Case Study Mali

Decentralized sector-based Budget support (DSBS)

• State and donors resources transfer to the local agents of decentralization (Local communities, the state decentralized Technical departments)
• Restitution of local affairs management to the public; citizen participation
  

Bamako, November 2010

Contributor: Abdel Kader Dicko
Peer review: Mozambique

Video Intro
Have a look at the video intro to get an overview of the case study and its contents.  

Fact sheet

1. Context

What is the challenge?

Like many countries counting on international public aid, Mali has put a system of general or sector budget support mechanism in place based on the principles of Paris declaration (a strategic framework on the fight against poverty, a general agreement on budget support, annual journals and mid-term government expected performance …). In the case of the decentralization reform which is what we are concerned with here, the budget support put in place since 2006-2007, did not produce the expected outcome because donors resources were directly sent to the concerned sector-based Ministry ( Education, Health, … ) and did not reach the local actors in charge of the transfer of competence. Also, the targeted objectives of changes are also threatened by these subsidy agreements which are not pertinent to local agents’ responsibility as well as work reports’ modification between the central offices and local the communities.

The challenge is the introduction of DSBS into budget support and ensuring that Swiss aid resources reach the local agents so as to enable them run their own local development program.

How is the challenge being addressed, what is done to address the challenge?

The ADD has joined the precedent general agreement to budget support in Mali, by negotiating with the Ministry of Economy and Finance to sign a bilateral agreement taking into account all the requirements and conditions of Swiss aid. These requirements and conditions are to ensure that the Swiss funds get to the targeted local agents (local communities mentioned in the agreement), the determination of actions to be implemented under the supervision of the local communities and also fixing the public annual release of the budget resources management granted by Swiss aid in the presence of the civil society organizations and people from different zones.

How is our project/program supporting what is being done to address the challenge?

Two projects of SDC in Mali are affected by the DSBS: the PACY-N project, covering the circle of Youwarou (Region of Mopti) and the circle of Niafunké (Region of Tombouctou) on one hand and on the other hand, the PADE which is operational in the region of Sikasso, the circle of Youwarou in the region of Mopti and in the region of Tombouctou.

The PACY-N targets infrastructures realization and hydro-agricultural implementation, structuring in favor of the socio-professional organizations. This project is therefore expected to promote food security by creating the conditions for production as well as agricultural productivity. The PADE will contribute to the qualitative and adaptable decentralized basic education for all in its areas of intervention. In this perspective, it strives to support the educational system adaptable to the needs and socio-economic realities of the population such as the mobile schools in nomad zones. It also promotes alternative educational strategies at affordable prices like the accelerated schooling strategies aimed regrouping a greater number of children excluded from the classical system.

In the DSBS, funds are thus granted to the communities concerned in this project so as to carry out their own action programs with the support of the state decentralized technical services and the planning offices, commissioned by the SDC in the field to help local actors and to ensure a clear follow-up process.

Why do we want to share this experience?

The SDC wants to share this experience because it is innovating in terms of budget support. In case of success, the DSBS would be a booster to accelerate the public resources transfer from the base and increase chances for other non governmental actors to public aid. (cf. Recommendation of Accra agenda on democratization of public aid, its implementation mechanism.

2. Activities and approaches

Since the beginning, the SDC has wanted the DSBS to re-enforce the Swiss aid accreditation of the local communities in the decentralization in Mali. In this regards, the SDC has signed two bilateral agreements focusing on PACY-N and PADE whose implementation mechanism permits to make budget registration to Malian state budget every year. These registrations are done by the central departments of the Ministry of Finance and Economy and ensure accounting and knowledge about amount and Swiss aid modalities. Also, the mechanism obliges the central departments of the Treasury to make regional and local transfer of the said funds to targeted beneficiaries in bilateral agreements signed between the Swiss and Mali. The SDC follows all the phases of the process and keeps all the documents of all transfers made in the central departments and communicates them to its field agents in order to help them obtain their subventions. Also in the field, the SDC has employed a technical support strategy with proxy research apartments or Swiss NGOs to ensure that the programs of action of the local communities are well elaborated, adaptable and efficient. These programs are presented on the approval of the state local representative before the implementation of annual budgets allocation of SDC to Mali.

At first, the technical application measures on the field were necessary to complement the weak human resources abilities and to ensure the SDC of the viability of the process underway, keep watch on the dates and the quality of the documents produced (notably the local communities’ action plan).

For the SDC, the hypothesis of impacts concerns the state and other DSBS donors. It has also enabled the state to learn new mechanisms and aid management tools. Also, for SDC, the level of involvement of the state central departments in the DSBS application, the operational level of the targeted authorities in decision making from the lowest to the highest point are key indication of the success or failure of the process.

After six months of implementation, it is too early to make conclusions on the accomplishment of hypothesis or appropriation. But the index used by the state to demonstrate the process is clearly portrayed through the production of necessary regulations favoring the transfer of resources to the base. Furthermore, the service in charge of the implementation of the decentralization and coordination of partners intervention (the local communities national department), engages itself with the SDC in the follow up in the field and the capitalization of the experience in terms of the quality of resources management, the quality of financial reporting and effectiveness of the state control over the activities of the local communities.

3. Experiences

It must be emphasized that the experience of SDC in Mali is in progress (implemented from June 30th, 2010, signature date of both PACY-N and PADE projects agreements concerned with DSBS). So, we do not yet have the necessary means to compute results, changes and difficulties of the process.

Nevertheless, the SDC can evoke the first impression it gets from the field during this process of implementation. The information need of local actors about decisions taken at the national level on DSBS and the conduct of decentralization in general are enormous. From this point of view, the activities on national follow up carried out by SDC is important because it permits to shorten time and information access channels to local actors (use of telephone, fax and scanner to directly transmit the copies of major decisions taken). Firstly, all the local actors were apprehensive about the functioning of the mechanism and the speed of access to funds. Despite all, the local communities and the representative organs are up to date in the elaboration of planning documents. And, the approval procedures of those planning have been respected during this second semester 2010.

At the national plan, the disbursement process of SDC funds took place as planned (declaration of funds, opening of a special account in the Malian treasury to receive funds...). The funds received were notified on the field; nevertheless, the job of the SDC here is to ensure close follow up of the governmental central departments to remind it of its omissions and commissions. However, it is important to cite a very high administrative culture which is not conversant with the management of this DSBS document. Be that as it may, the Malian government has done its job by setting up these budgetary resources.

As already indicated, it is too early to evaluate results. But some observations can be made from the national standpoint following the signature of DSBS and SDC agreements. We have noticed a great interest which other donors have shown in this experience. Several organs have sought information about its inception, mandatory structures, and the SDC provisions in its entirety...these are Belgium Corporation, the KFW, and the World Bank. The Malian administration did not show special ostracism in this new provision. On the contrary, a good will and a good faith have been shown to make sure this process works and also produces results. We have already indicated that the national Department of Local Administration, which is in charge of piloting the decentralization process for the state, is highly involved in the follow up and capitalization. It is aimed at attaining some goals within the frame of its 2010 – 2014 national programs for the execution of the Malian decentralization process.
This concern:

• Better structured and regulated public restitutions of annual balance sheets of local affairs;
• Reinforce the control of Financial and Administrative Management of Local Administrations, especially by the introduction of Administrative, Accounting and Financial Manual Procedures.

4. Lessons learnt

While expecting the necessary tools which can help to draw to draw lessons from DSBS experience, the following points can be put forward:

1. Despite the prejudices and apprehensions, the Malian administration is in the position to produce and on time, the statutory measures and necessary frameworks to DSBS;
2. A follow up and supervision work is necessary from BuCo in order to ensure a leap from one step to another and facilitate the access of local actors to information /central decisions;
3. Local actors are able to adapt to the yearly programming approaches, if there is a period of learning and technical assessment;
4. The administration is not opposed to the innovations and changes if some decisions have been taken early to inform and associate it to innovative projects;
5. The other donors of the state are also in search of alternative solutions to impulse decentralization and accelerate the transfer of some resources to the Local Administration. In this way, they will be tool takers and new mechanisms will help proved the tested and probative results.

5. Conclusions

The DSBS can be an apprenticeship experience for colleagues within the frame of national resources transfer at the base as well as a more equitable access of non-governmental actors to the resources of development aid. In this judicial mechanisms (signed bilateral agreements); the conditionality and global provisions set up by SDC can constitute a source of inspiration. In return, the diversity of context of countries of intervention and legislative environments are just a pure and simple replication which is not advised. On the contrary, the potential scaling of this experience exists as it is totally registered in the national procedures.

An open question addressed to Malian authorities is the cohabitation of this approach of providing the resources alongside the mechanism of the National Agency for Local Administration Investment, being also a public organ created by the state to receive funds of the state and financial partners to support Local Administrations. How will the state combine the management of the efficiency and direct access of Local elected agents to resources with the coordination of financial mechanisms?