2005 PRS Review Balancing Accountabilities and Scaling Up Results

1. 2005 PRS ReviewBalancing Accountabilitiesand Scaling Up Results The World Bank

2. Presentation • Overview: PRS Approach • Balancing Accountabilities • Scaling Up Results Overview Balancing Accountabilities Scaling Up Results

3. PRS snapshot • Introduced in late 1999 • Intended a fundamental shift in relationship • 49 countries (+ 11 + 10) • About half in sub-Saharan Africa • About half HIPC • Average implementation, 2 ½ years • 3 countries have fully revised strategies Overview Balancing Accountabilities Scaling Up Results

4. Key PRS pillars Country driven: Country ownership, broad-based participation What do they really mean and why are they important ? Poverty Reduction Strategy Long-term perspective Results-oriented Country-driven Comprehensive Partnerships Overview Balancing Accountabilities Scaling Up Results

5. (Trade) Government Polices, Programs, Public actions Poverty- and results-oriented Well-implemented more aid Participation predictable harmonized aligned Domestic Constituents PRSP External Actors Institution and capacity building agenda Analytic Underpinnings Mutual accountability Overview Balancing Accountabilities Scaling Up Results

6. links to budgets Government Polices, Programs, Public actions Poverty- and results-oriented Well-implemented effective monitoring more aid institutionalized participation: who, when, how, what predictable harmonized aligned Domestic Constituents PRSP External Actors Institution and capacity building agenda Analytic Underpinnings Domestic accountability Overview Balancing Accountabilities Scaling Up Results

7. links to budgets Lack of prioritization and specificity Conditionality effective monitoring Government Polices, Programs, Public actions Poverty- and results-oriented Well-implemented Volume and modalities of assistance institutionalized participation: who, when, how, what Limits on policy space more aid predictable harmonized aligned Domestic Constituents PRSP External Actors Institution and capacity building agenda Analytic Underpinnings Some factors that can tilt the balance Overview Balancing Accountabilities Scaling Up Results

8. Greater prioritization and specificity Aid modalities that support domestic accountability links to budgets Government Polices, Programs, Public actions Poverty- and results-oriented Well-implemented more aid effective monitoring predictable institutionalized participation: who, when, how, what harmonized aligned Domestic Constituents PRSP External Actors Institution and capacity building agenda Analytic Underpinnings (Re-) Balancing accountabilities Overview Balancing Accountabilities Scaling Up Results

9. Linking PRS to budget processes Why important? • Need to embed strategy in domestic institutions/processes… otherwise just a paper • Budget constraints encourage prioritization What has happened so far? • Greater focus on public expenditure management • Evidence of improvements, esp in HIPCs (albeit from low base) • Initial focus: budget formulation ; now increased attention: budget execution and reporting Continued attention: • Coordinated, sequenced, demand-driving support for capacity building • Political commitment and deep institutional reform Overview Balancing Accountabilities Scaling Up Results

10. Strengthening monitoring systems • More focus on results highlighted lack of baseline data and robust monitoring systems • Some improvements in data coverage, quality, and access (more needed) • Real challenges • Building monitoring systems that coordinate the collection of data and its analysis. • Creating demand for evidence based decision making (using information in policy making). Overview Balancing Accountabilities Scaling Up Results

11. Institutionalize participation • Who: neglected stakeholders, specialization • What: opening policy space • When: formulation/implementation • How: rules of the game, communications, invited space or entitled space Aspire Engage Influence Overview Balancing Accountabilities Scaling Up Results

12. Strengthening content, analytical foundations • Poverty analysis • Analysis of growth and the productive sectors • how the poor benefit from growth (e.g., jobs) • coherent sectoral strategies • Use of distributional analysis (PSIA) of key policy measures to inform policy design, choices, and sequencing. Overview Balancing Accountabilities Scaling Up Results

13. Realism vs. ambition • PRSs need to be realistic to provide the basis for an operational framework to reduce poverty • But, countries may also have more ambitious medium- to long-term goals (such as the MDGs) • Using alternative scenarios could provide a link between realism and ambition. Elements could include: • Assumed financing (aid and domestic resource mobilization) • Actions to address absorptive constraints • Expected improvement in results Overview Balancing Accountabilities Scaling Up Results

14. Scaling up (results) • Likelihood of substantial increases in aid flows provides scope for scaling up poverty reduction efforts • How to help use additional resources well: • Continuing process of improving quality/specificity of PRSs • Understanding and addressing absorptive constraints Overview Balancing Accountabilities Scaling Up Results

15. Absorptive constraints Indicative classification Macroeconomic Debt sustainability Dutch disease effects (currency spikes) Human, physical capital Technical and managerial skills of public officials Lack of adequate infrastructure and equipment Institutional and policy Perverse incentives due to recruitment systems Inadequate Public Expenditure Management Social factors determining demand for services Donor behavior Aid volatility Uncoordinated donor behavior Difficulties to shift to improved donor behavior Overview Balancing Accountabilities Scaling Up Results

16. Thank You www.worldbank.org/prspreview Overview Balancing AccountabilitiesScaling Up Results