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Minding the Gaps Integrating PRSs and Budgets for Domestic Accountability. Vera A. Wilhelm The World Bank. Key questions of the study. Role of PRS and budget for domestic accountability Main challenges in countries when trying to integrate PRS with the budget

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minding the gaps integrating prss and budgets for domestic accountability

Minding the GapsIntegrating PRSs and Budgets for Domestic Accountability

Vera A. Wilhelm

The World Bank

key questions of the study
Key questions of the study
  • Role of PRS and budget for domestic accountability
  • Main challenges in countries when trying to integrate PRS with the budget
  • Main entry points and lessons, with particular focus on reporting mechanisms
accountability a simple framework
Accountability: A simple framework

Principal demands accountability from agent for x

Principal has powers to ensure that agent

delivers x

ACCOUNTABILITY

Agent considers itself accountable

for x

It is in the agent’s interest

to deliver x

Capacity

The agent has the ability to deliver x

O

W

N

E

R

S

H

I

P

I

N

C

E

N

T

I

V

E

S

prs and budget ownership
PRS and budget: Ownership

The PRSP

The Budget

Parlia-ment

Executive

Parlia-ment

Executive

Finance

Ministry

Cabinet

Cabinet

Line

Ministries & Providers

Planning

Planning

Finance

Finance

Sectors

Sectors

Civil Society

Electorate

Civil Society

Electorate

Strong Ownership

Moderate

Weak

I

Societal

Societal

prs and budget incentives
PRS and budget: Incentives

In theory:

  • Results orientation
  • Transparency of decision making

In practice:

  • Proliferation of products
  • Poor budget execution
budget accountability multiple gaps and fractures

Sector

Strategies

Budget

Formulation

Budget

Execution

MTEF

PRSP

Policies & Plans

Budget Reporting & Accountability

Budget accountability: Multiple gaps and fractures
however there s hope
However, there’s hope
  • HIPC evaluation shows that several countries can improve their performance significantly within three years (GH, Mali, MZ)
  • Budgets increasingly include some elements of results orientation
  • Second generation PRS try to make a more explicit link with the budget (Tanzania, Rwanda, Mozambique, Madagascar)
linking prs and budgets
Linking PRS and budgets

3 principal approaches in LICS:

  • Pro-poor spending priorities
  • MTEFs
  • Results-oriented budgets

Main Lesson: Narrow technical solutions suffer from low ownership and weak incentives for reform

success stories
Success stories

3 Insights:

  • Centrally led reform initiatives to achieve domestically owned objectives
  • Absence of institutional fragmentation enables integrated reforms
  • Gradual approach starting with strengthening budget basics allowing sufficient time
integrated reporting challenges
Integrated Reporting: Challenges

Local Government & MDA

Sector

National

Impact

Outcomes

PEAP Results Matrix

Poverty Status Report

Annual Sector Reports

Outputs/ Activities

Assessment Reports

Sector MIS

Returns

MIS Reports, League tables

Budget Performance Reports

Ministerial Policy Statements

PAF Grant

Reports

FDS Reports

Inputs/ Funds

LG Financial

Statements

CCS

Returns

the incentive challenge
The Incentive Challenge
  • Incentives to supply information and sources of demand
    • Donor driven (e.g. APR)
  • Incentives to use information to improve performance
    • Internally driven (e.g. Uganda)
summary findings
Summary Findings
  • Contested ownership weakens domestic accountability
  • Policy making, planning and budgeting are embedded in fragmented processes and institutions
  • Technical fixes alone won’t do it
the way forward lessons
The way forward: Lessons

1. Focus on strengthening and harmonization of existing processes and adopt a gradual approach to reform

2. Support from within: High level ownership of policies, a challenge function within the executive and clear sector roles.

3. Foster incentives for integration

4. Keep it simple

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