Public Sector Capacity Building Program Support Project (PSCAP)

Background

Regional civil servants attending a PSCAP workshop

The government of Ethiopia has embarked upon on a long-term strategy of "state transformation" characterized by bold attempts to implement multiple reforms in parallel; the massive scale-up of institutional development efforts across tiers of government; and the deliberate expansion of the scope of public sector capacity building initiatives. The government’s National Capacity Building Program, which is the precursor to the PSCAP aimed at rapid state transformation, had 14 sub-programs, including six that form the PSCAP: Civil Service Reform, Justice System Reform, Tax System Reform, District/Woreda Level Decentralization Program, Urban Management Capacity Building Program and Information and Communication Technology Development.   The PSCAP supports (1) development of human resources; (2) development of working system and (3) development of effective organizational structures.A Ministry of Capacity Building was established to provide policy direction, coordination among other partner institutions and monitoring and oversight of capacity building efforts.

PSCAP Features

• The PSCAP is a nationwide program – implemented by regions and relevant federal ministries.
• PSCAP is supported by multiple donors who have harmonized their procedures.
• Estimated cost of the program is about US $400 million, from which the World Bank has provided a credit of US $100 million (other donors provided US $100 million in grants and the rest is to be financed through the government’s own budget).
• PSCAP has two project components: federal and regional (which represents the bulk of the program).
• PSCAP is based on a “drawing rights” system, designed to guarantee that access to program resources is performance-oriented, and shift which resources year-to-year and in-year from poor performing to higher performing subprogram activities; each PSCAP component is (i) planned based on annualized five-year drawing rights; (ii) adjusted semi-annually and annually; and (iii) reflected in participation and performance agreements with commitments to deliver on specific capacity building outputs.
• The most important institutional actors of PSCAP are: all regions and city administrations of Ethiopia, andthe Ministry of Capacity Building, through three departments: 1) Planning and Programming Directorate (coordination, monitoring and evaluation, heads of government and donor group); 2) Budget and  Finance Directorate (financial management) and 3) Procurement and Property Administration Department (procurement, for example the procurement of goods through International competitive bidding); Federal Technical Team (reviews regional plans, quality insurance); Ministry of Finance and Economic Development (MOFED); Supreme Court; Ministry of Water and Urban Affairs (MWUA), and other executing agencies and beneficiaries.

Project development objectives

Court filling system before color coding

PSCAP sub-programs and Objectives 

Subprogram 1—Civil service reform: Promote the development of an efficient, effective, transparent, accountable, ethical, and performance-oriented civil service; Subprogram 2—District-level decentralization: Deepen the devolution of power to the lower tiers of regional government, to institutionalize decision-making processes at the grassroots level with a view to enhance local participation, to promote good governance, and to improve decentralized service delivery; Subprogram 3—Justice system reform: Promote the rule of law as well as the efficient and effective functions of the justice system as part of Ethiopia’s broader democratization and private sector development processes; Subprogram 4—Urban management capacity building: Enhance the capacity of municipalities in the delivery of services and enable urban centers to play a more effective role in social and economic development; Subprogram 5—Tax systems reform: Encourage capital investment and development, increase tax revenues (through improved compliance and efficiency of collection), and ensure equity and fairness in the tax system through a comprehensive overall of the current legislation and tax administration system; Subprogram 6—Information & communications technologies (ICTs): Harness ICTs for the development of human resources, democratization, service delivery, and good governance. Several programs under PSCAP including urban management, and tax aector reform, are seeking to use ICTs in this manner; and Mandatory activity—Program support: For speedy implementation of the six subprograms in a holistic manner, PSCAP will finance public-private development or equivalents in regions, and related subprogram offices that support relevant offices in the Ministry and Bureaus of Finance and Economic Development. PSCAP impact in Ethiopia

A concrete example of PSCAP impact in Ethiopia

Court filing system using color coding

Within the PSCAP subprogram, “Civil Service Reform”, the Amhara region has extended its business process reengineering plans, which includes hospitals, government institutions and goes all the way to woredas and kebeles. This exercise has allowed many of these government institutions to reassess working procedures, redefine objectives and ways to enhance the quality of the services provided to citizens. This is particularly evident in the main regional hospital, where waiting lists have been reduced, public spaces are more user-friendly, services are provided in an integrated way and staff have been moved between departments to ensure quality services.

Progress toward achieving development objective(s)

Considerable efforts have been made to institutionalize the rules-based performance oriented PSCAP system. Financial and operational autonomy have provided a strong incentive for federal and regional executing agencies to realize early gains in three areas: expenditure management reforms have led to enhanced comprehensiveness of budget formulation and fiscal reporting, strengthened classification of expenditures through a new and improved chart of accounts, and improved planning procedures. A government-wide business process reengineering program has resulted in operational improvements (including reduced processing time for clients) in the Customs Authority and Federal Inland Revenue Authority in the Ministry of Inland Revenues; the Ethiopian Investment Commission under the Ministry of Trade and Industry; the Treasury and Central Procurement Departments in the Ministry of Finance and Economic Development; and the courts. The decentralization program is moving rapidly in urban and rural areas with the established of local government structures, assignment of expenditure and revenue responsibilities, adoption of financial regulations for municipalities, bulk training of officials, and the restructuring of select local authorities. Looking forward, continued progress will require urgent attention to problems of inadequate compensation for civil servants, weak procurement capacities, and monitoring and evaluation.

Despite several constraints experienced in the first year, most of the minimum mandatory building activities were achieved in the four big regions. The first Woreda-municipal benchmarking survey was completed.