UCLG Position Paper v_2 (eng)
22/12/09
18:13
Página 16
Support Paper on Aid Effectiveness and Local Government
Support Paper on Aid Effectiveness and Local Government
1.
The Policy Context: An Emerging Consensus on Aid Effectiveness
In Paris, donors resolved to take concrete, effective and timely action in implementing all agreed commitments on aid effectiveness. The Declaration provides a well defined road map (with performance indicators11) for increasing development effectiveness by enhancing partnership commitments, aligning donor support to partner countries’ development strategies, harmonizing donor actions, and improving mutual accountability for development results.
Since the mid-1990s, official development agencies, under the leadership of the Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD), have been re-examining the way they deliver aid in an effort to generate greater impact in terms of social and economic development.
The Aid Effectiveness agenda has been marked by a significant shift in the methods by which development assistance funding is spent and managed. In an effort to more effectively coordinate and harmonize development assistance, a much higher volume of funds are being pooled in a comprehensive budgetary process (through mechanisms such as Budgetary Support, Program Based Approaches and Sector Wide Approaches) over which the central government, in collaboration with coalitions of donors, plays a leadership role in determining where and how resources will be allocated. This is in contrast to more traditional means where donors would plan projects and contract the services of development partners, either from their own country or third party countries, to provide specific goods or services to recipient countries. The result has been that in a growing number of countries the centre of decision making and influence over the allocation of program funding is gradually shifting from donor headquarters in the north to host governments in the south in an effort to strengthen local ownership.
The 2005 Paris Declaration on Aid Effectiveness, signed by all OECD countries and endorsed by many developing countries, reflects a consensus on a series of recommended actions which official development agencies and partner countries could undertake to enhance the delivery and management of aid. These actions include, amongst other things: i) local ownership of development strategies; ii) alignment with national development strategies; iii) harmonization of development interventions; iv) managing for results; and v) mutual accountability and transparency.10 This policy consensus is shaping the way that donors define their priority sectors, focus countries, and select the mechanisms through which they deliver aid. The drive to harmonize, align, and manage development assistance for greater impact has been gaining momentum since the Monterrey Conference on International Development Finance in 2002 and subsequent high level forums in Rome (2003) and Marrakesh (2004) which focussed on issues related to enhancing aid effectiveness (i.e. Harmonization and Managing for Results respectively).
2.
Reviewing Progress of the Paris Declaration
As the mid-point in the implementation of the Paris Declaration has recently been reached, donors, recipient governments and other development practitioners undertook a review of the agreement to assess whether it has had the desired effect of fostering more effective and accountable development.
10 Development Cooperation Directorate (OECD, March 2005). 11 Indicators include, for example: “Partners have operational development strategies”; the target for 2010 is that 75% of Southern partners will have operational strategies. Another indicator is the “use of common arrangements”. For this, the target for 2010 is that 66% of aid flows are provided in the context of program-based approaches. (OECD, August 2005: 4).
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