Honduras Threshold Program

Recognizing that corruption and inefficiency is exacerbated when governments cannot properly plan and execute their own budgets and have weak procurement practices, the Public Financial Management Project aimed to make the management of government finances more efficient and transparent. The project accomplished this by working with the Government of Honduras to improve budget formulation and execution, planning, payments, procurement, auditing, and civil society oversight. The project had four activities:

Budget and Treasury Management: The project supported government institutions to improve budget formulation and execution.  This support resulted in more vendors being paid in a predictable and timely fashion, improved quality of congressional budget hearings, and budgets that more accurately reflect anticipated expenditures and require fewer mid-year corrections.

Improving Procurement Capacity: To improve procurement practices and ultimately make the Government of Honduras more transparent and efficient, the project supported the Regulatory Office of Contracting and Acquisitions of Honduras (ONCAE) to conduct procurement assessments, provide procurement training, and improve the regulatory framework to promote compliance with existing national law and improve value for money.

Strengthening the Capacity of the Honduran Supreme Audit Institution: Performance auditing helps governments evaluate the management of public institutions in terms of efficiency, effectiveness, and accountability. The project strengthened the capacity of the Honduran Supreme Audit Institution to plan, conduct, and report on performance audits and illicit enrichment audits.

Grant Facility for Social Accountability: A strong civil society improves the accountability and effectiveness of its government. The project is supported grants to Honduran civil society organizations to assess the quality of service delivery by government institutions as a means to increase government accountability. One of the grant recipients, the local chapter of Transparency International, used the grant to assess six government institutions and has successfully fostered productive conversations thereafter within the government on how to improve government institutions.

The Government of Honduras uses public-private partnerships (PPPs) to build many new infrastructure projects and deliver public services. The Public-Private Partnerships Project sought to improve the efficiency and transparency of PPPs by increasing the government’s capacity to implement, and oversee these complex transactions.

The project had two activities:

Develop Core PPP Capacity: MCC provided support to improve the capacity of government agencies with key responsibilities to develop PPPs in accordance with international best practices. This included support to develop manuals and procedures needed to properly select, prioritize, structure, and award PPPs; identify and manage fiscal risks in its PPP portfolio; and training in using these manuals and procedures. Additionally, the project funded trainings based on the Certified PPP Professional (CP3P) program to representatives of the public and private sectors involved in the development and implementation of PPPs in Honduras.

Implementation of PPPs: MCC provided specialized technical assistance to improve administration of PPPs in implementation.

The projects’ expected outcomes include improved transparency and accountability of PPPs, improved capacity in economic and financial analysis to structure future PPPs, improved capacity for the monitoring of concessionaires, and proper government management of the previously signed road concession contracts.