AGHD PRSP Learning Event

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AGHD PRSP Learning Event
Africa Great Lakes and Horn Department January
2002
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PRSPs in Practice

• Origins of the PRSP idea
• Core principles
• Phasing key elements of a PRSP
• Whats new
• Links with other instruments/processes
• Emerging Experience
• Relevance in conflict post-conflict countries

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Origins of the PRSP Idea

• Poor record on poverty reduction in 1990s
• Findings on aid effectiveness (limits of
  projects,
• undermining of govt. systems capacity)
• Limits of conventional conditionality
• Justification for big increase in multilateral
• funding for debt relief (HIPC II)

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Core PRSP Principles
Sept. 1999 the PRSP replaced the PFP (Policy
Framework Paper) as the governing contract
between the IMF/World Bank client countries.
Central to it are five principles

• Country-led/owned based on participation
• Outcome oriented
• Comprehensive analysis of poverty
• Medium to long term perspective
• Donor partnership under government leadership

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PRSP Schedule Key Elements
Preparation Status Report
1st Annual Progress Report
2nd Annual Progress Report etc..
I-PRSP
PRSP (I)
PRSP (II)
9-24 months
3 years
HIPC(II) Completion Point
HIPC(II) Decision Point
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1st Annual Progress Report
Preparation Status Report
2nd Annual Progress Report etc.
I-PRSP
PRSP (I)
PRSP (II)

• PRSP elements
• Poverty analysis
• Goals/targets
• Prioritised policy actions
• Med-term budget fw
• Financing plan
• External assistance
• Participatory process

3 years
9-24 months
HIPC(II) Decision Point
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Whats New?

• Linking strategy to the fiscal macro framework
• Reducing the disconnect between policy results
  (structuring actions viz. impact on poverty)
• Opening up strategy process to
  broad-basedparticipation
• Opportunities for new ways of delivering
  aid(pooled funding of general budget, joint
  appraisal, common performance assessment)

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Links with other instruments
PRGF (replaces ESAF)
PRGF perf.criteria/benchmarks (3 years)
Goals targets (5-10 years)
I-PRSP
PRSP (I)
PRSP (II)
HIPC(II) Completion Point
HIPC triggers
HIPC(II) Decision Point
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Sector strategies priorities

• PRSP elements
• Goals/targets
• Prioritised policy actions
• Med-term budget fw

I-PRSP
PRSP (I)
PRSP (II)
HIPC(II) Decision Point
MTEF
Inter-sectoral priorities Resource
constraints Expenditure monitoring
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Cont...

• Link with PRSC more complex. Designed to
• support PRSP implementation
• PRSC structured as a series of annual single-
• tranche programmatic adjustment credits with
• clear performance benchmarks linked to the
• PRSP (initially a replacement for SACs)

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Cont...

• Bank has put in place 5 due diligence tests.
• Full PRSP
• Social/structural diagnostic or review (SSR)
• PER, CFAA
• Poverty social impact analysis
• Environmental assessment
• Only 3 PRSCs in place so far Uganda, Vietnam
• (DFID co-financing both) Burkina Faso, 2 or
• 3 in the pipeline

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Emerging Experience

• Upgrading of poverty policy MoFs engaged
• Achieved at some cost to senitments to national
• ownership but IFIs getting better at stepping
  back
• PRSP process document heavily influenced by
• density of previous reform effort(s)
• Synergy with MTEFs especially important
• Value-added clear policy vision linked to
  results,
• increased policy space for CSOs/private sector
  etc.

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Cont...

• Participatory processes generally limited to
• consultation, depth of understanding limited
• Ambitious targets, weak prioritisation costing
• of policy actions
• Disconnect/lags between related reform efforts
• civil service reform, local govt. reforms -
  PRSP
• ME still the poor relative

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Relevance in Conflict Settings

• No straightforward picture
• Rwanda opportunity of the PRSP has been
• seized upon as an input to wider national
• reconciliation
• Sierra Leone IFIs have re-engaged and an
• I-PRSP produced, but major concerns about the
• Govt. ownership, capability CSOs capacity to
• respond to the PRSP timetable

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Key Questions

• How on what basis is govts commitment to
• poverty reduction being judged?
• Are decisions about when IFIs/donors re-engage
• based on an analysis of the political economy
  of
• conflict?
• What are the minimum requirements in terms of
• a functioning budget/administrative system for
  a
• PRSP process to be viable?

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Cont...

• How does any proposed consultation process
• take account of the dynamics of conflict?
• How do other processes of peace reconciliation
• relate to the PRSP?
• To what extent are the analysis of poverty and
• proposed policy actions informed by
  conflict/security
• issues? Does this imply different assessment
• criteria?