How to improve public sector finances in Honduras

Abstract

The objectives of a public sector management program should be to use resources more efficiently rationalize public sector operations and reduce financial disequilibrium. This report presents a comprehensive policy program to improve public finances in Honduras. It recommends that Honduran authorities prepare an action plan for improving public sector management. The plan should include the following measures: (a) increase savings; (b) introduce efficiency-saving measures; (c) improve budgeting, debt management and tax collection; (d) standardize accounting practices and properly account for debt service obligations; (e) start external management audits of enterprises; and (f) establish financial targets for, and reduce government transfers to, public enterprises. It also recommends measures to: (g) improve service delivery; (h) implement a well-defined privatization program; (i) prepare and implement a growth oriented and financially feasible public investment program; (j) improve decisionmaking and increase accountability and autonomy in public enterprises; (k) improve coordination of the sector; (l) target subsidies; and (m) improve better financial information on the public sector.Environmental Economics&Policies,Public Sector Economics&Finance,National Governance,Banks&Banking Reform,Economic Stabilization