Bangladesh fails to meet requirements of fiscal transparency

Bangladesh failed to meet minimum requirements of fiscal transparency in the Fiscal Transparency Report (FTR) 2022 published by the US state department.

Bangladesh was, however, bracketed among the 27 nations which made significant progress toward meeting the minimum requirements of fiscal transparency.

“A determination of 'significant progress' indicates a government satisfactorily addressed a key deficiency in meeting the minimum requirements of fiscal transparency during the review period,” said the report.

The report, published on Friday, assessed fiscal transparency of governments in 1 January – 31 December, 2021.

Of the 141 countries (and the Palestinian Authority) evaluated, a total of 72 met minimum requirements of fiscal transparency and rest of sixty nine did not.

Among the assessed countries, South Asia’s India, Nepal and Sri Lanka met the minimum requirements of fiscal transparency while Afghanistan, Pakistan, Maldives and Myanmar did not.

The 2022 fiscal transparency review process evaluated whether the government publicly disclosed key budget documents and whether the government had a supreme audit institution that meets international standards of independence and audits the government’s annual financial statements, and whether such audits are made publicly available.

The review further assessed whether the process for awarding licenses and contracts for natural resource extraction is outlined in law or regulation and followed in practice, and whether basic information on such awards is publicly available.

In government-by-government assessment, the report praised the Bangladesh government for significant progress by publishing its end-of-year report within a reasonable period, making its executive budget proposal and enacting budget widely and easily accessible to the public, including online.

However, the US state department report said the supreme audit institution, which is office of the Comptroller and Auditor General of Bangladesh, failed to meet international standards.

“The government’s supreme audit institution reviewed the government’s accounts, but its reports did not contain substantive findings and were not made publicly available within a reasonable period. The supreme audit institution did not meet international standards of independence.

The government specified in law or regulation and appeared to follow in practice the criteria and procedures for awarding natural resource extraction contracts and licenses. Basic information on natural resource extraction awards was not consistently made publicly available.”

Four recommendations

The report proposed four recommendations for Bangladesh to improve the fiscal transparency. These are-- preparing budget documents according to internationally accepted principles, ensuring the supreme audit institution meets international standards of independence and has sufficient resources, publishing timely audit reports that contain substantive findings, recommendations, and narratives and making basic information about natural resource extraction awards publicly and consistently available.