Performance Budgeting Challenges in Developing Countries: A Case Study of Afghanistan

Following the overthrow of the Taliban, in late 2001, Afghanistan became a major reconstruction project of the international donor community. Assistance in public financial management (PFM) included modest attempts to introduce information on ministry functions and objectives into budget documents. Unlike some post-conflict countries, Afghanistan at the time of international intervention was by no means a public administration vacuum. The post-conflict era brought large amounts of external aid funding for reconstruction projects and the delivery of essential services. Performance budget reforms became a central plank of PFM development only a few years into the post-Taliban period. International donors operating in Afghanistan enthusiastically supported the proposed reform and in the second part of 2006 an adviser funded by the UK’s Department for International Development delivered training and instruction on program budgeting to the pilot ministries. Although program budgeting at that stage had had limited impact on budget formulation, it did have a significant effect on the workload of the pilot ministries.