Laos Module 4

Joint Staff TrainingPoverty Reduction Strategies(JST-PRS): 

Joint Staff Training Poverty Reduction Strategies (JST-PRS) Module 4 Linking the PRS to national decision-making processes within the Policy-Budget-Results chain

Module Objectives: 

Module Objectives Develop answers to 4 Key Questions: How does the Policy-Budget-Results cycle work in a democratic state? What constrains the decision-making process at different points of the cycle? How should the PRS fit into this cycle? How might we increase the impact of the PRS on policies, budgets and outcomes?

How does the national decision -making process work?: 

How does the national decision -making process work? Think of it as a cycle: Policies  Budgets  Results  Feedback Recognise that it is a rules-bound process, embedded in laws and Institutions Remember that it is a resource-constrained process: financial & HR limitations Remember that it is a political process…..

An idealised Policy-Budget-Results chain: 

An idealised Policy-Budget-Results chain

Constitutional constraints on the policy-budget process…: 

Constitutional constraints on the policy-budget process… Protects allocations to key office holders The President, Judges, Controller & Auditor General In Russia ‘heroes of the Revolution’; in Nicaragua, students & universities. Determines entitlements of Regional/ Local Govts: Possibly an entitlement to collect certain taxes; Supplemented by Transfers from Central Government: Fixed % of total revenue collections, eg Argentina. Unconditional formula-based Per capita allocations Conditional allocations linked to mandated services.

Legal constraints on the policy-budget process…: 

Legal constraints on the policy-budget process… Public Finance & Audit Act Specifies format & process for budget preparation, approval, execution and audit. Specifies timing & structure of reporting (inc Chart of Accounts). Sector policies often framed as laws: Laws specify standards for service delivery: Who is entitled to services ? (Degree of Access) Of what quality ? (Minimum standards) At what price? (Level of subsidy)

Financial and cost constraints on the policy-budget process…: 

Financial and cost constraints on the policy-budget process… Resource constraints Difficulties of collecting tax in semi-formal economies Distortionary effects of taxation, eg ‘Window Tax’ Problems of aid dependency and Dutch Disease Dominant influence of fixed costs in the budget: Few ‘discretionary’ resources available to be used after deductions for fixed items: Statutory transfers and pensions Debt servicing Salaries Maintenance

Political constraints on the policy-budget process…: 

Political constraints on the policy-budget process… Formal Politics: Most initiatives need a decision by Executive or Legislature Governments need to be re-elected so must avoid unpopular policies Governments also need to look after their supporters and interest groups Informal Politics: Politicians and civil servants will naturally protect their interests: hence tendency to empire building and to use of restrictive practices to create ‘rents’

But what do we mean by National Policy?: 

But what do we mean by National Policy? Implies an institutionalised set of decisions: Either a Legal or even Constitutional basis; or Some process of Government Approval: Parliamentary decision Presidential or Cabinet decision Ministerial decision; or sometimes… Administrative decision by senior civil servant. Thus, the PRS is embedded in an existing policy structure, ... ……….which the PRS must seek to influence.

A more complete Policy-Budget -Results chain…: 

A more complete Policy-Budget -Results chain… Policy Framework

Where in the policy cycle must influence be exerted?: 

Where in the policy cycle must influence be exerted? Card Exercise You are the co-ordinating team for the PRS. You need to ensure the new PRS initiatives are implemented. Identify where in the cycle you must intervene to achieve this. In the middle of the table, lay out first in one long line, and in their proper order, the White Cards of the cycle. Then place to the right the Blue Cards representing the stakeholders who must be influenced at each stage. Lay out to the left the Yellow Cards which illustrate policy initiatives. For each initiative, place the cards at the stages of the cycle where influence must be exerted.

What are the implications for a PRS lobbyist ?: 

What are the implications for a PRS lobbyist ? Remember the multiple constraints on the Policy Process: radical change is difficult ! Be aware of the many stakeholders involved in decision-making. Use PRS as a strategic influencing tool: Do not do too much! Focus on what is important and feasible! Be strategic – act over medium not short term. Apply lessons of successful policy influence.

Success criteria for PRS as ‘influencing tool’: 

Success criteria for PRS as ‘influencing tool’ Institutional arrangements for Implementation clear & feasible Clear link to Budget Preparation & Execution Desired Outcomes clearly specified & feasible Successful Policy Influence All key entry points into the cycle covered Political support developed and maintained