PAR and Institutional reform processes in periods of transition Case study Afghanistan Stephan Massing & Abdul Bari, UNDP Afghanistan Seminar on Capacity Development, Bratislava

Capacity in the Afghan public sector Major systemic problems: Fragmented government structure with overlapping functions Fragmented government structure with overlapping functions Outdated, cumbersome work processes & procedures Outdated, cumbersome work processes & procedures Highly centralized state & limited presence at subnational level Highly centralized state & limited presence at subnational level Inadequate pay and grading structure -> “ twin civil service ” Inadequate pay and grading structure -> “ twin civil service ” Absence of merit-based recruitment; patronage & nepotism Absence of merit-based recruitment; patronage & nepotism Aging civil service & unbalanced gender relations Aging civil service & unbalanced gender relations Human resource problems: Ineffective Human Resources Planning Ineffective Human Resources Planning Unskilled & untrained civil service; low capacity in policy development, project implementation, service delivery Unskilled & untrained civil service; low capacity in policy development, project implementation, service delivery Lack of work ethic, morale, motivation and integrity Lack of work ethic, morale, motivation and integrity

The ARTF and its role in systemic & institutional capacity development ARTF: World Bank administered multi-donor trust fund; two funding mechanisms: “recurrent” & “investment window” ARTF: World Bank administered multi-donor trust fund; two funding mechanisms: “recurrent” & “investment window” Set up of ARTF has not been linked to the development of the PAR programme -> minor role for institutional reform process Set up of ARTF has not been linked to the development of the PAR programme -> minor role for institutional reform process Projects funded under investment window have no clear focus; CD initiatives have been designed and implemented at project level -> limited role for programmatic CD Projects funded under investment window have no clear focus; CD initiatives have been designed and implemented at project level -> limited role for programmatic CD But, critical role in: Coordinating & channelling donor funding to recurrent costs Coordinating & channelling donor funding to recurrent costs Ensuring functioning of the administration & providing resources needed to deliver basic services -> stability Ensuring functioning of the administration & providing resources needed to deliver basic services -> stability Strengthening GoA’s public finance management system Strengthening GoA’s public finance management system

The Public Administration Reform Programme and the IARCSC PAR comprises six components: civil service legal framework civil service legal framework personnel management personnel management institutional streamlining & development institutional streamlining & development policy management & machinery of government policy management & machinery of government administrative efficiency administrative efficiency physical infrastructure improvement physical infrastructure improvement IARCSC structure: CS Management Department: HRD&M, legal & regulatory framework, determination of a new salary structure CS Management Department: HRD&M, legal & regulatory framework, determination of a new salary structure Appointments & Appeals Board: merit-based recruitment Appointments & Appeals Board: merit-based recruitment Administrative Reform Secretariat: coordination of PAR Administrative Reform Secretariat: coordination of PAR

The Public Administration Reform Programme and the IARCSC Constraints for implementation of PAR: PAR programme overambitious and too centralised given low capacity of IARCSC; some components outside IARCSC PAR programme overambitious and too centralised given low capacity of IARCSC; some components outside IARCSC No strategic plan for IARCSC -> No sequencing, prioritization of PAR programme No strategic plan for IARCSC -> No sequencing, prioritization of PAR programme No structured approach to strengthening IARCSC capacity prior to implementing the PAR No structured approach to strengthening IARCSC capacity prior to implementing the PAR Lack of oversight by Cabinet & poor communication and briefings -> no political & public support for PAR & IARCSC Lack of oversight by Cabinet & poor communication and briefings -> no political & public support for PAR & IARCSC Slow, insufficient, uncoordinated & overlapping donor support Slow, insufficient, uncoordinated & overlapping donor support

Institutional & Organisational CD: Priority Reform & Restructuring Priority Reform & Restructuring (PRR): Main element of PAR for admin reforms and restructuring of ministries or departments Main element of PAR for admin reforms and restructuring of ministries or departments Allows staff performing critical functions to be placed on an elevated pay scale in exchange for reform and restructuring Allows staff performing critical functions to be placed on an elevated pay scale in exchange for reform and restructuring Conceived as tool for civil service reform but also as pragmatic measure to attract & retain capacity in government Conceived as tool for civil service reform but also as pragmatic measure to attract & retain capacity in government PRR salary scales as an interim solution to existing compressed pay scale and unconstrained wage increases PRR salary scales as an interim solution to existing compressed pay scale and unconstrained wage increases Recruitment for PRR position on merit Recruitment for PRR position on merit

Institutional & Organisational CD: Priority Reform & Restructuring Failures & Lessons Learnt from PRR: PRR shifted from narrow & strategic approach (key functions) to comprehensive reform programme (whole government) PRR shifted from narrow & strategic approach (key functions) to comprehensive reform programme (whole government) Expansion resulted in loss of quality of the process & concerns about fiscal sustainability & ignored lack of capacity in ministries to introduce reforms & in IARCSC to support PRR Expansion resulted in loss of quality of the process & concerns about fiscal sustainability & ignored lack of capacity in ministries to introduce reforms & in IARCSC to support PRR PRR primarily seen as means of increasing salaries rather than part of institutional reform process PRR primarily seen as means of increasing salaries rather than part of institutional reform process Little or no formal restructuring has taken place after PRR approval due to inadequate support at ministry level Little or no formal restructuring has taken place after PRR approval due to inadequate support at ministry level Significant delays in appointment process due to lack of capacity in IARCSC and ministries Significant delays in appointment process due to lack of capacity in IARCSC and ministries Reluctance of ministries to deal with surplus staff in the absence of a policy on retrenchment Reluctance of ministries to deal with surplus staff in the absence of a policy on retrenchment

Short-term capacity injection and its contribution to institutional CD Due to limited capacity in the civil service, great need to attract short-term capacity from outside the civil service Due to limited capacity in the civil service, great need to attract short-term capacity from outside the civil service Afghan Expatriate Prog. (AEP) & Lateral Entry Prog. (LEP) are recruiting Afghan expertise not available in the public sector Afghan Expatriate Prog. (AEP) & Lateral Entry Prog. (LEP) are recruiting Afghan expertise not available in the public sector Preliminary findings & lessons learnt: AEP & LEP contribute to institutional CD in so far as they regulate salaries and incentives by a common set of rules AEP & LEP contribute to institutional CD in so far as they regulate salaries and incentives by a common set of rules AEP advisors have acted as catalysts for change & had significant impact on the reform agenda of their agencies AEP advisors have acted as catalysts for change & had significant impact on the reform agenda of their agencies Concerns about limited impact of “expensive” AEP/LEP advisors in dysfunctional ministries (chicken & egg problem) Concerns about limited impact of “expensive” AEP/LEP advisors in dysfunctional ministries (chicken & egg problem) Concerns about insufficient skills transfer & sustainability of CD Concerns about insufficient skills transfer & sustainability of CD High salaries for AEP advisors has resulted in political resistance High salaries for AEP advisors has resulted in political resistance

Short-term capacity injection and its contribution to institutional CD Due to low existing capacity & limited supply of expertise, GoA has heavily relied on international technical assistance Due to low existing capacity & limited supply of expertise, GoA has heavily relied on international technical assistance Some TA channelled through a facility (TAFSU) but its performance considered poor (weak capacity of TAFSU) Some TA channelled through a facility (TAFSU) but its performance considered poor (weak capacity of TAFSU) TA in general has come under growing criticism: TA in general has come under growing criticism: –TA under pressure to deliver specific outputs at the expense of developing government capacity (capacity substitution) –TA hired for technical skills not for ability to transfer skills –TOR often poorly formulated and performance not tracked –Bad management of TA by the GoA: lack of counterparts, oversight and coordination Benefit of TA for institutional CD mixed (trade off between short- and long term CD) Benefit of TA for institutional CD mixed (trade off between short- and long term CD)

Capacity injection through staffing support: PMUs and institutional CD PMU as pragmatic solution as immediate development & reconstruction activities had more urgent priority than CD PMU as pragmatic solution as immediate development & reconstruction activities had more urgent priority than CD As external units PMU’s operate outside the structure of gov. and do not strengthen institutional capacity of ministries As external units PMU’s operate outside the structure of gov. and do not strengthen institutional capacity of ministries PMU’s result in weak ownership, can generate resentment among staff & can blur lines of accountability PMU’s result in weak ownership, can generate resentment among staff & can blur lines of accountability After project completion dissolved PMU’s usually leave little capacity & institutional memory behind After project completion dissolved PMU’s usually leave little capacity & institutional memory behind

Capacity injection through staffing support: PMUs and institutional CD Recommendations & lessons learnt Build programme mgmt. functions rather than PMU’s Build programme mgmt. functions rather than PMU’s Elaborate phase-out plans and exit strategies for PMU’s and link them with a CD plan (permanent transfer of skills) Elaborate phase-out plans and exit strategies for PMU’s and link them with a CD plan (permanent transfer of skills) Make use of existing incentive framework to fill staff gaps instead of using project staff to fill senior line positions Make use of existing incentive framework to fill staff gaps instead of using project staff to fill senior line positions Focus project support on programme mgmt. rather than project mgmt. so that staff are engaged in a range of projects Focus project support on programme mgmt. rather than project mgmt. so that staff are engaged in a range of projects Train managers & staff to operate in a matrix mgmt. structure Train managers & staff to operate in a matrix mgmt. structure