Ministry of Finance and Economy of the Republic of Serbia, Central Harmonisation Unit
Sixteen Ministries, the City Administrations of Beograd and Novi Sad, together with three Mandatory Social Security Organisations (MSSO’s) (Republic Institute of Health Insurance, the National Employment Fund and the Republican Fund for Pens
Public administration reform and governance issues remain priorities of the Serbian government. In recent years there has been a noticeable improvement of awareness and priority for the need to improve PIFC to international standards and EU expectations contained in Chapter 32 of the Acquis Communautaire.
Public institutions remain in a weakened state in part due to continuing politicisation and centralisation of authority, frequent changes in regulations and institutions through non-transparent processes, and limited strategic planning.
The EU has previously provided two phases of technical assistance to increase awareness and develop improved PIFC arrangements in the public sector. The cumulative impact of this assistance has been to significantly raise awareness at all levels of the benefits to public sector service delivery that improved PIFC processes can bring. These projects have helped create a legal, tertiary, institutional environment allied to a cadre of trained personnel that can effectively lead and guide full implementation of PIFC reforms throughout the public sector using the CHU as its conduit.
The implementation and subsequent sustainability of the sound basis laid for PIFC reforms needs to be driven by a Government created institution the CHU.
Experiences in candidate and recent member states provide evidence that the CHU is pivotal to providing the impetus and support needed to embed reforms. To compensate for the lack of capacity that will be inherent in the staff of the CHU it is crucial that they are provided with the support of suitably qualified public finance management experts who have experience of CHU development as well as understanding the standards required by the EU, INTOSAI and the IIA amongst others.
The main message is that the application of sound financial management processes, including the use of internal audit, thro