Harmonisation and Alignment: Summary of Group 3 Discussions at High-Level Forum Preparatory Consultation Workshop

1. Africa Region Accra High Level Forum Preparatory Consultation Workshop Summary of Group 3 Discussions on Harmonisation and Alignment 28.-30. April, 2008 Presented by Mr. Lawrence Kiiza Director Economic Affairs Ministry Finance, Planning and Economic Development Uganda

2. Harmonisation The Paris Declaration makes an overall statement committing donors to reform and simplify policies and procedures. Indicator 9 and 10 refer to the use of common arrangements or procedures and encourage shared analysis. The preliminary survey for the PD 2008 indicates little progress in this area

3. What issues need to be addressed? • Donors need to be transparent regarding their non-usage of partner country systems • Capacity Development for the long term, at both the institutional and human levels • Partner countries need to reform their systems as an incentive for donors to use them • Non-state actors need to be included in the relevant harmonization processes

4. Key Issues on Harmonization • Rationalize frequency and number of missions • Harmonize joint evaluation and reporting • Financing modalities should complement each other • Harmonisation should not undermine the principles of ownership • Cross-cutting issues must be integrated in the government priorities to avoid parallel funding.

5. AAA • Simplification, and where possible, harmonisation of aid procedures including procurement and disbursement procedures, safeguard policies, formats of reporting, monitoring and evaluation e.t.c and other resources could reduce transaction costs of aid delivery • Agree to good practice principles on complementarity • Donors need to honour and deliver on their commitments to harmonise • Coordinated capacity building of TA by donors in order to avoid duplication

6. Alignment • Indicator 2 to 8 in the PD refer to this area • Objective is to ensure that donors support the recipient national development strategies

7. Aligning to the National Development Strategy • Key messages: • Ownership and alignment to priorities need to go hand in hand, cannot align to country priorities without using country systems • Partner governments should provide leadership on their priorities and strategies for which donors should buy in

8. Use of country systems in PFM and procurement • Partners countries to reform and strengthen their PFM systems and update their procurement laws • Key Messages: • Share of total aid provided through government systems still low • Despite progress in reforms undertaken by countries, donors are still reluctant to use national procurement systems • Default position should be for donors to use country systems where possible and indicate transparently reasons why they may not. • Need reforms in PFM and procurement as an incentive for donors to use country systems but alignment can be also used in strengthening country systems. • PEFA assessments should be a common framework used by all donors as it is done jointly. • Donors avoid using parallel systems and procedures which undermine country systems and procedures

9. Predictability • Predictability of aid flows can improve in several aspects ranging from long term forecasting to short term administrative delays in disbursing agreed funding. • Key Messages: • Increased predictability of aid flows, including multi-year planning of aid, transparency and information sharing of aid, and alignment to government budget cycles is necessary

10. Untying of aid • Tied aid increases transaction costs and reduces the value of aid most notable in the case of tied technical assistance. • Key Messages: • To get value for money, donors need to unity their aid. • Need to extend the coverage of the DAC recommendations and use of local procurement.

11. AAA • Respect for country leadership and ownership in developing priorities and donors aligning to them • General Budget Support is the preferred mode of financing as it has a stronger influence on the policy environment, superior ownership properties and greater aggregate coherence • Increased predictability of information regarding timing of planned, committed and disbursed aid and aligning it to country budget cycles • Alignment to government policies and programs and donor coordination within a common policy framework • Increased reliance of government systems and procedures where desirable, avoiding the use of parallel systems

12. Thank you for listening!