PART:ONE Development Planning: Approaches and Techniques

PART:ONEDevelopment Planning: Approaches and Techniques Bishnu Prasad Lamsal SDS,NASC

Outlines 1. Concept of Development Planning 2. Why Planning? 3. Development Planning 4. Different Types of Plan 5. Planning Life Cycle 6.Contains of Development Plan 7.Basis of the Plan Formulation 8. Success of a Development Plan Depends Upon: 9. Planning Process

Outlines 10. The Planning Process in the Plan Formulation 11. Process of Formulation 12. Plan Document Approval 13. Macroeconomic Framework Formulation 14. Medium Term Expenditure Framework [MTEF] 15. Components of MTEF 16. Macro Economic Framework 17. Concept of Managing for Development Results (MfDR) 18. Result Based Planning 19.Logical Framework Analysis

1. Concept of Development Planning • Begins since 1928 from the Soviet Union • After Second World War adopted and spread in the developing world • Most of developing countries economy adopted mixed economy • Nepal introduced economic plan more than 6 decades ago • 14 periodic plans has been implemented so far • The 15th five year plan is in the first year of its implementation

Cont. … … • Concept of central controlled economy planning has changed in 1990 worldwide • After this, market led or liberal policy adopted in the context of globalisation • Planning is more direction-oriented in command economy and more indicative in liberalized economy • The form of the plan has changed [Direction to more indicative or democratic] (Political change of 1990 and 8th Plan) • Role of the government has been changed significantly [catalyst, motivator, regulator and facilitator role] (Feeding people VS Enabling People)

Cont. … … • The private sector became as an engine of growth and lead role in economy • Two concepts emerged after 2006 • Federal structure of state • Adoption of three pillar economy viz. public, private and cooperative sector • Followed more participatory approaches than ever before • Adopted both “top down” and “bottom up” approach • Started to formulate more strategic and result-based planning • Started to prioritization of projects and programs since Tenth Plan • Linked Annual plan with periodic plan through MTEF since the Tenth Plan (PRSP)

2. Why Planning? Relevancy of Planning • State knows the best • State accords priority to real needs • Best use of resources • Focus and perspective • Better distribution of resources and outputs • Efficient resource mobilization • Development in all areas • Saves time, energy and resources • Poverty reduction

Cont. … … • Inclusive development • Private sector development • Market development • Coordination • Foreign aid mobilization • Development of remote and deprived areas

3. Development Planning • Development planning is the systematic management of resources for the purpose of achieving definite targets or objectives within specific period of time • Development planning is a deliberate effort of the government to influence in the major socio-economic variables like GDP, consumption, savings, investment, prices and employment etc, of a country for a specific period of time to achieve its desired objectives

Cont. … … In planning, we try to respond the three basic questions: 1. Where are we now? [The present socio-economic status of the country] • Requires to analyze the country’s social and economic situation based on reliable data and information 2. Where do we want to be? What do we want to achieve ? • The medium term goals/objectives, a clear goal and objectives of the government needs to be spelled out , based on the long term vision of the country

Cont. … … 3. How can we get there? [Strategy to achieve policies and programs] • Requires analysis of the options available to achieve the objectives and choosing the most appropriate and efficient option • Also requires to identify the policies and programs that best suits to carry out the strategy

4. Different Types of Plan • SpatialJurisdiction: • National periodic development plan • Provincial periodic development plan • Local level periodic development plan • Time Frame (Period): • Long term (perspective) plan • Medium term plan • Annual plan

Cont. … … • Objectivity: • Controlled economic planning • Indicative planning • Strategic planning • Sectorial: • National comprehensive plan. • Sectorial plan • Sub-sectorial plan

5. Planning Life Cycle • Concept paper preparation • Approach paper preparation • Approval of approach paper • Detail plan • Plan implementation and monitoring • Review and evaluation (Back to new plan-concept paper preparation)

6.Contains of Development Plan • Review of current plan/Factsheet analysis • Long term vision and strategies • Statement :Vision/Statement/Goals • Statement of the objectives • National strategies • Macro-economic Framework [Targeted growth rates of various economic sectors, Investment requirements and source of funds to achieve the targeted growth rates]

Cont. … … • Priorities • Quantitative Targets. • Sectorial objectives, strategies, policies • Programs/projects of various sectors • Allocation of resources • Implementation Mechanisms • Monitoring and Evaluation Mechanism, and • Expected Output/Outcomes

7.Basis of the Plan Formulation • Directive principles and policies of the constitution • Election manifesto of ruling political party in the general election or common minimum programmeof the coalition partners • Aspirations of the people (through various means) • Perspective/ long-term plan and other sectoral perspective plans • SDGs and other global, regional commitments

Cont. … … • Domestic issues [e.g. inflation, low economic growth, poverty, unemployment, governance and so on ] • Contemporary Challenges of the development [ Climate change and global economic issues etc.), and • Influential social /interest group and influential leaders

8. Success of a Development Plan Depends Upon: • Knowledge of the economy including grass roots level realities • Proper setting of the objectives • Appropriateness of policies and strategies • Adequacy of data and information • Realistic targets and projections • Adequate consultations with the stakeholders • Proper understanding of needs, resources and values

Cont. … … • Adequacy of resources for targeted activities • Inter-sector consistency and coordination • Adequate allocation of human and institutional resources • Appropriate organizational set up and administrative arrangement • Public participation in all activities • Coordination among the stakeholders • Good quality projects/programs design

Cont. … … • Effective Implementation plan • Efficient M&E system for feedback and timely correction • Effective monitoring and evaluation mechanism and plan • Reward and punishment system • High level political commitment and priority • National consensus for development targets and goals

9. Planning Process 1. Traditional Approach: • Top down [little involvement of stakeholders and beneficiaries] 2. New Approach: • A participatory and bottom up • Local, Provincial and National Level Consultations • More inclusive participations: [gender, ethnic groups, Dalits, Madhesis, minorities, disabled, youth, political parties, development partners, NGOs/INGOs, CBOs etc]

10. The Planning Process in the Plan Formulation 1. Steering Committee: • Chair -VC NPC • Members of NPC and • Secretaries of Line Ministries 2. Sectorial Committees: • Chair –member of NPC • Joint Secretaries/Under Secretaries of Line Ministries and NPC, • Experts, advisors, and invitees.

Cont. … … 3. Sectoral Technical Committees: • Chair-Joint Secretary of NPC, • Joint Secretaries/Under Secretaries of LM, • Program Directors/Planning Officers of NPC, • Experts, advisors 4. Task Force: Line Ministries: • Chair –Secretary of respective LMs, • Department heads, • Joint Secretaries /Under Secretaries /Section Officers of LM

11. Process of Formulation • Review of previous plan • Current status in various sectors • Sending guidelines to Line Ministries • Setting long term vision • Setting macro objective, strategies, policies and priorities • Formulation of macroeconomic framework • Setting sectorial objectives, strategies, policies and targets • Programs/projects to achieve these targets • Preparation of logical framework

Cont. … … • Consultations with various stakeholders. • Interaction at the central level. • Interactions at the regional/provincial Level. • Seeking experts' suggestions • Involvement of the ministries and other public agencies. • Review process. • Validation process( for ownership) • Thematic/sectorial coordination.

12. Plan Document Approval • Preparation of Draft Approach Paper • Presented to National Development Council (NDC) meeting • Finalization of Approach Paper incorporating suggestions and guidance of NDC • Submission of Approach Paper for the approval of the Cabinet • Based on the Approach Paper detail Periodic plan is formulated

13. Macroeconomic Framework Formulation Projections of: • GDP Targets • Total investment requirements: Public and private • Estimate of required resources • Revenue • Public expenditures • External sources: Grants and loan • Domestic borrowings

14. Medium Term Expenditure Framework [MTEF] • Three year rolling plan: Vision, objectives, strategies • Allocation in priority sector and fiscal discipline: Constitution, policy and plan • Tools of public financial management: Prioritize, unit cost, cost estimation, expenditure and resources projection

MTEF for • Macro economic stability • Balance between plan and budget • Resources allocation • Allocative efficiencies • Budget and program projection • Economic and financial discipline

15. Components of MTEF • Medium term financial framework [Macro economic framework and target] • Medium term budget framework [Resources allocation based on program prioritization and demand] • Medium term performance framework [Between periodic plan and annual budget]

16. Macro Economic Framework • The macro economic framework presents the whole pictures of the economy which includes: • The real sector • The fiscal sector • The monetary sector, and • The external sector • Macro models can be used to forecast the macro economic variables to ensure consistent macro economic framework • Forecasts and assumptions about domestic and international economic performance

Cont. … … • Government's macro-economic policy stance reflected in: • Monetary and exchange rate policy • Real sector growth targets • Projections of domestic and donor inflow including: • Domestic revenues • Foreign grants and loans • Levels of government domestic borrowing

17. Concept of Managing for Development Results (MfDR) • Set of concept, principles and tools for: • Improved development effectiveness • Improved performance management • MfDR (output, outcome and impact) in different levels through result-based. • Strategic planning • Budgeting, and • M & E

Cont. … … MfDR follows the following five principles: 1. Focusing the dialogue on results at all phases of the development process 2. Aligning programming, monitoring, and evaluation with result 3. Keeping measurement and reporting simple 4. Managing for, not by, results, and 5. Using results information for learning and decisionmaking

18. Result Based Planning • RBP is a strategy to increase transparency, and accountability • Therefore, it recommends to establish a planning process that: • Increases transparency • Ensures accountability • Promotes proactive management, • Focuses on performance, and • Ensures results.

19.Logical Framework Analysis • It is very useful for planning, monitoring, implementing and evaluating development tool • It helps to identify the cause and effect relation between the goals, objectives, output/outcomes of the project • It develops the indicators as well as the external forces and influences that determines the success of the projects • It provides a logical approach in setting priorities and determining activities and the intended results of a project

Logical Framework

PART:TWO Issues and Challenges in Project Management

Outlines • Meaning/Definition of Project • Basic Features of a Project • Project life Cycle • Project Management • Concept of Project Management • Issues and Challenges in Project Management in Nepal • Suggestions for Improving Project Management in Nepal • Conclusion and Suggestions

1. Meaning/Definition of Project • A project may be defined as a proposal for an investment activity which employs resources with the aim of generating specific future benefits at certain costs. • A project is a proposal for an investment to create, expand and/or develop certain facilities in order to increase the production of goods and/or services in a community during a certain period of time. • A project is a set of activities with specific objectives to be completed within given time and cost.

Cont. … … • A project is a unique, transient endeavor, undertaken to achieve planned objectives, which could be defined in terms of outputs, outcomes or benefits. • Project is any scheme or a part of a scheme for investing resources which can reasonably be analyzed and evaluated as an independent unit---- Little & Mirrless

Cont. … … • A project can be considered to be any series of activities and task that has a specific objective to be completed within certain specification, defined start and end dates, funding limits, focus into effective utilization of limited resources---- Harold Kerzner • Projects are the building blocks of a investment plan. • Projects consume resources and they generate benefits during project operation period.

2. Basic Features of a Project • Specific objective or goal • It is an investment activity • Estimates of cost- benefits • Uses financial, labour and materials • It has life cycle • It has start and end date • Provides benefits over the project period • It has an independent identity and itself complete • It has specific responsibility

3.Project life Cycle • Many ideas of project cycle and it’s stages by scholars and authors. Broadly project management consists of the following stages • Initiation • Planning • Execution • Closure (METHOD 123)

Cont. … … Initiation stage • Feasibility study • Identifying scope • Identifying deliverable • Identifying project stakeholders - Developing a business case. • First, we need to develop an idea for a project and carefully examine to determine whether or not it give benefits. • During this phase, we need to decide whether the project can realistically be completed or not?

Cont. … … Planning Stage • Creating project plan • Workflow document • Financial plan • Resources gathering • Anticipating risk • During this phase, we need to prioritize the project, estimate the budget requirement and schedule, and determine what resources are required

Cont. … … Execution stage • Organize workflow • Tasking team member • Communicating • Monitoring • Managing budget • In this phase, resources' and tasks are distributed and teams are informed of their responsibilities. • Information related to the project are gathered. • Project works are carried out.

Cont. … … Closure stage • Analyzing project performance • Analyzing team performance • Documenting project closure • Accounting budget • During this phase the project managers require to get project status and progress • After project tasks are completed and an evaluation is required to know about project success Projects management processes vary from project to project depending on nature and scale of the project

4. Project Management • Management has been defined as getting results through people • Management has been defined as getting things done • Project management is the management of project resources to achieve the objectives • Management is an art to achieve organizational goal through planning, organizing, controlling, coordinating, budgeting, monitoring and mobilizing human resources

PART:ONE Development Planning: Approaches and Techniques