1. CABRI response to Accra Action Agenda
5th Annual Seminar
Dakar, Senegal
7-8 April 2009

2. A reminder of AAA adopted at the High Level Forum
Context
A reminder of AAA adopted at the High Level Forum
An overview of the work CABRI undertook that relates to ‘use of country systems’
Developing a response to the AAA
Discussion

3. Accra Action Agenda
Purpose: acceleration of actions towards achievement of aid effectiveness targets as set out in Paris Declaration
Three main focus strategies
Increasing country ownership
Build more effective and inclusive partnerships
Achieving development results
Important implications for bringing aid on budget
Points under:
Acceleration of actions towards achievements of aid effectiveness targets as set out in Paris Declaration
Remind key strategies to achieve greater aid effectiveness are ownership, alignment, harmonisation and mutual accountability
Alignment and use of country systems important towards ownership and building effective states
Sub-strategies discussion
Increasing country ownership and particularly use of country systems main focus of CABRI response. Improving quantity and quality of aid on budget will help broaden dialogue by making aid more transparent at country level.
On other hand, some actions set out in the AAA under making aid more transparent and increasing medium term predictability of aid crucial or a first condition for bringing aid on budget successfully, for example
Donors will publicly declare regular, detailed and timely info on the volume, allocation and if possible results of development expenditure to enable more accurate budgeting, accounting and reporting by developing countries
Developing countries will strengthen their budget planning for managing external and domestic resources
Donors will provide full information on annual commitments and actual disbursements
Donors will provide information on their three to five year forward expenditure and implementation pans and indicative disbursements.
Mention that there are many other important items in the AAA eg with regard to donor harmonisation, but less important to bringing aid on budget

4. …what AAA said on Use of Country Systems
Accelerate the strengthening and use of country systems to the maximum extent possible
Provisions
Use country systems as a first option
Donors must provide reasons for, safeguards and measures when not using country systems
Mutual assessments of country systems
Donor plans to implement, incentivise staff, etc.
65% of aid as programme-based aid
50% of aid use country fiduciary systems
Important to remember purpose of PD and AAA
Increase effectiveness of aid
Paris Declaration and AAA commitments are the means towards this end
With last set of bullets can expand a bit that Paris Declaration learnt from decades of ineffective aid practice and is a new way of delivering aid, based on the understanding now of the relationship between alignment, country ownership and use of country systems and (i) sustainability of aid, (ii) the contribution or damage aid delivery can cause to states building long-term capacity to manage themselves. It is not only WHAT aid is delivered, but HOW that counts. However, ultimately it is about whether aid leads to development. The declaration commitments and indicators are the means to this end

5. CABRI work on Aid on Budget
CABRI’s response aimed at ensuring that use of country systems result in improved aid effectiveness
Draws on CABRI’s work and SBOs experience
Aid on Budget Study
Discussions of SBOs
Aid on Budget Working Session in Rwanda

6. Lessons from Aid on Budget work
Use of country systems can contribute to improved aid effectiveness
Not all systems used at once; countries should make measured progress weighing up risks
Bringing Aid on Budget does not equal budget support: progress should be made in all modalities
Putting effort into clear, useful, commonly understood definitions of aid categories helpful
Countries should define criteria for use of country systems
Streamlined country systems
The Brief has examples for each of these points which can be drawn on to fill presentation out.

7. … allows for development of a response
CABRI recognises role of aid and international recognition of developing country ownership and leadership.
But
Use of country systems should not be applied as a blanket approach
A developing country also faces risks when integrating aid into country systems
Development, fiduciary and reputational risks
Unreliable and unpredictable aid flows
Unreliable and unpredictable flow of aid information
Cost of putting aid through fiduciary systems can outweigh its benefits

8. Greater emphasis on upstream budget cycle – planning and budget
…but
Greater emphasis on upstream budget cycle – planning and budget
Stronger role for developing countries in determining whether and where aid should be integrated into budget cycle
Putting forward targets and use of fiduciary systems as a first choice for donors, can undermine developing country choice and increase developing country risk
Upstream budget cycle: Putting aid on plan, budget and report essential for effective domestic resource use, transparency and accountability and carries no risk for donors
But not putting aid on plan etc carries high risk for recipient countries
Emphasis on fiduciary systems encourages use of these systems above priority use of planning, budgeting and reporting systems

9. questions to guide discussion
Are the five points appropriate given country experiences
Use of country systems not used as blanket approach
Acknowledge risks for developing countries
Aid on plan and on budget as default?
Stronger role for developing countries
Default use of fiduciary systems undermine developing country choice, ignore developing country risks
Other points?
What are appropriate forums for presenting CABRI position?

10. thank you!