The Programme Aid Partnership The Role of Civil Society

1. Theme 3: The institutional and political setting (role of stakeholders in determining results): The Example of Mozambique - Mutual Learning Initiative -OECD/DAC Joint Venture on Managing for Development ResultsJinja, 15-16 June, 2006

2. SUMARY • The Programme Aid Partnership • The Role of Civil Society • The question of ownership and government leadership • Towards harmonization and alignment – recent developments • Government vision on the role of the donor community • Statistical Issues: improvements in statistical collection and dissemination

3. I. THE PROGRAMME AID PARTNERSHIP • The Programme Aid Partnership (PAP) has been established in 2004 between the Government of Mozambique and 15 countries and international agencies providing budget and balance of payments support to Mozambique. Actualy the Group is composed by 18 members and is also Know as G-18; • The Government of Mozambique and the donors signed a Memorandum of Understanding (MoU) in 2004 which sets out the principles, terms and operations for the Programme Aid Partnership; • The overall objective of the Programme Aid Partnership (PAP) is to contribute to poverty reduction supporting the evolution, implementation of Action Plan for Poverty Reduction/Plano da Acção para a Redução da Pobreza Absoluta (PARPA) by: • Building a partnership based on frank and open dialogue; • Providing financing to the public sector for poverty reduction, clearly and transparently linked to performance, in a way which improves aid effectiveness and country ownership of the development process.

4. I.I MONITORING AND DIALOGUE PROCESSES Monitoring and dialogue processes use: • Planning documents including: the PARPA, PES, CFMP and OE ; • Monitoring documents including: Review of PES (mid- year), Budget Execution Reports, the General State Account and annual audit reports (including the Administrative Tribunal Report), a Value for Money audit and a report on PFM-assessment • There are two joint GoM-PAPs reviews on Programme Aid: the annual review (following the production of the review of the PES) and a mid-year review (prior to submission of the PES and OE to Parliament).

5. II. THE ROLE OF CIVIL SOCIETY • In the sequence of the PARPA and similarly to what was happening in other countries, some civil society organizations requested the constitution of a Poverty Observatory with the objective of facilitating the interaction between the civil society and the government for the reduction of poverty . • The objective of the Poverty Observatory is to accompany and coordinate the process of monitoring and evaluation of all activities intended for poverty reduction (Provincial Strategic Plans, Provincial PES and BdPES) • It is recognized, however, that Capacity issues undermine the performance of the Civil Society in this forum

6. III. OWNERSHIP AND GOVERMENT LEADERSHIP • In the preparation of PARPA II 22 Working Groups were created with the participation of the Government, civil society and international partners. Such groups worked throughout the year to produce sector reports for the PARPA • The working groups were leaded by the senior Government staff in each working thematic area to ensure the ownership of the whole process; • Joint Review and Mid Year Review exercises are strongly leaded by the government

7. IV. HARMONIZATION AND ALIGMENT – RECENT DEVELOPMENTS • The MoU committed donors to align to Mozambican instruments, processes and systems of financial management, including: - dialogue around the PARPA, PES and PAF based largely on government priorities in order do ensure Donor Co-ordination & Aid Effectiveness • Critical issues on this approach: • Imbalance in the degree of GoM control exercised over the design of the first PAF • Line ministries expressed concern that the priorities contained in the PAF were not their priorities. This lead to high level of direct funding of sectors and off-budget support. Many line ministries engage primarily in dialogue around policy and finance with the donors rather than with the Ministry of Planning and Finance.

8. Cont.. • The development of the PAF (at the Joint review in April, with a revision in September at the mid-year review) was seen to be out of step with this process, weak though it may be. Government officials reiterated the need for improved internal dialogue, but also for donors to respect national planning and budgeting cycles • The discussion on the indicators has entered a new era with the new PARPA. The PARPA will have a strategic matrix and the PAF will be a subset of this strategic matrix. This means a big step forward in terms of priority setting, monitoring of results and alignment of donors to government policy choices

9. V. GOVERNMENT VISION ON THE ROLE OF THE DONOR COMMUNITY • What matters most for the Government is that donors perform well on 3 fundamental areas: - Predictability, namely: disbursement according to agreed amounts and schedule and multi-year agreements - Alignment, namely with the government systems and bugget cycles, reporting and evaluation mechanisms. In this topic two other dimension: no extra conditionality beyond what is agreed in the MoU & harmonization with bilateral agreements and MoU. - Articulation and alignment of technical cooperation within an overall framework for capacity building for governance (information and policy development analysis)

10. Others: • Increase in Budget Support, especially General Budget Support, as a proportion of total aid • While donors continue to direct large flows of funds to projects outside of government planning and budgeting processes, these strategic resource allocations are partly undermined • The Government believes that Budget Support, is the best aid modality to support a wide reaching poverty reduction plan in a democratic, economically stable developing country such as ours. • The need for donors to subordinate policy dialogue at sector level to the GoM dialogue with its line ministry. Donors must ensure that their interventions reinforce rather than undermine coherence in overall national policymaking. Currently, only around 30% of the aid is canalized as direct Budget Support to the budget

11. Cont… In order to facilitate da achievement of the targets of the PARPA the goverment challenge the donors to implemente de “Paris Declaration” for example by descentralize de authority for the local missions and respect the targets defined: 85% of external aid most be included on the general budget (in other words no more than 15% off-budget. 70 % of aid most be available on time.

12. VI. STATISTICAL ISSUES: IMPROVEMENTS IN STATISTICAL COLLECTION AND DISSEMINATION • The Mozambique National Statistics Institute (INE) is the only institution with the mission to carry out surveys within the country. • Data collected by INE are available for free for the users. Users are always invited to discuss the relevant aspects to be included in the questionnaire. • Technical and financial aspects limited the way INE responds to the demand • Representativity of the data at district level and the need for panel data to understand the dynamics of poverty are some issues that INE has not been able to answer yet

13. Thank You