Connecting Budget Credibility and the Sustainable Development Goals : Results from 13 Country Investigations

Budget credibility is a challenge found in many developing countries. It is defined as the difference between the budget that is approved by a country’s legislature, the actual expenditures spent, and revenues collected during a fiscal year. Budget credibility is a measure of whether governments can meet the fiscal targets set out in their budgets. In practice, governments can often deviate from their budget targets at both the aggregate level of total revenues and expenditures, as well as in shifts in spending at a compositional level, for example, spending more or less than planned in different ministries and sectors. In certain cases, shifts during the year away from planned budgets are necessary, planned, and reviewed or approved by legislatures. Supplementary budgets, often used by governments to adjust resources in times of crisis, were a widespread practice during COVID and helped countries respond to the crisis and lessen its economic impact.