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

2 PRSPs in Practice  Origins of the PRSP idea  Core principles  Phasing & key elements of a PRSP  What’s new  Links with other instruments/processes  Emerging Experience  Relevance in conflict & post-conflict countries

3 Origins of the PRSP Idea  Poor record on poverty reduction in 1990s  Findings on aid effectiveness (limits of projects, undermining of govt. systems & capacity…) undermining of govt. systems & capacity…)  Limits of conventional conditionality  Justification for big increase in multilateral funding for debt relief (HIPC II) funding for debt relief (HIPC II)

4  Country-led/owned based on participation  Outcome oriented  Comprehensive – analysis of poverty  Medium to long term perspective  Donor partnership under government leadership Core PRSP Principles Sept 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:

5 I-PRSP PRSP (I) PRSP (II) 9-24 months 3 years HIPC(II)DecisionPoint HIPC(II)CompletionPoint 1 st Annual ProgressReport PreparationStatusReport 2 nd Annual Progress Report etc.. PRSP Schedule & Key Elements

I-PRSPPRSP (I) PRSP (II) 9-24 months 3 years HIPC(II)DecisionPoint 1 st Annual ProgressReportPreparationStatusReport 2 nd Annual Progress Report etc…. PRSP elements:  Poverty analysis  Goals/targets  Prioritised policy actions  Med-term budget fw  Financing plan  External assistance  Participatory process

7 What’s 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)

8 Links with other instruments I-PRSP PRSP (I) PRSP (II) HIPC(II)DecisionPoint HIPC(II)CompletionPoint PRGF (replaces ESAF) PRGF perf.criteria/benchmarks (3 years) HIPC triggers Goals & targets (5-10 years)

I-PRSPPRSP (I) PRSP (II) HIPC(II)DecisionPoint PRSP elements:  Goals/targets  Prioritised policy actions  Med-term budget fw MTEF Sector strategies & priorities Inter-sectoral priorities Resource constraints Expenditure monitoring

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

11 Bank has put in place 5 ‘due diligence’ tests.  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 Cont...

12 Emerging Experience  ‘Upgrading’ of poverty policy – MoFs engaged  Achieved at some cost to senitments to national ownership but IFIs getting better at stepping back ownership but IFIs getting better at stepping back  PRSP process & document heavily influenced by density of previous reform effort(s) 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. increased policy space for CSOs/private sector etc.

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

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

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

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