Budget support training Module 2 Public policies (national/sector development strategy) (First...
-
Upload
lisa-barber -
Category
Documents
-
view
216 -
download
4
Transcript of Budget support training Module 2 Public policies (national/sector development strategy) (First...
Budget support training
Module 2Public policies (national/sector development strategy)
(First eligibility criterion)
Version October 2013
2
What do you need to know?• Imagine: you work at a Delegation. The EC provides sector
budget support to Education (ministry of Education and Culture). With one of your contacts you have had some informal conversations about the threat to cultural heritage in the country, as has happened in Iraq, Afghanistan and Mali.
• A few weeks later this medium level official presents you with a document titled “National Policy on Cultural Heritage” and asks whether this policy could be supported with BS as well. What do you need to know?
• 5 minutes buzzing
3
Outline of module 5
1. Public policies, coverage and objectives
2. Why is it an eligibility criterion for BS?
3. What to assess and when?
4. How to assess?
A public policy is a series of interlinked actions (= policy) designed and implemented by the state (= public)
Policies contribute individually or jointly to various objectives
Macroeconomic stabilisation Equity, vertical (income distribution) and horizontal (equal development across regions) Resource allocation: i.e. providing public services: health, education; providing public goods (law & order, defence); building infrastructure
Macroeconomic policies
• Fiscal policy• Monetary policy• Exchange rate policy
• Trade policy• Public debt policy
Structural policies (1)
• Governance• Public sector management
• Decentralisation• Public finance management
Structural policies (2)
• Land use policy & land reform
• Market regulation
• Financial sector regulation
• Environmental regulation
Sector policies
• Public services (education, health,..)
• Social security• Social protection
Running Head 12-Point Plain, Title Case
5
The public policy process
Initial situation
(economic, social,
political)
Situation aimed at by the policy
Public services delivery (infrastructure, social
services, law and order, ….)
Pu
blic
Fin
an
ce
Man
ag
em
en
t
Budget preparation, approbation and execution
Strategy/policy formulation
6
Public policies are designed and implemented by a series of public institutions
• General government comprises• Central government• State government, in federal countries• Local government• Social security funds are sometimes combined into a separate
subsector • Public sector includes, in addition to the general government,
corporations and quasi-corporations controlled by the government units (including the central bank)
It is essential to understand the role,
responsibilities and activities of these
actors
7
Outline of module 3
1. Public policies, coverage and objectives
2. Why should it be an eligibility criterion?
3. What to assess and when?
4. How to assess?
The existence of a relevant and credible policy is essential:
It is the interest of both the partner government and the Commission that their policy dialogue aims at improving the relevance and the credibility of
the policy
for the partner government
It is possible to implement badly a relevant and credible policy….
… but is not possible to implement properly a policy that is not relevant and credible
The existence of a policy/strategy is a prerequisite for government accountability
Running Head 12-Point Plain, Title Case
8
for a fruitful use of BS
BS is a modality to support policies:
A strategy/policy must exist and
it must be owned by the partner country
The policy
dialogue
Running Head 12-Point Plain, Title Case
Is a key component of
BS
Remember
BS = Money
+
policy dialogue
+ (capacity building)
9
Must be informed
• To contribute to the design and implementation of the partner’s policy
• To help the Commission with assessing and managing risk
It should address:
The design and implementation of the government’s policy/strategy The design and implementation of reforms (in particular PFM) The annual results (outcomes) of the strategy and the nature of the policy response
10
Outline of module 3
1. Public policies, coverage and objectives
2. Why should it be an eligibility criterion?
3. What to assess and when?
4. How to assess?
Analysing the partner’s policy
documents
• PRSP
• Sector policy programmes
• Institutional reform programs
• Etc.
Running Head 12-Point Plain, Title Case
Assessing the partner’s policy requires
Understanding the partner’s policy
• What do they want to do? (what are the objectives?)
• How do they want to do it (instruments deployed, resources mobilised and allocated, institutions involved, …)
Concluding
• BS is or is not the most appropriate aid modality to support the partner’s policy.
• The policy is or is not sufficiently relevant and credible to be eligible for EU budget support
The focus of the assessment will differ according to the type of BS
GGDC: governance, broad sustainable development, poverty eradicationSBC: restoration of vital state functions & basic social servicesSRC: sector reforms, sector governance, service delivery.
When should public policy eligibility be assessed?
Running Head 12-Point Plain, Title Case
during design
Assess:
• the relevance of the policy
• the credibility of the policy
during implementation
Assess progress made in implementing the policy
results achieved whether the policy continues to be sufficiently relevant and credible
Public policy must be eligible when the programme is approved
and at the time of each budget support disbursement
12
13
Outline of module 3
1. Public policies, coverage and objectives
2. Why should it be an eligibility criterion?
3. What to assess and when?
4. How to assess?
14
Eligibility assessment during design
• « Is the policy sufficiently relevant and credible for the BS programme objectives to be largely achieved ? »
• Delegations to provide 6-8 pages document accompanying the BS Action Fiche and covering 5 points:1. Policy framework2. Policy relevance3. Policy credibility4. Conclusion: EU Delegation’s appreciation of eligibility5. Expected progress in policy implementation
15
1° Description of the policy framework
Policy formulation: Where is the policy defined? Period covered? Linkages with political cycles or other political
processes? Approval process? Involvement of stakeholders in formulation.
Existence and quality of monitoring and evaluation framework? (reflects policy objectives, includes indicators, availability of a Performance Assessment Framework or PAF)
Review mechanisms and donor coordination (regular review process led by Government? Is it published? Stakeholders involved? )
Coherence of the policy with other government policies (coherence national, sector, local; intra-sectoral)
A good policy document should:
Be authored and endorsed by the Government (not the donors)
Address the role of the government in the sector/area and distinguish regulatory functions and service delivery
Define allocation of responsibilities between Ministries involved and tiers of government, and identify capacity constraints and requirements to mitigate them
Focus on the resources requirements to implement the policy, including current and capital expenditures
Have a strong result orientation
Set up clear mechanism for monitoring, review and updating the policy document
16
17
2° Relevance
Does the policy address (in an efficient and effective way)
the overall objectives of poverty reduction, sustainable and inclusive growth and democratic governance?
the specific challenges and objectives identified in the public policy and supported by the specific BS contract?
Does the policy aim at strengthening domestic accountability and national control mechanisms?
18
3° Credibility
Credibility depends on: the track record in policy implementation; adequate funding of the policy. Related questions:
Are there (appropriate) cost estimates of the policy? Are the cost estimates reflected in the budget and in the
medium-term fiscal and expenditures frameworks? Is the budget comprehensive or are there important off-
budget revenues and expenditures? Is the financial sustainability of the policy realistically
assessed (domestic revenue mobilisation, external financing, contingent liabilities)?
In case of fiscal decentralisation: are national budgets and sub-national budget allocations and mandates consistent?
19
3° Credibility (continued)• Existence of a common performance assessment
framework (PAF) to monitor/measure policy implementation Existence of baselines/targets/performance objectives with SMART/RACER
performance indicators
Institutional capacity and ownership: Existence of capacity assessment for the ministries or agencies
in charge of the policy Indications that the policy is sufficiently owned by the
institutions that have to implement it
Analytical basis and data quality Is there a move towards evidence based policy formulation and
decision making? Or is the lack of reliable data undermining the policy programme and the possibility to monitor it?
20
4° Delegation’s assessment of eligibility Based on its analyses, the EU Delegation concludes whether or not
the government policy is considered sufficiently (or no) relevant and credible and if its implementation can be supported with a Budget Support programme.
5° Expected outputs in policy implementation Basis for monitoring progress during implementation of the policy
must be specified. Available PAF and review documents should be used. If no available PAF, the EU Delegation should spell out how
eligibility will be monitored.
21
Eligibility assessment during implementation
This assessment is meant to verify: whether the policy continues to be sufficiently relevant and
credible, and; whether there has been satisfactory progress in policy
implementation.
The assessment must take into consideration exogenous shocks (external and internal)
Based on the same template than the baseline assessment of eligibility, but must focus on progress in policy implementation
22
Key messages Assessment of the relevance and the credibility of the
policy is a continuous task of the EC Delegations. It imposes: a comprehensive analysis of the situation at
identification/formulation stage and the monitoring of the progress of the policy during implementation;
to demonstrate that the policies supported by the BS contracts contribute to the overall objectives and to their specific announced objectives.
This requires an important collection and assimilation of information and informed opinions. The policy dialogue and the coordination with the Government and the donors should make this task more efficient and less difficult.