Integrating Aid Management with Government Financial Management Gerhard Pohl Senior Director Development Gateway Foundation International Consortium for Government Financial Management Annual Conference Miami, May 25, 2007

1 Corporate financial management is simple: revenues and expenditures are for traded goods

2 Government financial management is much harder: public goods are usually not traded Revenues are not market-based (taxes!) Goods and services are not sold Only costs of revenue are market-based Establishing the value of services is difficult Government accounting has no bottom line Performance cannot be expressed in $$$ Performance evaluation is hard, ….but very important !

3 Government financial management remains work in progress: Only basic issues have been resolved: Accounting tracks only costs, not values It can detect outright fraud and management But does not provide measures of performance Governments have a myriad of performance evaluation mechanisms: –elections, separation of powers, parliamentary debates, watchdog agencies, publication requirements, reviews, audits, M&E requirements, impact evaluation, etc, etc...

4 Government financial management requires open systems that can talk to others

5 Aid is large for many countries All developing countries (150): –1% of gross national income (GNI) –8% of government revenue Poor and small countries (50): –>10% of GNI –>50% of government revenue

6 1990s aid fatigue due to poor performance

7 …replaced by the New Millennium Aid Compact … with strong emphasis on better, common systems for: financial management, procurement, and M&E Partner sets the agenda Alignment with partners agenda Reliance on partners systems Common agreements Simplification of procedures Sharing of information Ownership Alignment Harmonization

8 Aid has shifted from infrastructure to basic government services Old aid: Dominica New aid: Rwanda

9 …these require new aid management tools …that are more than accounting systems

AMP Overview Web-based tool that allows a government to view, plan, and report on its entire development portfolio for the country; Integrates the most common development and management tools into one secure, team-based workspace; Encourages broad use by multiple government Ministries, specialised agencies, donors and aid effectiveness experts.

AMP Key Features (Modules) Aid Information - Summary view of all development activities in the teams portfolio Advanced Reporting - Create periodic and customised reports on financial and physical progress Document Management - Store frequently used project documents and web-sites directly in each activity file Planning Calendar - View key events and missions in one common calendar accessible to government and donors Monitoring and Evaluation (M&E) - Track project indicators against financial and physical goals and assess activity risk

AMP Background Steering Committee: OECD DAC (Chair) UNDP World Bank AMP was developed in response to the 2003 Rome Declaration on Aid Effectiveness, with Ethiopia as the test country

AMP Competitive Advantage Open-Source - AMP is provided under a royalty-free and source-available license to government partners Capacity Building - AMP is wholly transferred to the partner government, who can utilise and modify it as necessary Universal Architecture - AMP can integrate with a countrys existing systems, databases and standards Technical Assistance - AMP is not just software, but technical assistance to a partner governments human process

AMP Funding Bilateral lines of financing: Pre-negotiated grants to provide financing for a number of AMP implementations in priority countries: Swiss Agency for Development and Cooperation (SDC) Inter-American Development Bank (IADB) African Development Bank (AfDB) Belgian Development Agency European Commission UNDP Soon: Luxembourg

AMP Implementation - Status about to commence: Albania Montenegro implementations: Ethiopia Bolivia coming: Burundi, Congo, Ghana, Mali, Mauritania

Aid Management Platform (AMP)

Aid Information Module (AIM)

Advanced Reporting Module

Documents and Internet Resources

Aid Portfolio Calendar

Monitoring and Evaluation (M&E)

Coming Up - New Functionality Integration with National Budgeting System Bring together national budgets with aid management for more effective, efficient, and transparent aid management (i.e. FreeBalance, Oracle, SAP) With the union of the two systems, AMPs managing for results function - the capacity to monitor and evaluate impact on multiple levels - will enable governments to track the impact of projects in the national budget Integration with UNICEF DevInfo and GIS Link national statistical data with international data on development metrics (DevInfo) in a Geographical Information System, mapping progress visually across the country and from national to local levels Provide Monitoring and Evaluation data to policy-makers for analysis against national planning, and Millennium Development Goals

dgMarket The Online Solution for Government Procurement Information in Developing Countries Development Gateway Foundation April 2007

Aid Management Platform (AMP) Questions?

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