BAKU, Azerbaijan, October 22. Digitalization of state budget planning will accelerate reforms in Azerbaijan, Ilham Karimov, head of the Results-Based Budget Policy Department at the Ministry of Finance, said during a conference on the digital transformation of public finance held in Baku on Thursday, Trend’s correspondent reports from the event.
According to Karimov, digitalization of state budget planning and execution processes, along with the introduction of automated systems, will help accelerate budget reforms, improve the efficient use of human resources, and enable more accurate assessment of outcomes.
He noted that work has begun on implementing a results-based budgeting mechanism, with plans to incorporate additional sectors into the reforms each year. One of the main challenges in this process is the insufficient level of digitalization and automation.
"Comparing the traditional budgeting process with the new mechanism, it becomes clear that the traditional approach requires significant time and labor resources. Data is collected in separate spreadsheets and then consolidated and analyzed, making the process rather complex. In contrast, the new approach requires consideration not only of the financial amounts allocated to individual implementing entities but also of measures across entire sectors and their corresponding outcomes," he noted.
According to Karimov, under the results-based budgeting mechanism, measures are aligned with strategic goals, and performance indicators and interim targets are established to monitor their implementation.
"This is not just about annual financial indicators. Decisions and measures in specific sectors can span several years, with outcome indicators established to track their implementation. Ultimately, the results of these measures should contribute to achieving the strategic goals set for the respective sectors," the department head explained.
He emphasized that as the volume and complexity of budget data increase, processing it using traditional spreadsheets and separate dashboards becomes increasingly difficult. For this reason, developing unified digital platforms and automating data processing are particularly important.
"It is difficult to manage a large database effectively using traditional Excel spreadsheets or separate dashboards. Our experience shows that even when relevant forms and guidelines are provided, users still encounter difficulties when entering data. If a digital system incorporates built-in guidance and selection options, these processes could be significantly accelerated," he added.
According to Karimov, the use of artificial intelligence tools can help users enter data accurately, make appropriate selections, and complete processes more efficiently.
"It is inefficient for highly qualified specialists to spend a significant amount of their time filling out Excel spreadsheets and subsequently processing the data. Automated systems and platforms should make it possible to complete forms electronically, conduct preliminary data validation, and identify potential errors in advance," the department head stressed.
He pointed out that introducing preliminary validation mechanisms during data entry on digital platforms would help improve reporting quality and prevent errors.
Karimov added that one of the goals is to integrate the system into the budget program in the future. According to him, facilitating digital data exchange, consolidating information, and conducting monitoring on a single platform will help accelerate the implementation of reforms.