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John Rwangombwa Permanent Secretary and Secretary to Treasury

John Rwangombwa Permanent Secretary and Secretary to Treasury Ministry of Finance and Economic Planning Republic of Rwanda. Challenges and opportunities for strengthening ownership, accountability and aid effectiveness through better information: Experiences from Rwanda. 1.

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John Rwangombwa Permanent Secretary and Secretary to Treasury

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  1. John Rwangombwa Permanent Secretary and Secretary to Treasury Ministry of Finance and Economic Planning Republic of Rwanda Challenges and opportunities for strengthening ownership, accountability and aid effectiveness through better information: Experiences from Rwanda 1

  2. Background • Rwanda is heavily aid dependent • > $800m per annum in ODA • Equivalent to $80 per capita; half of Rwanda’s budget • Current strong government ownership of the aid agenda • Rwanda Aid Policy • Sets out GoR preferences and principles for aid delivery • Specific reference to the need for transparency through a national AIMS-DAD • Adherence to Paris Declaration

  3. Evolution of Aid Information Management in Rwanda • Pre-2006, aid data was unreliable/unavailable: • No single repository • Inconsistent donor reporting • There was a clear need for the development of a single, transparent channel for reporting on ODA flows to facilitate GoR processes: • Sound PFM (Budget preparation, Treasury management, Accounting) • Domestic accountability • Enabling the GoR to lead in coordinating donors and monitoring development activities • Supporting sound macroeconomic management

  4. Sources of aid information • Donors self reporting through the Development Assistance Database (DAD) • Web-based tool for donor reporting and GoR monitoring of aid flows • Reports on donor commitments and disbursements (reports both BS and project aid) • But currently unreliable: overestimated/underestimated, not regularly submitted • For Government, aid information required is based on: • Public financial statements • Budget support disbursement schedules aligned to budgeting process • Signed agreements • Information from individual project reporting • Central bank recording of official transfers

  5. What do we use aid information for? • Planning • Macroeconomic forecasting & (balance of payment, monetary, fiscal) • Development planning (division of tasks, avoiding overcrowding of sectors/ plans, avoiding parallel processes/alignment to national strategy) • Budgeting • Legal requirement under our Organic Budget Law: “all official aid must be recorded in the consolidated budget • Inter-sectoral resource allocation • Reporting • Development activities • Use of funds (how much was absorbed) • Track risks of corruption/embezzlement

  6. Aid information and Accountability • How is government held accountable by its citizens for contracting and using ODA? • All external loans are pre-approved individually by parliament • All grants & loans are required to be included in the budget appropriated by parliament • Budget execution reports including aid on budget prepared by Ministry of Finance is presented to Cabinet & submitted to parliament on a quarterly basis

  7. Key challenges (I) • Some aid modalities are more problematic than others: e.g. stand alone project vs GBS • Multiple reporting not matching country needs(e.g. not aligned to indicators in strategy or project components not aligned to budget lines ) • Growing role in development of off budget support (foundations and specific bilateral donors) • Willingness of in-country donors representatives to match reporting cycles of governments

  8. Key challenges (II) • Predictability of donors commitments: • Few multi-year donors have MTEFs • Timing of disbursements always un-predictable • Macroeconomic projections negatively affected by lack of aid information –leading to frequent & unnecessary revisions • Some aid by nature remains off-budget (aid delivered through NGOs and some bilateral donors)

  9. ODA figures from Different sources • ODA to Rwanda from Different sources in 2007 in Million USD • CRS: 503 • Gov’t Public Accounts : 543 • DAD: 675 - The need for a harmonized reporting system is critical

  10. Opportunities for improvement (I) • Rwanda has now completed for the first time a mutual review mechanism – the Donor Performance Assessment Framework • Relies on donor self-reporting to undertake an annual joint review of performance against 30 indicators covering a range of aid effectiveness issues (mainly Paris indicators) • Compliance with aid information requests through the DAD form one of the criteria for performance assessment • Peer pressure very important in strengthening mutual accountability

  11. Opportunities for improvement(II) • GoR now actively working on a streamlining of business processes to link donor-reported aid data with other databases (project management; IFMIS) to simplify reporting and reduce transaction costs. • IATI has the scope to support the development of consistent definitions for use by all partners, responding to country needs • Common electronic data format agreed under IATI reduces transaction costs for both donor and partner country government, supporting timely reporting.

  12. Thank you

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