ADVOCATING AND SUPPORTING PARTNERSHIPS FOR REGIONAL DEVELOPMENT IN A PRE-ACCESSION COUNTRY THE EXPERIENCE OF UNDP BULG

1. ADVOCATING AND SUPPORTING PARTNERSHIPS FOR REGIONAL DEVELOPMENT IN A PRE-ACCESSION COUNTRY THE EXPERIENCE OF UNDP BULGARIAHachemi Bahloul, UNDP Bulgaria

2. The Structural Funds (SFs) absorption challenge • The SFs constitute an unprecedented influx of resources (4% of GDP in Bulgaria) requiring a major national effort: all energies, capacities and resources need to be mobilized • The SFs need to be spent well => Partnership principle (PP) introduced by EC in 1998 to ensure the relevance of EU regional policy • Current EC regulations refer to consultation of regional/local authorities and socio-economic partners and “various groups” in programming, monitoring and evaluation • Constantly broadened circle of partners. New EC draft regulation for 2007-2013 programming period explicitly includes also NGOs

3. Why are partnerships important? • Priority needs addressed, ownership and commitment =>absorption • Wider range of expertise drawn up => better quality programmes • Legitimacy and transparency of decisions (counterbalance political influence) => democracy • Raised institutional capacity through institutional networking, learning across organisations (best practices)/innovation EC focuses on the benefits of consultation. Project partnerships are also important: 1) economies of scale; 2) co-financing; 3) building of civil society/social capital (people work together for a common cause)

4. Challenges for UNDP in a pre-accession context UNDP Bulgaria’s main objective: help the country take advantage of the opportunities provided by EU accession to meet the MDGs. What should be the strategic focus of UNDP Bulgaria in helping the country prepare for the SF? • Poverty - striking regional unbalances (Bulgaria is only one foot in Europe) => Regional Development identified as UNDP strategic area of support • Good governance - still centralized State (the voice of local/regional actors needs to be heared) => Partnerships as identified as another UNDP strategic area of support • The EU concerned with central government delivery capacity => Strategic focus/niche in partnerships for regional development (everyone knows that this is what UNDP is doing…identity!)

5. Challenges for UNDP in a pre-accession context • UNDP Bulgaria staff was not sufficiently equipped to advise the GVT/NGOs/business on SFs issues (Government staff are in Brussels or in a member state every two weeks) • Need to develop in-house expertise on EU issues: know and understand the EU story, jargon, way of thinking, procedures to be able to engage in dialogue/advise (EU is complex - developed country context) • In-house expertise helps understand how best UNDP can help to ensure that accession benefits the poor/improves governance (what is absorptive capacity, subsidiarity, additionality, n+2 rule, managing authorities, intermediate bodies etc.)

6. Killing 3 birds with one stone UNDP Bulgaria/Bratislava review of practices of Ireland/Portugal (old member states) and Poland and Czech Republic (new member states): countries with authoritarian past, similar size (except Poland), similar level of development at time of accession Objectives • Learn about the EU in general (how is works and thinks) • Learn about accession challenges (how new members are coping) • Derive lessons for Bulgaria but also for other countries of the region (replicate best practices – avoid mistakes)

7. Lessons learned: EU accession and governance EU “conditionality” leads to an overall improvement of governance processes • New ways of thinking and working initially limited to sensitive areas for EU integration eventually have a spill over effect on all sectors => cultural change – It takes time: the new member are learning • Institutionalization of partnership in planning and programming (NDP and Operational Programmes) • Greater transparency and accountability in the management of resources (strict tender and control procedures, result orientation) and monitoring of results (Monitoring Committees) • Decentralization: regional development operational programmes => new regional administration structures (management and legitimacy)

8. Lessons learned: dilema between partnerships and absorption in planning/programming • SFs absorption is the primary concern of the EC and the new member states • Old member states: 1) simple system of integrated planning/programming; 2) “top-down” planning counterbalanced by strong consensus oriented consultation; 3) focus on limited number of priorities and measures to simplify implementation and raise absorption • New member states: 1) complex planning/programming system; 2) local/regional participatory strategic planning disconnected from EU programming; 3) programming consultations are a formality/central government decides (de-facto centralization)

9. Lessons learned: dilema between partnerships and absorption in planning/programming • What is the problem faced by governments? • Too much consultation => too many problems => too many programmes=> too many priorities and measures • Complex system difficult to manage, monitor and report particularly in a situation of weak administrative capacity • The EU comes in and says: “you will never manage, please simplify” • A the end of the day, despite consultation, the GVT simplifies • => FRUSTRATION ON THE PART OF THE VARIOUS ACTORS

10. Lessons learned: dilema between partnerships and absorption in implementation • Old member states: 1) well developed large national programmes co-funded by SF to which beneficiaries apply; 2) implementation by strong state agencies; 3) many programmes implemented by local state agencies but with a strong local partnership basis – state agencies play the role of development actors (Enterprise Boards – Ireland) • New member states: 1) weak national programmes; 2) weak state agencies; 3) reliance on grant schemes; 4) state agencies act as distributors of funds

11. Lessons learned: dilema between partnerships and absorption in implementation What is the problem faced by Governments? • Grants schemes provide access to the SFs to a variety of actors: they are based on the assumption that capacity is outside the state system • Excessive expectations as to the capacity of local and regional actors to absorb funds in line with EU requirements => absorption problems • Multiplicity of small projects (grants) which are difficult to manage and control by the central administration => absorption problems • Tendency to try to re-centralize the management of funds • FRUSTRATION ON THE PART OF THE VARIOUS ACTORS

12. Lessons learned: NGO participation in SFs • Governments accept the partnership principle but do not necessarily systematically comply with it – lack of trust • The extent to which the NGO sector influences decisions and receives SFs resources depends on its capacity to organize and lobby at the central level (decisions are taken centrally): eligibility of NGOs for SFs funding requires that they are designated as beneficiaries of measures of the Operational Programmes • NGOs generally eligible for few measures and can actually compete with other actors in a few areas (employment, social inclusion, tourism, environment) Issues: • Capacity to meet complex requirements (project formulation, accounting etc.) • 25% national co-financing of SFs • Bank guarantees

13. Lessons learned: municipal participation in SFs EU and GVT preference for big projects (easier to absorb funds) – new member states have a large number of small municipalities => importance of inter-municipal partnership Old member states: 1) IMP a natural process (based on necessity); 2) IMP interests and projects identified during planning process New member states: 1) prevalence of competition; 2) IMP takes place sporadically for specific projects; 3) planning appears to be an abstract process detached from reality • Pragmatic planning for achievement of consensus is essential • A facilitator in planning is needed (regional administration, association of municipalities, independent experts) • The central government must encourage IMP (publicize good practices, favour the selection of IMP projects)

14. What is the root cause of the dilema between partnerships and absorption of SFs? • Central government is entrusted by the EC with the responsibility to plan and manage the structural funds • The extent to which it is ready to share this responsibility also depends on the capacity of the other partners/development actors (municipalities/NGOs/businesses) • In new members this capacity is still weak

15. What is the solution to the dilema? • THE SFs THEMSELVES PROVIDE THE SOLUTION: A unique opportunity to raise the capacity of these development actors • This in turn depends on their own “organisational maturity”, that is the capacity to establish a partnership among themselves to lobby for greater participation in consultations/decisions/a fair share of the resources • This is a process: 1) lobby initially for their own strengthening; 2) then lobby for the management of a larger share of the resources • Partnerships is also about the sharing of power, resources and responsibilities – it takes time and requires the building of trust (have the right motives and capacities) and a culture of partnership

16. Where to start to resolve the dilema? We have a chicken and egg situation: the development community is weak because there are no resources to raise its capacity, there are no resources to raise its capacity because it is weak (organizational maturity) • Advocacy is needed on the importance of partnerships among the development actors themselves so that they organize and lobby vis a vis central government • More global grants, more measures from which members can benefits, solution by Governments to technical issues (bank guarantees, 25% co-financing etc.)

17. What does UNDP do in Bulgaria? Advocacy for policy impact • Review of EU member states partnership practices => illustrate why partnership is important (otherwise too abstract for actors/formality) • Assessment of municipal and district capacities => impact on the National Strategy for Regional Development, on the RD Operational Programme (OP), on the Administrative Capacity OP, on the way municipalities think and organize • Assessment of NGO/business capacities => impact on the Administrative Capacity OP, on the way NGOs/businesses think and organize

18. What does UNDP do in Bulgaria? Direct support to local actors/demonstration/policy impact • Support to participatory planning in 1 region (40 municipalities) • PPP training in 90 municipalities, direct support to the identification and formulation of PPP projects for SFs • Inter-municipal project identification and formulation: pilot in 2 district based on Portugal best practice => policy impact expected • Leader+: 11 Local Leader Groups established, micro-credit for projects, inter-municipal co-operation => policy impact expected • UNDP supported network of 40 business centers (JOBS) expected to be the main local delivery structure for the “Competitiveness” OP

19. THANK YOU!