Transcript Sectoral Approaches

Sectoral Approaches
Mick Foster
December 2002
Plan of Session
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Definitions
Rationale
Where are SWAPs appropriate?
Links to other instruments & approaches
Lessons of experience
Rationale
SWAPs were invented to solve problems of projects:
• Distorted spending patterns (uneven provision,
too much capital but too little operating budget)
• High costs for low coverage
• Fragmentation of policy and budget process
• Weak ownership
• Poor sustainability
• Bypassing of Govt systems weakens
accountability for public expenditure as a whole
• Cross-cutting reasons why projects fail
• SWAp definitions reflect this history:
One definition of a SWAP
“The defining characteristics of a SWAP are that
– all significant public funding for the sector supports a single sector
policy and expenditure programme,
– under Government leadership,
– adopting common approaches across the sector,
– and progressing towards relying on Government procedures to
disburse and account for all public expenditure, however funded.
The working definition focuses on the intended direction of change
rather than just the current attainment.”
(Foster and Mackinosh-Walker 2001)
Problems with this definition
• Focuses on role of public sector• But all sectors have many actors involved
• There are bigger sector issues than just how
to finance public spending:– Who pays and who provides what services?
– What coordination processes are needed to
minimise waste & duplication while allowing
consumer choice & encouraging innovation?
What process is needed to
negotiate sector policy?
– Role of Govt and other actors in finance &
service provision?
– Extent of joint or coordinated planning?
– Who monitors and regulates to what standards?
– How and at what level are public expenditure
priorities decided?
– How balance benefits of consultation against
risks of capture & costs of endless discussion?
When is a sectoral strategy
process appropriate?
• Whenever market failure or need to assure access
by the poor requires Govt to take a leading role.
• But consider benefits & costs when deciding
scope of strategy, who participates, what decisions
require agreement, what processes should be joint.
• Subsidiarity principle:- take decisions at lowest
efficient level.
When is a SWAp appropriate?
• Public expenditure is a major feature of the sector
• Donor contributions are large & causing co-ordination problems
• Reasonable Government and donor consensus on sector strategy
• There is a supportive macro and budget environment
– i.e. budgeted resources likely to be available
• Supportive institutional arrangements
– E.g. single line Ministry, and a manageable number of donors
• Government and donor incentives are compatible with SWAp
– Donors reliably deliver the flexible funding, Govt willing & able to
respond to donor scrutiny of policy, implementation and accountability
Links to other Instruments &
Approaches
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LT Perspective Plan (e.g. Vision 2020)
MT National Development Plan
PRSP
MTEF
Annual Budget
Sectoral strategy and spending plans
Province, regional, district plans
Projects
Regulatory mechanisms
M & E systems
Basic Elements of a SWAp
• Decide goals, e.g. UPE plus output from secondary and higher
education sufficient to meet labour market requirements.
• Analysis of constraints, options for financing and provision.
• Define sector policy, roles, institutional arrangements.
• Develop sector public expenditure framework, linking Govt objectives
to costed expenditure proposals to achieve them.
• Negotiate Govt and EDP funding through the national budget process,
but taking account of other sources e.g. cost recovery. Revise the
output targets in line with the resources available.
• Agree procedures for disbursement, annual review & rolling forward,
accountability, M & E
Lessons of Experience-1
• Keep it clear, strategic, & simple:
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Few, strategic objectives linked to outcomes
Linked to where resources will be allocated
Clarity on how they will be managed
& monitored
• Don’t Blueprint & overplan
Lessons of Experience-2
• Link to national budget process
• Plan and non-plan (development &
recurrent)
• Explicit resource envelope & discussion of
trade-offs coverage & quality
• Recognise cost barriers to household access
Lessons of Experience-3
• Need parallel process to deal with
constraints above sector level, e.g. civil
service performance management,
disfunctional budget processes, corruption.
• Recognise limitations of public sector
providers, may need other options.
Lessons of Experience-4
• Communication to staff at all levels always takes
more effort than is originally designed for, needs
continuous reinforcement
• Communicate also to households: they can be
allies in ensuring the policy is implemented.
• Involve lower levels in review process, but
• Will also need business meetings with more
restricted participation.
Lessons of Experience-5
• Process not destination
• Don’t need to decide everything in advance;
gather content over time
• Don’t let procedures & funding displace policy
content
• Build trust:– Few commitments, but both sides honour them
– Transparent & open discussions
– Build PEM track record, & budget support will follow
eventually
Lessons of Experience-6
• Donors need strong Govt leadership to avoid drift: manage
the agenda, ensure decisions get made
• In house research & policy capacity to prepare meetings
• Allocate Govt staff to ensure follow up of decisions, not a
consultant or donor driven implementation unit
• Don’t let minor partners dictate the pace
• Informal working group of core Govt and major partners
can be helpful
• Involve partners in the planning and budget process to
ensure they recognise the implications of limited funds for
prioritisation
Lessons of Experience-7
• A core of reformers and flexible donor partners
can achieve significant change
• But can deteriorate into a pointless talking shop or
grind to a halt if:– Donors still wedded to interventionist detail
– Sector Managers not committed to focus resources on
improved service delivery to the poor
– & reformers not empowered to address the institutional
& Governance constraints
Suggested Issues for Discussion
• What is the key level for intervention to improve sector outcomes:national, sectoral, province, local?
• Who are the key participants in defining sector policy- does Pakistan
want a SWAp process involving EDPs in policy dialogue?
• Are cross-cutting reforms needed before sector reforms can work?
• What are the risks of dependence on donors for budget support?
• What would be the potential gains from moving towards a sectoral
approach?
• What would be the potential costs?
• What are the obstacles?