guidance note : undp support to country-level aid coordination mechanisms (april 2011)

7/30/2019 Guidance Note : UNDP Support to Country-Level Aid Coordination Mechanisms (April 2011)

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UNDP Support to Country-Level Aid Coordination Mechanisms

April 2011

We in the developing countriesmust own the developmentagenda, and our partners haveto align their support to ouragenda, our priorities and thesequencing we have set forourselves... Developmentcannot be imposed, it can onlybe facilitated.

President Benjamin Mkapa,

United Republic of Tanzania,November 2004

OverviewAcross the world, UNDP is working to support programme countries to strengthen th

capacities to coordinate and evaluate the impact of external development assistance in l

with national development plans and priorities. The United Nations development system

mandated to do so by the United Nations General Assembly and the United Natio

Economic and Social Councils triennial comprehensive policy review (ECOSOC/TCPR), as w

as the resolutions on the High-level Dialogues on Financing for Development.1

UNDPs work is underpinned by the recognition that capacity development and ownership

national development strategies are essential for the achievement of internationally-agre

development goals, including the Millennium Development Goals (MDGs). UNDP theref

supports efforts and initiatives to enhance the quality of aid and its impact, such as the PaDeclaration (PD) on Aid Effectiveness and the Accra Agenda for Action (AAA).

This guidance note provides a brief overview of the conceptual framework for UNDP support to country-level aid coordinat

mechanisms, with reference to principles of aid and development effectiveness and UNDPs approach to capacity development, a

with a view to supporting national development planning strategies and processes. It provides practical step-by step guidance on h

UNDP country offices can support the government in establishing and/or reforming existing aid coordination mechanisms, depend

on their particular country context, and how UNDPs support to country-level aid coordination mechanisms links to efficient a

effective coordination of the development work of the United Nations Country Team (UNCT).

1 See General Assembly Resolution A/RES/62/208 and related documents on the TCPR of operational activities for development of the United Nations system. For m

details on the High-level Dialogues on Financing for Development, see the website of the Financing for Development Office.


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2 UNDP Support to Country Level Aid Coordination Mechanisms

Conceptual frameworkOver the last decade, international aid architecture has evolved rapidly. The development landscape at country level has chang

dramatically with the emergence of new players, new modalities, and additional challenges. Despite this rapidly evolving conte

official development assistance (ODA)2 continues its crucial role of empowering programme countries to leverage other sources

development finance such as foreign direct investment, remittances and others and to help manage the various resource flows

better development effectiveness.

Based on the conviction that the national government holds primary responsibility for its countrys development and for coordinati

all types of external assistance, UNDPs support to programme countries is geared towards strengthening their capacities to doeffectively and efficiently and to assume ownership and leadership over this process. At the same time, UNDPs work aims to enhan

efforts and initiatives to improve the quality and impact of external assistance, including the PD on Aid Effectiveness and the AA

While external assistance can have a catalytic effect on development outcomes, UNDP takes the view that ODA is just one element

national public finance, alongside domestic revenues and loans. For UNDP, aid effectiveness is therefore part of a larger concept

development effectiveness and UNDPs support to aid coordination and management is geared towards supporting natio

counterparts in effectively integrating external assistance into their national development processes.

Aid effectiveness

At the global level, the drive to improve the effectiveness of external assistance gained momentum with the launch of the MDGs

2000, the 2002 International Conference on Financing and Development in Monterrey, and the World Summit in 2005. United Natio

Member States instituted in 2003 the High-level Dialogues on Financing for Development and called for the establishment oDevelopment Cooperation Forum (DCF) as an inclusive forum to discuss key policy issues affecting the quality and impact

development cooperation. The Development Assistan

Committee of the Organisation for Economic Co-operation a

Development (OECD/DAC) also launched a process of high le

fora, starting with the Rome High-Level Forum on Harmonisat

in 2003. At the 2nd High-Level Forum on Aid Effectiveness in Pa

in 2005, over 100 donors and programme countries endorsed t

Paris Declaration on Aid Effectiveness. The PD includes f

principles and 12 progress indicators that are being monito

until 2011. The 3rd High Level Forum on Aid Effectiveness in Ac

in 2008 resulted in the endorsement of the Accra Agenda Action. The AAA highlights the need for capacity developme

the use of country systems, aid predictability, and mut

accountability, among others. At the Accra forum, six countries

situations of fragility also decided to launch the first survey on t

Principles for Good International Engagement in Fragile Sta

and Situations, which complement the PD Principles.

The PD highlights ownership, alignment, harmonization, management for results and mutual accountability as the key principles

make aid more effective at the country level. Two surveys have already been conducted in 2006 and 2008 to monitor progress

implementing the PD, and a third survey will be conducted in 2011. The surveys indicate that progress has been made but not f

enough to reach all of the targets. In particular, even though programme countries have made progress in improving their natio

systems, donors need to make more efforts in strengthening and using country systems in a way that reinforces country ownershipaid. Moreover, donors and programme country governments need to improve accountability for the use of external resources. T

means not just increased domestic accountability for the use of development resources, including strengthened parliament

oversight of the use of public resources, but it also obliges donors and programme countries to establish mechanisms to hold ea

2 The OECD defines ODA as official financing to promote economic development and welfare, with a grant element of at least 25 percent. See OECD Glossar

Statistical Terms.

Global commitments for aid and development effectiveness

U

nitedNations

MillenniumDevelopmentGoals

Millennium Summit, 2000World Summit, 2005World Summit, 2010

Financing forDevelopment

Monterrey Consensus, 2002Doha Declaration, 2008

DevelopmentCooperation

Forum

Development Cooperation Forum 2008Development Cooperation Forum 2010

OECDD

AC

Aid Effectiveness Rome Declaration on Harmonisation, 2003Paris Declaration on Aid Effectiveness, 2005Accra Agenda for Action, 2008

Conflict andFragility

Principles for Good InternationalEngagement in Fragile States and Situations


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other mutually accountable for their commitments. Finally, development resources need to be managed more cost-effectively, wh

requires more effort by donors to harmonise their support and improvements in government-led aid coordination.3

The 8th MDG, which calls for a global partnership for development, reflects an agreement among world leaders that stro

international partnerships are crucial to achieve the MDGs. Such a partnership includes ODA, but MDG 8 indicators go beyond aid

include trade and market access, debt sustainability, access to affordable essential medicines and access to new technologies. Wh

there has been progress, greater efforts are needed for a coherent international enabling environment for development.4 Po

coherence is needed so as not to undermine advances in development through contradictory policies. Nonetheless, ODA can be

catalytic instrument that supports internal resources and other development assistance financing instruments. The effective utilisat

of aid is conducive to the effective use of all development resources but needs to be supplemented by an enabling environmentother policy areas.

Strengthening national capacities

Developing countries have varying capacities to harness and use aid effectively for the well-being of their citizens as well as to respo

to the changing nature of aid and other development resources. Some have become more judicious in their acquisition of exter

assistance and in dialogues with donors, while others have been unable to assert their authority over aid strategies due to lack

political will or weak national capacities. Among the traditional donor community, ways of working continue to vary widely fro

agency to agency. While the PD established the primacy of the principle of respect and support for programme country leadership,

international community has not yet, in all cases, managed to design and deliver aid in line with this principle. Also, the ra

expansion and diversification often referred to as aid fragmentation of development cooperation actors (global and vertical fun

NGOs, foundations, private sector) and increasing South-South cooperation pose both opportunities and challenges to natioauthorities effective use of development assistance.

Capacity development starts from the principle that people are best

empowered to realize their full potential when the means of

development are sustainable home-grown, long-term, and

generated and managed collectively by those who stand to benefit.

UNDP recognizes that there is no one-size-fits-all solution to

strengthening national capacities. Instead, it approaches effective

capacity development responses with three fundamental questions

(see table) to shape the design of each capacity response according

to the specific priorities and issues at stake.

In the context of development effectiveness, capacity development

means that countries work to make their institutions resilient and

strong and their country systems reliable and sound to improve the

services delivered to their citizens. They can do so by building on

existing national and local capacities to effectively and transparently manage public resources for human development, includ

ODA. The AAA highlights that all external support to capacity development needs be demand-driven. Technical cooperation c

provide a useful means of knowledge transfer, if based on national policies and priorities and underpinned by the recognition th

training efforts must be delivered in an effective and holistic manner to further capacity development. Since development cannot

imposed from outside, technical cooperation by definition is never a means to its own end. It serves its purpose only if it contributes

the empowering and strengthening of endogenous capabilities. In this logic, capacity development and aid effectiveness principles

hand in hand. They are the means that enable developing countries to formulate and implement their own national developme

strategies for the achievement of sustainable development.

3 See Surveys on Monitoring the Paris Declaration.4 See MDG Gap Task Force Reports.

UNDPs capacity development approach

Whosecapacity?

(entry points)

Enabling environmentOrganisational levelIndividual level

What kindof capacity?

(core issues)

Institutional arrangementsLeadershipKnowledgeAccountability

To whatend?

(functionalcapacities)

Capacity to engage stakeholdersCapacity to assess a situation and define a visioCapacity to formulate policies and strategiesCapacity to budget, manage and implementCapacity to evaluate


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National development planning and public financial management

The 2007 TCPR highlights the role of national policies and development strategies in the achievement of sustainable developmen

emphasizes that external support to national development should be carried out for the benefit and at the request of program

countries in accordance with their own policies and priorities. ODA should complement other sources of national public finan

directed towards the achievement of national development priorities.

Public financial management is at the very heart of how governments translate public resources into development results. It is used

governments to mobilize, allocate and account for the spending of public resources. While national development priorities

determined by national development plans, it is the institutional framework, organizational capacity and everyday expendit

management practice of government that determine the allocation and management of public expenditures towards the achievem

of these development priorities. The effectiveness of external assistance in achieving desirable development outcomes is th

intimately linked to the effective use of all of a countrys public financial resources. This also means that if external sources of finan

are managed separately from other elements of national public finance, the effectiveness of overall public financial managemen

likely to be compromised.

Yet when ODA is not directly channelled through t

treasury of the recipient government, the nature a

complexity of current modalities of external assistan

often delink the management of external assistance fr

other sources of national public finances. Even thou

many donors have committed to use country systemsthe maximum extent possible, budget support o

accounts for a fifth of all development assistance accord

to the PD Monitoring Survey 2008 and many donors

falling behind in their commitment to increase the use

country systems. UNDP takes a pragmatic view towa

support for country-level aid coordination, recogniz

that in various circumstances donors might be likely

continue channelling a large proportion of exter

assistance outside of the recipients national treasury.

long as multiple channels for external resource allocat

continue to exist, recipient countries need to be enabled

coordinate all types of support and manage information

external sources of finance for the benefit of coordinat

development planning, implementation and monitor

and evaluation (M&E) as well as for a transparent a

accountable use of other public financial resources.

The demand for greater transparency in public finance is a worldwide trend. Until the late 1990s, diagnostic work in public expendit

focused largely on only one aspect of public financial management the budget process through public expenditure reviews. T

emphasis has now shifted from management to the governance of public resources, which inherently involves issues of inter

control, the availability of reliable and timely public accounts, the availability of performance reports and the conduct of professio

external audit. Domestic accountability of governments to their citizens also closely relates to mutual accountability betwe

governments and development partners. While governments need to be accountable to parliament and the wider public and engastakeholders in strategy development and implementation of national development strategies, development partners need to prov

transparent and predictable information on external resource flows to enable governments to account for them to their citizens.

Practical guidanceA country-level aid coordination mechanism that fosters development effectiveness should be anchored in the national policy a

budget cycle. Yet, all too often, coordination mechanisms are instead established to respond to donor needs and reporti

requirements. When advising governments on optimal structures for aid coordination mechanisms, UNDP highlights the follow

points to ensure that aid coordination mechanisms are government-led and support national development planning processes:

Aid modalities and approaches

Direct budgetsupport

Resources are transferred directly to the treasury insupport of the national budget and are managed inaccordance with the recipients budgetary procedures.General budget support is not earmarked.Sector budget support is managed in a national accountby a government entity for a specific set of sector orprogramme results.

Programme-basedapproaches(PBAs)

Development cooperation based on the principle of co-ordinated support for a locally-owned developmentprogramme, such as a national poverty reductionstrategy, a sector programme, a thematic programme,or a programme of a specific organisation.A sector-wide approach (SWAP is a PBA operating at thelevel of an entire sector.

Basket /pooled funds

The pooling of financial resources by participatingpartners outside of a national account.

Project

support

A form of aid to finance specific activities with a limited

objective, budget and timeframe to achieve specificresults.

Humanitarianassistance

Assistance designed to save lives, alleviate suffering andmaintain and protect human dignity during and in theaftermath of emergencies. Assistance is usually short-term, project-based and delivered outside of nationalaccounts.


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Aid coordination structure: Aid coordination mechanisms should integrate aid into already existing public service structuand improve capacities from within. Aid coordination mechanisms need to be compatible and align with intra-governmen

coordination mechanisms (whether or not they correspond to national development strategy priority areas). An effective

coordination structure should comprise both a political and a technical level of coordination.

Results management: Public management for results-based development requires strategic visioning at the

institutional level, as well as solid and detailed planning,

implementation and M&E at the technical level. Results

management of external assistance should rest on the

governments development vision or strategy and inform

national and government-led results monitoring. At the

technical level, it should correspond to the governments

expenditure framework to plan and monitor and

evaluate the use of public development resources.

Policy and budget cycles: Aid coordination mechanismsshould correspond to and be aligned with national

development results monitoring cycle(s), which ideally

feeds into the national budget cycle in time to inform

annual deliberation/approval of the national budget in

parliament. Multi-year planning frameworks need to

respect the governments mandate period. Annual

benchmarks for M&E should serve to inform deliberation

of the national budget in parliament.

Transparency and accountability: Transparency in theuse of public resources enables the public to measure the

governments performance and to hold it accountable

for achieving development results. To facilitate domestic accountability on the use of public resources, donors need to

accountable to governments on their assistance in the same way that governments need to render accounts to donors on t

utilization of these resources. To improve this mutual accountability, aid coordination should be underpinned by transpare

governmental aid information management, which will also enable the governments domestic accountability on developme

resources to its citizens. This can be facilitated by the use of web-based Aid Information Management System (AIMS).

While each country context is unique, some context types can be distinguished that result in common features of the country-level

architecture. Most notably, aid dependence ratios5 impact the type and structure of the country-level aid architecture, and so do t

particularities of post-crisis settings:

High aid dependence ratio: Central government expenditure is highly dependent on ODA. As a function of the degree of dependence, there is a progressive penetration of the donor community in key areas of public management, both at the mac

economic level and with regard to core state services.

Low aid dependence ratio: Aid received has a low impact on central government expenditure, but is of potentially grimportance to capacity development in strategic areas of national development plans. The recipient government is in a posit

of greater national autonomy, advocating that international cooperation should complement other resources available

development.

Post-conflict setting: In the aftermath of violent conflict, development planning is short-term as long as political powbrokerage continues and the institutional setting remains volatile. Often, international assistance is framed by the engagem

of an international peace-keeping force, peacebuilding dialogue and related funding mechanisms.

5 Aid dependency ratios can be calculated using ODA as a percentage of gross national income, gross capital formation, imports of goods and services or governmexpenditure. See World Development Indicators, Open Data Catalogue, World Bank. This guidance note uses ODA as a percentage of government expendituremphasize the national public finance aspect. Ratios can be as low as 1% or fewer (e.g. South Africa, Thailand, Uruguay and others) and reach over 100% in the maid dependent countries (e.g. Afghanistan, Burkina Faso, Cambodia (until 2005) and others).

Figure 1: Aid Architecture Features

high aid dependency

st

crisis

low aid dependency


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Post-disaster setting: Development planning for the affected area(s) is mostly short-term to respond to the needs of recovand reconstruction in the aftermath of crisis. The country receives large volumes of humanitarian assistance, which are usu

channelled outside of country systems.

Country context: high aid dependence

Current thinking on aid effectiveness and aid modalities often focuses on contexts where recipient governments are highly depend

on ODA and where national development strategies and aid coordination mechanisms are usually structured accordingly. In countr

eligible for the Heavily Indebted Poor Country (HIPC) Initiative, started by the World Bank in 1996, Poverty Reduction Strategy Pap

(PRSP) often constituted the first generation of government-led national development strategies. In most aid dependent countrPRSPs, or follow-up national development strategies, thus constitute the corner-stone of donor-recipient coordination, includ

budget support coordination mechanisms, when they exist. This has been the case in Burkina Faso, Ghana, Malawi, Mozambiq

Nicaragua, Rwanda, Uganda, Tanzania and Vietnam, for example.

While UNDP advocates basing government-led aid coordination mechanisms on national development strategies, care has to be tak

to ensure that national development strategies are indeed nationally owned. All too often, first generation PRSPs were drawn up

haste to respond to requirements of the HIPC Initiative and later the Multilateral Debt Relief Initiative (MDRI) without suffici

attention to aligning it with the mandate periods and priority areas of action of government (as outlined in government manifestos,

example). As a result, the structure of such national development strategies sometimes diverges from the actual structure

government, which determines public expenditure management.

Aid coordination structure

For a government-led aid coordination mechanism to effectively engage with and support public financial management, it is mo

important that it links with the governments expenditure framework, than to correspond to virtual sectors defined in a natio

development strategy. Whenever a sector of a national development strategy is not underpinned by a lead government minist

department or agency or by a national institution responsible for its implementation, it is unlikely that public resources will

specifically allocated for it. National ownership is also likely to be compromised.6

UNDP can support the government in overhauling its aid coordination structure, so that sector-specific aid coordination is led by t

key government ministry/agency or state institution in charge of the issue. Collaboration can take the form of specific programm

based approaches, including sector-wide approaches and basket funds. Donor priority areas of engagement for which no le

counterpart is identifiable would need to be sub-divided according to key counterparts. For instance, security sector reform might

divided among the Ministry of Defence, Ministry of Interior and the Ministry of Justice. Cross-sectoral issue areas such as acorruption might have to be reorganized depending on the national context and institutions in place. As an example and depend

on the context, anti-corruption could be based around support to the National Audit Office or around support for public sector refo

led by the Ministry of Public Administration. It might also be feasible to adopt a cluster approach that involves several governm

entities on cross-cutting issues, so long as the division of responsibilities between national counterparts is clearly established.

Results management

Since PRSPs are a requirement for the HIPC Initiative and the MDRI, multi-year national development strategies remain particula

relevant for countries with high volumes of aid where such strategies form the basis of engagement with external partners.7 Ideally,

governments strategic vision and development strategies translate into detailed expenditure frameworks that are used to mana

and allocate public resources by sector. In practice, however, national budgets are often organized and voted upon along the lines

governmental administrative units rather than according to the sectors of the national planning framework particularly in countrwith high volumes of ODA and in fragile settings where donor pressure deviates the substance of national planning frameworks aw

from government priorities for public spending.

6 This is often the case for sectors that are priority intervention areas for development partners, such as governance, anti-corruption, security sector reform, e

recovery and others.7 The notion that multi-year development strategies are a precondition to effective development management is also reflected in the ownership indicator of the

which measures the percentage of programme countries with operational development strategies.


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UNDP can support the government to relate aid coordination mechanisms to national expenditure frameworks and inform natio

M&E systems that are used to prepare and implement the national budget. While it is important that such frameworks relate

national strategic visioning or planning exercises, aid coordination mechanisms need to more closely relate to the as is situation

public financial management than to the should be framework. Beyond support to aid coordination mechanisms, UNDP can supp

the government in better linking strategic visioning exercises with actual expenditure frameworks or in defining better sec

strategies that are linked to the budget, when such support is requested by government. UNDP should coordinate this support w

other development partners that are providing assistance to improving public expenditure frameworks.

At the same time, government-led development results management and M&E is more usefully done for specific sectors or refo

programmes rather than at the national level. The pressure for aggregate multi-year results monitoring of national developmestrategies comes from external conditionalities and donor reporting requirements, even though results monitoring in donor count

themselves is usually sector-specific. Aid coordination mechanisms should reinforce donors coordinated support towards natio

statistical capacities and M&E systems, to which the donor communitys own M&E of external assistance should be progressiv

aligned.

Policy and budget cycles

When national development strategies conform to donor requirements, they often do not correctly reflect priority areas of governm

engagement and are usually delinked from the governments expenditure framework. If external partners support the governmen

elaborating multi-year development strategies, such strategies need to be cognizant of the governments incumbency period a

flexible enough, including in resource allocation predictions, to adapt if a change of government takes place.

UNDP can support the government to coordinate development assistance so that it effectively links to the national budget cycle a

informs the budget deliberation and/or approval in parliament. With aid effectiveness high on the international development agen

international partners increasingly aim at coordinating and harmonizing their support, for example through the elaboration of jo

assistance strategies and through agreements on a division of labour among donors.8 Yet, recipient governments sometimes find t

greater donor harmonization can potentially weaken government leadership. In particular, donor-coordinated division of labour can

contradictory to the premises of the PD with regard to ownership and mutual accountability. 9 To avoid such contradictions, UNDP c

support recipient governments in working with their development partners to elaborate a national aid policy, strategy or action pl

that defines the country-specific pathway towards more effective aid by building upon national cycles and processes. An aid pol

strategy or action plan is a useful tool at the hands of governments to adapt the international aid effectiveness agenda to their nee

and circumstances and to coordinate external support around national priorities, strategies and processes.

Transparency and accountability

In an aid-dependent environment, recipient governments are often under much more pressure to be accountable to donors than th

are to their own constituency, in particular to the relatively small tax base of their citizenry. Yet, without transparency a

accountability to the citizens, trust will be lacking between a government and those whom it governs. In most countries, t

constitutional framework provides for institutional checks and balances to hold public decision-makers accountable for their actio

such as parliamentary control in the budget process. Government-led aid coordination mechanisms should serve to reinforce su

checks and balances. In countries with high volumes of external assistance, transparent and detailed information on exter

assistance is a necessary precondition for effective parliamentary deliberation and approval of the national budget. Beyond t

government's accountability to its citizenry, transparent information on external assistance also serves to improve donor coordinat

and to align donor assistance with national development strategies, institutions and procedures.

In preparation for the ECOSOC Development Cooperation Forum 2010, UNDP and the United Nations Department of Economic a

Social Affairs (DESA) conducted a survey that showed that overall progress on mutual accountability is very limited. The survey d

however result in an analytical report that outlines key steps to enhance mutual accountability, which include, for example: 1

8 The European Union (EU) has established a code of conduct for EU donors to that effect: EU Code of Conduct on Complementarity and Division of Labou

Development Policy, see the EU Toolkit for the Implementation of Complementarity and Division of Labour in Development Policy.9 Even though the AAA highlights that developing countries will lead in determining the optimal roles of donors in supporting their development efforts at natio

regional and sectoral levels (AAA, para. 17.a), division of labour exercises at country level are often donor-driven.


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national aid policy with specific performance targets for individual donors and recipient agencies; 2) a monitoring process at t

highest political level and with strong recipient government leadership; 3) the inclusion of parliaments and civil society a

independent analytical inputs; 4) comprehensive databases that cover aid quality issues; and 5) peer pressure among providers.10

Beyond support for the elaboration of a national aid policy and for strengthening national M&E systems, UNDP can support

government in implementing AIMS. Many governments have found AIMS useful to manage their aid flows, improve the ove

alignment of assistance with country priorities and facilitate reflecting international aid flows in national budgets. Such softw

applications enable governments to record and process information about development activities and related aid flows, even wh

they are channelled outside of the governments treasury. AIMS are usually web-based and rely on the governments developmepartners to enter data on their assistance. A government-led aid coordination mechanism can serve as the institutional framework

ensure regular and accurate data entry. Information on the use of external development resources should also be made availa

publicly.11 In countries in which parliamentary oversight of the national budget is generally weak, assistance could be tied in with m

general support to government for the production of transparent and detailed information on public resources.

Country context: low aid dependence

In middle income countries where ODA constitutes only a small percentage of public expenditure, governments are in a position

greater autonomy vis--vis external partners. As a result, donors in countries with little dependence on aid are usually much le

involved in areas of public management. Governments are better positioned to advocate that international cooperation sho

complement existing development resources, particularly through the provision of technical assistance in areas of interest to

government. This approach is reflected in China and South Africas policies on development cooperation, for example. In such cas

development cooperation has a potentially great importance to strengthen national capacities in strategic areas of natio

development plans.

In countries with relatively small amounts of ODA, decentralized development cooperation is playing an increasingly important role

an inclusive instrument that can foster good governance and maximize the effectiveness of aid as a catalyst for national and lo

capacity development. Decentralized development cooperation is considered more flexible, close to the communities and able

facilitate cooperation networks through which expertise, resources, knowledge and technical capacities, particularly for lo

development planning and management, are shared and adapted to the local context and put into practice.

While some countries with little dependence on ODA have chosen not to engage in global and regional dialogue on aid effectiven

issues in order to distance themselves from a perceived donor-recipient dichotomy (for example, Brazil, China, India and Russia), oth

have signed the PD and do engage with international partners on issues of aid effectiveness (Egypt, Colombia, the Dominican RepubIndonesia, Peru, the Philippines, Ukraine and others). At the same time, an increasing number of countries in the process of graduati

from development assistance are themselves providing development assistance to other countries.12


In countries with lower volumes of aid, programme-based approaches are less significant and basket funds are often established

support a specific institution rather than a sector. There are still very few analyses that provide solid ground for the utility

programme-based aid for countries with low volumes of ODA, where the provision of basic services does not depend on internatio

financing. Recipient governments are sometimes weary of programme-based aid coordination mechanisms to avoid more dir

influence of the donor community on the design and implementation of public policies and a potential increase in the workload

ministry personnel.13

If there is little desire of government to establish a comprehensive aid coordination mechanism, coordination structures might usefu

be limited to sector- and institution-specific coordination in the areas that receive the greatest amount of external suppo

10 See www.un.org/en/ecosoc/newfunct/pdf/ma_study-status_and_progress.pdf.11 See Asia-Pacific Aid Effectiveness Portal (2009), Better Data, Better Aid? Practical Guidance Note on Aid Information Management Systems, UNDP.12 UNDP country offices that have been solicited to provide capacity development support to emerging assistance providers can consult the draft UNDP Guidance N

on Capacity Development for Southern Providers of Development Cooperation.13 FRIDE (2009), Implementing Paris and Accra: Towards a Regional Agenda in Latin America and the Caribbean, Development in Context, No. 18, January.


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Coordination structures should correspond to already existing intra-governmental or inter-institutional coordination structures, so t

they do not represent an additional burden to the personnels workload. Whenever aid coordination structures include st

institutions outside of government such as parliament or the supreme court, the coordination structure needs to be in conformity w

the mandate of the institution (constitutional provision or by decree).

UNDP can support national and local authorities to strengthen the potential for mutual learning and cross-fertilization amo

multilateral, national and local institutions, and decentralized cooperation networks. This will enable national and local authorities

better address cross-cutting issues and bottlenecks related to development, multiple levels of action, shared programming amo

different actors, demand-driven cooperation and territorialization of the MDGs. In recent years, UNDP has involved decentraliz

cooperation territorial stakeholders, both in the North and the South, to cooperate and contribute to the multilateral framewthrough its ART Initiative. ART programmes in different countries use this multi-level, multilateral approach by includi

representatives from local governments, decentralized cooperation partners, relevant academic institutions and other territorial sta

holders in the programmes steering committees. By providing this kind of support, UNDP can contribute to enhancing the impact

decentralized cooperation and support better alignment with wider development processes.14

Results management

In middle income countries with low volumes of aid, explicit multi-year development strategies are less common than in a

dependent countries. Overall, strategic visioning is more likely to be expressed in governmental or ruling party manifestos. At the sa

time, more capacity exists to formulate and monitor sector-specific strategies. Even though the international community is l

engaged in public management when aid dependence is low, many middle income countries actively look for support a

opportunities for peer learning to modernize state functioning and effectiveness. ODA can have a catalytic effect in this regard, whresources are directed towards strengthening internal capacities for results management.

UNDP can support the government and national counterparts to strengthen national capacities for sector- or institution-specific g

and target setting, as well as M&E. At the same time, middle income countries often have substantial existing national statist

capacities and M&E systems, within state institutions and beyond. While national statistics institutions might not necessarily focus

M&E areas considered essential by donors, sound statistical information will help the government and donors to monitor progre

towards the targets of sectoral results frameworks. UNDP should support the government in harnessing donor support for natio

statistical and M&E capacities and encourage South-South partnerships and peer learning in this regard. It should also encourag

pluralistic view on national statistical and M&E capacities, in which institutions of the state build on and complement statistical work

universities, research institutes, think tanks and NGOs.


As within aid dependent contexts, aid coordination structures need to correspond to the mandate period of the governme

Institution-specific support needs to conform to the mandate period of the institution (if different from the governments manda

period). For example, if several donors support the National Office of the Ombudsperson, aid coordination should be organized arou

the mandate period of the incumbent ombudsperson, even when the mandate period differs from the governments term of office.

UNDP can support national counterparts in setting up appropriate and desired aid coordination mechanisms and coordinat

external partners effectively. Since aid coordination is more likely to take place at the sectoral and/or institutional level, each instituti

ministry, department or agency needs to ensure that results-monitoring and benchmarking are timed to be available to info

national deliberations in parliament, when appropriate.

Transparency and accountabilityEven when aid ratios represent lower shares of public spending, governments might find it useful to track external assistance in

AIMS. Where public financial management systems are sufficiently advanced, such tracking can be a part of integrated finan

information management systems. UNDP can support efforts that have been made in several middle income countries in this rega

including linkages to debt information management. Aid and debt information management systems as well as integrated finan

information management systems can also serve as catalysts for promoting increased transparency and mutual accountability acr

14 For more information on the UNDP ART Initiative, see www.undp.org/partners/region-local/art.shtml.


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the public sector in middle income countries. They serve as showcases to encourage inclusive discussions and stakehold

engagement, including parliamentary oversight, on issues of transparency and domestic accountability.

Country context: post-conflict setting

Different imperatives determine the different types of international engagement in post-conflict settings, which create considera

challenges for assistance providers to coordinate their support. For instance, peacebuilding aims at maintaining peace and secur

Humanitarian relief is provided to save lives and alleviate human suffering. Thus, the principle of ownership while necessary

sustainable recovery and statebuilding does not provide a useful starting point for international peacekeeping engagements

humanitarian relief activities, particularly when the government may have been party to the conflict. Even though current approachhighlight gray areas and overlaps among these different types of engagements, there is insufficient clarity as to which princi

dominates in which context. It is evident that ownership and alignment take a back seat when the focus is on the urgent requireme

of peacekeeping and humanitarian aid. Yet, at what stage do ownership and alignment principles become relevant in the transit

from peacekeeping to peacebuilding to statebuilding, or in the transition from humanitarian relief to recovery to development? In t

absence of ready-made answers to such questions, aid coordination mechanisms in post-conflict settings need to be flexible a

adaptable enough to make room for different priorities, without sacrificing coordination, transparency and accountability for exter

assistance.

International support to countries that experience or have experienced violent conflict usually aims at several parallel (and possib

even competing) objectives at once. Peacebuilding and security issues are always high on the agenda, alongside substan

humanitarian aid to alleviate human suffering. This has been the case in countries like Afghanistan, Burundi, the Central Afric

Republic, Chad, the Democratic Republic of Congo, Haiti, Nepal, Niger, Liberia, Sierra Leone, Papua New Guinea or Timor-Leste. At same time, most actors agree that strategic recovery activities that provide immediate relief should also aim to lay the foundations

longer-term sustainable development. There is a growing body of literature on international support in contexts of conflict and fragi

that reflects this belief. The OECD/DACs International Network on Conflict and Fragility has established the Principles for Go

International Engagement in Fragile States and Situations, which complement the PD and AAA commitments in situations of conf

and fragility.15 These principles centre international engagement around the premise of contextualized support, with doing no ha

focusing on statebuilding among the central objectives of post-conflict development assistance.

For the past ten years, the United Nations has pushed for closer integration of its departments, funds, programmes and agencies at

country level. Today, in most cases, United Nations peacekeeping missions are integrated missions, in which the Deputy Spec

Representative of the Secretary-General (DSRSG) also holds the functions of Humanitarian Coordinator (HC) and United Natio

Resident Coordinator (RC) / UNDP Resident Representative (RR). This enables the United Nations to develop a better integrat

approach to the challenges at hand. Yet, it is important for the DSRSG/HC/RC/RR and his/her office to acknowledge the differe

imperatives of peacekeeping, humanitarian relief and development assistance so that aid coordination mechanisms can be structur

accordingly.


When an international peacekeeping force is present, high-level aid coordination is often superseded by political dialogue on stabi

and security-related issues. The mandates of international peacekeeping forces often include direct participation in political decisio

making. Influential countries that have a significant interest in policy developments sometimes establish so-called contact grou

which are informal groupings with no secretariat and no recipient government participation. At the technical level, peacekeepi

missions usually establish coordination mechanisms with national military and police forces. The coordination of developme

assistance, on the other hand, follows a different dynamic, similar to aid coordination structures in stable countries with high volum

of external assistance. Challenges arise when comprehensive strategic plans or strategies are elaborated that focus specifically

stability, security and statebuilding without recognizing the different imperatives of peacebuilding, humanitarian relief and sustaina

development.

In post-conflict settings, aid coordination structures are likely to co-exist with stability and security-related coordination structu

throughout a period of transition. UNDP can support and encourage government ownership and alignment with intra-governmen

15 See the OECD DACs Principles for Good International Engagement in Fragile States and Situations.


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coordination mechanisms for all development-related matters beyond humanitarian aid and security-related issues. External supp

for security sector reform, stability and state-building should be organized along the lines of intra-governmental and territo

(national-provincial-local) divisions of labour, at least at the technical level. If doubts about the legitimacy of government continue

persist, external support and corresponding coordination can be structured around state institutions and non-state actors beyo

government. For example, support may be channelled to the Supreme Court, Parliament, an Independent Electoral Commission

National Ombudsperson or similar institutions. Support to civil society organizations or the media, for example, can be coordina

with national representative bodies, such as a national platform of civil society organizations, a national media council or association

Results management

In post-conflict settings, international and national actors increasingly use post-conflict needs assessments (PCNAs) as an entry po

for conceptualizing, negotiating and financing a common shared strategy for recovery and development. PCNAs are multilate

exercises undertaken by the United Nations, World Bank, regional development banks and international partners, in collaboration w

the national government. Based on such assessments, transitional results frameworks or action plans define key milestones

identified areas. Such frameworks and action plans tend to focus on short-term results, although they may be conceptually linked

expected medium- and long-term efforts. These frameworks promote the use of outcome indicators and monitorable targets

management tools for strategic planning and implementation monitoring and as an umbrella for donor coordination.16

PCNAs are useful exercises to coordinate and rally support around a commonly elaborated strategy for recovery and developme

Given that many actors with different objectives engage in the elaboration of PCNAs, UNDP can support and advocate for

inclusion of national counterparts, but it should also caution external partners to have realistic expectations with regard to natio

capacities for planning, implementing and M&E. Whenever planning and M&E serve primarily to respond to donor requirements on tuse of funds, external partners should not overburden national counterparts with such tasks. Instead, external partners sho

explicitly focus on investing in national capacity development for planning and M&E. Such capacity development is likely to be a lon

term exercise and donors will need to find intermediate solutions to respond to their reporting and M&E needs.


In post-conflict settings with interim constitutions and/or transition governments, policy cycles are likely to be shorter and more pro

to adjustments than in stable contexts. Government mandate periods are usually shorter than regular terms and often politica

contested. In many cases, transition governments function with limited sovereignty under transitional constitutional or United Natio

Security Council mandates. As a result, transitional policy cycles are usually determined by pre-negotiated short-term objectives w

specific priority issue areas, such as creating an autonomous state or negotiating/implementing a ceasefire agreement.

UNDP can support national authorities to ensure that the duration of aid coordination mechanisms conforms to such cycles a

objectives. It can also provide support to overhaul aid coordination mechanisms as soon as a cycle comes to an end. Aid coordinati

mechanisms should be flexible and light in structure. Longer-term planning exercises, such as elaborating joint assistance strateg

can be envisaged once the political situation is more stable.


In an environment of conflict and post-conflict response, governments are usually only partly able to fulfil their responsibilities

coordinating and accounting for the use of domestic and external public resources. Under such circumstances, the internatio

community often takes on the challenge of ensuring that external resources are used in the most effective way possible. Wh

international partners might be more efficiently able to provide an overview of available resources, they risk undermining t

development of sustainable national capacities for aid information management. The capacity development challenge in a po

conflict and humanitarian setting therefore requires an exit strategy on the part of development partners if aid informati

management is to be used as a means of strengthening national capacities for public financial management in order to facilitate t

transition towards sustainable development.

16 See United Nations / World Bank (2007): Joint Guidance Note on Integrated Recover Planning Using Post-Conflict Needs Assessments and Transitional Res

Frameworks.


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UNDP can support national authorities to conceptualise AIMS as an instrument that establishes clear linkages to public financ

management in order to facilitate the transition from humanitarian to government-led aid information management. Even in a po

conflict and fragile setting, the imperatives of humanitarian aid coordination should not determine the conceptualization a

establishment of a government-led AIMS. Existing global financial tracking should respond to this demand of providing tim

information on humanitarian aid. While it is crucial that humanitarian and peacebuilding actors receive fast and reliable information

resources available, UNDP considers it essential that recipient governments are empowered to manage available aid information a

progressively (re-)assume the leadership in planning and implementing programmes that will deliver on national developm

priorities. Linking PCNA exercises to governmental priority setting and institutional capacity building can serve as a stepping stone

that direction.

Country context: post-disaster setting

The international community often provides emergency relief and disaster recovery support to national partners in the wake o

natural disaster. International support for emergency relief and disaster recovery occurs in countries with both high and low a

dependence. Indonesia and Pakistan are examples of countries with low levels of ODA prior to disaster, while other countries such

Bangladesh, Benin or Haiti, for example have received emergency relief and disaster recovery support in a context of more signific

levels of development assistance. Since poverty and political fragility contribute to a lack of disaster preparedness, natural disast

often disproportionally affect human livelihoods and erode development gains in poor and post-conflict countries.

As in post-conflict settings, different imperatives drive different types of international support in the aftermath of a natural disast

While emergency relief aims to save lives and alleviate human suffering, disaster recovery support re-establishes the foundation development and allows life to return to a sense of normalcy in the wake of a disaster. The different stages in the transition from re

to development are not clear cut and run in parallel, since effective recovery needs to begin early when relief and emergen

operations are still ongoing in order to reinforce the resilience of communities at risk, reduce the loss of life and avoid repeated s

backs to the development process.

The international community has developed common procedures and mechanisms to support national governments in risk pro

countries. Much effort has been made in recent years to improve leadership and the systematic coordination of internation

humanitarian responses to crises. Humanitarian actors have adopted a cluster leadership approach and the HC system has be

strengthened. This has led to a humanitarian aid coordination system at the country level in which cluster leaders are accountable

the HC for the performance of their cluster, and HCs in many countries have additional authority over different sources of pool

humanitarian funding. In some cases, the United Nations Secretary-General appoints a Special Envoy on an ad hoc basis to mobil

resources, build partnerships and promote a strategic, coherent and comprehensive approach to supporting the humanitari

recovery and reconstruction needs of crisis-affected areas.


To further a smooth transition from humanitarian relief to development assistance, UNDP encourages HCs to invite governm

counterparts to annual humanitarian assistance planning workshops, so as to engage them in identifying humanitarian program

priorities. It has also proven helpful for transitioning humanitarian relief to development assistance to involve local and provin

government actors in inter-agency provincial and/or territorial coordination mechanisms, so that they can contribute to identifyi

priority needs in key sectors in cooperation with United Nations agencies, NGOs and donors.

Even though emergency assistance can only be provided on the basis of an official request by the affected country, humanitarian re

efforts can be managed and coordinated without major involvement of national counterparts. This is especially true in cases whenational capacities are too low to ensure a rapid and comprehensive emergency response. Nonetheless, recovery activities need to

coordinated with these counterparts in order to strengthen national capacities. Such coordination has to increase progressiv

throughout the transition from humanitarian relief to development assistance.

In cases when the government decides to establish an interim reconstruction commission to spearhead and accelerate the recov

process, UNDP can support the government in creating linkages between such a commission and permanent governmental entit

to facilitate the phasing over and exit strategy once the mandate period of the interim reconstruction commission comes to a clo

While initial aid coordination structures are likely to reflect priority areas of a post-disaster needs assessment (PDNA) and recov


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frameworks, UNDP should support the government in developing flexible structures that allow for progressive alignment of

coordination structures to the different stages of the commissions exit strategy.

UNDP strives to support the strengthening of the governments institutional, financial and technical capacity to manage the recov

process. As in other contexts, aid coordination structures should be modelled along the lines of intra-governmental coordination a

institutional divisions of responsibility. When the international community opts for pooled funding mechanisms to accompany t

transition, the governance arrangements of such funds should correspond with the division of competencies within government a

within the state. If the governance arrangements of pooled funding mechanisms differ substantially from the national division

competencies, it will be difficult to progressively increase the involvement of national counterparts as capacities improve.

Results management

Similarly to the use of post-conflict needs assessments and transitional results matrixes in post-conflict settings, international a

national stakeholders are increasingly relying on post-disaster needs assessments and recovery frameworks to facilitate

coordination and results management in the wake of disaster. These tools aim to harmonize the assessment, analysis and prioritizat

of damages, losses and needs by a range of international stakeholders in support of the national government. A PDNA is

government-led exercise, with integrated support from the United Nations, World Bank, European Commission and other national a

international actors. It pulls together information in a single, consolidated report - information on the physical impact of a disaster, t

economic value of the damages and losses, the human impact as experienced by the affected population and the resulting early a

long-term recovery needs and priorities.

UNDP can support national ownership of PDNAs and associated recovery frameworks, which serve as a useful planning a

coordination framework for a multi-stakeholder recovery strategy, by identifying prioritized benchmarks, outcomes and desired resu

to repair and restore social, physical, institutional and economic systems. At the same time, UNDP can support national counterparts

cautioning international partners to avoid the use of artificial performance measures that divert attention from real and dynam

strategic imperatives of emergency reconstruction. International donors can rightfully demand reasonable fiduciary oversight,

UNDP should support governments in resisting excessive restrictions on emergency relief fund management. Such overly restrict

relief fund management risks inhibiting effective emergency relief in situations when limited information, emergency demand and

politics of the operating environment require quick and proactive field operations.


In post-disaster settings where violent conflict does not affect the stability of national institutions, government mandates and natio

development planning might be more longer term than the shorter and more targeted response in affected areas. In such cases, UNcan support the government in relating the PDNA and associated action plans to longer-term frameworks. At the same time, the

should be a distinction between the relief effort on the one hand, for which international support should maintain and promote

culture of urgency in its business arrangements, and the recovery and development effort on the other hand, which requi

comprehensive stakeholder engagement as well as sound planning and M&E. The coordination of international support to po

disaster recovery should be sufficiently flexible to allow for changes and adjustments in response to newly emerging opportuniti

which might not have been foreseen in advance but which enable accelerated progress towards recovery.


The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) mandated to mobilize and coordinate humanitar

assistance delivered by international and national partners has established the Financial Tracking System (FTS) to record all report

international humanitarian aid in a global, real-time database (pledges, commitments and contributions). The FTS is an important tofor the humanitarian appeal process and for supporting country-level coordination and resource mobilization in the wake of a disas

During the immediate emergency response period, the international community might assume certain responsibilities for

information management at country level for the sake of providing relief actors, government, parliament and the larger public w

much needed information on incoming aid flows. Nonetheless, this should be done with a view to eventually transition

government-led coordination and management, as soon as adequate structures are in place to assume this task.

For UNDP, transparent and publicly accessible AIMS provide a means through which governments and external actors can positiv

contribute to improving domestic and mutual accountability on the use of development resources for the recovery process. At t

same time AIMS can improve aid coordination and information-sharing among all stakeholders. UNDP can support and promot


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balance between a focus on the donor community's coordination and information-sharing needs and a much needed investment

strengthen government capacity for aid information management.

Lessons learnt

Ownership and capacity development are necessary preconditions for sustainable development.

Development cooperation can have a catalytic effect on national development, but it must be careful to avoid replacing natio

ownership and leadership of a countrys development process. It is critical that development assistance supports governmen

societies, organizations and individuals to obtain, strengthen and maintain the capabilities to set and achieve their own developmeobjectives over time. ODA remains an important financial vehicle for development, not as a panacea, but as an important complem

to other sources of financing available to developing countries. While remaining crucial in post-crisis countries and least develop

countries, ODA has the potential, particularly in lower and mid-level middle income countries, to leverage larger amounts of domes

and foreign capital for development. ODA has the potential to be a catalyst, through strengthened country capacities and responses

stimulate inclusive growth, productive public and private investments and to tackle persistent and area-based poverty. Ownership o

this process hinges heavily on a countrys capacity to drive and negotiate their own development strategies and financi

arrangements, including the coordination and management of aid.

External assistance is just one element of the national public resources of a recipient country.

For the sake of development effectiveness, aid coordination mechanisms need to underpin and contribute to the coordination

national public resources. Coordination of external partners around issues for which no national institution, ministry, departmentagency can be held accountable runs the risk of being dissociated from national development management. External partners c

lobby and encourage the government to focus on particular priority areas that they consider necessary for sustainable developmen

advocacy results in the creation or strengthening of a governmental or state entity in charge of (and with a budget for) the sector

question, the aid coordination mechanism can be remodelled to include this entity. In the meantime, aid coordination structu

should be government-led and reflect the existing structures of intra-governmental coordination and public expendit

management. This does not pre-empt the donor community to coordinate among each other on issues, independent from pub

management, such as support to civil society or the media, for example.

Development assistance is just one means of engagement by donor countries.

International partnerships for development go beyond ODA. While delivering on aid quantity and quality commitments rema

important, more attention should be given to the need to pursue more coherent development cooperation. This implies ensuring t

development cooperation objectives are bolstered by the range of policies in other areas, such as trade, climate change, food secur

migration and security. Developing countries need to engage more effectively with issues that are beyond aid by putting in pla

appropriate, country specific policies and institutions.

Genuine partnerships are a precondition for the effective use of all development resources.

Global partnerships are about promoting effective and equal partnerships between countries, including stakeholders such

parliaments, civil society, local governments and the private sector. As the global development landscape incorporates an ev

growing number of providers of development cooperation, coherence and consistency among the activities of various actors cann

be ensured any longer by means of coordination meetings alone. Measures to improve transparency and accountability

development cooperation providers and recipients for their activities become imperative to enable concrete collaboration and divis

of responsibilities.


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United Nations Country Team coordinationThis guidance note is intended to facilitate the mainstreaming of

aid effectiveness issues into UNCT development planning. The

note links closely to the revised United Nations Development

Assistance Framework (UNDAF) guidelines and its roll-out at

country level.17 Yet, improving the efficacy of United Nations

assistance to a country is a different objective than improving

external aid effectiveness within that country more generally. Both

processes are interlinked and build on the same principles but

responsibilities differ. Supporting a government to improve the

effectiveness of its external assistance is a programme objective,

while improving the efficacy of overall United Nations assistance is

a management objective.

UNDP programme staff (economists, aid effectiveness specialists, technical advisors, programme specialists, etc.) advise and supp

the government (usually the Ministry of Finance, the Ministry of Planning or similar units) on issues related to aid coordination a

effectiveness. The RCs Office, on the other hand, is responsible for improving the performance of United Nations agencies, funds a

programmes support to the country. For this purpose, the United Nations Development Group (UNDG) created a toolkit for improv

functioning of the United Nations development system at country level. The toolkit provides a comprehensive structure to supp

countries in planning and implementing the change effort required to improve development impact and increase efficiency of t

United Nations development system.18

In some countries, the United Nations RC also takes on the role of chair or co-chair of donor/government aid coordination grou

While this is a crucial function to facilitate harmonization and donor alignment with national development objectives, it sho

nevertheless be accompanied by targeted support to national capacity development for aid coordination and management. Sou

and coherent aid coordination on the part of donors (even if facilitated by the United Nations) cannot substitute national engageme

ownership and leadership of the development process.

17 See UNDG Programming Reference Guide.18 See UNDGToolkit for Improved Functioning of the United Nations Development System at the Country Level.

Capacitydevelopment foraid effectiveness

Improving theeffectiveness ofUnited Nationsassistance

Type ofobjective

Programme objective Managementobjective

Programmingframework

Country Programme

Action Plan/AnnualWork Plan (CPAP/AWP)

UNDAF

Unit incharge

UNDP programme staff(economists,programme specialists,technical advisors)

RCs Office


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Resources and further readingCatalytic role of ODA

Griffith-Jones, Stephany and Jos A. Ocampo, A Counter-Cyclical Framework for a Development-Friendly InternatioFinancial Architecture, DESA Working Paper, No. 39, ST/ESA/2007/DWP/39, United Nations Secretariat, New York, 2007.

International Poverty Centre, Does Aid Work? - For the MDGs, Poverty in Focus, IPC, Brasilia, October 2007.Capacity development

UNDG, Position Statement on Capacity Development, December 2006.

UNDP Presentation, Overview of UNDPs Approach to Supporting Capacity Development, August 2008. UNDP, Frequently Asked Questions: The UNDP Approach to Supporting Capacity Development, June 2009. UNDP, Practice Note on Capacity Assessment, October 2008.

Public financial management and accountability

Overseas Development Institute (ODI): Centre for Aid & Public Expenditure (CAPE) Oxford Policy Management (OPM): Public Financial Management The World Bank: Public Finance Center on International Cooperation (CIC): Public Finance and Economic Recovery Project

The International Consortium on Governmental Financial Management (ICGFM)

The OECD DAC processes

The Rome Declaration on Harmonisation, February 2003. The Paris Declaration on Aid Effectiveness, 2005. The Accra Agenda for Action, 2008. 2006 Survey on Monitoring the Paris Declaration 2008 Survey on Monitoring the Paris Declaration OECD DAC, Aid Effectiveness: A Progress Report on Implementing the Paris Declaration, Better Aid Series, 2009. OECD DAC, Managing Aid: Practices of DAC Member Countries, Better Aid Series, 2009.

United Nations Financing for Development and Development Cooperation Forum

Monterrey Consensus on Financing for Development, 2002. Doha Declaration on Financing for Development, 2008. Report of the First Development Cooperation Forum, 2008. World Summit Outcome, 2005. World Summit Outcome, 2010. ECOSOC, Enhancing Mutual Accountability and Transparency in Development Cooperation, Background Study for t

Development Cooperation Forum High-Level Symposium, November 2009.

United Nations,Trends and Progress in International Development Cooperation, Report of the Secretary-General, E/2010/June 2010.

Role of the United Nations Development Group

United Nations,Triennial comprehensive policy review of operational activities for development of the United Nations, 2004 United Nations,Triennial comprehensive policy review of operational activities for development of the United Nations, 2007 Report of the Secretary General, Follow-up to and implementation of the outcome of the International Conference

Financing for Development, 10 August 2007.


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Annex 2: Checklist of elements to consider when supporting thereform of aid coordination mechanisms

Country:

Initiative manager:

Government entity:

Consultant/reviewer:

Review date:

Background

[Replace this text with a brief description of how the initiative originated]

Objectives

Yes No Comments

1. Establish a forum for policy discussion on national/sector strategies andpriorities

[Replace this text with thobjectives of this

initiative.]

2. Mobilize additional resources for the national development strategy (and/or

selected sector strategies)

3. Create a forum for mutual accountability: progress review and agreement on

joint benchmarks/objectives and partnership mechanisms

4. Other (e.g. is it a national or theme/sector-specific initiative?)

Development results (apply to national and sector level)

Yes No Comments

1. Is there a single medium-term development strategy? [Replace this text with

details.]

2. Is it results-based and MDG-based?

3. Does the strategy include a results matrix based on the countrys national

development strategy (PRSP, etc.) and that broadly encapsulates measurable

growth and poverty reduction outcomes in the country?

4. Does the strategy include a monitoring matrix with a limited number of MDG-based targets, SMART indicators and sources of verification?

5. Does the strategy clarify implementation issues, including resource

requirements as well as capacity assessment and capacity development plans with

defined indicators or progress benchmarks and are resources allocated for this

purpose?


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6. Does the strategy include a mutual accountability framework based on mutually

agreed systematic country and donor performance assessments (benchmarks),

with periodic assessments by independent observers?

7. Has the strategy been developed in a participatory manner, including inputs

from civil society, parliament and the private sector?

8. Other

Development resources (apply to national and sector level)

Yes No Comments

1. Is there a costing of the development strategy, including at least one scenario

based on current resources and one scenario based on needs to achieve the

MDGs?

2. Is the costing sufficiently detailed (i.e. with concrete priority actions and

investments identified and costed)?

3. Is there a mapping of current aid allocations against costed targets (by donor,

based on existing donor pledges and engagements)?

4. Is there a resource matrix overlaid on the country results matrix that clearly

identifies the activities and financial support that aid partners are committing to

and disbursing against, in each of the monitored areas?

5. Is there an in-depth analysis of ways to enlarge fiscal space, by identifying fiscal

and macro-economic potential for growth?

6. Is there a Medium Term Expenditure Framework, taking into account both

national and existing external resources?

7. Are global funds and programmes, NGOs and private foundations includedwhen discussing external resources?

8. Is there a link to country budgetary cycle and domestic accountability processes

to include active participation by representatives of parliament, civil society and

media in the coordination mechanism?

9. Other

Partnership 1: Regular coordination mechanisms (apply to national and sector level)

Yes No Comments

1. Is there a functioning coordination mechanism between the government and

donors on development results and aid effectiveness issues? (i.e. regular meetings

several times a year, with senior representatives of ministries/agencies and heads

of donor cooperation agencies in country)

2. Is the coordination mechanism chaired and led by the government?

3. Is there a functioning government mechanism, allowing for inter-ministerial

coordination on aid management issues?


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4. Does the coordination mechanism include appropriate participation from civil

society, private sector, parliamentarians?

5. Is there a clear policy and/or procedures on aid allocation/management,

applicable to all donors?

6. Is the coordination structure used for results-based monitoring (based on

targets set in the development strategy) and mutual accountability (under national

aid management policy/procedures)?

7. Other

Partnership 2: Key elements to overhaul traditional Consultative Groups / Roundtables results and create results andresources partnerships

Yes No Comments

1. Is the mechanism prepared under government leadership and chaired by the

government?

2. Does the mechanism include appropriate representation of civil society, private

sector and parliamentarians?

3. Is there a specific engagement and communication strategy to ensure that all

stakeholders are involved as appropriate, including emerging and non-OECD DAC

donors?

4. Does the mechanism build on and improve existing mechanisms and systems in

the country?

5. If the mechanism does not build on existing, regular coordination mechanisms,

are there plans to discuss a government position paper/policy on the

establishment of such aid management and partnership mechanisms?

6. If the mechanism does not build on existing, regular coordination mechanisms,

is there a framework for preparatory activities, with appropriate benchmarks and

timelines?

7. Does the mechanism focus on resources and managing for results, shifting

towards performance and programme budgeting?

8. Is appropriate time allocated (at least 30%) to review aid effectiveness,

implementation and partnership issues, based on a mutually-agreed national

action plan and benchmarks for aid effectiveness? (implementation of the PD)

9. Is sufficient attention being paid to capacity issues, with costed capacity-

development plans, based on capacity assessments and clear benchmarks?

10. Is sufficient attention being paid to cross-cutting issues (gender, environment,

human rights, HIV/AIDS)?


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11. Is there an appropriate monitoring instrument (aid management system) to

monitor aid flows, impact and predictability, establish linkages with the national

budget process and ensure transparency and accountability of resource

management?

12. Are appropriate procedures in place for aid management and information-

sharing, with a particular focus on ensuring predictability of aid, with multi-annual

commitments?

13. Other

General observations

[Replace this text with information regarding the overall readiness of the initiative. This must be filled in by the manager.]

Actions for follow up

ID Action item Assigned to Due By

[mm/dd/yyyy]

[mm/dd/yyyy]

[mm/dd/yyyy]

Comments

[Replace this text with comments.]

Approvals

Initiating entity: ___________________________

Initiative manager: ___________________________ Date: ___/___/____

Technical manager: ___________________________ Date: ___/___/____

Consultant: ___________________________ Date: ___/___/____

Reviewer: ___________________________ Date: ___/___/____


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Acronyms and abbreviationAAA Accra Agenda for Action

AIMS Aid Information Management Systems

AWP Annual Work Plan

CPAP Country Programme Action Plan

DAC Development Assistance Committee

DCF Development Cooperation Forum

DESA United Nations Department of Economic and Social Affairs

DSRSG Deputy Special Representative of the Secretary-General

ECOSOC United Nations Economic and Social Council

EU European Union

FTS Financial Tracking System

HC Humanitarian Coordinator

HIPC Heavily Indebted Poor Country

M&E Monitoring and Evaluation

MDG Millennium Development Goal

MDRI Multilateral Debt Relief Initiative

OCHA United Nations Office for the Coordination of Humanitarian Affairs

ODA Official Development Assistance

OECD Organisation for Economic Co-operation and Development

PCNA Post-Conflict Needs Assessments

PD Paris Declaration on Aid Effectiveness

PDNA Post-Disaster Needs Assessments

PRSP Poverty Reduction Strategy Papers

RC/RR Resident Coordinator / Resident Representative

SWAP Sector-Wide ApproachTCPR Triennial Comprehensive Policy Review

UNCT United Nations Country Team

UNDAF United Nations Development Assistance Framework

UNDG United Nations Development Group

For more information: www.undp.org/capacity/aid.shtml and www.aideffectiveness.org

Acknowledgements:

This guidance note is a technical document of UNDP staff and does not represent an official position of UNDP or its Executive BoaThe note builds on the draft Compendium of Needs Identified, Lessons Learnt and Good Practices on Capacity Development and AEffectiveness (April 2008) and on the draft Technical Note on Consultative Groups and Roundtables (March 2007). It complements texisting Checklist of Elements to be Considered when Reforming Aid Coordination Mechanisms and has been shared with practitioners acolleagues for review.

A discussion draft of this note was widely shared amongst practitioners for review in November/December 2010. We wish to thank tfollowing colleagues for their comments and feedback: Gert Danielsen, Artemy Izmestiev, Jennifer Moreau, Astrid Schnitzer, Dailovi, Tuija Rytkonen and Mark van den Boogaard. We would also like to thank Julia Steward for her thorough and conscientiocopy-editing of the manuscript.

Contact information:

Bettina Woll, Aid Modalities Specialist, Capacity Development Group, Bureau for Development Policy, UNDP, [email protected].

guidance note : ￼undp support to country-level aid coordination mechanisms (april 2011)

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guidance note : undp support to country-level aid coordination mechanisms (april 2011)