Public Financial Management
Public finance that works for people
How governments raise, manage and spend public money has a direct impact on people’s lives. Good public financial management helps governments put money where it is most needed – into schools, healthcare, infrastructure and environmental protection.
It also helps protect public money from misuse and to build trust in government institutions.
The Basel Institute on Governance works with governments and other stakeholders at both national and subnational levels to strengthen public financial management. We combine hands-on experience in the technical aspects of public financial management with our wider strengths in anti-corruption, asset recovery and good governance in sectors such as health, climate and environment.
Our approach is grounded in more than a decade of impactful work with regional and municipal governments in Peru. This experience has produced tools and approaches that can be adapted for use in other countries, along with practical lessons about what works and why.
What is public financial management?
Public financial management covers the systems, processes and institutions through which governments collect revenue, set priorities, allocate resources, spend public money and account for the results.
Good public financial management helps governments to:
- maintain sustainable public finances
- direct resources towards the right priorities
- deliver public services efficiently and fairly
- strengthen transparency and accountability
- reduce opportunities for waste, misuse and corruption.
For citizens, sound public financial management means taxes are collected fairly, public services work better and public money is protected from waste and misuse.
For businesses, effective public financial management creates a more predictable and fair operating environment, with transparent procurement, reliable public services and efficient tax administration.
Public financial management and anti-corruption
We see public financial management and anti-corruption as two sides of the same coin. Well-designed budgets and procurement systems cannot deliver their full potential if public money is diverted or controls are weak. Corruption also persists when wrongdoing goes unnoticed or unpunished.
Strong public financial management also makes anti-corruption efforts more effective. When proceeds of corruption and crime are recovered, for example, authorities need to properly safeguard and manage these funds so they can be re-used for the public good.
Our approach therefore integrates anti-corruption and accountability into public financial management rather than treating them as separate issues.
What makes our approach different?
Much of what matters most to citizens – schools, hospitals, water, roads and other public services – is delivered by regional and municipal governments.
We have more than a decade of experience working directly at this level in Peru, while also helping connect subnational reforms with national policies and systems so that everything flows smoothly together.
This includes developing and applying a tailored methodology to implement PEFA evaluations, which are the gold standard for evaluating public financial management capacity, at the subnational level.
We help governments strengthen internal controls, manage corruption risks and embed transparency, accountability and integrity into everyday financial processes.
Our experience in Peru – where one regional government rose from 18th to 1st place in Peru’s national corruption prevention index – shows what is possible when anti-corruption measures are integrated into everyday administrative processes and institutional culture.
The Basel Institute brings specialist expertise in financial investigations and asset recovery that is unusual in the public financial management field. Through our International Centre for Asset Recovery (ICAR), we help both national and subnational authorities to trace, recover and manage assets linked to corruption and other financial crimes, and where possible to bring the perpetrators to justice.
The relationship between asset recovery and public financial management runs both ways. Strong financial management can reduce opportunities for corrupt actors to steal or misues public money. And when governments are able to recover stolen assets, they can return those resources to the public purse and show that corruption has real consequences.
Good public financial management is also essential for asset management. We help governments put in place measures to safeguard returned stolen assets, manage them transparently and ensure they are used for the intended public purpose.
The team supported us in the analysis of the case, in the review of the evidence and in the coordination required to gather more information. As a result, we were able to jointly draw up a very well‑prepared action plan that allowed us to identify the illicit assets and launch proceedings to confiscate them.
Citizens experience public financial management through the services that governments provide: medicines or vaccines in health clinics, school books in classrooms and natural area that are protected against illegal and unsustainable logging or mining.
The Basel Institute’s wider anti-corruption programmes give us deep experience in the governance of sectors such as health, education and environmental protection, where weak systems and corruption can have particularly serious consequences.
We want to defend our land and its resources. It is becoming increasingly difficult, but thanks to [the Basel Institute] we have new tools that can help us in our mission and in the preservation of our culture.
How we work
Diagnostics
Systematic assessment of institutional, political and financial context before designing solutions. Includes PEFA Evaluations adapted for subnational use.
Technical assistance
Hands-on support embedded within government entities. Advisors work side by side with officials through mentoring and iterative problem-solving.
Capacity building
Training, peer learning and professional development. Use of digital channels and social media to extend reach beyond direct programme beneficiaries.
Tools and technology
Practical instruments to improve processes and internal controls. Tech solutions that strengthen government systems and citizen access to services.
Behavioural approaches
Low-cost, evidence-based interventions to shift behaviours and incentives sustainably. Example: nudges that improve tax compliance without raising rates.
Knowledge generation
Incubating tools, good practices and lessons that can be adapted and applied in other countries and contexts. Sharing good ideas through international forums.
Our aim is to help strengthen institutions and build systems that actually work in practice, and that continue to deliver long after external support ends.
Peru – more than a decade of success
Our flagship Programa GFP Subnacional, funded by the Swiss State Secretariat for Economic Affairs (SECO), has worked hand-in-hand with regional and municipal governments in Peru since 2015.
In a country where a significant share of public expenditure is decentralised, the programme helps subnational governments and civil servants strengthen the way they raise, plan, manage and spend public resources.
Its work spans five interconnected areas:
- Improving public services
- Strengthening public investment
- Increasing fiscal revenues
- Preventing corruption
- Asset recovery
The programme has helped beneficiary governments achieve measurable results. These include significant increases in property tax revenues, stronger budget execution, improvements in the distribution of vaccines and health supplies, and the recovery of more than USD 94 million in stolen public funds.
Beyond its impact in Peru, the programme provides an important evidence base for the Basel Institute’s wider public financial management work. It has allowed us to test what works over time and to understand why, and to adapt successful approaches to other contexts.
Transforming public finances
Discover how we support subnational governments in Peru to strengthen integrity and enhance public service delivery.
Download the programme’s factsheet:
For detailed project updates and local impact data, visit gfpsubnacional.pe.
Impact stories
View all storiesLatest news
24 August 2026
Bringing local voices into Peru’s decentralisation debate
Learn more8 July 2026
From budgets to bridges: how better public finance management improves lives in Peru and beyond
Learn more12 January 2026
A career with purpose in public finance management: Límberg Chero
Learn more28 January 2025
Peru’s Integrity Week celebrates transparency and good governance, including for the environment
Learn more21 October 2024
Swiss-Peruvian public finance management programme enters exciting new phase
Learn more6 June 2024
Peru celebrates five years of its non-conviction based forfeiture law – USD 94 million so far
Learn more28 February 2024
The Quispe Callo case: Peru’s provincial prosecutors recover corrupt assets through non-conviction based confiscation
Learn more8 February 2024
Managing public investments in infrastructure: novel course in Peru connects theory and practice
Learn more23 January 2024
Improving public integrity in Peru: how regional governments can take the lead
Learn more27 July 2023
Fostering peer learning and innovation on public integrity in Peru
Learn more15 February 2023
Judges’ convention shows why Peru is a leader in recovering proceeds of corruption through non-conviction based forfeiture
Learn more14 February 2023
Large public investment projects, large challenges – new analysis from Peru
Learn more19 January 2023
Peruvian Government publishes integrity risk management guidelines with support from the Basel Institute’s Public Finance Management programme
Learn more24 June 2022
National Convention of Prosecutors in Peru celebrates three years of applying its non-conviction based forfeiture law
Learn more23 September 2021