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ASSESSING AGENCY EFFECTIVENESS AND BUILDING CAPACITY FOR MUTUAL ACCOUNTABILITY

Matthew MartinDebt Relief International

3rd MfDR Roundtable Hanoi, 7 February 2007

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STRUCTURE

Introduction and Context Assessing Agencies: the Views of

36 HIPCs Using the Assessments to Build

National Aid Strategies Using the Assessments at the

International Level (donors/groups)

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INTRODUCTION AND CONTEXT HIPC Capacity-Building Programme works at

demand of 36 HIPCs to build (unleash) capacity to manage government financing (orig. debt relief)

Funded by six DAC donors (Austria, Canada, Ireland, Sweden, Switzerland, UK)

Capacity-building organised in country by sustainable regional organisations run by developing countries – “working out of job”

Presentation based on country results/views Earlier summaries prepared for UNDP and UK CFA,

currently updating for ECOSOC For more details see www.development-finance.org

and www.hipc-cbp.org.

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METHODOLOGY - PROCESS Designed through consultative process with all government

aid managers and Ministers lasting 12 months, to ensure all key concerns of countries included

Clearly benchmarked setting quantifiable targets against donor best practices and Paris commitments

Evaluations continually updated since 2002 – 1/3 of countries each year now moving to 1/2

Evaluations conducted in country by 20-30 aid management officials and based on examining data and documents, not opinions – simultaneously builds capacity

Can be/is being applied to all funders (incl multilateral, bilateral, vertical funds/NGOs/ECAs, commercial)

Constantly developing at country request – currently adding in new criteria on quality of results, cost-effectiveness

Also analyse effectiveness of own policies/procedures

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METHODOLOGY - CONTENT Based on 34 criteria under 22 groups relating to policies and procedures Includes detailed evaluation of progress against Paris, but goes beyond

to include eg conditionality, flexibility to finance against shocks, coverage of all key sectors of PRS

Policies: concessionality, types of aid, channels (on-budget), sectors (PRSP and all priorities), TA (country-led and genuinely capacity-building), flexibility (against shocks or for new country priorities), predictability (multiyear, aligned disbursement calendar, disbursed on schedule), conditionality (number/enforcement/delay), policy dialogue (activism and alignment with country or BWIs)

Procedures: conditions precedent (PIUs, CPF, appraisal, financial and legal), disbt methods, disbt procedures separate from government (PSI, accounts, reports, audits), procurement procedures (untying, local sourcing), harmonisation (joint missions, analytical work), alignment with partner PFM and procurement - and delays at all stages

Advocacy of and responsiveness to genuine mutual accountability

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RESULTS Overall priorities different from Paris – worst areas

are flexibility against shocks and excessive conditionality

MULTILATERALS VS BILATERALS Multilaterals better at: on-budget, untying Bilaterals better at: concessionality, less conditionality,

fewer conditions precedent, more advance disbursements

INDIVIDUAL DONORS Best performing multilaterals: IDA, some UN, EDF,

IFAD, IMF Some non-traditionals perform better>some DAC But high degree of variation across partners due to

different performance by donors

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DONOR/CREDITOR POLICIES

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DONOR/CREDITOR PROCEDURES

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WHAT FOR ? USING RESULTS FOR NATIONAL AID STRATEGY

Vital to design own strategy principles (eg including non-Paris aspects)

Then discuss further with donors – not abandon but clarify policies

Do own monitoring of donors from data/documents – not rely on self-reporting, validate vs budget

Build sustainable government capacity not use consultants National Compendia of Donor Practices

Complement Paris Surveys (or sole source) to set baselines Global Compendium of Donor Best Practices

Through exchange among 36 HIPCs Compare National and Best Practices to plan further

potential/planned improvements

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WHAT FOR ? USING RESULTS FOR NATIONAL AID STRATEGY

Design donor-by-donor strategies to accelerate alignment, spread best practice and set donor-by-donor annual targets

Aggregate to work out seriously prospects for Paris and other improvement

Diversify (the issue for most LICs) using knowledge of good performers in other countries

Or rationalise donors if cant improve, to make aid effective Negotiate constantly to improve donor performance on

each project Refuse offers of bad funding (“free riders”) in order to

enhance aid effectiveness Publicise donor performance to accountable to targets Improve own performance of government Use independent monitoring to resolve tricky issues

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USING RESULTS AT THE INTERNATIONAL LEVEL (1)

FOR EACH DONOR/CREDITOR: Should organise annual partner consultations where HQ can

be told by group (less retaliation risk) about strong/weak points and discuss how to spread best practices and reduce variability (except where justified by partner performance)

Needs to go beyond performance at country level to assess global issues eg allocation criteria, scaling up, orphans

Can also be informed of partner views about eg relative performance of multilaterals, NGOs, vertical funds

Should be assessed under Paris by degree to which sign up to bilateral targets at national level and organise annual partner consultations

Self-evaluations/independent evaluations should include strong, comprehensive partner evaluation

Also vital partners understand Paris and have frank discussions with donors about progress on partner indicators

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USING RESULTS AT THE INTERNATIONAL LEVEL (2)

REGIONAL DISCUSSIONS Meetings of regional recipient governments with regional

donors and regional organisations to express views Key role of regional organisations in assembling and

expressing views (but who is independent ?) GLOBAL DISCUSSIONS

Africa Partnership Forum needs to be more Africa-led in assessing Monterrey/Gleneagles commitments

Why Africa so privileged in G8 ? Why not similar discussions with Asia and Latin America groups ?

Division of labour to play to strengths: DAC (at least to collect Paris info through normal data and report in Peer Reviews), Independent 3rd party to write global report, IMF/World Bank to disseminate through GMR ? ECOSOC to discuss at high-level ?

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WHAT IS NEEDED ?1. DONOR POLITICAL OPENING

a. Clear demonstration that countries can go beyond Paris both in breadth and ambition

b. Opening to bilateral targets (Mozambique?, Rwanda)c. Not all donors will move – use best practiced. Not all partners will achieve ? (like-minded, capacity)

2. PARTNER SELF-CONFIDENCE a. Being prepared to discuss honestly with partnersb. Moving from paper-pushing to accountabilityc. Learn best practices in choosing best aid for results

3. CAPACITY-BUILDINGa. Massive needs of technical officials in evaluating,

forecasting and negotiating aid alignmentb. Vital role of parliamentarians, AGs, civil society in

assessing not just execution of spending but results Major shift in all three or little chance of Paris/MDGs