GOOD GOVERNANCE

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IFAD Eastern and Southern Africa Regional
Implementation Workshop Bujumbura, 16-19
November 2009
GOOD GOVERNANCE FINANCIAL MANAGEMENT
Ruth Farrant Financial Management Officer
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Good Governance

• The issue of good governance and
• capacity-building is what we believe
• lies at the core of all Africas
• problems
• Commission for Africa, 2005

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Good Governance

• Pillars of Good Governance
• Transparency
• Accountability
• Participation

Good governance is integral to economic growth,
the eradication of poverty and hunger, and
sustainable development. The views of all
oppressed groups, including women, youth and
poor, must be heard considered by governing
bodies because they will be most negatively
affected if good governance is not achieved
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Corruption

• Corruption is a drawback to any government's
  effort in saving the people from the pangs of
  poverty and will be fought in deeds and words
  because it is right, because it is good, and
  because it is Government policy
• President Banda of Zambia September 2009

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Corruption

• Universal, historic issue which occurs in
  developed developing countries, public
  private sectors, non profits
• Examples of frequently encountered fraud/
  corruption in projects
• Bid collusion, inflated invoices, kickbacks to
  influence award of contracts, theft or misuse of
  project assets, abuse of official discretion,
  disclosure of privileged information to assist
  friends/ relatives, falsification of accounts,
  recruitment issues, audit anomalies

Corruption hurts the poor disproportionately
by diverting funds intended for development,
undermining a governments ability to provide
basic services, feeding inequality and injustice,
and discouraging foreign investment and aid
Statement to the UN General Assembly by Kofi
Annan, UN Secretary General On the Adoption of
UN Convention against Corruption (December 2003)
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IFAD Operational Approach

• Focus IN-COUNTRY on Risks, Outcomes
  Sustainability

• Project design
• Risk assessment. Quality review
• Internal controls checks

Credible sanctions Suspensions Cancellations.
Mis-procurement. Audit plan Ineligible expenses
Start up and training Govt buy-in. Qualified
staff Procurement, FM, audit capacity Contracts
clauses
Zero-Tolerance Setting the bar
Legal framework Corruption policy Contract clauses
Supervision support On-site verification. FM
advisers Communications plan Project oversight
Proactive Prevention Participatory mechanisms
to strengthen accountability transparency In-bui
ld capacity, thresholds Publicise award of
contracts
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IFAD Approach Processes

• Responsibility for use of funds rests with
  Government
• Concentrate on design quality staff
• IFAD now requires additional checks/ controls
  for
  countries which have score of less than 3.0
  per TI (10/16 borrowing
  countries in our region)
• Systematic checks/ controls may be built in at
  design /or implementation stage of a project
  (e.g. low procurement thresholds/ FM
  advisors) in addition to normal IFAD procedures

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Financial Management Good Governance

• FM work involves 2 approaches
• assurance that IFAD funds are being used for the
  intended purposes (thro reliable internal
  systems direct supervision)
• solely for the purpose intended and
  results-orientated
• in accordance with the AWPB
• in conformity with administrative, technical,
  financial, environmental, agricultural, rural
  development practices and good governance
• (2) assistance to governments/ projects to
  improve FM capacities
• FM is an integral part of the development process
  to achieve the Millennium Development Goals
• In line with the Paris Declaration, ESA works
  with borrowers to use national systems where
  possible (e.g. reporting/ procurement/
  budget)

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Good Practice Good Governance Framework
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FM Tools Resources

• PF FMGG Internet site address
• English http//www.ifad.org/operations/pf/financ
  e
• French http//www.ifad.org/operations/pf/fina
  nce/french/index.htm

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