Capacity Development for Aid Effectiveness Experiences and Challenges in Albania

1
Capacity Development for Aid Effectiveness
Experiences and Challenges in Albania

• Albana Vokshi
• Director
• Department of Strategy and Donor Coordination
• Prime Ministers Office

Capacity Development for Aid Effectiveness in the
Western Balkans, Sarajevo, Bosnia and
Herzegovina2-3 March 2006
2
Progress made in Albania

• Improvement of economic performance, a stable
  economic growth
• Continuous progress towards Stabilization-Associat
  ion Process and integration in NATO
• NSSED prepared a multi year plan focused on
  poverty reduction and government improvement
• Implementation of Civil Servant Law

3
Problems / issues

• Current financial and planning systems in Albania
  were not harmonized and linked with each other
  which brought two main issues
• 1 it was very difficult for the Prime Minister
  and his cabinet to give coherent and strategic
  orientations
• 2 it was very difficult for the Line Ministries
  to respond with their limited resources to the
  different demands from central institutions
• Recommendation To integrate policies and
  financial planning systems and begin capacity
  building.

4
Problems faced with External Assistance in Albania

• It has not been planned or implemented to support
  government priorities, to maximize their
  potential benefits for the Albanian economy.
• The decentralized management of the external
  assistance has had a negative impact in
  increasing the EA effectiveness for the Albanian
  economy

5
Challenges of Harmonisation

• Over 250 donor missions/year, very few joint
  studies or missions
• Less than 2 use of Gov systems many parallel
  PMUs
• Only 50-60 of aid reported in the budget

6
The Need for Aid Effectiveness

• Donor-led Coordination starts 2003
• Donor-Government dialogue begins 2004 for
  planning and budget reform
• Different processes put demands on limited Gov
  and donor resources
• Government-led Donor Coordination starts late 2005

7
Progress on Donor Coordination

• in response to past problems, donors and previous
  government created two Technical Secretariats
  (DTS GTS)
• with creation of new department in Council of
  Ministers (DSDC), there is now a focal point for
  donor coordination
• a donor-funded DTS (3 staff) office has been
  established to work closely with DSDC
• quarterly donors roundtable are being organized

8
Donor Coordination Architecture 2003-2005
Quarterly Roundtable
Joint Technical Secretariat
Donor Technical Secretariat
GovernmentTechnical Secretariat

• Justice Home Affairs
• Defence and Security
• Elections and Electoral Reform
• Human Dimension
• Land and Property Issues
• Gov Modernisation (PAR/AC/ICT/CSR)
• Loc Gov Decentr incl Disaster Mgmt
• Civil Society, Gender and Youth

17 sector working groups

• NRM, Environment and Agriculture
• Energy
• Transportation Infrastructure
• Financial Private Sector Development
• Social Assistance Welfare
• Health
• Education
• Public Finance Management
• Tourism Coastal Development

9
Coordination structure today
QuarterlyDonor Roundtables
44 International Donors
Government
(Chaired by Dep.PM)
(Represented by HoMs)

• Donor Technical Secretariat4 Multilaterals as
  Stewards UNDP,EC, WB, OSCE
• DTS Heads of MissionsMonthly meetings
• DTS CommitteeWeekly meetings

• Inter-Ministerial Committee for Strategic
  Planning
• Inter-Ministerial Committee for Government
  Modernisation

Department for Strategy and Donor Coordination
(DSDC)
DTS Office
(7 persons)
(3 persons)
10
Strengthening for Aid Effectiveness

• 2000 MTEF work initiated
• 2001 PRSP completed
• 2003 Aid effectiveness debate
• 2004 Management Info System
• 2005 IPS Design Approved
• 2006 IPS Implementation begins

11
What is IPS?

• IPS is not a separate planning process.
• IPS provides a broad planning framework within
  which the Governments core policy and financial
  planning processes function in a coherent,
  efficient and integrated manner
• NSSED
• MTBP
• European Integration
• Government Programme
• Public Investment
• External Assistance
• other core programs to be included over time
  (e.g., decentralization)
• IPS will accomplish this through the new
  structures and a series of coordinating mechanisms

12
What is the Integrated Planning System?
Long-Term Vision Targets
GoA Policy
Management Info System
Medium-Term Integrated Strategy5-7 yrs
3 year Multi-Annual Budget
Investment Planning
Annual Budget
AidManagement
1
2
3
4
5
6
7
8
0
Years
13
Department for Strategy and Donor Coordination
(DSDC)

• Created December 2005
• Reports to Prime Minister and Deputy Prime
  Minister
• Responsible for
• National Strategy coordination
• Integrated Planning System implementation
• Donor coordination/Aid management

14
Challenges of Government Reform

• Create a new integrated National Strategy based
  on revised sector strategies
• Link Strategy to MTBP to Budget
• Redesign Management Info System
• Identify donor projects for budget gaps

15
2006 Transition

• 2006 is a transition year for IPS as new
  organizations are established and new
  methodologies approved
• but concrete progress will be made
• all ministries/major agencies produce at least a
  basic MTBP Submission
• all ministries produce at least a basic Sector
  Strategy
• European Integration requirements to be fully
  reflected
• all Ministers present Ministry Integrated Plans
  (June) and sector strategies (Oct.) to the
  Strategic Planning Committee
• MoF to develop a new Public Investment Management
  process for implementation in 2007

16
Lessons learnt

• Government leadership is critical
• Government needs appropriate system to handle new
  role
• Euro-Atlantic integration and socio-economic
  development must be interwoven into one National
  Strategy

17
(No Transcript)
18
Annex 1IPS 3-Year Work Plans

• Key Milestones

19
NSSED

• NSSED focus shifts from poverty reduction and 1-4
  year action plans to a strategic planning
  framework
• all sector strategies will fully reflect European
  Integration
• every ministry will produce a basic strategy by
  December 2006
• all ministries will complete good quality, full
  sector strategies by 2007

assess sector strategy status for each ministry/
major agency
all ministries complete basic sector strategy
all ministries complete full sector strategy
following in-depth work
Updated NSSED Document approved
Annual Progress Report (2007 results)
NSSED Document approved
20
MTBP

• 4 ministries, with previous experience, will do
  full MTBP in 2006
• all other ministries will do basic MTBP
• all ministries will do good quality, full MTBP by
  2008

4 ministries do full MTBPs others do basic MTBPs
assess ministry capacity TA needs
all ministries complete satisfactory full MTBPs
all ministries attempt full MTBPs
21
European Integration

• SAA/Legal Approximation Plan establishes a
  far-reaching policy and legal agenda with
  significant fiscal implications
• in 2006, revised European Partnership Action Plan
  and Instrument for Pre-Accession to be completed
• EU will increasingly be source of external
  assistance
• IPS must ensure that EI is fully reflected in
  every relevant sector strategy and its
  initiatives are costed/funded through MTBP
• all EU commitments need to be included and
  tracked through IPS Information System

22
Government Programme

• Government Programme was an extensive document
  covering most sectors to 2009
• NSSED and MTBP processes need to take GP into
  account
• policy directions need to be reflected in sector
  strategies
• program changes in MTBP
• action plan tracked in MIS

23
Public Investment

• new unit in Ministry of Finance is being
  established, trained
• new process for identifying, approving and
  monitoring domestic and foreign-financed public
  investments to be approved in late 2006
• new process introduced and tested in 2007 (driven
  by sector strategies)
• IT system to be designed in 2007 for
  implementation in 2008
• external assistance to be incorporated

interim process in MTBP build staff capacity
design and approve new public investment process
test new process reflect in 2007 MTBP
design, test and implement IT system for PI
new, PI process, including external assistance,
reflected in 2008 MTBP
24
External Assistance

• donor coordination process to be designed in 2006
• IPS funding mechanism by end 2006
• new public investment process to include
  foreign-financed projects
• full integration with public investment IT system
  in 2008

implement IPS Funding Mechanism
integrate EA into PI IT system
produce basic EA strategy
design donor coordination process
establish EA unit
produce full EA strategy