Pillar I assesses whether the government budget is realistic and implemented as intended. This is measured by comparing actual revenues and expenditures (the immediate results of the PFM system) with the original approved budget.

Realistic and reliable budgets underpin good fiscal management and are essential for long term fiscal sustainability.

Pillar I has three indicators:

  • PI-1. Aggregate budget outturn
  • PI-2. Expenditure composition outturn 
  • PI-3. Revenue outturn

If the government budget is to be a reliable basis for policy implementation, it should be implemented as authorized by the legislature.

Factors that can affect budget reliability include:

  • Policy initiatives or other post-budget spending decisions outside the annual budget process;
  • Major reallocations between ministries and programs;
  • Over-optimistic or otherwise unreliable revenue estimates;
  • Allocation of grants and other budgetary support by development partners outside the annual budget cycle;
  • External shocks such as natural disasters or adverse global or regional economic conditions.


PEFA Handbook Volume 1: The PEFA Assessment Process – Planning, Managing and Using PEFA