Donor coordination in anti-corruption

Making use of Poverty Reduction Strategies, international conventions, and regional initiatives

Content

Poverty Reduction Strategies | Unrealistic donors? | Uganda AC coordination | Int'l legislation and initiatives | UNCAC and coordination

The alignment imperative

As a matter of both principle and the long term effectiveness of donor interventions, donors should align their support and interventions to national priorities and plans. This will give the government policy "sovereignty" and ownership which is lacking in very many developing countries. Where there are too many frameworks at play the development partners should help the government focus their activities or align the different initiatives into one overarching structured plan. Donors should impose discipline on themselves and channel money on what are the agreed priorities rather than a host of smaller "pet" projects.

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Poverty Reduction Strategies & PRSP's

In most countries receiving development aid the Poverty Reduction Strategies (PRS) and the comprehensive Poverty Reduction Strategy Papers (PRSPs) are the central structure around which donors align and coordinate their development cooperation initiatives. PRS(P)s also provide the overall framework for government-donor collaboration. By the end of 2004, PRSPs had been drawn up on 42 countries and interim PRSPs had been made by a further thirteen.

The poverty reduction strategies of many countries do not contain specific corruption related targets or relate to any existing AC strategy. A recent GTZ study of PRS documents of 54 countries found corruption was mentioned in a "passing comment" in some, while others included detailed AC strategies. Only in Ghana and Nicaragua did PRS processes contribute to improved donor coordination on AC.

Budget support donors may be moving more quickly and more effectively towards improving the dialogue with the partner government. In the fifteen country Special Partnership for Africa (SPA) survey of alignment of budget support donors in Africa in 2004, government satisfaction with donor behaviour increased overall by comparison with the previous year, with the exception of minimising and coordinating reporting requirements.

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Unrealistic donors?

One important consideration the development partners must make for each country is whether incorporation of specific chapters on corruption represents a real commitment by the government to reduce [high level] corruption. If the will is not there then the donors must rethink their strategy along the principles we mention in the section on "fighting corruption in hostile settings".

Another issue of concern is that donors may have used their power to incorporate an unrealistic number of measures into their programme framework with little regard for national capacity to implement these reforms. If this is so, donors must use more energy on supporting the aid management system. More can be done to:

• Establish more capacity building funds
  
• Support sector ministries and local government
  
• Concentrate on specific skills to manage SWAps and Direct Budget Support (DBS), that is, public financial management

The 'Birmingham study' on donor co-ordination in Africa raises the question whether the main progress in using PRS is likely to come from technical measures such as transparency and accountability with which public funds are managed, offering reduction in corruption only in the longer term. The case of highlighted Uganda gives interesting insight although the findings are not universal, as they are a result of a 15 year old "donor history".

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Example: bringing AC into poverty reduction budget support in Uganda

At the centre of poverty reduction budget support arrangements with donors is a matrix of agreed actions to be taken by government, which should be based on government's poverty reduction strategy - in Uganda's case its Poverty Eradication Action Programme (PEAP). The matrix sets progress indicators, which are then monitored by donor working groups. Any related concerns/ recommendations are conveyed to the Head of Mission-level working group, to be taken up in dialogue with GoU.

In 2004 GoU produced a National Strategy to Fight Corruption. On the suggestion of donors, the World Bank linked its latest Poverty Reduction Support Credit (PRSC 5) to implementation of the strategy, via the 'Governance Matrix' attached to this support. The Directorate of Ethics and Integrity worked with donors to form a consensus on the range of actions to be completed prior to PRSC 5. The Office of the Prime Minister, the Minister of Finance and the Secretary to Cabinet agrees the actions.

This has helped support reform efforts and provided a framework for "a comprehensive dialogue with government" on AC issues, according to DFID advisors in Uganda. But some donors observe they have not noticed a "real shift" in "high level political commitment". For example findings of corruption enquiries have yet to be acted upon. Rather success has been visible at a more technical level:

• legislation has been drafted,
• capacity is being built, and
• case monitoring is being established.

The view from advisors is that at least some "victories", albeit small ones, are being won. The framework that is being created "may be beneficial in the long term when the appropriate political opportunity arises".

The partnership principles in the Ugandan PRSP process might be used as a guide for other to follow:

Overall, it seems clear that the PRS framework may provide an orderly and unified forum for government-donor dialogue, whether or not PRS is used specifically as a vehicle for anticorruption measures. In countries without frameworks like a PRS, such as Nigeria, donors have found coordination to be more "ad hoc", but positive steps are taken by both government and donors in many countries.

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International legislation and regional initiatives

In some countries (Uganda, Rwanda, Tanzania, Mozambique and Vietnam) the policy dialogue is increasingly focused around budget support (general and sector). Similarly, international and regional codes have been signed up to by many countries (e.g. United Nations Convention Against Corruption, (UNCAC), Africa Union Convention/ the New Partnership for African Development (AU/NEPAD), and there are important new initiatives to support African development (e.g. the Global Coalition for Africa (GCA); and the Commission for Africa).

These overarching frameworks are essential points around which AC work can crystallise - either in complementing PRS-processes or come as a substitute. Conventions have particular value in setting out acceptable and non-acceptable practices in areas most vulnerable to corruption, and to raise national standards in areas such as accounting, audit, and procurement. It may also facilitate dialogue with signatory governments and coordination around anti-corruption issues.

Donors therefore need to consider how they can individually and collectively support the ratification, implementation and effectiveness of the above conventions/ frameworks/ forums. It is evident that the above frameworks are relatively new and there is limited evidence on implementation and compliance (see paper on the use of conventions on the Conventions Page of the U4).

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The UN Convention Against Corruption

The UNCAC is the framework around which donor common support should be crystallised in the near future. It is expected that member states which have ratified it shall take steps to revise or adopt national legislation on anti-corruption to ensure compatibility with the Convention; some states will also need to take the initial step of revising national legislation to allow ratification of the UNCAC. This provides further impetus for action and opportunities for donors to dialogue with partner governments among themselves on priority areas to support.

There are various possible entry points including opportunities to strengthen enforcement and prevention systems as well as national integrity systems. The justification would be to enable partner governments to comply with the terms of the Convention. Thus it provides a platform to initiate discussion in order to identify priorities and bring key stakeholders together to ensure a coordinated response to the problem of corruption (UNODC is the UN agency tasked with supporting signatory parties implement the provisions of the convention and is currently drafting a legislative guide).