1. Political Economy and Results Based Financing: Client’s Power, Voice, and the challenge of monitoring Agnes Soucat, World Bank and Gaston Sorgho, World Bank Insitute

2. Results Based Financing: is it simple ? On the basis of the experiences of Results Based Financing presented to you. Which institutional and political conditions do you think have favored or hampered the development of these experiences ?

3. Messages Services are failing poor people. But they can work. How? By strengthening incentives –For service providers to serve the poor –For the poor to seek services –Or both ….. By empowering poor people to –Monitor and discipline service providers –Raise their voice in policymaking

4. Outcomes are worse for poor people Deaths per 1000 births Source: Analysis of Demographic and Health Survey data

5. How are services failing poor people? Public spending usually benefits the rich, not the poor

6. Expenditure incidence HealthEducation Source: Filmer 2003b

7. Public spending benefits the rich more than the poor Money/goods/people are not at the frontline of service provision –Public expenditure tracking results on what reaches or is at the facility level How are services failing poor people?

8. Nonwage funds not reaching schools and health services: Evidence from PETS (%) CountryMean Ghana 200049 Madagascar 2002 55 Peru 2001 (utilities) 30 Tanzania 1998 57 Uganda 199578 Zambia 2001 (discretion/rule) 76/10 Source: Ye and Canagarajah (2002) for Ghana; Francken (2003) for Madagascar; Instituto Apoyo and World Bank (2002) for Peru; Price Waterhouse Coopers (1998) for Tanzania; Reinikka and Svensson 2002 for Uganda; Das et al. (2002) for Zambia. CountryMean Chad 200445 Senegal 2003 40 Cameroon 2004 30 Rwanda 2003 60 Source: World Bank

9. Access to primary school and health clinics in rural areas Distance to nearest primary school (km) Distance to nearest medical facility (km) GNI per capita Poorest fifth Riches t fifth RatioPoores t fifth Richest fifth Ratio Chad 1998 2509.91.37.622.94.8 Nigeria 1999 2661.80.35.511.61.67.1 CAR 1994-95 8196.70.88.914.77.71.9 Haiti 1994-95 3362.20.36.48.01.17.2 India 1998-99 4620.50.22.32.50.73.6 Bolivia 1993-94 10041.20.0-11.82.06.0 Morocco 1992 13883.70.313.113.54.72.9 Source: Analysis of Demographic and Health Survey data. Note: GNI per capita is in 2001 US$. Medical facility encompasses health centers, dispensaries, hospitals, and pharmacies.

10. Public spending benefits the rich more than the poor Money/goods fail to reach frontline service providers Service quality is low for poor people How are services failing poor people?

11. Percent of staff absent in primary schools and health facilities

12. A framework of relationships of accountability Poor peopleProviders

13. A framework of relationships of accountability Poor peopleProviders Policymakers

14. Client-provider Strengthen accountability by: Choice Participation: clients as monitors

15. Which mechanisms reinforce client power?

16. Money power –User fees –Bamako Initiative –Micro-insurance –Conditional Cash Transfer –Co management, participation

17. Impact of social marketing on ITNs ownership

18. Conditional Cash transfers Providing resource to the poor to access services Mexico PROGRESA: decrease in number of illness episode among children Honduras: large increase (15-20%) of intake of antenatal care and growth monitoring

19. Poor people Policymakers A framework of relationships of accountability Providers

20. Citizen-policymaker Political economy of public services

21. Ah, there he is again! How time flies! It’s time for the general election already! Why don’t services work for poor people? By R. K. Laxman

22. PRONASOL expenditures according to party in municipal government Source: Estevez, Magaloni and Diaz-Cayeros 2002

23. Citizen-policymaker Political economy of public services Formal channels Importance of non-formal channels Role of information –Citizen report card (initiatives in Vietnam, Indonesia, Philippines) –Publicizing textbook distribution in Philippines— and engaging communities as monitors

24. Schools in Uganda received more of what they were due Source: Reinikka and Svensson (2001), Reinikka and Svensson (2003a)

25. A framework of relationships of accountability Providers Policymakers Poor people

26. Policymaker-provider Contracting Nature of provider “Hard to monitor” versus “Easy to monitor” Information for monitoring

27. Communities Government Providers Local Govt. Clients Bad policy Poor budget handling Primary education Sub-optimal spending (Big salary bills but insufficient textbooks & materials) Financing problems Information & monitoring Local govt. incentives skewed Local capacity issues Low quality instruction Provider incentives unclear, absenteeism Hard to monitor, users helpless Quality inappropriate Lack of demand Externalities Community norms Budget constraints Intra-household behavior But, what looks good on paper seems to break down in practice… Donors Bad aid policy

28. Communities Government Providers Local Govt. Clients Result-based national-to- local budget transfer Primary education Results-based Contracting Low quality instruction Results-based incentives for CHWs Lack of demand CCT. CCP Systematic application of RBF modalities to fix the “broken lever”? Donors Result-based Aid Results-based planning and budgeting (MBB)

29. A phased approach It is not possible (or necessary) to implement all modalities at once Prioritize where it is most “broken” in the chain  bigger impacts Prioritize the most “feasible”  get buys-in for the next steps It is an evolution – The Rwanda experience –RBF for quantity  quantity + quality –RBF for health facilities  facilities + individuals

30. What not to do Leave it to the private sector Simply increase public spending Rely on technocratic solutions only

31. Of course we have progressed a great deal, first they were coming by bullock-cart, then by jeep and now this! What not to do… technocratic solutions…

32. What is to be done? Tailor service delivery arrangements to service characteristics and country circumstances

33. Short and long routes of accountability

34. Poor people Providers Policymakers Contracts- Purchasing Selection of providers Monitoring Self Regulation Legislative framework Citizens’ Monitoring Participatory budgeting Coalitions Money power Co-management Monitoring Litigation

35. Poor peopleProviders Policymakers Donors and service delivery: outside of the triangle Global funds Community Driven Development Project Implementation Units Making Services Work for Poor People

36. What are we up against when attempting to improve aid efficiency?

37. What is to be done? Strengthen mechanisms of accountability Tailor service delivery arrangements to service characteristics and country circumstances

38. Not One Size Fits All

39. What is to be done? Tailor service delivery arrangements to service characteristics and country circumstances

40. So what about health services Multiple outputs, different nature of services -Population Oriented services -Family Oriented services -Individual Oriented services

41. Individual Oriented clinical care: –Large heterogeneity of needs –Asymmetry of information –Conflict of interest and supply driven demand –Difficult to monitor by both poor users and government: –Eg diagnostic and treatment of Pneumocystis carinii pneumonia Cerebral malaria Toxemia Complex services….

42. Population Oriented services : - Homogeneity of needs –Lower Asymmetry of information because of standards –Easier to to monitor by government/policymakers: –Eg : Systematic screening Expanded immunization Population treatment (ivermectine) Spraying Micronutrient supplementation Services can be made less complex through standardization Individual Oriented clinical care: –Large heterogeneity of needs –Asymmetry of information –Conflict of interest and supply driven demand –Difficult to monitor by both poor users and government: –Eg diagnostic and treatment of Pneumocystis carinii pneumonia Cerebral malaria Toxemia

43. Family Oriented services : -Needs heterogenous -More amenable to information –Easier to to monitor by users: –Eg : Information and peer support for safe sex …or through empowerment..and coproduction Individual Oriented clinical care: –Large heterogeneity of needs –Asymmetry of information –Conflict of interest and supply driven demand –Difficult to monitor by both poor users and government: –Eg diagnostic and treatment of Pneumocystis carinii pneumonia Cerebral malaria Toxemia

44. Easy of difficult to monitor Three types of monitors: –clients –Policymakers: –Self Regulation of providers

45. Who can monitor what Clients can monitor services that are transaction intensive, discretionary and with little asymmetry of information –Eg: use of soap. Handwashing, bed nets, condoms, presence of teachers, presence of nurses, cleanliness of services, quanity and taste of water etc

46. Who can monitor what Policymakers can monitor services that are standards and non transaction intensive even with high assymetry of information –E.g: water access, learning of kids, diseases surveillance, quanity and quality of standards services (immunization, antenatal care)

47. Who can monitor what Self regulation need to develop when services are both transaction intensive, discretionnary and with high assymetry of information –-eg clinical care: only doctors can monitor doctors, engineers engineering

48. No One Size Fits All

49. Eight sizes fit all?

50. Clientelistic politics Can be measured: benefit incidence Dynamic Political process complex: both pro-poor and clientelistic streams Working at the margin: opportunities

51. Eight sizes fit all?

52. Homogeneous 1. “Externality” Public Good: eg air and water quality, Externalities: e.g communicable diseases, curriculum, roads, water access Network externalities: ef electricity grid

53. Homogeneous 2. Common needs eg Administrative requirements Antenatal care/ deliveries/ immunization School exams/ requirements

54. Homogeneous 3. Common destiny eg Policies Legal framework Standards

55. Eight sizes fit all?

60. Making Services Work for Poor People