SECTOR POLICY SUPPORT PROGRAMMES

1. SECTOR POLICY SUPPORT PROGRAMMES A new methodology for delivery of EC development assistance.

2. Part 1 – BackgroundParis Declaration of March 2005 • 90 countries and 26 multilateral organisations resolved to take far-reaching and monitorable actions to reform the ways they deliver and manage aid. • Participants agreed to 56 Partnership Commitments and 12 Indicators of Progress. • Pledged to monitor and assess their progress against agreed targets set for 2010. • Recognised that commitments must be interpreted in the light of the of each partner country’s situation. • Welcomed initiatives by partner countries and donors to establish their own targets for improved aid effectiveness . • Targets require action by both donors and partner countries

3. Paris Declaration • Developing countries will exercise effective leadership over their development policies & strategies, & will coordinate development actions; • Donor countries will base their overall support on recipient countries' national development strategies, institutions, and procedures; • Donor countries will work so that their actions are more harmonized, transparent, and collectively effective; • All countries will manage resources and improve decision-making for results; • Donor and developing countries pledge that they will be mutually accountable for development results.

4. Monitoring Progress • 12 Indicators of Progress • Targets set for 2010 • Progress scheduled to be monitored in 2006, 2008 and 2010

5. Indicator No 1 - Ownership • Partner countries have operational development strategies with clear strategic priorities, linked to a medium-term expenditure framework and reflected in annual budgets. • Target for 2010: • At least 75% of partner countrieshave operational development strategies.

6. Indicator No 2 Reliable Country Systems • Number of partner countries that have procurement and public financial management systems that either (a) adhere to broadly accepted good practices or (b) have a reform programme in place to achieve these. • Target for 2010: • (a) Public financial management – Half of partner countriesmove up at least one measure on the Country Policy and Institutional Assessment scale of performance. • (b) Procurement – One-third of partner countriesmove up at least one measure on the four-point scale used to assess performance for this indicator.

7. Indicator No 3 Aid Flows Aligned with National Priorities • Percent of aid flows to the government sector that is reported on partners’ national budgets. • Target for 2010: • Halve the proportion of aid flows to the government sector not reported in government budgets (with at least 85% reported on budget).

8. Indicator No 4 Strengthen Capacity by Co-ordinated Support • Percent of donor capacity-development support provided through coordinated programmes consistent with partners’ national development strategies. • Target for 2010: • 50% of technical co-operation flowsare implemented through co-ordinated programmes consistent with national development strategies.

9. Indicator No 5a Use of Country Public Financial Management Systems • Percent of donors and of aid flows that use public financial management systems in partner countries, which either (a) adhere to broadly accepted good practices or (b) have a reform programme in place to achieve these. • Target for 2010: • 100% of donors use partner countries’ PFM systems • Reduce by two thirds the amount of aid to the public sector not using partner countries’ PFM systems.

10. Indicator No 5b Use of Country Procurement Systems • Percent of donors and of aid flows that use partner country procurement systems which either (a) adhere to broadly accepted good practices or (b) have a reform programme in place to achieve these. • Target for 2010: • All donorsuse partner countries’ procurement systems. • Reduce by two thirdsthe amount of aid to the public sector not using partner countries’ procurement systems.

11. Indicator No 6 Strengthen Capacity by Avoiding Parallel ImplementationStructures • Number of parallel project implementation units (PIUs) per country. • Target for 2010: • Reduce by two-thirdsthe number of parallel project implementation units (PIUs).

12. Indicator No 7 Aid Is More Predictable • Percent of aid disbursements released according to agreed schedules in annual or multi-year frameworks. • Target for 2010: • Halve the proportion of aid not disbursed within the fiscal year for which it was scheduled.

13. Indicator No 8 Aid Is Untied • Percent of bilateral aid that is untied. • Target for 2010: • Continued progress over time.

14. Indicator No 9 Use of Common Arrangements or Procedures • Percent of aid provided under programme-based approaches. • Target for 2010: • 66% of aid flowsare provided in the context of programme-based approaches.

15. Indicator No 10 Encourage Shared Analysis • Percent of (a) field missions and/or (b) country analytical work, including diagnostic reviews, that are jointly prepared. • Target for 2010: • (a) 40% of donor missionsto the field are jointly undertaken. • (b) 66% of country analytical work is jointly undertaken.

16. Indicator No 11 Results-Oriented Frameworks • Number of countries with transparent and monitorable performance assessment frameworks to assess progress against (a) the national development strategies and (b) sector programmes. • Target for 2010: • Reduce by one-third the proportion of countries without transparent and monitorable performance assessment frameworks.

17. Indicator No 12 Mutual Accountability • Number of partner countries that undertake mutual assessments of progress in implementing agreed commitments on aid effectiveness including those in the Paris Declaration. • Target for 2010: • All partner countrieshave procedures for mutual assessment reviews in place.

18. The Purpose of the Paris Declaration

19. To Make Joint Progress Toward Better Aid Effectiveness • Ownership - Developing countries set their own strategies for development, improving their institutions and tackling corruption. • Alignment - Donor countries align with these objectives and use local systems for delivery of assistance. • Harmonisation - Donor countries coordinate, simplify procedures, and share information to avoid duplication. • Results - Developing countries and donors shift focus to development results - and results get measured. • Mutual Accountability - Donors and partners are accountable for development results.

20. Implications for Partner Countries • Partner Countries must now take the lead in establishing coherent, well planned, well budgeted development policies and strategies. • They must improve their systems and procedures to ensure efficient, transparent and cost-effective allocation of resources. • They must coordinate donor support for development strategies and policies.

21. Implications for Donors • Leadership in the development process lies with the partner country. • Donors must align their support to partner country strategies and policies. • They must use partner country systems to deliver aid. • They must harmonise their procedures, including by carrying out investigations and analyses jointly with partner countries and other donors. • Aid must be untied.

22. Joint Implications for Partner Countries and Donors • Both are mutually responsible for the results. • Both are responsible for monitoring progress

23. Progress to 2008 • Progress is being made across all indicators. • Shows that real change is possible when there are joint efforts between partner countries and donors. BUT • A considerable acceleration of change in most countries will be needed to achieve the targets set for 2010.

24. Progress on Track • Indicator 4 – Technical co-operation is aligned and co-ordinated. • Indicator 2a – Public financial management (PFM) systems are reliable. • Indicator 8 – Aid is increasingly untied.

25. Targets Requiring Efforts But Still Within Reach • Indicator 6 – Donors avoid parallel project implementation units (PIUs). • Indicator 3 – Aid flows are accurately recorded in countries’ budgets. • Indicator 7 – Aid is more predictable within the year it is scheduled.

26. Targets Requiring Very Special Efforts • Indicator 1 – Countries operationalise their development strategies. • Indicators 5a and 5b – Donors use country PFM and public procurement systems. • Indicator 9 – Donors use co-ordinated mechanisms for aid delivery. • Indicators 10a and 10b – Donors co-ordinate their missions and their country studies. • Indicator 11 – Countries develop sound frameworks for monitoring development results. • Indicator 12 – Mechanisms for mutual accountability are established at country level.

27. Accra Agenda for Action 2008An Agenda to Accelerate Progress • Predictability – donors will provide 3-5 year forward information on their planned aid to partner countries. • Country systems – partner country systems will be used to deliver aid as the first option, rather than donor systems. • Conditionality – donors will switch from reliance on their own conditions about how and when aid money is spent, to conditions based on the developing country’s own development objectives. • Untying – donors will relax restrictions that prevent developing countries from buying the goods and services they need from whomever and wherever they can get the best quality at the lowest price.