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FINNISH AID in the PRS-context...

FINNISH AID in the PRS-context. ...Where are we?. Timo Voipio/MFAF May 2003. Finland’s role?. Goals / Commitments / Real situation - Summary:. All ODA , incl. budget support, sector support and projects have to be based on the PRS-priorities.

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FINNISH AID in the PRS-context...

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  1. FINNISH AIDin the PRS-context... • ...Where are we? Timo Voipio/MFAF May 2003

  2. Finland’s role?

  3. Goals / Commitments / Real situation- Summary: • All ODA, incl. budget support, sector support and projects have to be based on the PRS-priorities. • The % of BS/SS still low in Finland’s ODA (~2%) • Most contracts in the form of projects, but increasingly aligned to PRS-priorities. • But: PRS & BS & SS are important elements in the context where Finland operates. • E.g. >50 % of Tanzania’s total ODA is BS. • Hence  We (at least) have to understand & discuss - preferably influence!

  4. Government of Finland’s Policies? • MAIN GOALS OF DEV’T COOP.? • Poverty reduction • Reduction of global threats to environment • Promotion of equality, democracy, human rights

  5. GoF 2001 ’Decision-in-Principle’: To enhance poverty impact… • bilateral cooperation will be concentrated on fewer partner countries(Moz,Vie,Tan,Eti,Nep // Ken?Zam?Nic?BuFa?Hon?) • …and focused on fewer and larger programmes or sectors (max. 3/country). • Finland supports dev’t and implementation of PRSs and sector programmes

  6. GoF 2001 ’Decision-in-Principle’: To enhance poverty impact (2)… • New forms of cooperation require new forms of mngt, decision-making and admin. • MFAF will ensure that the level of dev’t expertise will be maintained and enhanced: (a) reform the MFAF career system (MFAF?) (b) in-depth training for the entire staff (c) Recruit local experts and more advisers to embassies

  7. MFAF’s ’Implementation Plan’ • Millennium Decl. + MDGs = aid steering & perf. assessment framework • To ensure partner countries’ leadership and donor coordination  PRSP = main framework of Finland’s action. • Finland will… - participate in harmonisation of donor practices - advocate aid admin. that develops poor countries’ own admin.structures and procedures. • Need for bi/multi coherence  Influence WB/UN!

  8. ’The most important objective of cooperation is poverty reduction’ • MFAF-mandates for bilateral consultations have to be analysed from poverty perspective • Finland will support (and use), with other donors, country-specific poverty analyses • Finland will specifically monitor income redistribution policies and will seek to reduce inequalities • Finland will support democracy by promoting participation of civil societies and parliaments.

  9. Finland’s experience this far (1) 1) PRS-process: monitoring & support: - Moz, Viet, Tan, Eti, Nep, Nic, Zam, Ken . 2) Budget support to PRS-priorities: • Greatest demand for this mode of assistance • Tanz (Bilat.MDF-97PRBS-01WB/PRSC-03), • Nic. (-02), Moz. (-03) • But Viet: NO! Preconditions for Finland’s BS not met: a. budget transparency (state secret still in 1999-2000) b. link from PRSP (CPRGS) to budget c. implementation capacity  Can we identify other ways to support the PRSP-process? Embassy: Need for quick funds from Embassy.

  10. Finland’s experience this far…(2) • Sector programme support - FIN: engaged in preparations: many countries - all funding still through ’baskets’ or as projects • Discussion about Finland’s role and ’niches’. Money alone or also focused monitoring (TA)? - e.g. teacher training? - e.g. integrated special needs education? - e.g. forest inventories & NFPs? - e.g. reproductive health?

  11. Need to engage in, to read and to promote public discussion about, e.g… • National budgets and accounts monitoring. • PER – Public Expenditure Reviews • CFAA – Country Financial Accountability Assessments (~ auditors’ assessment) • Poverty, welfare & gender statistics development, monitoring and dissemination • Finland’s State Audit Office – BS OK, but monitoring of results – Take part in Poverty Monitoring? • Central/local gov’nt relationships: regional equalisation in taxation and budget allocation? • Tax reform and capacity building

  12. But…Finland’s capacity constraints 1) Staff – Too few embassy staff? • Traditionally all Finnish projects were managed by competent Finnish consulting companies • Now: Influencing takes place through donor-govn’t dialogues – Who can represent Finland? • 5 new experts recruited into embassies in 2002 – more needed! • Can we use monitoring consultancies & research…? 2) Money - Finland/SPA: 29 meuro (2003-5) • = 8 x Finland in 2000-2002, but only 1/5 x Ireland

  13. Good discussion in Finland on, e.g… • State Audit Office of Finland (VTV) •  Monitor results (pov.red), not inputs! • Budget support condition: IMF ”on-track”? • - Finland: Yes? Sweden: Not automatically. • Budget/Sector prgs vs. Area dev’t prgs? • - Budget s. – right principles (ownership, no parallel PMUs, capacity & systems dev’t for permanent institutions. But:  for Central governments? •  or for Local governments? (Districts?) • (= equal size partners with Finland?)

  14. Good discussion in Finland (2) • What role for Finnish dev’t NGOs? How to strengthen civil society partners’ capacity and voice in PRS-processes? • How to ensure markets for Finnish consultants (TK: If we are good, we’ll be OK.) • But: How to share Finnish/Nordic values & experiences? (Harmonisation of donor-procedures but not ideologies – How to provide a menu of models for poor country partners to choose from?)

  15. ’A thorough poverty analysis as part of design of every project and programme’ • Link between gender equality and poverty reduction must be integrated to this work. + Rights of disabled people • In recruitment/training of consultants attention will be paid to poverty/gender/disability skills • Within MFAF… – Poverty Competence Project / unit-by-unit - Pages at global.finland.fi/koyhyys - Joint Donor Staff Training on PRS-appr. - This training - Key messages 

  16. Causes and solutions to Poverty: • Multi-dimensional •  all MDGs • Context-specific •  national PRS, no ”one-size-fits-all” • Coherent •  e.g. aid + trade + migration + agric. • Democratic •  Country: ownership, participation, •  Donors: partnership, harmonisation

  17. MULTI-DIMENSIONAL POVERTY – ALL MDGs SECURITYvulnerability social protection/safety nets & springboards ECONOMICconsumptionincome assets POLITICALrights freedoms voice & influence GENDER ENVIRONMENT HUMAN healtheducationhunger, thirst SOCIO-CULTURALstatusrespect, dignity

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