Recent ODI output on PFM

[John Short]

Some of ODI's recent publications on PFM which provides useful reading

http://www.odi.org.uk/resources/details.asp?utm_source=cape&utm_medium=email&utm_campaign=20110603&id=5318&title=accelerating-transition-out-fragility-role-finance-public-financial-management-reform

http://www.odi.org.uk/resources/details.asp?utm_source=cape&utm_medium=email&utm_campaign=20110603&id=5719&title=pfm-public-financial-management-reform-developing-countries

http://www.odi.org.uk/resources/details.asp?utm_source=cape&utm_medium=email&utm_campaign=20110603&id=4896&title=tajikistan-budget-performance-report

http://www.odi.org.uk/resources/details.asp?utm_source=cape&utm_medium=email&utm_campaign=20110603&id=5445&title=budget-support-design-evidence-pfm-public-financial-management

Planning and budgeting in Southern Sudan: starting from scratch Lessons for planning and budgeting systems in post-conflict settings
http://www.odi.org.uk/resources/download/4980.pdf

[STONE]

Thanks John useful stuff

[harnett]

Yes - very useful.  The conference with significant input from the "recipients" (Accelerating the Transition out of Fragility) yielded some concrete pointers which we had all grappled with but good to see it validated:

1. Donors are not respecting government ownership and are micromanaging aid delivery despite commitments to the Paris aid effectiveness agenda in fragile states. We heard accounts from four Ministers of Finance of the difficulties they have had in managing the donor relationship and were struck by the comment that it was only possible to gain control of the reform process once domestic revenues had reached a high enough level to marginalise the influence of donors.
2. Participants recognised that PFM reform in fragile states requires a major change in management practices and buy in from a wide range of stakeholders in the country, with important administrative and political implications. It is not a technocratic fix. Yet there seem to be few country examples of properly designed and applied change management processes.
3. Current procurement procedures required by the international community are too complex and cumbersome for fragile states. While such processes reflect a valid need for accountability, it seems that the balance between accountability and development progress is insufficiently considered.
4. Inadequate pay levels in the public service in fragile states are having a serious effect on the sustainability of reform. In this regard, the policymakers are faced with a difficult choice between retaining qualified staff and ensuring a sustainable fiscal position, without impeding private sector development.
5. As fragile states move towards more democratic structures the role of Parliaments in the budget process would become more important. While there is no unique model for interfacing with Parliament, more attention needs to be paid to it to enhance budget transparency.
6. Too much time can be spent making legislative changes. Often these are not necessary because administrative regulations will do as well and the implementation capacity often does not exist to back up the legislation.
7. Finally, the conference demonstrated that collectively we are not learning as much as we can from the range of fragile state experience. Bringing together representatives from such a diverse group of countries, all of them struggling with the same problems can be enormously productive.

[STONE]

Thanks for the summary.

On procurement procedures - heard this before in a non-fragile (robust) state.  Donors saying 'we've done our bit - funded training on our procedures'; government saying 'yes, thanks,  but it's too cumbersome for us. Complex - that's accountability for you.  Cumbersome - does that mean can't be managed by the people in place?  If that's the case, and it was in the non-fragile state (that even started doing some professional training for future procurers rather than just ad hoc training for existing ones) , then consider one donor's response - to put in some 'cumbersomeness mentors' - neat way of dealing with the cumbersome bit without compromising the tedious accountability bit, I thought. 

The only problem was that our analysis suggested/revealed that there wasn't really a procurement problem, it was a project preparation (i.e, planning) problem  - the procurement folk plus mentors could procure something that was well prepared (with a 'proper' ToR - you know- something you could actually procure - not some half baked idea, that any self respecting shark will take a bite at).

[STONE]

Had another thought - how much of the content of the pointers would change if the term 'fragile-states' was find-replaced with 'developing countries'.

[harnett]

Good point - all apply to developing countries I imagine.

What I would like to explore more is the renewed focus on micromanagement (Point 1).   For I suspect behind this is donors feeling compromised in that MDGs should be targeted but their delivery method (BS) open to abuse.  Too often have I seen governments apparently flaunting reform/democracy in the knowledge that withdrawing aid is bad PR when MDGs are to be achieved - and they have Chinese (or Indian / Brazilian) unconditional support in the wings.

[petagny]

I agree with Stone's point about procurement. Often bad planning is at the root of the problems. It goes back to budgeting. It's not just about selecting projects with the potential to deliver value for money: major projects that are not 'ready to go' - even if they have the potential to deliver - should not be in the annual budget. Wait a year and get it right!