CIDSE / Caritas Internationalis (CI) Submission to World Bank / IMF

1.INTRODUCTION

There is widespread agreement on the relevance of the principles and concepts underpinning the Poverty Reduction Strategy Paper (PRSP) approach. This initiative has the potential to put country-led strategies for development at the heart of development assistance. It provides an opportunity to address critical problems in governance and institutional frameworks, at both a national level and with respect to donors' operations. In countries where principles of accountable governance, participation, country ownership and a clear poverty focus in national planning were already in the ascendant the initiative has added weight to reform efforts and opened new spaces for domestic policy dialogue. On the other hand, it adds another layer of conditionality to already overstretched authorities and threatens to undermine domestic institutional processes. The PRSP approach has made most headway where processes such as government-led harmonisation, budget support, Sector Wide Approaches (SWAPs), Medium-Term Expenditure Frameworks (MTEFs) and participatory mechanisms for policy dialogue were already underway and macro-economic stability had been broadly achieved (ex: Tanzania, Uganda). In other countries, however, progress has been very limited. The Concept Note for the Poverty Reduction Strategy (PRS) review rightly prioritises the question of the application of the PRS approach in conflict-affected and fragile states. However, even in countries which do not fall into this category, the PRS approach has been dogged by problems. These include weak design and implementation capacity at national level, fragile and uneven gains in participation, poor support for analysing policy trade-offs in macroeconomics, lack of donor alignment, and a perception that it is primarily another vehicle for donor- imposed conditionality. This CIDSE / Caritas Internationalis (CI) submission draws on the experiences of our members worldwide and responds to the issues raised in the World Bank / International Monetary Fund (IMF) PRS review concept note.2 We conclude that national policy decision-making must be brought within a country-owned, participatory, accountable decision-making framework. The question of how to achieve and sustain this objective must be central to the PRSP approach and hence to this review.download