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«Social Funds and Reaching Proceedings from an international workshop organized by the Poor The World Bank and Experiences and AFRICATIP La Red Social de ...»

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Social Funds

and Reaching

Proceedings from an international workshop

organized by

the Poor

The World Bank

and

Experiences and AFRICATIP

La Red Social de América Latina y el Caribe

Future Directions NGO-WB Committee

with the support of

Edited by

African Development Bank

Anthony G. Bigio Canadian International Development Agency

International Labour Office

Organization of American States

The World Bank

Washington, D.C.

Contents

Foreword

Acknowledgments

Part I Overview 1

1. Main Outcomes and Recommendations

2. Partnerships and Participation in the Workshop

Anthony G. Bigio Part II Updating the Conventional Wisdom 17

3. The World Bank’s View on Social Funds

Sven Sandström, Vinod Thomas, Ishrat Husain, Joseph Stiglitz

4. The Partners’ View of Social Funds

Eduardo Diaz Uribe, Magatte Wade, Manuel Chiriboga

5. The World Bank Portfolio Review of Social Funds Projects

Prem Garg, Soniya Carvalho, Christine Kessides

6. The Inter-American Development Bank’s Study of Social Funds

Margaret Goodman, Samuel Morley Part III A Close Look at the Key Issues 51 Parallel Thematic Sessions

7. Social Funds: From Responses to Emergency to Development

8. Financial Resource Mobilization for Social Funds

9. Role of NGOs in the Design, Management, and Implementation of Social Funds...... 65

10. Decentralization, Local Governments, and Social Funds

11. Social Funds, Private Sector Development, and Microenterprises

12. Designing Social Fund Components—Sectors, Themes, and Access

13. Monitoring and Evaluation of Social Funds

14. Sustainability of Subprojects, Maintenance, and Operations

15. Environmental Assessment of Social Funds Subprojects

16. Social Funds Systems, Outreach, and Communication Systems

Constituencies’ Consultations

17. Social Funds’ Directors

18. Municipalities

19. NGO Representatives

20. Development Agencies

Regional Consultations

21. Africa

22. Eastern Europe and Central Asia

iiiiv Contents

23. Latin America and the Caribbean

24. Middle East and North Africa

25. Development, Equity, and Social Justice

Aminata Mbengue Ndiaye, Senegal

26. Workshop Concluding Remarks

Steen Jorgensen and Ishrat Husain Part IV Original Workshop Papers 147

27. The Social Investment Fund in the Context of National Development............... 149 Marco Camacho, Director, Social Investment Fund, Bolivia

28. Financial Resources Mobilization for Social Funds

Hussein M. El Gammal, Managing Director, Social Fund for Development, Egypt

29. Social Funds: An Expanded NGO Critique

Jane Covey, Executive Director, and Tim Abbott, Research Assistant, Institute for Development Research, United States

30. Social Investment Funds, Local Governments, and Communities in Central America

Patricia de Jager, Director, Federation of Municipalities of Central America, Guatemala

31. Social Funds and Development of the Private Sector: The Case of Mali.............. 185 Lamine Ben Barka, Director, AGETIPE, Mali

32. Designing Social Fund Components: Sectors, Themes, and Access

Scarlette Gillings, Director, Social Fund, Jamaica

33. Zambia Recovery Project—Evaluations and Perspective of the Central Government

Irene M. Kamanga, Permanent Secretary, Ministry of Finance and Economic Development, Zambia

34. Sustainability of Subprojects, Their Operation and Maintenance

Werner Neuhauss, Sector Economist, Social Policy Department, KfW, Germany

35. Appraisal and Environment Assessment of Social Fund Subprojects: The Case of Ethiopia

Abebaw Alemayehu, Deputy Director, Social Fund, Ethiopia

36. Information Systems, Outreach, and Communication of Social Funds............... 219 Sam Kahkobwe, Director, Social Action Fund, Malawi Annexes 227 Annex 1: Workshop Program

Annex 2: List of Participants

Annex 3: International Workshop Credits

Foreword In May 1997, about 250 social fund practitioners came together in Washington, D.C. for a workshop sponsored jointly by the World Bank’s Economic Development Institute and a number of its partners from inside and outside the Bank. As the conclusions of the workshop clearly state, social funds have become an important instrument in our fight against poverty.

Social funds have also proven to be effective in forging partnerships with the private sector and with community groups to help the poor help themselves. In fact, social funds are reaching areas and groups heretofore untouched by public sector interventions, demonstrating that participatory development can be both cost-effective and quick. Social funds, however, should not be seen as a magic wand that will eradicate poverty. They can only be truly effective when combined with sustainable economic policies and investments in people.

As a follow-up to the workshop, the World Bank is supporting regional seminars as well as the strengthening or creation of regional networks of social funds, and we see an increasing need for this kind of knowledge exchange and learning. Looking back at ten years of experience, the Bank has found social funds to be a unique and valuable instrument, both in reaching poor people directly and in catalyzing the energies of a wide range of partners: public, private, nongovernmental organizations, and local communities. Looking forward to the next ten years, it is crucial that we build on the lessons of experience to ensure that we use this instrument as effectively as possible. The ideas of those who have contributed to this volume will help us achieve that goal.





–  –  –

v Acknowledgments This publication benefited from the collaboration, advice, and comments of a number of people.

Steen Jorgensen and Soniya Carvalho served as peer reviewers and brought to their role of oversight and quality control their experience and knowledge of social funds.

Deepali Tewari reviewed the audiotapes of the discussions that took place in the ten thematic parallel sessions and on that basis wrote the resulting section, shortened and edited the original conference papers, and provided general assistance in the editorial task.

Alberto Harth, David Steel, Roy Thomasson, and Mary Schmidt prepared the summaries of the regional consultations. Manuel Chiriboga, Eduardo Diaz Uribe, Prem Garg, Ishrat Husain, Tariq Husain, Vinod Thomas, and Magatte Wade provided substantive comments on the proceedings in their capacity as steering committee members. Jan Bojo, Katrinka Ebbe, Gita Gopal, Jennifer Sara, Michael Stevens, and Norbert Mugwagwa commented on the summaries of the parallel sessions.

Cecilia Zavaleta was in charge of formatting, spellchecking, and assembling the various versions of the manuscript. The image on the cover is the work of Patricia Hord, who designed the workshop’s program.

I am extremely grateful to all of them for their work. I especially wish to thank the authors of the ten original papers, who agreed to reflect on their operational experience with social funds, and the workshop participants whose commitment and enthusiasm was the substance of the event.

Anthony G. Bigio Economic Development Institute The World Bank vii Part I Overview Main Outcomes and Recommendations Objectives and Results of the International Workshop

The International Workshop on Social Funds, held May 27–30, 1997, at the World Bank’s headquarters in Washington, D.C., had the following objectives:

• To assess a decade’s implementation experience of social funds and their impact on poverty reduction

• To establish a broad consensus on their main achievements, weaknesses, and risks

• To generate a set of recommendations for improving existing operations as well as for the design of future social funds

• To facilitate the integration of international and regional networks of social funds.

The workshop participants included: (a) general managers and high-level staff of social funds;

(b) representatives of central government institutions that oversee the operations of the funds;

(c) representatives of municipal governments that interact with social funds in the selection and implementation of subprojects and of their regional associations; (d) representatives of nongovernmental organizations (NGOs) and civil society organizations that work with social funds;

(e) staff of the World Bank and of other multilateral and bilateral development agencies that finance, design, and supervise the implementation of social funds; and (f) observers including researchers, academicians, and consultants involved with social funds and representatives of national governments that are establishing new social funds operations.

Stock-taking occurred in different forms: through the presentation of the World Bank’s and of the Inter-American Development Bank’s studies on social funds, as well as through many individual interventions by social funds’ managers during the plenary sessions and in working groups. Ten original papers were also presented by relevant practitioners on specific topics related to social funds’ design, management, and implementation. These papers provide an overview of current design and implementation challenges and concerns facing social funds.

More than two of the workshop’s four days were devoted to group discussions, organized by topic, constituency, or regional perspective. It was in these discussion groups that the consensus and common understanding of the specific successes, weaknesses, and risks of social funds were achieved. Each of these groups also generated a set of specific recommendations that were presented briefly in plenary sessions and that were reviewed by the workshop participants.

In itself, the international workshop was also the first step in integrating the international and regional networks of social funds by bringing together families of programs that started with different sector priorities and approaches, such as the AGETIPs in Western Africa and the social investment funds in Latin America, and by stimulating the creation of social funds networks in Eastern Africa, Eastern Europe and Central Asia, and Northern Africa and the Middle East.

The international development agencies and the NGOs at the workshop committed themselves to more integrated and coordinated support to social funds. They also committed to the promotion of a more systematic use of Internet-based tools, such as the social funds World Wide Web page launched by the World Bank just before the workshop, to maintain the global 4 Overview dimension of the information exchange and to promote further collaboration among the regional networks and the programs themselves. The publication of these workshop proceedings is a contribution to this broad international effort.

Social Funds: Main Achievements and Weaknesses On the basis of the results of the plenary presentations and discussions, of the contents of the two new studies by the World Bank and the Inter-American Development Bank, and of the ten specific papers commissioned for the workshop, the following understanding of the main achievements and weaknesses encountered by social funds over their first ten years of implementation (1986–96) was summarized.

While it was clear to all participants that social funds have performed differently in accordance with their objectives and their national contexts, they agreed on their commonalties and the major achievements and weaknesses of social funds, which were analyzed under

four main angles:

• National poverty reduction strategies

• Effectively reaching the poor

• Social participation and partnerships in development

• Sustainable approaches for service delivery.

National Poverty Reduction Strategies

• Social funds have forcefully and effectively made a case for the importance of social equity objectives in national development and for addressing the needs of marginalized groups as a priority both in structural adjustment and in economic growth.

• They have piloted numerous successful innovations in emergency and development work. Their accomplishments enabled them to outlive the emergency phase during which they generally were created and to become permanent instruments for economic and social development.

• However, their visibility and high-level support often arouse misplaced expectations that social funds will eradicate structural poverty, while their budgets are small percentages of overall public spending and macroeconomic policies may be driven by growth objectives with no poverty reduction or income distribution goals.

• Social funds are also experiencing a complex transition from the creation of short-term employment in the emergency phase to permanent job establishment, which is required to address issues of structural poverty in the more challenging context of promoting social development.

Effectively Reaching the Poor

• Social funds have successfully served the poor and those communities that, on account of physical isolation, social exclusion, or gender and ethnic barriers, were not benefiting from the national investment programs or from the state’s ordinary social safety nets, if available.

• In doing so, they have shown the ability to respond quickly to the needs of the beneficiary target groups and to deliver jobs, services, and infrastructure efficiently, using modern and cost-effective management tools and techniques at low administrative costs.

• While social funds have improved the quality of life in targeted communities, their actual impact on the permanent level of income of the beneficiaries is difficult to assess, due to the provisional nature of the jobs created and to a general lack of baseline information on ex ante incomes.

Main Outcomes and Recommendations 5

• At times social funds do not reach the poorest of the poor, who are unable to express their needs, formulate requests, obtain a sense of ownership of the projects, and marshal the required participation. Cultural, gender, and ethnic barriers to development require special efforts through social communication and community outreach programs.

Social Participation and Partnerships in Development

• Social funds have highlighted the importance of civil society participation in both emergency and development projects and represent the first family of development programs with a clear role for community-based organizations in the design and implementation of subprojects.

• They also successfully introduced and practiced innovative partnerships between the public and private sectors, promoted the creation and access to markets of microenterprises, and strengthened the capacity of municipalities and local governments in delivering services.

• But the relative independence of social funds may be difficult to coordinate within the public sector and sometimes causes conflicts with line ministries. The stable management of social funds may suffer from the discontinuity of the political cycles. Social funds still depend heavily on international funding, while their programs are not always integrated in national budgets and planning processes.

• In countries with decentralized national governments, the social funds’ centralized management of significant amounts of resources to be invested locally may undermine the authority of municipalities. Local priorities may not match the centrally driven menu of subprojects, and high subproject preparation standards may contrast with low local capacity.

Sustainable Strategies for Service Delivery

• Social funds’ accomplishments in job creation and the rehabilitation or building of social and productive infrastructure are remarkable. These in turn have improved significantly the quality of life of the beneficiary communities.



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