MCA Monitor Blog

I support the above proposal and I would like to suggest that the MCC should put in place some form of monitoring mechanism so that they can confidently state how the funds have been used. There hav been blantant abuse or resources by governments elected on anti-corruption platform. Expenditures for such countries should be open for public scrutiny

A better criterion for where to spend money is what is likely to result from the spending.

I support the budgetary approch but would take it far further. South Africa, with undp support, has recently adopted the Community Investment Programme developed by www.thepeoplesagenda.co.za. This is a 'rights programme'. Communities that form and register Community Trusts and join the programme, recieve Child and Investment Rights. That is joint budgets formed by the number of children and adult members of each Trust.

They use these funds for agreed public purposes so that they are effectively 'local curencies' for two or more rounds, raising the low local income multiplier substantailly. From the generated additional local activity - growing food for all their children locaaly and buying it at locally determined prices, for instance - they are able, in a social compact as partners of government, to pay higher school and health fees, with a general cover for all. That enables government to divert more of its large education, health and social grant budgets to 'investment' through communiites who then repay it through fees derived from the additional local activity.

It thus has a progrssive element not unlike the proposal here but tailored to a very special citizen / community mobilisation, organisaton and enablement scheme.

Some 40% of the national budget could eventuially go through communiites at street, neighbourhood and village as competent and investing financial partners of the state!

It is on the web site under KZN Children.

Norman

It might be useful to review the experience that some of the donors have had over the past 25 years with the generalized support provided through, e.g., strucutral adjustment loans and credits and the use of HIPC-generated resources. Would the WB's IEG or the Fund's IEO have some reliable reviews of that experience? As I recall, it may not have been the practice under the SALs and SACs to audit the accounts in the recipient countries, and procurement rules were scant -- if any at all.

But that is what most donors are doing. In most countries the proportion of ODA going through DBS is small (and for some donors it is ery small). This proportion will increase as donors and governments learn to work together and trust each other. DBS has its problems (many of its assumptions one could argue are terribly naive) but one of its main benefits is harmonization of donors and alignment to government policies and visions. US ODA would do well to start by looking at how it can collaborte with others.

IBRD must claw back to its original key missions: roads; bridges; seaport facilities; water supply; and irrigation for agriculture. Streamlining procedures are essential. Lesser missions, but also for electrification upgrades [esp. transmission], and voice/internet telecoms infrastructure improvements.

Most of the plethora of called 'poverty reduction' schemes, mass health programs, skills training, education facility construction must be financed and carried out by locals and others in aid or private sector.

IBRD has become weakened by creep of explosive multiple missions' is now hamstrung by too many and varied jobs.

Eldridge, you have put your finger on a key WB issue, broader than the question of direct budget support (DBS)! I hope you share it with the other CGD blog on the WB. Some of us raised the issue of mission creep at the time of the 1987 reorganization. An option which we bandied about was that the WB should use some relatively modest part of its capital to endow a research institution which would house much of the research and non-operational activities which the WB seemed to be increasingly undertaking -- which of course subsequently "exploded," as you describe it. The endowed research institution would than have been expected to earn its own way -- much as the IIE, Brookings, CGD, etc., -- by contracting with the WB and other donors to provide (for a fee) the services. In this model, the WB could have better focused on its core competencies and mission. Alas, this remains the road not taken. But it is still not too late to follow this idea.