The consultation process
Funding agency discussions: Overall findings
Impetus for SWA to education
Using Government systems
SWA: Potential constraints and risks
Raising potential
The study incorporated a number of consultative processes with funding agency staff, field technical assistance and informal consultation with selected Government officials. A framework, summarised in Box 17 below, was used for data gathering of ongoing SWA type support programmes.
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BOX 17 SWA TO EDUCATION: A CONSULTATIVE FRAMEWORK · Ownership and Leadership: Government commitment, main champions, and pockets of resistance within Government and funding agencies? · Design and Planning: Government understanding and capacity, alternative design approaches, linkage with financial/institutional issues, forms of funding agency support for design process? · Cross-cutting Issues: Linkage with macro-economic framework and PER, effectiveness of poverty assessments and poverty reduction plans, effectiveness of institutional assessment and capacity building strategy? · Phasing and Sequencing: Evolving or blueprint approach, effectiveness of phasing and sequencing, attention to sector performance monitoring systems, attention to outcome-based technical/financial tracking systems? · Transitional Arrangements: Attention to transitional phase, incorporation of existing projects into SWA, various forms of transitional support, maintaining Government confidence in SWA? · Funding Agency Procedures: Effectiveness of funding agency co-operation, forms and efficiency of formal Government/funding agency partnerships, sources of funding agency tension? |
Summary of Case Study Review Instrument
The consultation framework broadly focuses on the impetus behind SWA approaches, assessments of the degree of Government ownership and leadership and Governments' planning and design capabilities. It was designed to determine the degree of linkage between sectoral and cross-cutting institutional, social and financial issues, the attention given to sector performance monitoring, any planned transitional arrangements and the procedures for effective funding agency co-operation.
Discussions with economic and institutional advisers of funding agencies confirm that the emergence of modified design and financing modalities (SIPs, SDP and SSPs) is a symptom of a shift in focus on macro-economic dialogue between Governments and funding agencies. Discussion now centres upon improved public expenditure management and the role of Government in public service provision rather than overall structural adjustment. Alongside, there is growing recognition that the effectiveness of individual projects is constrained by the policy, economic and institutional environment within which a project is implemented. A SWA is therefore largely a response to the limitations of project assistance and programme aid. These responses are succinctly encapsulated in Box 18.
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BOX 18 SECTOR APPROACHES: SOME EARLY LESSONS · SWA may be better placed to internalise external factors, especially macro-economic and institutional concerns · Flexible budgetary support needs to secure additionality to sector funding · A long term vision (not blueprint) is critical, showing clear linkage between strategic targets and realistic resource envelopes · SWA for education needs to be set within broader civil service and local Government reforms; sector ministries alone cannot lead reform processes · Greater attention needs to be given to outcomes and outputs, rather than simply resource shifts, linked to reliable data collection and monitoring systems · Early commitment to SWA can build up confidence, trust and capacity, while accepting the need for flexible adjustment to strategy and budgeting · Funding agencies need to show more trust in Government systems, linked to reasonable accountability and audit mechanisms within Government |
Source: Foster, 1998
Various evaluation exercises (e.g. World Bank 1998, DFID 1998) highlight the limitations of project assistance. A proliferation of projects can lead to policy fragmentation, resulting in conflicting or duplicated (sometime parallel) approaches, distortion of spending priorities and uncertain sustainability of outcomes and benefits. Additional arguments against a project approach include lack of national ownership, managerial overload through servicing funding agency missions, lack of flexibility in adjusting to changing policy environments and a tendency to create 'islands of excellence'. The tradition of stand-alone PIUs contributes to distortions in staff incentive packages, overburdening of key ministry staff and a danger of continued over-centralisation of management and implementation responsibilities, often inconsistent with public service and local Government reform policies.
An over-arching concern is the likelihood of slow absorption and disbursement through the use of PIUs. Recent surveys (e.g. Uganda school facilities projects, 1998, ADB portfolio reviews 1996/7, World Bank, 1998) demonstrate that central procurement can result in low disbursement rates, often as low as 15 - 20% of targets. Use of PIUs often create parallel technical and financial management and accounting systems which drain the capacity of national systems and undermine aid capture within national education budgets.
While programme aid has the potential advantages of more flexibility and rapid disbursement, it has limitations in a sector context. Several agency evaluations point to the difficulty in correlating general budget support with achievement of education sector performance targets, due in part to problems of fungibility and tracking. Linking budgetary support to macro-economic targets can create difficulties in uneven, stop/start financing for education reform. These budgetary uncertainties can undermine confidence and continuity, interfere with programme implementation and distort forward education budget planning.
In general, agency advisers consider that the movement towards a sector-wide approach addresses these limitations. The main SWA characteristics are a sustained partnership arrangement (often formalised in a Memorandum of Understanding, e.g. Tanzania, Zambia) that aims to define sector scope, a collaborative work programme and agreed strategic negotiation/review structures. Work programmes increasingly focus on developing phased and sequenced sector policies and strategies, resource availability and expenditure projections, common management systems and institution building plans (e.g. Ghana, Uganda).
Advisers' comments [Boxes 18, 19 and 20] and a growing literature (e.g. Harrold and Associates 1995, SIDA 1995, Eeckhout 1996, Oxford Policy Management Group 1997, Andersen and Christensen 1997, Bhatia and Okidegbe 1997, Cassels 1997, EU Horizon 2000 1996 & 1997, SPM Consultants 1998, Gould, Takala and Nokkala 1998) highlight the potential strengths of the SWA [our emphasis]. National leadership and the use of national systems are central to the SWA context of joint negotiation and collective responsibility.
Secondly, a SWA is an evolving process, including phased and sequenced programmes, not a time-bound exercise. This allows for feedback review and flexible strategy adjustment as conditions change. Also, SWA are predicated upon a long term Government-funding agency commitment to achieving development objectives, reflected in joint responsibility to fulfil agreed medium and long term financing commitments.
Another strength of an education SWA is its focus on output audit rather than input accounting, whereby flexible, high volume budgetary support can be tranched against achieving agreed milestones and targets (e.g. Uganda, ESIP April Review, 1999).
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BOX 19 DFID ADVISERS: IN SUPPORT OF SWA SWA has the potential to: · develop robust Government in terms of policy and ownership and future sustainability, · develop sustainable growth of the education sector, · strengthen Government macro-economic programmes, general budget preparation, expansion, auditing, accounting and expenditure systems, · produce transparent financing and accounting systems, · foster funding agency co-operation, · forge partnership arrangements, · save Government resources (time and human benefits from dealing with one group of funding agencies rather than separate funding agencies), · meet Governmental agendas (education expansion, equity, poverty reduction, manpower requirements), · meet funding agency agendas (poverty reduction, environmental protection, human rights, democracy, social sector improvement, decentralisation). |
Source: Discussions with DFID Advisers, 1998, 1999
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BOX 20 OTHER AGENCIES: IN SUPPORT OF SWA SWA has the potential to: · improve absorptive capacity through recognition that more aid will ensue if absorptive capacity is raised, · develop the normative role of the Ministry of Education, leading to more professional Government, · be relatively impervious to changes of Government, · make funding agencies follow Government wishes through assumption of leadership by the Ministry of Education, · appropriate a form of credit to Government in a way that is also shared with the public, thereby creating wider ownership and national pride, · strengthen public ownership through the budget, · give all funding agencies a voice at meetings with Government, thereby making them stakeholders, · develop and enforce appropriate codes of conduct and memoranda of understanding, · promote and build competency and capacity. |
Source: Discussion with Aid Agencies, 1998, 1999
Use of Government systems is potentially more cost-efficient and inherently more capacity building than financing a proliferation of project management and implementation visits. Joint Government-funding agency review missions potentially reduce the dangers of funding agency competition and enhance cost-effectiveness in the use of Government senior management and agency advisers' time. Potentially, the percentage of costs spent on SWA development and management will be reduced significantly, particularly for high volume support programmes.
Discussions with funding agency officials also highlighted a number of potential limitations and risks for education SWA [Box 21]. A fundamental concern was lack of leadership, commitment and understanding within Governments and agencies to implement broad-based reforms (e.g. some Pacific countries, Tanzania ESDP). A second concern was the dangers of over-centralisation of SWA design/planning, including 'parallel' task forces and lack of involvement of MoE line directorates and other stakeholders (e.g. Ethiopia ESDP, Tanzania ESDP). In several instances (e.g. Ghana ESDP, Thailand/Indonesia SSDP), there were concerns over weak linkage and overloading of education budgets with medium term expenditure frameworks, potentially exacerbated by inflexible funding agency programming modalities.
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BOX 21 SWA: THE RISKS If the opportunities presented in Boxes 18,19,20 are not realised, they will present a formidable list of risks. In addition, a number of funding agency officers considered there could be a risk to SWA if: · weak leadership, commitment, ownership and management capacity exist at central and district levels, · there is under-involvement of NGO and private sectors, · funding agency groups act in an undisciplined way, · there is a persistence of projects and a tendency to focus on inputs rather than outputs, · education users are not consulted on the issues (especially with regard to equity and poverty), · there are not good links between the Ministry of Finance and the Ministry of Education, · traceability of money is subordinated to fungibility, · World Bank continues to appear inflexible in its approach, · information is not shared. [The risk arising from lack of funding agency attribution, frequently cited in the literature, was not regarded as a serious matter among respondents spoken to.] |
Source: Discussion with Funding Agency officers, 1998, 1999
Three main issues stand out as common concerns and potential risks covering the majority of SWA-type initiatives for education support. Firstly, there is the potential risk of weak national institutions and capacities to deliver programmes through central and decentralised Government systems, both technical and financial. Secondly, there is frequently a lack of agreement on realistic and achievable performance targets, alongside weak EMIS and monitoring/review systems. This second risk may be exacerbated by any blueprint approach that leaves less room for manoeuvre on strategic review and expenditure adjustments. A third risk appears to be an unwillingness of some funding agencies to sign up to an education SWA (including resistance to incorporating discrete funding agency-financed projects) for reasons of accountability.
To summarise: the main risks are potential delay and perceived complexity. On the Government side, senior education policy-makers and managers face criticism if 'action on the ground' appears to be taking too long. The consequence could be declining commitment and confidence, especially if the 'reform group' is small. On the funding agency side, officers frequently face 'disbursement pressure' from programme managers, undermining confidence and resolve. Key risk management strategies include an effective advocacy and dissemination programme and early financial commitment (including a transitional programme), alongside pre-start up capacity building programmes at various levels. Another risk may arise if there is a failure to recognise that the SWA is an innovative process [Box 22].
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BOX 22 SWA: A PROCESS - NOT A PANACEA This extract is from a report of a recent NORAD seminar on macro-economic concerns about SWA: "I emphasised the continuing rote of incentives and sanctions ('conditionality' in old speech), to protect funding agencies when the conditions of partnership were breached. I emphasised the need to focus conditionality more on issues of process, dialogue and transparency, to ensure that there was a shared vision and commitment at the outset, but to retain sanctions for tackling in particular decisions which were corruptly taken, or taken without due observation of the agreed procedure or 'compact'. Recent cases in Ghana and Zambia showed the need for explicit agreement on the rules of the game and the dispute resolution process. "Some good questions... focused on whether weak initial conditions meant we should not try sector programmes: [our emphasis]. I argued we should took for a process of change, which becomes closer to a full SIP as capacity develops. There was agreement on the need to deal with macro issues alongside sector specific ones, and on the need for incentives and sanctions on both sides, although we agreed it is difficult to impose conditions on the funding agencies. Concerns about visibility of each funding agency's support could be handled with careful presentation, highlighting the attractive sector-wide goals (e.g. we are helping to halve infant mortality), and making a virtue of working alongside other partners towards a common purpose. Others stressed the importance of bolstering the poverty content of sector programmes, and the need to ensure consistency with macro budgets and reform process." Mick Foster, 12 February 1999 |
Source: Foster, 1999
Foster's summary points (Box 18) and analysis (Box 22) bear re-emphasis. The potential benefits from adopting an education SWA lie in the recognition of willingness by Governments and funding agencies to engage in a two-way process that demonstrates the following attributes:
· Shared vision, commitment, confidence and trust through dialogue, transparency, accountability and explicit agreement about joint undertakings and the 'rules of the game';· Internalisation of external influences, particularly macro-economic factors;
· Flexibility, particularly in programme design, work planning, budgeting and budget support;
· Output auditing rather than input accounting;
· Consistency with national goals and broader reform processes (such as decentralisation, civil service reform and restructuring).
Many of the characteristics of this process underpin the principles of partnership within a SWA and are re-visited in the next chapter.
