Key reforms were initiated under the ERS 2003-2007 including the strengthening of the PFM legal framework and the establishment of key PFM institutions, the development and roll out of IFMIS, IPPD and PMIS, and development of programme-based budgeting manual. With the promulgation of the Constitution in August 2010, further gains in the legal and institutional framework were enabled. Key among these includes the establishment and operationalization of the Commission on Revenue Allocation, the Office of the Controller of Budget, and the Transition Authority through their various establishing statutes.
The above successes have not been without their fair share of challenges in some aspects as indicated in various reviews including PEFA assessments (2006 and 2008) and the Ecorys Review of the PFM Strategy (August 2010). Some of the challenges which remain outstanding include credibility of the budget; comprehensiveness of the budget; policy based budgeting; budget execution; accounting and reporting; electronic service delivery and IFMIS; independent audit and oversight; the legal framework and fiscal decentralization.
As a result, key areas have been identified for prioritization to address these challenges. Some of these priority areas include implementation of new revenue policies; harmonization of the list of State Corporations to allow for full and comprehensive reporting on their budget and expenditure; rolling out of programme based budgeting; operationalization of government assets management; establishment of the Public Sector Accounting Standards Board; acquisition and installation of new technological infrastructure and equipment across national and county governments; strengthening the oversight role of the Office of the Auditor General; enhancing PFM legislative development capacities and providing a framework for intergovernmental fiscal relations.
Further, as a way of addressing the programme implementation challenges experienced in the previous strategy, the current strategy provides for an assessment of progress through a results framework composed of seven outcome indicators corresponding with each thematic area