Good Practice PEAM Work

1. Planning for High Impact Good Practice PEAM Work PEAM Core Course March 23, 2005 Bill Dorotinsky, PRMPS

2. PER Objectives Inform Donor Lending It is important to keep the multiple goals in mind when planning the work Policy advice to client REFORM and Development PER Capacity-building Identify lending opportunties

3. Country Examples 2 Examples Lessons Tanzania The annual government-led pubic expenditure review process is managed by the joint govt/donor/civil society PER working group. Each year the PER work includes a budget review, and in-depth analysis of selected policy and management issues. Government is transferring the Secretariat supporting the work to the Ministry of Finance. -- the way work is done can support country institutions and build capacity Poland The 2002 PER focused on providing practical advice to the client. The client had the choice of what issues the PER would cover. As each PER input was prepared (e.g. budget management), it was provided to Government as a stand-alone paper to meet client needs. The full PER report was a secondary aspect. -- focusing on the client objective rather than Bank product can support reform

4. Country Examples 2 Examples Lessons Turkey The PER process was used to build consensus and working relationships in Government across competing agencies. -- the way work is done can contribute to reform directly Mexico The government, under a fee-for-service arrangement, is purchasing World Bank advisory services on PFM for the Ministry of Finance. The task is characterized by real-time advice and products to support development of a reform strategy and action plan. A PER is under preparation, drawing on the knowledge gathered via the advisory services, supplemented with selected additional missions. -- through supporting client needs, we can also meet our information needs

5. Country Examples 2 Examples Lessons Vietnam An annual program of analytic work has grown into a Government-led PER process and donor integration in support of a Government reform program and strategy. With each iteration, the Government takes more responsibility for leading process and producing documents --- and completing reforms. -- proving value for Government leads to continuous engagement, direct support to reform implementation, and many opportunities for lending Madagascar The government is in the process of developing an action plan aiming at consolidating the recommendations of different diagnosis (own government’s assessment, CFAA, CPAR, IMF technical assistance reports, etc). The government is expecting the donors to align their program of work against this action plan. PERs could seek to fill this consolidating role. -- reducing transaction costs and aligning donors can improve the chance of reform and build capacity Papua New Guinea The 2003 PNG PER was designed from the start to support the Government budget and public finance reform process. Donors share the government’s view that the PER must be a process-driven exercise aimed at helping the government implement the reforms. The PER directly supports Cabinet and Treasury decisions and processes with specific analytic products. -- we can vary approach by country circumstance, but plan from the start for higher impact

6. The focus of the work is supporting Government strategies and institutions, building capacity, and reducing donor transaction costs --- towards results on the ground --- rather than solely diagnostic report production for donors. Summarizing • the analytic work supports the Governments own public sector reform strategy and action plans • the work includes Government leadership in selecting topics, and Government production of working papers and the final report • the work outputs support the Government's own decision-making process • the process will be used to bring together Government actors • the process also brings together multiple donors to support and participate in the analytic work -- and hopefully to support more generally the Government reform strategy and action plan • the process also focuses on building domestic non-governmental capacity through use of local consultants where possible • within the Bank, the work seeks to integrate PREM, OPCSFM, and OPCSPR A good test: the Government is increasingly taking over the process, building it into their budget process.

7. …but the ideal is not always possible PEIR’s, CFAA’s and CPAR’s generally should seek: • greater country participation in planning and carrying out PFM work • to harmonize with country budget cycles to support government processes • be based on a country-specific strategy for PFM work over the medium-term to assure full coverage of issues, meet the relevant needs of all parties, minimize burden on country authorities, and avoid duplication of effort • greater involvement of other donors • cross-participation in missions by OPCS, PREM and IMF staff • to share documentation and information on country issues, perhaps establishing a joint intranet repository • to coordinate contract support to minimize duplication and maximize joint use of outputs • mutual comment and concurrence on outputs, and produce joint outputs where possible (e.g. reports, or BTORs) • joint dissemination missions, harmonizing messages

8. Approaches for using PER as instrument of change- fitting to country circumstances

9. Approaches for using PER (2)