A four-day workshop on "Performance Based Budgeting and Mid-term Budget Framework" took place in the conference hall of "Panorama-Grand" Hotel in Samarkand on 10-13 September 2007. The workshop was jointly organized by the World Bank Institute and UNDP Projects "Public Finance Reform in Uzbekistan" and "Support to Uzbekistan’s Welfare Improvement Strategy".

Fiscal and social policies currently being implemented in Uzbekistan are targeted at achieving sustainable development of the country, improving the effectiveness of public expenditures, increasing the incomes of pensioners and the employees in the public sector. Implementation of these policies should improve social protection of the citizens of Uzbekistan, as well as the quality of health care and education.

Citizens of Uzbekistan, being both taxpayers and consumers of public services, should be confident that their money, paid in tax, is used transparently and efficiently and has a positive impact both on the society, as a whole, and on each citizen, in particular.

Clearly established targets and performance criteria for budget formulation and execution, as well as transition to the mid-term budgeting, are the gist of new approaches in public finance management. This means that expenditures of Uzbekistan’s state budget should be planned for three years using concrete and measurable results. Many transitional countries, including some CIS countries, have already introduced the system of mid-term budgeting and performance-based budget.

Bakhrom Ashrafkhanov, Head of Treasury of the Ministry of Finance of Uzbekistan, said in his opening speech "…public finance reform is a powerful asset of Uzbekistan toward achieving competitiveness in the world market, ensuring sustainability and effectiveness of the national economy. Eventually, the way Uzbekistan will look like in the next decade depends on the success of the current state fiscal reforms and policy."

Recognized international experts, possessing both theoretical and practical knowledge and skills in this area, facilitated the workshop. Leading specialists from the World Bank Institute, government officials and researchers from Albania, Armenia, Georgia, Russia, Slovakia, and Kazakhstan made presentations.

International consultants described international experience of transition from cost-based annual state budget planning to mid-term budgeting. In particular, they presented methods of costs estimation and priority ranking during formulation of the state national programs, as well as using the situation analysis as exemplified by the budget systems of Russia and Kazakhstan. Health care and education sectors were used for more detailed review.

During the workshop, the representatives from Uzbekistan’s Ministry of Public Education and Center for Economic Research made presentations about the mechanisms of improving of the monitoring system and evaluation of the state education programs.

Open discussions, that followed presentations, showed that there are still some debatable issues exist in understanding of the process of transition to new budgeting methods. The session on Albania’s experience in transition from annual to long-term budgeting was of special interest to the seminar’s participants.

The workshop was attended by senior officials, as well as by the representatives of the regional branches of the key Uzbek ministries and agencies involved in the state budget preparation.

As noted by the participants, the workshop contributed to improving the knowledge and practical skills of fiscal policy experts, particularly in performance based budget preparation. The knowledge gained from the seminar will ensure that many problems and mistakes will be avoided in the process of mid-term budget development and introduction in Uzbekistan.