|
|||||||||
| |
|||||||||
I would like to comment on public expenditure management. The current vogue for direct budget support (DBS), which is displacing funds formerly earmarked for agriculture investment projects, has implications for the way agencies work with ministries of agriculture. Although the DBS approach is advocated as a way of reducing "interference" in the affairs of sovereign states, increasing ownership by recipient governments, and ultimately as a way of substantially increasing resource transfers, it seems to mean in practice that donors are dodging their responsibility as partners in the fight against poverty. In most Sub-Sahara Africa countries, the development budget is largely funded externally. In the past, financing institutions and donors often earmarked a specific share of their loan portfolios or development budgets for the agricultural sector. They then supported the formulation of a variety of investment projects, targeting sub-sector development, or constraints within the sector. Latterly, all such projects had an underlying emphasis on poverty reduction. With the increasing shift towards DBS, the capacity to earmark investments in the development budget has been reduced. Policy dialogue and the use of a policy matrix to accompany PRSCs and other forms of DBS are important processes. However, in the end, decisions about resource allocation are increasingly left in the hands of ministries of finance. We all know that our principal partners in developing countries - the ministries of agriculture (MoAs) - are invariably the weakest of the sectoral ministries and the least capable of making a convincing case with the MoF for scarce budget resources. Similarly, many MoAs remain trapped in a production-oriented view of their role and so have little sympathy with the current preoccupation with poverty reduction. Without projects and earmarking of resources, it is difficult to ensure that the agricultural sector receives the resources needed to stimulate growth in the agricultural sector. It is also difficult to ensure that agriculture sector programmes target poverty reduction, and to provide effective technical support to MoAs to this end. In particular, technical assistance (TA), which was previously "bundled" with agriculture sector investment projects, is hard to target in isolation. How should development agencies concerned with agriculture and rural development change the way they operate in this new environment? Michael L.Wales Principal Advisor FAO Investment Centre viale delle Terme di Caracalla 00153 Rome, Italy Tel: (39 06) 57055432 Fax: (39 06) 57054657 E-mail: <address removed> Web page: http://www.fao.org/tc/tci/tci.htm <http://www.fao.org/tc/tci/tci.htm>
Please visit dfid-agriculture-consultation.nri.org.