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By Philip Mpango (AFTP2) PFAM Course - PREM Learning Week May 3, 2006

Tanzania Public Expenditure and Financial Accountability Review: Some Insights -----------------------------------------------. By Philip Mpango (AFTP2) PFAM Course - PREM Learning Week May 3, 2006. I: TRANSITION FROM PER TO INTEGRATED PEFAR: OPPORTUNITIES & CHALLENGES.

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By Philip Mpango (AFTP2) PFAM Course - PREM Learning Week May 3, 2006

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  1. Tanzania Public Expenditure and Financial Accountability Review: Some Insights----------------------------------------------- By Philip Mpango (AFTP2) PFAM Course - PREM Learning Week May 3, 2006

  2. I: TRANSITION FROM PER TO INTEGRATED PEFAR: OPPORTUNITIES & CHALLENGES • Pre-1998: Bank product by Washington missions => Focus on restoring fiscal equilibrium (introduction of cash budget system). • 1998 to 2000: Introduction of Participatory annual PERs & MTEF; =>Focus on consolidating fiscal prudence; improving budget predictability & Accountability; TTL in country. • 2001-2004: Participatory annual PERs to support implementation of PRSP => Focus on protecting social sector expenditures. TTL in country • 2005 to date: “One Process One Assessment” = Integrated PEFAR review of PE + PFM+ PP. => Focus on aligning the budget to support the growth focus of MKUKUTA. TTL in country

  3. KEY FEATURES OF THE TANZANIA PER PROCESS • Govt-led & Participatory process (PS-MoF; Secretariat; Broad membership of Macro & Sector PER WGs; Regular meetings); Jointly agreed work program that dovetails with the budget cycle. • Joint External Evaluation: WB, IMF/East AFRITAC, DFID, KfW, EU, Finland, Ireland, Canada, NGOs – Haki Elimu, Water Aid, NPF, REPOA + consultancy support (local & international) to feed into the Annual Stakeholders Consultative meeting => Provide feedback to stakeholders + Get feedback of draft budget frame/cross-sector allocations. • Migrating from focus on priority sectors to MKUKUTA clusters (?)

  4. II: DONOR HARMONIZATION Claim: Tanzania is on the frontier of donor harmonization Opportunities: • Lower transaction costs to GoT (e.g. Joint review for PRBS/PRSC, PFM, PEFA + analytic work) • Minimized donor overlap & duplication of effort • Leveraged resources (manpower, financial) Success Factors: • Articulate country Devt Program • Strong GoT leadership & demands (Quite period; shame list; inclusion of NGOs in external evaluation; one process-one assessment; clearance of analytic work) • IMG: Honest broker (select group; ESRF) • Up front consultation with DPs to agree on areas of focus for the year & supportive analytic work + continuous dialogue & regular briefs to DPG • WB leadership in the process (heavy weight champion!) • Continuity provided by national staff

  5. HARMONIZATION CHALLENGES • Harmonization is time consuming • Term assignment of DP staff => Discontinuity in dialogue (e.g. Change of IMF RR) • Disagreements on right policy sometimes (stabilization Vs growth) e.g. taxation of the informal sector; creating fiscal space. • Integration of the product (scope Vs depth; uneven quality of contributions; Agreement on process & Label for buy in). • How to strengthen domestic accountability in a highly donor-dependent environment

  6. III: STAYING IN LOVE WITH GOVT: SOME TIPS • Identify COMMON OBJECTIVES/INTERESTS • TRUST: Give space to Govt to articulate their views; Listen humbly; Use your expertise to engage in constructive dialogue (challenge positions & offer alternatives; Give credit where due; Appreciate genuine difficulties – technical or political. They know the country, political games, allies & adversaries & culture better; Focus on the big picture /overall progress not just to pick the negatives • COLLABORATION: Involve Govt officials in analytic work for substantive contributions & capacity building; Provide support as needed e.g. drafting MKUKUTA, task forces, Technical WGs; Invite Govt officials to WB to talk about key developments/challenges faced e.g. SBAS

  7. STAYING IN LOVE WITH GOVT: SOME TIPS • COMMUNICATION: Maintain continuous dialogue on difficult reforms (process); Consolidate gains instead of introducing more reforms especially where capacity is weak; Ensure consistency of messages to Govt; Good PR – official & social etc. • Identify and form a COALITION with key reformers in and outside Government. • Existence of the referee (IMG) to guard against the parties going astray.

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