Sectoral aid in practice

n° 07

exPost ExPost

Evaluation and capitalisation unit Summary Notes series.

December 2009

Sectoral aid in practice E x p o s t summary notes present the lessons learned from evaluation and capitalisation experiences on a theme or a particular intervention.

They particularly address AFD teams and their partners in the North and South, but also professionals involved in development actions with similar features to the operations under analysis.

This edition has been produced by Lionel Cafferini and Hugo Pierrel.

Lessons learned and next steps for AFD Analysis based on experiences in Africa Since the Paris Declaration on Aid Effectiveness, developing countries and donors have increasingly favoured the

development of sectoral aid, which represents a substantially

different approach from the way aid was provided in the past.

In light of this, AFD decided to carry out a review in order to better direct its actions towards sectoral approaches and to

mobilise its funding instruments more effectively to support the

public policies of partner countries. The Strategy department

has undertaken an ex-post analysis based on four case studies from West Africa: Education in Mauritania, health and education in Niger and education in Burkina Faso.

The aim of this capitalisation exercise is to review AFD's

experience of sectoral aid and identify courses of action for improving it in practice. By means of a summary, this note

reminds us of the context of this work and suggests a definition and a typology of sectoral aid. It then presents the main observations of these experiences and outlines some

recommendations for AFD. The complete report and the

Agence Française de Développement Département de la Recherche 5, rue Roland Barthes 75012 Paris www.afd.fr

country reports are available on the AFD website.

exPost ExPost • Summary Notes series • n° 7 December 2009

2

BACKGROUND

A

lthough many aid organisations have accumulated extensive expe-

rience in sectoral approaches since their

inception in the mid-1990s, it is really

since the Paris Declaration on Aid Effec-

tiveness in December 2005 that the international community has agreed to distrib-

ute more programme-based aid. In

Accra, in September 2008, donors reaf-

eficiary countries, strengthened coordina-

tion and harmonisation between donors,

alignment of donors with the strategies

and procedures of beneficiary countries,

dialogue centred on policies and results, and lastly, reduced transaction costs.

From a French perspective, growth in

programme-based

50% or more of government-to-govern-

ment assistance through country fiduci-

ary systems.”

The use of sectoral aid generates a

repeated in the action plan for strength-

ening aid effectiveness and implement-

ing the Paris Declaration of December

2006. The AFD (French Development Agency) has incorporated this commit-

number of expectations within the interna-

ment into its 2007/2011 strategic orienta-

in an increased adaptation of aid by ben-

vention frameworks.

tional community, notably that it will result

to sectoral aid for education, health,

water and environmental programmes.

In light of this, the Strategy department

aim of this capitalisation exercise is to

national Cooperation in May 2005 and

as

as sectoral aid. AFD mainly contributes

the Inter-ministerial Committee for Inter-

approaches by 2010 and (ii) to channel

aid

the support given has been implemented

has undertaken an ex-post analysis

Assistance is an objective established by

of

gramme-based approaches and a fifth of

sectoral aid within Official Development

firmed their commitment to: “(i) provide 66%

Since 2003, around two thirds of AFD’s

commitments have taken the form of pro-

based on four case studies. The main

review AFD's experience in terms of sec-

toral aid, particularly in the social sectors,

and identify courses of action for improv-

ing the practice of this type of intervention and financing.

tion plan and into its main sectoral inter-

TABLE 1. The case studies used to support analytical work Country Sector

Mauritania Education

Niger Health

Niger Education

Burkina Faso Education

Sectoral programme

National Education Sector Development Programme (PNDSE)

Health Sector Development Programme (PDS)

Ten Year Education Development Plan (PDDE)

Ten Year Basic Education Development Plan (PDDEB)

Period covered by the sectoral programme

2000/2009

2005/2010

2003/2012

2000/2010

Partners

AFD *

World Bank and AFD

World Bank (Fast Track Initiative) + AFD + Netherlands + Norway + DFID

World Bank + AFD + the Netherlands + Belgium + Denmark + Sweden + UNICEF + European Commission

* The World Bank and the African development Bank use a parallel funding programme within the framework of project aid integrated into the programme approach.

© AFD - RCH / EVA • Sectoral aid in practice

Source: AFD.

exPost ExPost• Summary Notes series • n° 7 December 2009

3

DEFINITION AND TYPOLOGY

T

he programme approach has been

defined by the Learning Network

On Programme-based Approaches as

“a means of engaging in development

cooperation based on the principle of coordinated support for a locally owned programme of development such as a

national anti-poverty strategy, a sectoral

programme, a thematic programme or a programme from a specific organisation".

The sectoral approach is the applica-

tion of the programme approach at sec-

tor-level.

It seeks to formulate, programme,

implement and monitor a sectoral devel-

opment plan that covers all aspects of the sector and all sources of funding. It is

Programme-approach idea according to the DAC It is generally defined as a framework of relations between national authorities

and donors based on four characteristics:

1. The country or the beneficiary organisation has control over the donor-

financed programme.

2. There is a single integrated framework for budget and programming.

3. A formal process has been implemented to ensure the coordination and

harmonisation of donor procedures for at least two of the following elements: (i) reporting; (ii) budgeting, (iii) financial management and (iv) procurement

procedures.

4. For the support being provided, the donor uses local systems for at least two

of the following elements: (i) design; (ii) implementation; (iii) financial

management (iv) monitoring and evaluation.

Sectoral aid is a modality for funding

It transits via the budgetary channel

generally defined as a framework of rela-

the sectoral approach and can be

donors, based in principal on the follow-

● Supports a collection of structured

uses the existing discussion and coordi-

● A coherent, realistic and detailed sec-

and sustainable results at sector level (or

those which cover the monitoring of gen-

tions between national authorities and ing characteristics:

described as funding that:

and quantified actions to achieve global

and national public spending procedures.

In contrast with general budget support, it

nation frameworks at sector level and not

toral policy;

theme level), and which is part of a politi-

term expenditure programme covering

● Follows the structure of the budgetary

SBS can take one of two distinct formats:

ficiary country or is aligned with those of

(SBS–NT) and targeted sector budget

● A sectoral budget based on a medium

all the financial resources available for

the sector;

● A detailed and coherent timetable of

activities and investments;

● Clear, measurable and realistic indica-

tors and targets, to evaluate the progress

cal/strategic dialogue on the sector.

and accounting procedures of the benethe other funders.

It covers two main types of funding:

Sector budget support, which can be tar-

geted or non-targeted and non-budget-

eral budget support as part of the strategic framework for Poverty reduction.

Non-targeted sector budget support, support (SBS –T).

● SBS-NT is directly paid into the cur-

rent account of the national treasury. The

resources allocated to the sector in ques-

in implementing the sectoral policy;

ary common funds. Project aid, which is

tion are entirely fungible with the other

that covers all the sector's activities ;

same as sectoral aid.

● SBS-T is used to directly fund expen-

● A monitoring and evaluation system ● An institutional system for coordina-

ting and harmonising the approaches

and the activities in the sector, in which

all the stakeholders participate, under the responsibility of the national authorities.

part of a sectoral approach, is not the

Sector Budget Support (SBS) is

budgetary resources.

diture in a sector. Targeting allows the

resources to be allocated to the sector

used to fund government expenditure

under consideration and ensures the

sectoral policy.

and financial partner’s resources.

resulting from the implementation of the

subsequent traceability of the technical

© AFD - RCH / EVA • Sectoral aid in practice

exPost ExPost • Summary Notes series • n° 7 December 2009

4

C h a r t 1 . Programme approach and types of aid

Non-budgetary sectoral aid (SA-NB), where the partners

PROGRAMME APPROACH

decide to pool their funding via

the creation of an ad hoc com-

SECTORAL APPROACH

General budgetary support

Government income

Sectoral budget support

mon fund, or by using an interme-

Sectoral aids

Common fund Donors X & Y

Donor X

Donor Y

diate structure whose accounts

are held by a commercial bank.

Donor W

The resources and spending

from these funds can be included

in the government budget, but

COMMERCIAL BANK

PUBLIC TREASURY

Co-financed activities Projects

they are executed outside of the

country’s budgetary procedures and public accountancy rules.

Project

Project

Project

Sectoral strategy and programme

Growth and poverty reduction strategy Source: AFD and presentation by the Train4Dev network

Financial procedures and procu-

rement procedures are usually specifically defined for the fund in

question. Monitoring generally

takes the form of independent and specific periodical audits. ■

FINDINGS

T

he main findings seen on the ground highlight the particularly

ambitious nature of this approach in the

countries being studied, notably in terms

They also illustrate the complexity of

the approach and the progressive learn-

ing curve that this new type of partner-

ship requires. These findings should be

of defining and managing sectoral poli-

taken with caution given the limited num-

observed between the expectations

covered poor West African countries and

cies. These findings reflect the shortfall

ber of samples examined, which only

tion and health sectors, is an important

departure from previous project-based

practices. It has resulted in:

● The adoption of a more global vision

of the sectors as part of a long-term

governmental approach with a common

(even the impatience) placed in these

social sectors.

target being the achievement of the Mil-

mentation conditions, on the one hand,

The sectoral approach takes shape

cross-sectoral instruments for the strate-

case studies, on the other.

ning of 2000, in particular in the educa-

new approaches, based on ideal imple-

and the situation observed in the various

The approach initiated since the begin-

© AFD - RCH / EVA • Sectoral aid in practice

lennium Development Goals. It draws on

gy, running and management of public

policies (ten-year sectoral strategy bro-

exPost ExPost• Summary Notes series • n° 7 December 2009

ken down into multi-year programmes,

with the aim of achieving eligibility for the

budget by programme, etc.);

the sectoral programme had been adopt-

medium term expenditure guidelines,

● The implementation of coordination

measures that are increasingly organi-

sed and inclusive (formal partnership

agreements, shared monitoring tools,

naming of a leader, implication of new

stakeholders, etc.).

There is no doubt that sectoral aid is

behind the major progress made that had

long been inaccessible within the frame-

be struggling to find its place in terms of

ed, etc.).

financing that it favours, typically project

regarding the objectives being pursued,

port. Another possible interpretation of

This creates an element of confusion

the targets to meet and the degree of

sectoral aid, as a result of the types of

aid or non-targeted general budget supthis position would be to consider that the

accuracy of the hypotheses contained in

EC has already gone beyond the secto-

more, sectoral policies are very often

Transaction costs generated by formal-

the core sectoral documents. Further-

inadequately incorporated into related

strategies and developments in the glob-

al intervention context (decentralisation,

public service reform, private sector

sectoral ministries, and as a result,

Despite the undisputed unifying charac-

increased control over the definition and

● The European Commission seems to

Fast Track initiative only one year after

work of project aid and particularly: (i) the rehabilitation of the legitimacy of certain

5

capacity ...).

ter of sectoral aid, harmonisation between

ral aid approach.

ising institutional and instrumental frameworks (strategy, programming, opera-

tional, budgetary and partnership docu-

ments) have tended to be added to those

linked to traditional project management,

whose portfolio remains considerable.

During this phase of gradually building

management of sectoral policies by the

donors is still only making slow progress.

the foundations of the approach and of

coordination between partners and

transit via harmonised funding. In addition

high, particularly as the division of labour

alignment, (iii) the implementation of dis-

funding sources (project aid, sectoral aid,

proved to be complex processes that

beneficiary countries, (ii) the increased progress in terms of harmonisation and

cussion mechanisms managed by the governments of the South, bringing

together a wide panel of stakeholders

and (iv) a greater consideration of the

global institutional environment in the

country of intervention and of its impacts

A majority of external aid still does not to the government budget, many other

vertical funds, NGO financing, etc.) can be

identified in all the case studies.

We see that:

● UN

organisations

are

generally

● Some of the major international initia-

put in place (budgetary or not). Although

tives, notably in the health sector (GAVI,

mainly depends on the type of sectoral aid the objectives of the sectoral aid are gen-

erally identical to those of the national

● The World Bank and some bilateral

with the budget cycle has been relatively

treatments free of charge in Niger was

donors (the Netherlands, Denmark,

the sectoral framework, education policy

monised or aligned intervention modes

objectives in Burkina Faso were revised

Lastly, the progress relating to alignment

World Fund, etc.), do not fit into the sec-

toral aid implemented in the field;

not planned for and thus not included in

ventions and (ii) each donor having their

with national systems is still nascent. It

often more difficult to achieve (decision

regarding the provision of certain medical

of types of organisation and donor inter-

and the Japanese development depart-

ment;

strategic analysis, political decision-mak-

times chaotically.

own financial calendar.

of the sectoral policy, etc.).

ing and operational implementation is

were organised gradually and some-

absent from sectoral aid, as are some of

the bilateral agencies such as USAID

In practice the logical sequence of

and the pooling of skills between funders

This situation is linked to: (i) the variety

on the sector (management of public

finances, decentralisation, sustainability

sectoral aid, transaction costs stayed

strategies, the alignment of sectoral aid poor, both in the budget preparation

France, etc.) make an effort to apply har-

phase and the execution phase.

to their funding;

ments remains strongly dependent on

Alignment with national reporting instru-

© AFD - RCH / EVA • Sectoral aid in practice

6

exPost ExPost • Summary Notes series • n° 7 December 2009

TABLE 2. Degree of attainment of the objectives of the sectoral programmes for Education

● Very good progress / target reached ● Slight progress ● Stagnation or deterioration Mauritania 2001-2008

Niger 2001 - 2006

Burkina Faso 2001 - 2006

Pupils/teachers ratio

● ● ●

Pupil attainment level

●

● ● ● ● ●

● ● ● ● ●

Gross Intake rate (%) Completion rate (%)

Pupils/reading books ratio

-

Source : AFD

the types of sectoral aid being used, par-

ticularly in terms of targeted spending,

and is sometimes affected by the donors

involved and the internal procedures.

they acquire sustainably literacy, remains

poor. Pupil attainment levels remain extremely low. Despite specificities and

contexts that are unique to each country,

generally produced late and without

coordination with the government budget

preparation process and the multiyear

general expenditure framework. Similar-

it appears that quantitative objectives

ly, the activity planning tools used by gov-

Performances are below objectives.

precedence over all the sectoral pro-

and are subject to production and valida-

ground, the intermediate objectives of

ment of objectives to improve quality and

Confronted with the reality on the

related to accessing basic education take

grammes that were studied, to the detri-

the sectoral programmes examined in

teacher effectiveness, both of which are

reached.

rating.

tania, Niger and Burkina Faso with

because they are too ambitious and are

this study have, to date, rarely been Table 2 illustrates the situation in Mauri-

regards to the development of certain

key indicators for access to basic educa-

stagnating, and in some cases, deterioMeasuring instruments are poorly used

in fact focused on sectoral aid. We

observe a recurring contrast between a

ernments are more and more complex

tion delays that have a negative impact

on their implementation. They focus on

approaches and nomenclatures that are

often far removed from those used for

budget preparation and are difficult, or

even impossible, to apply in operation.

In addition, these tools often follow a

quantitative and financial approach and

do not give sufficient consideration to the

tion and its quality.

set of somewhat idealistic measuring

tors that reflect service volumes (gross

the implementation and monitoring of

be correctly executed.

and the realities of the management that

during the sectoral reviews rarely pro-

cant improvements (completion rate,

ment tools that were used, on the other.

rate of the state budget at sectoral level,

pupil, etc.).

instruments in place, in particular in

Progress so far mainly concerns indica-

primary intake rate, gross intake rate,

number of classes, etc.), whereas quali-

tative indicators are not showing signifi-

pupil/ teacher ratio, number of books per The systems’ capacity to retain pupils

until the end of the primary cycle, so that

instruments drawn up ex ante to facilitate

sectoral programmes on the one hand, has occurred and the related manage-

technical and institutional dimensions

required for the sectoral programmes to The annual assessments presented

vide precise data about the execution

Indeed, the financial programming

despite its importance in financing pro-

medium-term sector expenditure frame-

These observations lead us to ques-

works, are not regularly updated and are

© AFD - RCH / EVA • Sectoral aid in practice

grammes.

tion the suitability of the instruments

exPost ExPost• Summary Notes series • n° 7 December 2009

proposed, in the context of the intervention and the stakeholders involved, and

this despite the considerable investment

made in terms of time and human

resources to manage them, both by

7

These situations can sometimes border

on the absurd, notably in the framework

of common funds, when they result in the

creation of parallel and rigid management systems that hinder the implemen-

national authorities and donors.

tation of actions and force the administra-

tion: complexity of the programmes and

ming and planning that becomes impos-

Dialogue is little (or poorly) related to sectoral results

Sectoral approaches have encouraged

tion into an endless cycle of program-

the creation of regular discussion and

the tools; poorly understood contexts;

sible to monitor.

the management of local governments. It

holder capacities (including donors);

difficulties in becoming operational.

There are many reasons for this situa-

overestimated and/or inadequate stake-

Such systems encounter considerable

poor control over the process of trans-

Most of the time they produce few exter-

many cases, these tools seem to have

shown to be merely poor catalysers for

forming means into performance, etc. In

been developed purely to satisfy the demands of donors.

coordination mechanisms placed under

is true that this dialogue has clearly allowed the various stakeholders to

acquire a general and shared vision of the

nalities on national systems and are

sectoral policy in the long term. Neverthe-

sectoral dialogue.

dialogue remains mostly centred on the

The planning process in the Niger health sector At the start of the Health Sector Development Plan (HDP) in 2005, the

Health ministry put in place an annual bottom-up planning system for activities that were part of the five-year work plan. (FYP) Consequently, each

administrative entity draws up their own annual action plan (AAP) following

the structure and the directions of the FYP (objectives, strategies, activities,

costs, indicators).

less, in terms of policy implementation, means made available for programmes, their management and the monitoring

instruments that apply to them.

It is little and poorly related to sectoral

results. Discussions on fund program-

ming and the operational planning of

activities seem to have the effect of usurping a more strategic, resultsfocused dialogue.

The annual programme progress

We have counted 42 FYP at central level (central management, national

reports include little qualitative analysis

42 FYP at district level. All of the planned activities are listed and detailed in

undertaken, the funding mobilised, the

This plan covers an increasing variety of activities and funding sources

es achieved. These elements are rarely

In practice, this process is experiencing a series of delays as a result of the

al perspective likely to encourage the

usefulness. It does not take into account the costs relating to the human

level discussion focused on the strate-

programmes, hospitals and offices), 8 FYP for regional authorities, and

a summary chart by programme (objective) and sub-programme (results).

(government budgets, common fund partners, project aid and vertical funds).

ambitious approach and complexity of the exercise, which limits its

resources that are mobilised. It is disconnected from the budget preparation

cycle as a result of the specific nomenclature that it uses and the fact that it is

managed by departments other than those in charge of budgetary aspects.

However, it has proved possible to monitor the execution of 7,275

programmed activities in 2007.

and information about the activities

reforms underway and the performanccollated and analysed from a more glob-

evaluation of performances and a high-

gic and priority aspects of the sector being supported.

Furthermore, the absence of a mecha-

nism that more clearly defines the

answers to be provided in the short or long

term, when expected results are not being © AFD - RCH / EVA • Sectoral aid in practice

8

exPost ExPost • Summary Notes series • n° 7 December 2009

TABLE 3. Ex-post evaluations carried out or scheduled Country Sector

Period covered by the sectoral programme Evaluation carried out since the start of the sectoral programme

Burkina Faso Education

Mauritania Education

Niger Education

Niger Health 2005/2010

2000/2009

2000/2010

2003/2012

Yes – External Evaluation – Report produced in 2007 – Format does not meet international evaluation standards

No External evaluation scheduled for 2008 but not carried out to date

No Mid-term review performed in 2007 by the Nigerien authorities

Yes – Self-evaluation produced in 2008 by the Nigerien authorities.

– Additional work by the external consultant is scheduled (satisfaction and epidemiology surveys) Source: AFD.

achieved, does not always encourage a

critical discussion about this shortfall.

Indeed, decision making about pay-

ments is strongly linked to process

of exercise (self-assessment by the

stakeholders themselves). They do not

ity of beneficiaries and the progressive

standards, in terms of the objectives fol-

systems on the other.

always meet international evaluation

development (carrying out reviews, pro-

lowed and the evaluation criteria used.

use of the available resources.

their attention on their resources and

and regular ex-post assessments is not a

aging programmes, the often inade-

ducing documents...) and to the correct Lastly, the carrying out of independent

priority, either for donors or the benefici-

In fact, the tendency of donors to focus

the systems for implementing and manquate abilities of national stakeholders

ary countries. The existence of a series

to manage complex sectoral pro-

toring measures (joint periodic reviews,

of disbursement combine to deflect

of relatively unwieldy institutional moni-

production of implementation reports,

etc.), the sometimes unsynchronised

grammes and lastly the chosen means attention from one of the key objectives

of sectoral aid, that is to say a result-

timetables of the various stakeholders

centred approach.

programme phase, etc.) and the com-

structed to ensure the continuity of sec-

(funding renewal, formulation of a new

plexity of organising a joint evaluation of

The entire system seems to be con-

toral funding, even when the desired

a public policy can explain this situation.

results are not reached.

ried out or are performed late compared

Targeting and traceability lead to rigid aid management

In practice, evaluations are rarely car-

with the commitments featuring in the strategy or partnership documents. Fur-

thermore, the formats adopted do not include all the guarantees of objectivity

and independence inherent to this type

one hand, and the increased responsibil-

The implementation of sectoral aid rais-

es a recurring dilemma between a legiti-

mate demand for control and results from

partners regarding their funding on the

© AFD - RCH / EVA • Sectoral aid in practice

alignment with national management A number of factors make the case for

maintaining a close control on resources provided, particularly:

● The intervention context at sectoral

and/or global level, notably in terms of:

- The limited performance of national

procedures in the areas of: Budget exe-

cution or procurement and (ii) internal and/or external monitoring systems.

- Treasury difficulties, that can affect the funding of the sector being supported;

- The poor ability to manage and absorb resources at the sectoral level.

● The constraints and preferences of

the partners, including:

- The need to ensure a certain visibility for their action;

- The desire to focus their resources on some of their priorities;

- The ability to control and formally

account for the use of the resources; - Aversion to fiduciary risk.

exPost ExPost• Summary Notes series • n° 7 December 2009

9

In the cases studied, the final arbitra-

● Relatively short funding agreement

and financial execution at sectoral level;

mentation of a target for the aid, specif-

● Annual funding announced and paid

cial execution of sectoral programmes

tion has usually resulted in the imple-

ic control conditions and certain fiduci-

ary arrangements to limit the risks in the short term.

This generally takes the form of:

● Tracing the use of the given re-

sources, prior to disbursement (ex-

ante validation of spending plan),

sometimes at the moment of disburse-

periods (3 years on average);

late to limit risks.

This way of operating can impact on

the coherence and effectiveness of the

chosen management methods compared with the stated ambitions of the

sectoral approach. It often results in

that focuses on external resources;

● Discussions about means and their

management, rather than discussion about results;

● A certain rigidity in the use of the

resources provided;

bureaucratic and rigid aid management,

● High transaction costs;

● Poor forward planning that has a

systems.

ment (approval for the awarding of

characterised by:

(external audit).

negative effect on programme structure

contracts), and in all cases ex-post

● Monitoring of the technical and finan-

● Very poor externalities on national

■

TABLE 4.Types of sectoral aid and alignment Country Sector

Mauritania Education

Niger Healthcare

Niger Education

Burkina Faso Education

Type of sectoral aid

Targeted sector budget support

Non-budgetary common fund

Targeted sector budget support

Additional remarks

Funding of the budget line expenditure of the Ministry of Education via the treasury

Funding of the expenditure of the annual action plan via a commercial bank account

Funding of the budget line expenditure of the Ministry of Education via the Treasury

Use of national budget and accounting procedures

Strong

Poor

Strong

Quite Strong

Intervention of PTF in procurement

No

Yes

Before 2005: no Between 2005 and 2009: yes (following an unfavourable audit) Since 2009: no

Before end 2008: no Since end 2008: yes

Use of an annual external audit

Yes

Yes

Yes

Yes

Monitoring reports specific to sectoral aid

No

Yes

No

2005-2007: no Since 2008: yes

Since 2005: Targeted sector budget support Before 2005: Nonbudgetary common fund

Payments to a special treasury account dedicated to the expen diture of the Ministry of Education

Source : AFD

© AFD - RCH / EVA • Sectoral aid in practice

exPost ExPost • Summary Notes series • n° 7 December 2009

10

LESSONS LEARNED

T

he high expectations created by the use of sectoral aid seem to have

contributed to a certain idealisation of the

strategy and to an underestimation of

● However, the synergies between the

that has taken place within the frame-

remain inadequate. Capacity building

has led AFD to address the multiple

although they had been considered pri-

development also has to be compared

cations for assistance, to ensure that the

ting to the coordination process bet-

various instruments at its disposal activities are often put in place very late,

mordial during the examination of applisectoral approach works well and to

work of the sectoral approach, which

dimensions of public policies. This

with the time AFD allocated to contribuween donors, in contexts where the

operational implications.

minimise certain risks. This support does

approach practically, the main stakehold-

of sectoral aid, in particular with regards

● The risks linked to sectoral aid are

lenges inherently linked to the complexi-

dation. This practice is remarked upon by

controlled than in classic project-based

a new style of partnership.

with a variety of mechanisms depending

After some years of applying this

ers are now faced with a number of chalty of the approach and the need to learn

● AFD has up to now been working on

better harmonising its interventions with

those of other donors, and in certain

not use the same mechanisms as those

to the planning process and activity vali-

local partners who find themselves faced

on the operating mode used. In terms of

the link between general budget support

and sectoral aid, situations differ accor-

ding to country, but they show that inter-

cases, on aligning them with national

actions between the two tools to streng-

pragmatically structure the directions and

have yet to be created.

procedures. In particular, it has sought to

objectives of French aid with the strategic

priorities of the countries and with the

then coherence and complementarity

● The time spent by AFD teams on

division of labour often appears limited.

often more numerous and less well aid. There are a number of reasons for

this: (i) the scale and complexity of sec-

toral programmes; (ii) the major cultural,

political and sometimes societal changes

that may be caused by sectoral pro-

grammes; (iii) the strong inter-relation between these programmes and the

government's cross-sector strategies;

(iv) the sometimes “voluntaristic” (and

therefore risky) alignment with national

procedures that are still fragile; (v) the

training and monitoring assistance in

consensual nature of the coordination

much greater than the average referen-

ners; (vi) the sometimes risky preoccupa-

to the partnership dynamics in place.

ce financed through classic project-

gement when the means and the proce-

to draw on such a diverse range of fun-

explained by the change in paradigm

cooperation strategies of other partners.

Within this framework, it has opted for flexible approaches and has striven to

adapt its instruments to the context and AFD is one of the few donors to be able

ding instruments to achieve this (funding

the form of sectoral aid is generally

ce time that AFD dedicated to assistan-

based aid. This observation can be

of non-budgetary common funds, targe-

ted or non-targeted sector budget support, general budget support, contribu-

tion to support actions for capacity buil-

ding in the form of resident technical

assistance, training, short term consul-

tancy missions, etc.).

© AFD - RCH / EVA • Sectoral aid in practice

and harmonisation with the other part-

tion with promoting result-based mana-

dures are poorly understood.

■

exPost ExPost• Summary Notes series • n° 7 December 2009

11

NEXT STEPS

● Defend the realism of public policies

T

and the pragmatism of the monitoring

tools by drawing on its knowledge on the

his analysis confirms that AFD is

right

to

pursue

the

initiative

launched within the framework of its

strategic orientation for 2007/2011 with

the aim of actively participating in the

commitments made by the Paris Decla-

ground, by encouraging strategy-updat-

ing processes, by anticipating the technocratic tendency of its instruments and by operating the necessary selectivity in its interventions;

● Position itself systematically regarding

for options that are likely to generate

positive externalities on national methods and procedures.

Developing AFD’s work methods to meet the demands of sectoral aid The strengthening of AFD’s action in

support of public policies via a more

intensive use of sectoral aid, must be

ration and mobilising its funding instru-

policy and results analysis by playing an

based on a structured and organised

public policies of partner countries. With-

at the heart of discussions, and by con-

volumes to be mobilised and the

ments more effectively in support of the

active role in putting results and reforms

in this framework, the AFD should contin-

tributing to setting up, in funding and

ples and methods that encourage a cer-

anisms should the defined objectives fail

ue its efforts to adopt an attitude, princi-

partnership documents, feedback mech-

tain vision of sectoral aid among the

to be reached;

changes and reforms that are needed

● Promote the implementation of regu-

other stakeholders, accompany the

and give the partner countries a certain

freedom, whilst at the same time incorpo-

rating the barriers and selectivity needed according to the context.

This note outlines a number of cours-

es of action arranged into two categories: firstly to promote some core

principles to guide AFD in its sectoral

mechanisms and optimise transaction

costs. In light of this, this note particu-

● Focus on alignment and limit ex-ante

frame, country strategy, programming of

possible, by looking for a more effective

a more systematic and global logic at

monitoring and targeting as much as arbitration between acceptable risk and

ing in terms of a funding continuum (time

means, etc.) by placing its actions within

sector level (political, technical institu-

an improved inclusion of aid in national

tional, capacity building dimensions, etc.)

not to set targets, AFD should, system-

modalities, monitoring indicators, ex-post

in-depth assessment; (ii) establish a

from funding discrete projects to funding

Promoting a number of core principles to guide AFD’s action in sectoral approaches

consensus with its partners about the

promote the following four principles:

improve monitoring and evaluation

● Develop its intervention strategy think-

atically: (i) justify its choice based on an

acterise its role in sectoral aid, AFD could

to strengthen capacities internally,

being supported;

demands of sectoral aid.

of sectoral approaches but also to char-

vention and the means to be deployed

larly recommends that AFD:

with partners in the sectoral programmes

procedures. While it seems premature

In order to improve the general practice

modalities and locations of the inter-

lar, systematic, independent evaluations

approach, and secondly to develop its

working methods when faced with the

approach, both in terms of the financial

dysfunction, justifying the adoption of

non-aligned procedures in the short-

term; (iii) consider the practice to be

transitory and embark on a change

process to resolve identified weakness-

es; (iv) limit negative effects and look

and by adapting its methods (instruction

evaluations, etc.). It should therefore shift

continuous public policies;

● Improve links between the funding

instruments at its disposal (project-based

aid, technical assistance, sectoral aid, global budgetary assistance, etc.);

● Strengthen its own capacities by re-

© AFD - RCH / EVA • Sectoral aid in practice

12

exPost ExPost • Summary Notes series • n° 7 December 2009

Publications from the Evaluation and Capitalisation Unit examining its procedures and the way

work is organised within project teams, by equipping itself with tools such as a

guide to sectoral aid, and by consolidating the training available to its staff;

● Better define the role of leader on the

ground (scope of the function, added

value for AFD, risk analysis, means

required, organisation of the division of

labour between funders, definition of a mandate and a roadmap, etc.);

● Control and optimise management

● Summary Notes series No. 1.

Energy Efficiency in the Lebanese Construction Sector – March 2007

No. 2.

Managing Watercourses in the forested Guinea highlands, Guinea - Sept. 2007

No. 4.

What Microfinance for Agriculture in Developing Countries? - Sept. 2008

No. 6.

Three-way encounters: AFD partnerships with local authorities and NGOs -

No. 3. AFD-funded No. 5.

Support for farmers’ organisations in Guinea – November 2008

December 2008

● Methodological Notes series

No. 1. A Comparative

Study of Evaluation Policies and Practices in Development

Agencies, Marta Foresti with Christina Archer, Tammie O’Neil and Richard Longhurst - December 2007

costs inherent to sectoral aid by seeking

No. 2. Agence

that it has to fulfil (leader, management

No. 3. Are

a better balance between the functions

Resident Technical Assistance – November 2007

Française de Développement, a Process of Building in-house

Ownership and Capacities, J-D. Naudet and J. Delarue - December 2007

evaluations useful? Literature review about “knowledge and decisions”,

authority, silent partner, division of labour,

J. Delarue, J-D. Naudet and V. Sauvat - January 2009

tions (amount, duration, etc.);

● Impact Analysis series

● Consolidate the analysis and the

vie des ménages au Mali et au Burkina Faso, S. Mesplé-Somps, A-S. Robillard, J.

etc.) and the optimal size of its opera-

monitoring of risks by adopting a matrix

adapted to the specificities of the

approach and of sectoral aid, and by

organising, as often as needed, bilateral

reviews of the AFD’s contribution to the

sectoral approach being supported in a

given country.

■

No. 1.

Coton et pauvreté en Afrique de l’Ouest: analyse comparée des conditions de

Gräb, D. Cogneau and M. Grimm, DIAL- AFD - December 2008 – (in French only) No. 2.

Poverty, Access to Credit and the Determinants of Participation in a New

Micro-credit Program in Rural Areas of Morocco, B. Crépon, F. Devoto, E. Duflo and W. Pariente, EEP- J-PALAFD, December 2008

● Evaluation and Capitalisation Series. Latest publications No. 22.

Les collaborations opérationnelles entre l’AFD et les ONG, P-M Rosner -

No. 23.

Étude d’évaluation de la Société immobilière de Nouvelle- Calédonie,

No. 24.

Synthèse de l’évaluation rétrospective, C. Hugues et S. Fahmy - May 2009

No. 25.

Ex-post Evaluation of the FGEF Energy Efficiency Project in the Cons-

No. 26.

Support for family rubber plantations – Capitalisation on AFD’s experiences,

December 2008 (in French only)

G. Horenfeld - March 2009 (in French only) Publication director:

Jean-Michel Severino.

Editorial director:

Jean-David Naudet.

ISSN: 1957-1232

Copyright: December 2009

Page layout: Solange Münzer

(in French only)

truction Sector in Afghanistan, A. Riès, May 2009 J. Delarue - September 2009

The analysis and conclusions of this document are those of the authors. They do not necessarily reflect the official position of the AFD or its partner institutions.

© AFD - RCH / EVA • Sectoral aid in practice