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An Evaluation of DFID-Funded Technical Co-Operation For VOLUME 2 EV667 June 2006 DEVELOPING CAPACITY? AN EVALUATION OF DFID- FUNDED TECHNICAL CO-OPERATION FOR ECONOMIC MANAGEMENT IN SUB-SAHARAN AFRICA VOLUME 2: CASE STUDIES Oxford Policy Management Technical Cooperation for Economic Management Volume 2: Case Studies Preface/Disclaimer This evaluation was commissioned and funded by the UK Department for International Development. However the report is the responsibility of the consultants alone and neither the conclusions drawn nor the analysis presented should be attributed to DFID. Both the synthesis report and this second volume of case studies were prepared by a team comprising: Stephen Jones (study director), Val Imber (country team leader, South Africa and Zambia, and leader for pooling study), John Gray (country team leader, Kenya), Andrew Lawson (country team leader, Ghana), Adom Ghartey (organisational/capacity development expert, Ghana), John Kashangaki (economic management expert, Kenya), Donald Maphiri (economic management expert, South Africa), Inyambo Mwanwina (economic management expert, Zambia), Ole Therkildsen (organisational/capacity development expert, Zambia), Andrew Wyatt (organisational/capacity development expert, Kenya and South Africa), and Katarina Kotoglou and Aarti Shah (researchers). Nils Boesen contributed to the development of the study methodology but was forced to withdraw from the Ghana country team as a result of illness. Anne Thomson provided quality assurance. Thanks are due to the many DFID staff and others who have contributed time and views to the evaluation team. i Technical Cooperation for Economic Management Volume 2: Case Studies Table of Contents Preface/Disclaimer i Table of Contents ii List of Tables vii List of Figures ix Abbreviations x Executive Summary xix Introduction xix Main Findings Of The Evaluation – Results Of Dfid’s Technical Cooperation xxi Evidence on capacity development technical cooperation emerging from the evaluation xxv Implications for DFID policy and practice xxviii EVALUATION FRAMEWORK 1 1. Introduction 2 Objectives and scope of the evaluation 2 Structure of the report 3 Issues for the evaluation 3 2. Framework and approach for the evaluation 7 Organisational capacity 7 Economic management: framework and performance 10 Approach and methodology for the country studies 11 Overview of the activities covered by the evaluation 13 Issues in applying the framework 17 GHANA CASE STUDY 1 Executive Summary 2 Context for capacity development 2 Economic management in Ghana 3 Results of the technical cooperation: organisational capacity for economic management 4 Results of the technical cooperation: summary of the evaluation results 4 Conclusions and implications 5 1. Introduction 7 2. The context for capacity development 10 The political context 10 The institutional context 13 ii Technical Cooperation for Economic Management Volume 2: Case Studies DFID’s strategy for technical cooperation 17 Summing up 18 3. Economic management in Ghana 19 Overall economic performance 19 Macroeconomic management (1999-2004) 19 The economic management process 23 Has economic management improved? 25 4. Results of the technical cooperation: organisational capacity for economic management 26 National Development Planning Commission (NDPC) 26 The VAT Service 31 Ministry of Finance and Economic Planning 34 5. Results of the technical cooperation: summary of the evaluation results 41 Relevance 41 Effectiveness 41 Efficiency 42 Impact 42 Sustainability 42 6. Conclusions and implications 43 References 46 List of persons consulted 48 Summary of Findings – Evaluation Matrices 50 KENYA CASE STUDY 56 Executive Summary 57 Context for capacity development 57 Economic management in Kenya 58 Results of the technical cooperation: organisational capacity for economic management 58 Results of the technical cooperation: summary of the evaluation results 59 Conclusions and implications 60 1. Introduction 62 2. The Context for Capacity Development 65 The Political Context 65 The institutional context – public sector administrative capacity 66 DFID’s strategy for TC in Kenya 67 3. Economic management in Kenya 70 Overall economic performance 70 iii Technical Cooperation for Economic Management Volume 2: Case Studies Performance of Economic Management: 1999-2004 71 Budget and public financial management 72 Has economic management improved? 74 4. Results of the technical cooperation: organisational capacity for economic management 75 The Ministry of Finance (MF) and the Ministry of Planning and National Development (MPND) 75 Office of the President (Directorate of Personnel Management) (OP/DPM) and Kenya Institute of Administration (KIA) 78 Ministry of Local Government (MOLG) 80 Kenya Anti-Corruption Agency (KACA) 83 Summary 84 5. Results of the technical cooperation: summary of the evaluation results 85 Relevance 85 Effectiveness 86 Efficiency 86 Impact 87 Sustainability 87 6. Conclusions and implications 89 References 91 List of persons consulted 93 Summary of Findings – Evaluation Matrices 94 SOUTH AFRICA CASE STUDY 101 Executive Summary 102 Context for capacity development 102 Economic management in South Africa 103 Results of the technical cooperation: organisational capacity for economic management 104 Results of the technical cooperation: summary of the evaluation results 104 Conclusions and implications 106 1. Introduction 107 2. The context for capacity development 110 3. Economic management in South Africa 117 Overview of economic performance 117 Macroeconomic management: 1999-2004 118 Summing up 121 4. Results of Technical Cooperation: organisational capacity for economic management 122 iv Technical Cooperation for Economic Management Volume 2: Case Studies The National Treasury 122 The Department of Public Enterprises 127 5. Results of the Technical Cooperation: summary of the evaluation results 135 Relevance 135 Effectiveness 135 Efficiency 136 Impact 137 Sustainability 137 6. Conclusions and implications 138 References 140 List of persons consulted 142 Summary of Findings – Evaluation Matrices 143 ZAMBIA CASE STUDY 147 Executive Summary 148 Context for capacity development 148 1. Introduction 153 2. The context for capacity development 157 The political context 157 The institutional context 158 DFID’s strategy for TC in Zambia 162 3. Economic management in Zambia 164 Overall economic performance 164 Macroeconomic management: 1999-2004 165 Budget and public finance management 166 Summing up: has economic management improved? 168 4. Results of the technical cooperation: organisational capacity for economic management 169 Ministry of Finance and National Planning - overview 169 MFNP: Budget and Economic Division 171 The Internal Audit Unit 173 The Tax Policy Unit 175 The Zambian Revenue Authority 177 Department for Human Resources, Information and Planning (HRIP), Public Service Management Division (PSMD), the Office of the President 180 Summary 183 5. Results of the technical cooperation: summary of the evaluation results 185 v Technical Cooperation for Economic Management Volume 2: Case Studies Relevance 185 Effectiveness 186 Efficiency 186 Impact 186 Sustainability 187 6. Conclusions and implications 188 References 191 List of persons consulted 194 Summary of Findings – Evaluation Matrices 196 STUDY OF POOLING ARRANGEMENTS FOR TECHNICAL COOPERATION 203 Executive Summary 204 1. Introduction 206 2. Framework and issues for the study 208 The changing international landscape for harmonisation 208 Findings from the Baser and Morgan study 209 Budget, procurement and management issues 211 3. Country experience: progress on donor harmonisation and TC pooling 214 Introduction 214 Government policy on harmonisation, including TC pooling 215 The provision of TC under the arrangements reviewed 217 Summary of progress 226 4. TC pooling in Ethiopia, Mozambique and Tanzania 227 Range of pooling arrangements 227 Strategic management 230 Implementation management 232 5. Conclusions 235 Ownership 235 Alignment 235 Harmonisation 237 Overall assessment 237 References 239 Synthesis References 241 Appendix A: Terms of Reference 244 Appendix B: Evaluation Matrix for Country Case Studies 251 vi Technical Cooperation for Economic Management Volume 2: Case Studies List of Tables Evaluation Framework Table 1. Expenditure on the projects reviewed 16 Table 2. Areas of intervention of projects reviewed 16 Ghana Case Study Table 1. Organisations and projects selected 8 Table 2. DFID TC project expenditure in Ghana – economic and governance sectors 9 Table 3. Key political events and their significance (1992-2000) 12 Table 4. Key political events and their significance (2001-5) 13 Table 5. Public sector reform and intent in Ghana 14 Table 6. Major aid events and their significance 15 Table 7. Macroeconomic indicators (1997 – 2004) 20 Table 8. Average budget deviation index, 2002-4 23 Table 9. NDPC staffing trends 1998- June 2005 29 Table 10. Number of years at NDPC 29 Table 11. VAT collections relative to targets and GDP 33 Table 12. Changes in quality of MOFEP products, 1997-2005 39 Kenya Case Study Table 1. DFID TC project expenditure in Kenya: Economic and Financial management 64 Table 2. Key macroeconomic indicators 70 Table 3. Recurrent Expenditure (Shares in Total Expenditure) 72 South Africa Case Study Table 1. DFID TC project expenditure in South Africa: Economic and Financial Management 109 Table 2. Unequal participation 112 Table 3. Key macroeconomic indicators 117 Table 4. Unemployment, inequality and poverty indicators 118 vii Technical Cooperation for Economic Management
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