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Cablegate: Demarche Response: Central Government Budget Transparency

VZCZCXYZ0001
PP RUEHWEB

DE RUEHBUL #3402 2980629
ZNR UUUUU ZZH
P 250629Z OCT 09
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC PRIORITY 2440
INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC 0921

UNCLAS KABUL 003402

SENSITIVE
SIPDIS

DEPT FOR EEB/IFD/OMS - SAUNDERS AND SCA/A - JEA
TREASURY FOR JCASAL, ABAUKOL, AWELLER, AND MNUGENT

E.O. 12958: N/A
TAGS: EAID ECON EFIN PREL PGOV AF
SUBJECT: DEMARCHE RESPONSE: CENTRAL GOVERNMENT BUDGET TRANSPARENCY

REF: (A) STATE 81177 (B) STATE 288885 (C) KABUL 2812

1. (SBU) Deputy Finance Minister Mastoor responded October 20 to
the demarche on budget transparency (Ref A), expressing appreciation
for Afghanistan's FY-2009 waiver of the Foreign Appropriations Act's
prohibition on assistance to "a central government that does not
make its national budget, both income and expenditures, publicly
available on an annual basis." He noted, however, his Ministry
annually publishes the Afghan national budget on a publicly
available website
www.budgetmof.gov.af/nationalbudget/budget/bu dget.html
in three languages: English, Pashto, and Dari. In addition,
Mastoor said the Finance Ministry also posts mid-year reviews of the
national budget (reconciling expenditures with the budget ceiling),
the MOF's Treasury Department execution and disbursement reports,
and end-of-the-year closing account and audit reports on its web
site. Responding to the point that the Ministry might also post
national budget documents in government offices and other public
places, Mastoor said he would consider the suggestion.

2. (SBU) Mastoor acknowledged his Ministry must refine its
budgetary submissions further to meet international transparency and
internal controls standards. He stressed the Finance Ministry is
seeking the reinstatement of Article 61 of the Public Finance and
Expenditure Management Law to permit his Ministry to audit line
ministries (Ref C). Mastoor predicted the issue would be resolved
in the next few weeks, thereby strengthening the Ministry's
oversight powers. Mastoor added that the MOF is considering
adopting a performance review system that would report both
disbursements to line ministries and the actual performance outcomes
of those disbursements. Deputy Minister Mastoor said he would soon
request USAID and World Bank assistance in implementing this
performance-based budgetary reporting system so that it could
encompass as well provincial and district-level offices.

EIKENBERRY

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