National Public Investment System of Argentina

Country
Investment Map Training Methodologies Projects Bank Legal Framework Processes Stakeholders Instruments Formulation Planning Cross-cutting Processes Budgeting Evaluation Cross-cutting Processes Ex-ante Evaluation Selection Execution Ex-post Evaluation Other Stakeholders Public Investment Policy Cycle Staturory Governing Body National Public Investment Plan Law on Public Investment (No. 24.354) of Argentina National Directorate of Public Investment, Office of the Chief of Cabinet of Ministers (JGM) National Budget Office National Public Sector Agencies Steering Financing Coordination Information Project Management Cycle

 

Stakeholders

Governing Statutory Body:

The Secretariat of Budget Assessment, Public Investment and Public-Private Participation (SEPIPyPPP) of the Minister Cabinet Leadership (JGM) is the authority to apply the SNIP. Its functions are focused on regulatory aspects and inter-institutional coordination for the formulation of the National Public Investment Plan (PNIP). In particular, it has the power to formulate instrumentation, complementary or explanatory regulations of the Law on Public Investments entering into the administrative acts required for the integral management of the SNIP. Moreover, it informs and advises Minister Cabinet Leadership of the Nation on the inter-institutional coordination for sectoral prioritization of public investment and shows them for consideration the PNIP proposal prepared by the National Directorate of Public Investment (DNIP). The DNIP is the body responsible for the SNIP and has the following fundamental goals:

  • Controlling the formulation and assessment of investment projects carried out by the public entities, in terms of compliance with the established methodologies, guidelines and procedures;
  • Collaborating with the political authorities to improve the selection of projects and incorporating them into the national budget; Annually preparing the PNIP;
  • Managing the public investment project bank (BAPIN) which supplies adequate, timely and reliable information on the public investment projects.

Related Entities:

The National Budget Office (ONP) intervenes in the formulation, execution programming, modifications and assessment of the budgets of the National Public Administration (APN). The ONP annually communicates the budget limits to each of the APN’s institutions. Once the budget available for each entity is known, they select the projects (already assessed by DNIP) with own criteria, which will finally form part of the PAIP. The DNIP sends the investment plan to the ONP to be incorporated into the annual budget. Additionally, the ONP, in coordination with the DNIP, is in charge of supervising the budget execution of the public investment projects, as well as their physical progress. The records of this progress are kept in the Integrated Financial Planning System (SIDIF).

Incorporated Entities:

The entities that form the APN have the following faculties: identifying, formulating and assessing the investment projects inherent of their area, keeping the public investment projects inventory up to date, carrying out the physical-financial control of the projects, performing ex-post assessments and exchanging information with the DNIP and the ONP.

 

Legal Framework

The SNIP was created by the Public Investment Law (24,354) published on August 22nd, 1994. This law determines the functions of the body responsible for the system and provides for the preparation of the PNIP. Decree 720/1995 published on May 22nd, 1995 appoints the DNIP as the body responsible for the SNIP and creates the BAPIN. This Decree also determines that the PNIP is formulated annually with a three-year projection. In 2017 Decree 696/2017 modified the Law of Ministries and its modifications, assigning to the JGM the function to take care of preparation, registration, monitoring, assessment and planning of the public investment projects. As a result of this reorganization, the DNIP and its organizational dependencies are transferred from the Ministry of Production to the area of the Sub-Secretariat of Budget Assessment and Public Investment, reporting to the Secretariat of Public Policy Coordination of the JGM. See the complete legal framework

 

 

Methodologies

The DNIP has developed methodologies and manuals to facilitate the formulation and assessment of projects, as well as their registration in the BAPIN. The main documents include: The General Investment Project Assessment Guide to value projects based on the Internal Return Rate (IRR) and Net Present Value (NPV). Some sectors have specific assessment guides (culture, education, urban solid waste and transport), the Instructions for Uploading into the BAPIN, the Conceptual Assessment Guide and the list of types of projects, types of assessment and indicators. In accordance with the effective guidelines, projects with an investment of 10 million Argentinian pesos to 200 million Argentinian pesos should supply at least a quantitative/qualitative indicator and respond the 12 questions of the conceptual formulation principles. Projects over 200 million up to 3 billion Argentinian pesos require at least an economic indicator and a qualitative/quantitative indicator and projects over 3 billion Argentinian pesos must perform an economic assessment through a method or technique established in the Conceptual Assessment Guide and, additionally, should consign an economic indicator and a qualitative/quantitative indicator. See the full list of methodologies.

 

 

Public Investment Plans

The National Public Investment Plan (PNIP) has a multiannual (3-year) horizon and is updated annually and prepared by the DNIP, in accordance with the establishments of Public Investment Law No. 24354. The PNIP outlines the investment projects that are part of the Budget Bill for the year of publication, as well as its stipulations for the years after. Consequently, it provides for the totality of capital expenses, those destined to the execution of the works and those to acquire capital goods to be executed directly by some APN body, those executed by third parties with APN resources (capital transfers), and financial investment. Likewise, projects are included for execution under the Public-Private Associations (PPA) modality. The plan is linked to other national, sectoral and territorial planning documents, since it explicitly mentions that connection. An example is the Belgrano Plan and the National Water Plan. The 2020-2022 PNIP structure is composed of the main document and three annexes. The PNIP reviews its scope and describes the budget formulation process. Afterwards, an APN capital expense analysis is performed for 2020 according to its functional, jurisdictional and finance origin distribution. It also presents a comparison with the capital expense for 2019 and includes a description of the guidelines and main projects in the most relevant sectors for direct real investment, capital transfers and financial investment. Finally, public investment is presented under the PPA modality. The annexes outline the improvements of the last year to the SNIP, the second annex analyzes the budget execution of the previous year and the third annex contains a list of all investment projects to be executed during the year. This list shows the project name, the BAPIN code, the geographical location, the cost for the year in course and the projects for the two following years.

 

 

Investment Project Bank

One of the main elements of the SNIP of Argentina is the Public Investment Project Bank (BAPIN). The APN ministries and dependencies register in the BAPIN all projects to be included into the national budget. Through the BAPIN the formulation and assessment of the public investment projects is controlled. The BAPIN assures traceability of the public investment projects from their formulation until they are finalized. At the same time, the BAPIN is interrelated with the SIDIF, facilitating budget formulation and follow-up of the physical-financial execution of the investment projects. Access to BAPIN is restricted to authorized officers. Additionally, the possibility of georeferencing public investment projects is in the process of development. 

 

 

Training

In accordance with its faculties established in the Public Investment Law Art. 5, the DNIP has developed an annual training program in coordination with the National Public Administration Institute (INAP). The DNIP’s website shows the programming for the courses, which are offered presence-based to public officers of the APN. The topics are mainly methodologies for project formulation and assessment, use of the national public investment project bank, budget formulation, etc.

 

 

 Project Management Cycle

Public investment projects start with the identification of a need that was raised, which the formulation departments of the APN bodies depict in a project document. Through a series of questions called “Conceptual Formulation Principles” on the BAPIN project registration form, entities respond on the most important aspects of the projects such as: how the project was thought of, what the need is, the goal, what alternatives were evaluated before deciding on the one formulated, who the beneficiaries will be and the project’s geographical location. Additionally, in accordance with the investment amount, quantitative and/or qualitative indicators are to be included to assess the project (see methodologies).

Once the information has been given, as per the type of project, the DNIP determines whether the assessment is complete, partially complete or incomplete. In case of projects that exceed 3,000 million Argentinian pesos, a technical opinion is given on the economic assessment and it is determined whether the formulation and assessment of the project is approved or approved with observations. The projects with a complete registration and favorable DNIP observation will be considered as priority, and then the APN dependencies must select the projects they wish to execute, in accordance with the budget limits communicated to them by the OPN.

During the execution phase, the entities of the APN are in charge of performing and informing on the physical-financial progress of the projects and registering them on the SIDIF platform of the Ministry of Finance, which shares this information with the BAPIN until the execution of the assigned budget has been finalized. The DNIP has established mechanisms for transparency and accountability, which include quarterly progress reports of all the investment projects. The DNIP gives project formulators and executors transversal access to methodological guides and manuals to facilitate their respective tasks and carries out different training workshops which are periodically published on its website. When finalizing the projects, the executing dependencies have the faculty to perform the ex-post assessments they deem pertinent.

 

 

Public Investment Policy Cycle

The cycle of the Public Investment Policy in Argentina starts with the annual planning of the investments. The DNIP uses the BAPIN as the main tool for this. The BAPIN is extremely relevant since it is the only entrance of public investment projects into the national budget. In May the entities of the APN must register the investment projects in the BAPIN that they plan to include in the budget. This stage is known as the “investment demand”. Once this instance has been finalized, the political authorities define the capital expense quotas (budget limits) for each entity. Then the ONP communicates these limits and the public entities must select the projects from the “investment demand”, which they decide to include in the budget, by virtue of the assigned quota.

Once the selected projects have been communicated to the DNIP the National Public Investment Plan (PNIP) is prepared and it is sent to the ONP to be included as part of the national budget. The plan is updated annually and shows a 3-year horizon. The plan includes all public investment projects with the total investment amounts and the amounts are specified which are expected to be executed in the next 3 years. The PNIP also shows general public investment scenarios in the different sectors (public works, health, education, transport, etc.). In parallel to the PNIP there are sectoral plans such as the National Water Plan, with a horizon until 2030.

The monitoring of the execution and progress of the investment plan is done by the DNIP and the ONP based on the information reported by the APN entities in the SIDIF. Through this monitoring, an annual assessment can be made of national public investment and the conclusions of the analysis be considered for the preparation of the investment plan for the following year. The most relevant observation on the public investment of the year before can be found in the PNIP and the plan highlights the improvements that were made to the SNIP as a whole during the last budget year.

 

Latest update: June 16, 2021