The Changing Nature of PE work Managing Risks and Opportunities in a Growing Agenda

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The Changing Nature of PE workManaging Risks and
Opportunities in a Growing Agenda

• Anand Rajaram, PRMPS
• PREM Learning Week
• June 17th, 2002

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Theory of Evolution, adapted

• The theory of punctuated equilibria states that
  the history of evolution is concentrated in
  relatively rapid events . Most species during
  most periods do not evolve radically, but rather
  fluctuate aimlessly and within bounds given by
  expected spreads of statistical variation.
  Stephen Jay Gould

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PE Work A Case of Punctuated Equilibrium?(with
apologies to Stephen Jay Gould, R.I.P.)

• Until mid-1990s, PE agenda relatively stable and
  not central to Banks investment or adjustment
  programs
• Post 1995 growth of interest in institutional
  underpinnings of PE PEM (influence of
  Pradhan-Campos-Holmes)
• Late 1990s Bank and donor recognition of budget
  as critical gateway to development impact
  concept of fungibility - aid tied to PEM reform
  policy-budget links - PERCs etc.
• In last two years, explosive growth of interest
  in PE work

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Motivating factors

• Within the Bank and among bilateral donors
• Concerns about tracking use of HIPC resources
• Increased interest in external assessment of
  client budget/financial/procurement systems
• PRSP emphasis on MTEFs, costing programs and
  allocating resources to priorities
• Concern about development effectiveness leading
  to focus on outputs and development outcomes from
  PE
• More gradually, sectors moving towards systemic
  analysis of policies, budgets and service
  delivery
• Within governments
• Active desire to improve aid management
• Passive acquiescence to new donor agenda

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A Large Agenda PE work and Poverty Reduction
Policy Process
PE Analysis
Fiscal Sustainability
Allocative Efficiency
Incidence Analysis
Poverty Reduction ??
Fiscal risk
Service Del.survey
Tracking surveys
PE Management
Budget Formulation
Budget Execution
Reporting oversight
Procurement
Civil Service Reform
Decentralization
Related items
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Coming Soon to a PER near youCosting MDGs,
Gender, Participatory BudgetingMight we Break
the Camels Back?
Pro-poor PE
Policy Process (PRSP?)
PE Analysis
Fiscal Sustainability
Allocative Efficiency
Incidence Analysis
Missing Links
Poverty Reduction ??
Fiscal risk
Service Del.survey
Tracking surveys
PE Management
Budget Formulation
Budget Execution
Reporting oversight
Procurement
Civil Service Reform
Decentralization
Related items
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The PE Arena Many new actors, multiple agendas

• Cast, Props, Cameras, Action!
• The country economists doing PERs
• The accountants doing CFAAs
• The procurement guys doing CPARs
• The integrationists doing PEIRs/PEPFMRs/CIFAs
• The HD economists doing SSEFRs
• Political scientists doing IGRs
• Sub national PERs of various hues
• Whos directing this show? What is the plot?
• Where is the government in this scheme?
• Did the Butler do it?

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A sampling of recent PE work

• PE work with SUBNATIONAL ISSUES
• PERs w/Intergovt.Fiscal Czech,Thailand, Kazakh,
  Bosnia
• Provincial PERs Pakistan, India, Indonesia,
  China
• Social Exp. Review Kyrgyz Republic, Slovakia,
  Ethiopia (t.b.i)
• Local Social Services Delivery Romania
• APPROACHES TO INTEGRATING PE Work
• The Unbundled approach
• PIR/BM report/CFAA/ CIFA Russia
• The Dedicated PEM report Mozambique (2001)
• Coordinated PEIRs Turkey, Macedonia, Croatia,
  Bosnia, FRY
• Fully bundled PEPFMR Philippines
• PE Work SYNCHRONIZED W/GOVERNMENT PROCESS
• PE Reform support to MTEF Albania (2001)
• Bank supplement to Govt PER Malawi, Zambia
• Annual PERs Tanzania, Uganda, Ethiopia (2001)

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Risks of a poorly managed PE agenda

• Huge multi-volume reports attempting to do all at
  one go, or
• Fragmented, uncoordinated analysis by multiple
  networks with overlaps, gaps and potentially
  contradictory advice
• Either case,
• high transactions costs for government
• Difficult for government to absorb/contribute
  to/own such analysis
• Lack of coherent Bank advice to client
• Potential to miss important bits of analysis
• PE impact on poor/ outcomes
• Inappropriate sequencing of reforms
• Sub-optimal use of Bank staff and resources
• Poor integration into CAS

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Issues needing attention

• How can we manage such a large PE agenda within
  an agreed common framework?
• Over time
• Across networks and other partners
• To ensure it supports governments decision cycle
  (PRSP etc.)
• To derive an external assessment of budget
  systems
• To inform our CAS
• How do we achieve internal Bank coordination?
• What are guideline rules for engagement with
  government/donors?