IFI governance


Bank both player and referee in road to Accra

1 April 2008

By Lucy Hayes, Eurodad

The Africa Cup of Nations has ended, but Ghana will host two other international events this year: the UN Conference on Trade and Development quadrennial conference in April and the High Level Forum on Aid Effectiveness in September. On aid effectiveness the World Bank is both player and referee, prompting cries of foul play by civil society groups. The Bank is heavily involved in the process of monitoring commitments and is very present in the run-up to the Ghana meeting.

The Organisation for Economic Co-operation and Development (OECD) High Level Forum on Aid Effectiveness will review progress against the 2005 Paris Declaration and make commitments in areas where more needs to be done. The World Bank has signed up to the 56 commitments and 12 targets to be reached by 2010, agreed to by most donors and many aid recipient governments. The 2006 baseline survey to monitor progress shows that the World Bank scores relatively well in some areas compared to other donors, such as providing budget support or “programme-based” aid. It is only slightly better than average at disbursing money on time, and using developing country financial systems. And it does less well when it comes to providing technical assistance and coordinating missions to the country.

The rules of the Paris Declaration game are favourable to the Bank. Despite being a player, the World Bank also gets to be the referee on three targets. These are the targets related to public financial management, ownership and results. Despite the influence of the Bank, particularly in the latter two areas, its own actions avoid scrutiny.

donors monitor themselves, while recipients are monitored by the Bank

The Bank’s controversial scoring system, known as Country Policy and Institutional Assessments or CPIA (see Update 52), is used to measure the quality of developing countries’ public financial management systems. This is assessed using the results from one CPIA score, namely the “quality of budgetary and financial management”.

The second target assessed by the Bank is ownership. This is viewed as developing countries exercising effective leadership over their development policies, strategies, and coordinating development actions. The indicator and process for measuring success is circular at best. Developing countries are scored by how operational their Poverty Reduction Strategy Paper (PRSP) is as judged by the Bank. No country scores the top grade of having a “sustainable” PRSP, and 8 out of 62 countries are deemed to have “developed” PRSPs. There is no indicator to measure what the Bank (or other donors) should do to enable country ownership, such as ending policy conditionality.

The third area measured by the Bank is particularly problematic. This is the extent to which aid is implemented in a way that focuses on the desired results. Although both donors and developing countries have made commitments to pay more attention to the results of their interventions, the indicator for measuring progress refers only to efforts of the developing country, as judged by the Bank.

Using a review of its 2005 Comprehensive Development Framework progress report, the Bank examines the quality of developing countries’ performance assessment frameworks – based on the quality of statistical data available, stakeholder access to information and coordination of monitoring and evaluation. The Bank, together with other donors, plays a leading role in deciding the conditions and indicators in these performance assessment frameworks, and often in a non-transparent way. It is ironic that the Bank can then make a judgement on their quality. No country was awarded the top score, and only Tanzania, Uganda and Mozambique made the second grade.

A new Eurodad report, Turning the tables: Aid and accountability under the Paris framework, showcases civil society and southern government views on aid effectiveness. It argues: “The current monitoring process for the Paris Declaration is asymmetric – donors monitor themselves, while recipients are monitored by the World Bank and others.” CSOs from around the world are mobilising to make aid more effective, with over 380 organisations from over 80 countries having signed up to a civil society position paper Better aid: A civil society challenge to the 2008 Accra High Level Forum on Aid Effectiveness.

Meanwhile, negotiations are underway to agree the text of the communiqué that development ministers will announce in Accra as the outcome of the conference – the so-called Accra Agenda for Action. Developing countries have outlined six priorities – conditionality, capacity development, incentives for good performance (for donor agencies), division of labour/complementarity, predictability and untying aid. The Bank says in principle that it agrees with these six proposals – the devil is of course in the details of how they are addressed. Some donors want to ensure that no detailed pledges are made, just vague discussion on identifying “good practice principles”. Others are pushing for agreement on concrete actions moving forwards.

The World Bank sits in a pivotal position on the executive committee for the High Level Forum, together with representatives from the OECD and the government of Ghana. The Bank managed to rile both its team members and the other side in June last year by unilaterally producing a “zero-draft” of this communiqué, kicking the ball into play before the whistle was blown. The game was restarted, but it remains to be seen how much developing countries will be able to get or keep possession of the ball in the lead up to the Accra event.