Transparency in the management of public finances


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Transparency allows objects to be seen clearly, the opposite of something transparent is something opaque. The obligation of transparency is breached when activities of public interest are carried out secretly; when public information is not disclosed, or incomplete or wrong public information is delivered. Public finance refers to the revenues, assets, and budgets of various public entities. Transparency in the management of public finances refers to the need and obligation for state institutions to publicly and periodically disclose, either ex officio or upon request, information on the amount of their revenues and budgets, the assets they manage, the contracts they sign and the way in which they invest or spend public funds, since, as citizens, we have the right to know how the money that comes from all taxpayers and that the government collects through taxes or public debt is used.

The Political Constitution of the Republic of Guatemala indicates that public officials are at the service of the State, which implies that they must procure the protection of people and family and also, the realization of common good. This can only be achieved if public officials act with scrupulousness and transparency in the management of public resources entrusted to them. Both the Political Constitution of the Republic of Guatemala and the Law of Probity and Responsibilities of Public Officials and Employees (Decree No. 89-2002 of the Congress of the Republic) impose the obligation of public officials to be guided exclusively by merits of capacity, suitability, and honesty in the granting of public positions. Honesty or probity is the uprightness of mind and integrity in acting; a virtue that is tested and verified, in the case of public officials, when they must handle public money.    

In this regard, the Probity Law establishes, as some of the principles of probity that must govern the actions of public officials, the exercise of the administrative function with transparency; the dissemination of values, impartiality, and transparency of administrative management; and acting with honesty and loyalty in the exercise of the position, employment or provision of a service. Likewise, said Law prohibits public officials from using State-owned assets outside their official use, for personal benefit or for the benefit of third parties.  

In turn, the State Contracting Law, Decree No. 57-92 of the Congress of the Republic, establishes the State contracting and procurement information system called GUATECOMPRAS, which is a system for transparency and efficiency in public procurement, under the responsibility of the Ministry of Public Finance. The consultation of this system will be public, unrestricted, and free of charge, and will provide information in electronic and open data formats. The system will be used by all the subjects obligated by said Law, for purchases, sales, contracting, leasing, or any other modality of public procurement. It must publish information related to all phases of the public procurement process, especially electronic and digital information regarding calls for bids, receipt of bids, clarifications, non-conformities, responses, modifications, bids, awards, contracts and their modifications, variations or extensions, surety insurance and any document that supports the procurement file until the completion of the procurement process. No public official shall limit, alter or restrict the public information to be contained in the GUATECOMPRAS system.

All private or mixed, national, or foreign entities that receive and/or manage public funds, must publish and manage in GUATECOMPRAS, the purchases, contracts and acquisitions made, when they exceed the amount of the direct purchase established in the State Contracting Law.

To increase transparency and accountability in the public works construction sector, all COST (Construction Sector Transparency Initiative) disclosure indicators must be respected and met.

The Law of Access to Public Information, Decree No. 57-2008 of the Congress of the Republic, establishes as mandatory the principle of maximum publicity and transparency in the public administration and for the subjects bound by said Law. In this regard, the reporting parties must maintain, updated and available at all times, at least the following information, among others: (i) income and expenditure budget allocated for each fiscal year; (ii) contracting of all goods and services that are used by the regulated entities; (iii) inventory of personal property and real estate that each of the regulated entities has for the fulfillment of their duties; (iv) contracts, licenses or concessions for the usufruct or exploitation of property of the State; (iv) contracts, licenses or concessions for the use or exploitation of State property; (v) contracts made through the quotation and bidding processes and their respective contracts; and (vi) a list of direct purchases made by the agencies of the regulated entities.

Guatemala is a party to the United Nations Convention Against Corruption[1] and the Inter-American Convention Against Corruption[2]

The United Nations Convention Against Corruption states that each State Party shall take appropriate measures to promote transparency and accountability in the management of public finances; and that such measures shall include, inter alia: (i) procedures for the approval of the national budget; (ii) timely reporting of information on expenditures and revenues; (iii) a system of accounting and auditing standards and related oversight; (iv) effective and efficient systems of risk management and internal control; and (v) where appropriate, corrective action in the event of non-compliance with requirements.

The Inter-American Convention Against Corruption indicates that States Parties are to consider the applicability of measures to establish, maintain and strengthen, inter alia, systems for the hiring of public officials and for the procurement of goods and services by the State that ensure the openness, equity and efficiency of such systems. 

Transparency in the management of public finances is an obligation of public officials; and it is a human right of citizens that allows them, through access to public information, to constantly monitor public spending.

[1] Approved by Decree No. 91-2005 of the Congress of the Republic.

[2] Approved by Decree No. 15-2001 of the Congress of the Republic.


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