The World Bank Group

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The World Bank Group

• Working for a world free of poverty

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Millennium Development Goals

• Endorsed by 189 countries at the UN Millennium
  General Assembly in Sept 2000.
• Aim to halve the proportion of people in extreme
  poverty by 2015.
• Set targets for reductions in poverty,
  improvements in health and education, and
  protection of the environment.

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Millennium Development Goals
The Millennium Development Goals offer concrete
targets for everyone to rally around in the
global fight against poverty. But reaching the
goals will require action from both developed and
developing countries.
Paul Wolfowitz, President, The World
Bank
Developed countries must boost foreign aid to the
developing world, remove barriers to the exports
of developing countries, encourage private
investment, and make the benefits of science and
technology available to all the world's peoples.
Developing countries, meanwhile, must put in
place the right economic policies, work to
improve governance, invest in their people, and
create an enabling environment that is conducive
to growth and development.
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Governance and Poverty Reduction

• Governance impacts on poverty reduction
• Weak governance has blighted development
• Good governance
• requires robust government-wide systems to
  promote efficient and effective use of all public
  resources
• a target under MDG 8
• Improving governance a major challenge

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Good Governance has many dimensions
Citizens/Firms

• Political Accountability
• Political competition, broad-based political
  parties
• Transparency regulation of party financing
• Disclosure of parliamentary votes

• Formal Oversight Institutions
• Independent, effective judiciary
• Legislative oversight (PACs, PECs)
• Independent oversight institutions (SAI)
• Global initiatives UN, OECD Convention,
  anti-money laundering

• Civil Society Media
• Freedom of press, FOI
• Civil society watchdogs
• Report cards, client surveys

• Effective Public Sector Management
• Ethical leadership
• Public finance management procurement
• Civil service meritocracy adequate pay
• Service delivery and regulatory agencies in
  sectors

• Private Sector Interface
• Streamlined regulation
• Public-private dialogue
• Extractive Industry Transparency
• Corporate governance
• Collective business associations

Citizens/Firms
Citizens/Firms

• Decentralization and Local Participation
• Decentralization with accountability
• Community Driven Development (CDD)
• Oversight by parent-teacher associations user
  groups
• Beneficiary participation in projects

Outcomes Services, Regulations, Corruption
Citizens/Firms
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Governance and Corruption Not the same thing!
Governance
The manner in which the State acquires and
exercises its authority to provide public goods
and services
Corruption
Using public office for private gain

• Corruption is an outcome a consequence of the
  failure of accountability relationships in the
  governance system
• Poor delivery of services and weak investment
  climate are other outcomes of bad governance

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Corruption Poses 3 Key Risks
Development Effectiveness Risk
That corruption will undermine the impact of
development efforts in general and in
Bank-supported projects
Fiduciary Risk
Reputational Risk
That Bank lending in countries with corrupt
leaders will tarnish the Banks reputation
That Bank resources will not be used for the
purposes intended
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Public Financial Management and Governance

• Improved PFM capacity is at the core of good
  governance and lies at the heart of achieving the
  MDGs ensuring that public and
  donor resources are used efficiently, effectively
  and transparently for the intended purposes.

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Diagnosis of Country PFM Systems

• Emerging cross-cutting issues?

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PFM Diagnostics Emerging Cross-cutting Issues

• Incomplete Budget Information
• Inadequate Accounting Systems
• Obsolete Legal Framework
• Ineffective Internal and External Audit
• Poor dissemination of PFM information
• Shortage of qualified PFM Professionals
• Barriers to IFMIS

Mostly due to weak capacity
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How do we get there?
Going ForwardFrom Diagnostics to Implementation
From compliance to
capacity development
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Supporting and Strengthening SAIsWorld Bank
Strategy 3 Key Dimensions

• Using policy dialogue, TA funding and Bank
  operations to strengthen SAIs capacity and
  impact
• Promoting SAIs global, regional and bilateral
  pships
• Enhancing Bank staff skills to effectively
  support strengthening of SAIs

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Guiding Principles PFM Capacity Building

• Country leadership and ownership
• Tailor-made capacity development design
• Comprehensive programme design and implementation
• Coherent and coordinated donor support

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Poverty Reduction Global Challenge
In this new century, millions of people in the
worlds poorest countries remain imprisoned,
enslaved and in chains. They are trapped in the
prison of poverty. It is time to set them free.
Nelson Mandela International Global Call For
Action (Make Poverty History) Campaign, London,
February 2005