Win a signed copy of Matt Andrews' new book

[Napodano]

Hi, PFM Boarders;

You have a chance to win a signed copy of Matt Andrews' new book 'The Limits of institutional Reform in Development' (see cover at http://pfmboard.com/index.php?topic=6662.0 ).

Just write a short reply post here about your experience/ideas in implementing institutional reform in development. Matt will pick up the best reply and send a signed copy of his book to the author.

The competition is open from now to 15 February 2013.
Good luck.



 

[John Short]

To get the ball rolling!

In 1979/80, I worked on the Private Development Strategy in Uganda which was essentially a policy document covering taxation, tariffs, export and investment promotion etc.  One of the recommendations was to strengthen the Private Sector Associations (essentially the Uganda Manufacturers Association (UMA) so that a policy dialogue could take place which reflected not only the Government and the Donors (as that is what they were called then!), but also the emerging formal private sector.  USAID supported the initiative and provided TA to UMA.  A few years later, it was noticeable that balance of power in terms of analysis and “negotiation” had switched from Government (Ministry of Finance) to UMA so much so that narrow vested interests dominated the dialogue rather than broad development policy. 

The lesson is to ensure balance of analysis and ensure that politicians are able to make judgements that reflect the greater good rather than narrow group interests.  This requires a well resourced capacity in Government to do its job.

[Governwell]

Nice story, John. I think there are so many questions about who we need to engage in reforms and how. Most of the stories, of course, go untold.

[FitzFord]

I am not sure that this story qualifies but I liked my interaction with the WB Vice President who was involved, and it was a confidence booster for a young, brash kid:

During the 1980s, shortly after I joined the WB, I was working on urban sector issues in Brazil - which was still under military government at that time. My role was to design a system for financing an array projects in 8 cities; the projects would be chosen and managed by the cities. The Brazilian resources would be supplied by 6 Federal Agencies, 9 States (one city straddled 2 state boundaries) and the 8 municipalities. As may be expected, the interests at the three levels did not always coincide and existing 3-teired financed projects often suffered as a consequence. I proposed a system that the Brazilians liked and we went on to appraise the project. When the project was reviewed by the Bank Vice-President responsible for quality control, he looked at the list of financial sources involved and declared that the project would be a non-starter. I explained my strategy and challenged him to take me to lunch if the projects were being financed as planned, after 2 years. (Brash, but this was a much less bureaucratic WB). He looked at me intently for a while then signed off on the project. The project not only worked, it was commended in a subsequent review.  I had learned something about institutional economics while working in my government that I adapted and transferred to this situation: the financial arrangements were that none of the Bank-supported investments in a participating city could be started or continued unless all parties put their pledged resources into the bank accounts of all the agreed projects in the quarter before the activities were to begin. The incentives for each party to have their specific interests met created pressures to ensure that their counterparts fulfilled their roles and thereby overrode any lack of enthusiasm for activities not within their purview.

Fitz.

[Napodano]

Trying to muscle reform implementation in public sector management in general and in particular PFM is well known to lead nowhere in our profession. A common key factor for reform is having the PM and central agencie's ministers committed to the reform and technically informed on what it takes to implement it.

The above is well understood by practitioners but what often get missed out is that ministers are not the only agents to 'get on board'. There are senior managers like directors of budget, treasury and policy advisors who are as important players as the formers. They are part of the public sector context and culture, I would say they shape that context more than ministers.

The above I learned myself in a PFM reform project in a country of Central Asia. Budget Department in MoF had been opposing the reform, i.e. reinforcing links between policy and budget, for several months until there was a change of Government and a new Minister of Finance was nominated. The coalition Government was formed on a 'cost-effectiveness' platform (in that country 'cost-effectiveness' was used as substitute of transparency and accountability) and the new minister of finance's previous job was that of Chairman of the Parliamentary Commission for public finances and budgeting. A reformist.

The development partners financing the PFM project and I as budget advisor felt reinvigorated in our 'mission' and believed that the context had finally changed. Even some junior managers in the ministry thought that 'now there is a demand for PFM reform'. I remember a meeting in which the Minister asked me to present the stages of the reform to all the senior managers in the ministry and emphatically concluded: 'I want this reform implemented; you have the technical support to do it and you will be responsible directly to me for results'. I must confess that I had the feeling of holding the managers on my palm.... How wrong I was!

Fast-forward three months and the Government collapsed under allegations of corruption, the Minister resigned and the managers  in the Ministry of Finance immediately folded back to old practice of incremental budget and large reserves to accommodate ad-hoc policy requests.

[knoussi]

Dear PFM Experts,
I have just submitted my doctoral dissertation in which I ask the topical question how public accountability is effectively institutionalized. In order to solve this overall research puzzle I examine as a case study Supreme Audit Institutions (SAIs) from a global perspective applying a mixed-methods approach. Why does citizen-focused, independent, external public auditing thrive in some countries and fail in others? I develop seven main hypotheses and test them through econometric analyses and I study the practice of reform through 17 confidential semi-structured expert interviews with heads of SAIs.

I show that while the institutional arrangements for government auditing, the nature of the source of national income, the external influence on reform, the local demand for public accountability and the technical and organizational capacities of SAIs matter; the political economy of inter-elite relations and the existence of leadership commitment by the head of the SAI ultimately explain the success or failure of reform initiatives. I close by suggesting five practical strategies for strengthening powerful accountability arrangements that endure.


I. Analyze the problem correctly.
II. Invest in capacity building, but do not stop there.
III. Empower the SAI leadership.
IV. Build up coordinated pressure from all sides.
V. Nurture and spread a culture of integrity.[/li][/list]

I found it particularly interesting that the expert interviews as well as the statistical results confirmed that leadership by the SAI head can make a difference even in unfavorable socio-political contexts (see also the paper by Andrews, McConnell and Wecott, 2010 on leadership-led change).

For example, interviewee 11 most sharply put the responsibility on the SAI leaders to reform their SAIs and rejected the notion that the success of SAI reforms depends on the macro context.
I11: The tendency of many SAIs is to play victim mentality, that is not the way you operate as a leader, leadership is about influencing events, it is not about being submissive to the circumstances, [you need to put] a lot of effort in building a leader.

I thus would like to encourage everybody who is working on making external public auditing more citizen-focused and independent, to stay persevering like interviewee 12 when convincing others of the need to reform,

I12: “I never accept a “no”. If someone does not agree with me, I will come back to him again and again until he agrees with me. A “no” is not a possible answer for me.”

[Governwell]

Dear PFM boarders
Thanks to the few who put their experiences and evidence into play for this mini competition. I thought all of the stories were interesting and offered opportunities to learn.

I have decided to go with Knoussi as the winner of my book. The response was really interesting and the lessons resonate a lot with those offered in my book: focus on problems, go step by step towards a solution, and pay constant attention to context. If knoussi could, contact me at matt_andrews@hks.harvard.edu I will make sure a copy of the book is on the way!

For all others, I would value any support on buying or commenting on the book. http://amzn.to/ZeYiJB see recent comment http://bit.ly/13peHvt

[knoussi]

Dear Professor Andrews,

I have just sent you an email. I thank you so much for awarding me the price for the online competition and for appreciating my comments on the PFM board.

I big thank you also to Mauro Napodano for making all of this exchange possible, for having initiated this PFM board and for managing it with such a lot of commitment!

My thoughts above were based on my doctoral dissertation, which I submitted to the University of Vienna, Department of Political Science, in December last year. If anybody is interested in reading it, you can contact me at katharina.noussi@univie.ac.at and I will be happy to share it with you! 

On the professional side, I am currently teaching a seminar on international affairs at the Department of Political Science and looking for new opportunities. In the past I have been employed as project manager and advocacy officer for LIGHT FOR THE WORLD, a European NGO in the area of disability and development. The most inspiring experience was managing a large experimental advocacy project in Tanzania. The project succeeded in uniting the previously fragmented disability movement and in strengthening the rights of persons with disabilities in several policy areas and regions. It was then that I learnt many of the lessons which you also point out, that reform takes time, that stakeholder management is crucial to successful reform, ownership and leadership were crucial success factors as well. We also engaged in budget work at the district and national level, this is when I got interested in PFM reform and started my doctorate.
But what I actually wanted to also share with my fellow PFM Boarders is the insight that the challenges associated with PFM reforms or reforms of state institutions share many points in common with projects trying to strengthen the demand side of governance reforms, i.e. civil society empowerment projects. By the way the advocacy coalition which we founded in 2006 is still operating today, which is a big success on its own. 

I look forward to hearing back from you and for more discussions on the PFM board,
best,
Katharina Noussi

[FitzFord]

Congratulations Katharina! I will contact you.

Fitz.