Integrated Budget Intelligence Toolkit (iBIT)

Worldwide, people have been seeing higher prices at the grocery stores, gas pumps, and elsewhere in their daily lives, and many are adjusting how they budget in response. Costs are increasing for governments too, yet national ministries, agencies and state-owned enterprises may not register the decrease in purchasing power for months or even years, making it harder for them to deliver on their missions to maximize the impact of taxpayer funds and deliver quality public goods and services. Although this current inflationary period will recede, it highlights a perennial question for governments: How can governments provide more to the people they serve given diverse priorities, fiscal space constraints and the budgets they have?

Successful risk-informed financing solutions, therefore, hinge on prudent financial planning, management, and budget execution. Yet, all financial decisions confront an anomaly of risks arising from several layers of dissonance, both explicit (where finite public funds contend with diverse SDG priorities) and implicit (when funds spent collaterally degenerate SDG outcomes). While the latter brew interest in the sustainability of financing, the former grew interest in harnessing interlinkages and budgeting for the SDGs.

Through a Machine Learning Selection Operator, ESCWA has been pioneering the iBiT to support agile and transparent financial management and support Arab governments tie resources directly to mission outcomes, and boost the impact of public resources and taxpayer funds. The tool fills a knowledge gap in public financial planning and management. It is among the few that quantitatively unravels the impact of general government expenditures on SDG performance at the national and local levels.

The iBit inherently accounts for country specific idiosyncrasies, including the conditions dictating economic rationalization and fiscal consolidation. It takes cue from the need to maximize available fiscal space to optimize SDG outcomes and the returns on domestic public resources mobilized to support the advancement of the social compact. The Budget Compass employs a dynamic supervised algorithm that identifies the patterns or configuration of budget lines that are consistently (intertemporal variation) advancing or regressing SDG outcomes. By doing so, the Compass provides an evidence-based quantitative assessment of the budget lines that are directly and indirectly responsible for advancing/regressing SDG performance and provides insights on how SDG interlinkages manifest themselves in national contexts given intertemporal public spending variations