1. malcolm.green@c3consult.co.uk1 From ‘back of the envelope’ - to high-tech policy tool The model in use

2. malcolm.green@c3consult.co.uk2 Zambia: the first model 1997 - 1998

3. malcolm.green@c3consult.co.uk3 Zambia: classic bureaucratic issues Expenditure on pay crowded-out other necessary budget items Low pay Ad hoc (and inequitable) allowances High cost of separating staff External funds available to help fund a ‘solution’ – but what solution?

4. malcolm.green@c3consult.co.uk4 The strategy was clear Reduce employee numbers to release funds for other budget lines Improve pay after separations have been made Consolidate allowances into basic pay But – no robust financial analysis to determine precise solution

5. malcolm.green@c3consult.co.uk5 Zambia: the first model Custom-built in Excel User un-friendly (nobody in GoZ could use it) Not transparent to even an experienced Excel user But it worked Ministry of Finance worked through a solution, and presented it to a CG

6. malcolm.green@c3consult.co.uk6

7. 7 Zambia: model output – financial summary

8. malcolm.green@c3consult.co.uk8 East Asia financial models 2000 - 2003

9. malcolm.green@c3consult.co.uk9 Background Asian financial crisis had exposed institutional weaknesses Governments needed new policy tools to conduct rigorous analysis Objective: promote government efficiency with the focus on pay & employment Two major models developed for Philippines and Thailand; plus a ‘generic’ model

10. malcolm.green@c3consult.co.uk10 Design criteria Comprehensive – address all aspects of pay & employment policy Transparent design Easy to use – whilst maintaining rigorous analysis Counterparts to work on model development Transfer to clients

11. malcolm.green@c3consult.co.uk11 Design elements Three parts to model: Data entry: grade/ministry matrix (very easy to enter/re-enter) Calculations (inaccessible to user) Scenario development (very easy to use) with step-by-step guide

12. malcolm.green@c3consult.co.uk12 Philippines model No longer looks much like an Excel worksheet Easy to prepare – if you have the data Easy to construct scenarios Model workings are inaccessible

13. malcolm.green@c3consult.co.uk13 The model in use Typically we put a laptop on the Minister of Finance’s desk The Minister then plays with the scenarios he wants to see Live and interactive Policy decisions can be made on the spot

14. malcolm.green@c3consult.co.uk14 Generic model – available on web Developed a ‘Wizard’ to: Control data entry Assist scenario-building Used advanced modelling techniques to: Reduce model size Speed up processing

15. malcolm.green@c3consult.co.uk15 Individual country models Still required for detailed planning Needed to design in precise separation/pension rules Possibly integrate with pensions