgeting is an approach that uses fiscal policy and PFM instruments to advance gender equality. It is not just about funding explicit gender equality initiatives. It entails analyzing fiscal policies and budgets to understand their impact –intended and unintended– on gender equality, using this information to design and implement effective gender equality policies.

The use of gender budgeting tools can identify gender equality gaps and focus on more effective targeted policies, spending allocations and revenue measures that reach the entire population or are non-discriminatory (often unintentionally due to lack of information or inertia).

Green PFM is the integration of a climate-friendly perspective into PFM practices, systems, and frameworks – especially the budget process in the broadest sense– in the objective to promote fiscal policies that are responsive to climate (and environmental) concerns. Green PFM is about working out how the existing system can be reformed to better support the design and implementation of green policies, and the achievement of green objectives. It can be a key enabler of an integrated government strategy to combat climate change.

The IMF Green PFM framework presents a holistic approach, because climate change should be taken into consideration at every step of fiscal and budget policies to ensure that they work for, not against, the achievement of climate objectives. The IMF approach builds green budgeting elements in all five elements of the budget, developing and refining existing PFM processes rather than building an entirely new PFM system.

Gender Equality and Revenue Administration

Gender equality is an integral component of fiscal reform and plays a key role in achieving more inclusive and sustainable economic growth. As many countries seek to improve their economic and social performance, it is important now more than ever to consider the role of gender. Revenue administrations play a critical role in administering tax policies and can leverage their relationships with taxpayers and traders to strengthen the participation of these groups in the economy.

Furthermore, through their effective and efficient collection of tax revenue, revenue administrations provide funds for governments to finance spending in many critical areas that support women and girls: water, sanitation, social protection programs (such as maternal and parental leave, paid childcare), targeted social transfers, health, education, public sector employment expenditure that helps close seniority and wage gaps, and digitalization.

Finally, revenue administrations can develop gender-balanced and inclusive workforces with policies and procedures that ensure equal employment opportunities.

The IMF and its center in Almaty thank the State Secretariat of Economic Affairs of Switzerland for supporting this important work to strengthen human capital, budget institutions, and revenue administration in Mongolia and the Caucasus and Central Asia region.

The PFM team comprised in person and virtual presentations from Almudena Fernandez, Lauren Keating, Nino Tchelishvili, Imran Aziz, and Louis de Crevoisier. The RA team included Cindy Negus, Elizabeth Gavin, Elizabeth Goli, and Gregory Topping. The presentations covered a broad range of topics, and the workshop included implementation examples, and practical exercises.?