AGHD PRSP Learning Event Africa Great Lakes and

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

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 2

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

Core PRSP Principles Sept. 1999 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: § Country-led/owned based on participation § Outcome oriented § Comprehensive – analysis of poverty § Medium to long term perspective § Donor partnership under government leadership 4

PRSP Schedule & Key Elements Preparation Status Report I-PRSP HIPC(II) Decision Point 5 9 -24 months 1 st Annual Progress Report PRSP (I) HIPC(II) Completion Point 2 nd Annual Progress Report etc. . 3 years PRSP (II)

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

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 broadbasedparticipation § Opportunities for new ways of delivering aid(pooled funding of general budget, joint appraisal, common performance assessment) 7

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

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

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

Cont. . . § 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 11

Emerging Experience § ‘Upgrading’ of poverty policy – Mo. Fs engaged § Achieved at some cost to senitments to national ownership but IFIs getting better at stepping back § PRSP process & document heavily influenced by 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. 12

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

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

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

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