Poverty Monitoring Systems

Poverty monitoring systems are made up of a broad spectrum of activities involving numerous actors:

• Data/information producers: typically comprise the national statistical agency and other government and non-governmental data producers.
• Analysts: typically belong to various government agencies, universities, consulting firms, think tanks, and donors.
• Users: range from government decision-makers, to parliamentarians, civil society groups, the donor community and researchers.

Institutional arrangements

Institutional arrangements are the key elements that define the interaction between these actors and activities. While most countries involved in implementing a PRS already have in place a range of individual monitoring mechanisms, drawing them together into a common system is a relatively new undertaking that poses substantial practical challenges. In many countries, the systems suffer from fragmentation, lack of coordination, lack of demand, unclear mandates and responsibilities, lack of relevance and timeliness of data, and limited accessibility. This underlines the importance of institutional arrangements to bring all activities together in a coherent framework: roles and responsibilities, rules, procedures, reporting mechanisms, and so on. Effective institutional arrangements coordinate the production, dissemination and use of data and information amongst the various actors, define their roles and responsibilities, establish reporting mechanisms, and manage the functioning of the poverty monitoring system as a whole. Without adapted institutional arrangements, information typically does not flow between the various actors and is not used for better interventions and greater accountability.

Organizing Monitoring Activities

Before establishing a PRS monitoring system, most countries already possess a range of monitoring mechanisms. Organizing a coordinated monitoring system and ensuring that monitoring data are used in the policy process are both proving major practical challenges. The difficulties include issues with data collection, in the coordination of activities, a lack of operational detail, costing, and prioritization in many PRSs, weaknesses in public expenditure management systems, a deficit in analysis and evaluation and low demand among policy makers for monitoring information. Few systems have created functioning links between monitoring and decision making.

The lack of a consistent monitoring framework causes problems, though adding new monitoring obligations without simplifying existing arrangements is unlikely to help. The main challenges in establishing a PRS monitoring system therefore revolve around rationalizing existing monitoring mechanisms and coordinating numerous separate actors. Ideally, the institutional design should emerge out of a shared commitment to solving the practical problems of PRS implementation. Systems are consensual in nature and tend to function only if participants find them useful and legitimate and agree on a common purpose. Experience suggests the following variables are important in designing a PRS monitoring system.

1. Strong political leadership. Placing the institutional lead close to the center of government or the budget process is likely to give the system greater authority, while facilitating the creation of links to the policy and budget process.
2. Coordination of actors. The coordinating structure should be designed to encourage active participation by key stakeholders, with clear roles and responsibilities and well-defined activities, without imposing too great a burden on participants.
3. Links with line ministries. Most PRS monitoring systems are second-tier systems that rely on a supply of routine data from line ministries. The link works best when the nominated liaison points are substantively involved in monitoring and evaluation for sectoral policy making and management purposes and have the authority, time, and incentives to play this role effectively.
4. Involvement of national statistics agencies. National statistics agencies are often the most institutionally advanced elements in PRS monitoring systems. However, the system arrangements must ensure complementarity with existing statistical systems and statistical planning so as to avoid duplication, limit potential rivalry between the statistical systems and the PRS monitoring system, and strengthen links between central agencies and line ministries.
5. Involvement of local governments. Capacity constraints at the local level are usually critical, especially in the poorest areas. During the process of decentralizing service delivery, some countries have encouraged local authorities to develop their own monitoring arrangements, while others have preferred to strengthen the monitoring of local governments by the center.

Making use of PRS monitoring

It appears that more attention has been paid to organizing the supply of monitoring information than to ensuring the effective use of this information to improve PRS policies and programs. If the results of monitoring are not sought out and used by policy makers and public sector managers, then monitoring comes to be seen merely as a bureaucratic burden, and compliance with monitoring procedures deteriorates. The most promising strategy for strengthening demand is to tailor PRS monitoring system outputs to key points in the policy-making process where information on the performance of policies and programs is likely to be influential, such as around the budget, updates of the PRS, parliamentary sessions, public dialogue, and donor strategy elaboration. Important elements in encouraging the greater use of PRS monitoring information include the following.

1. Analysis and evaluation. If PRS monitoring is to influence policy making, the practice of analysis and evaluation needs to be institutionalized in the PRS monitoring system.
2. Outputs and dissemination. If they are to have an impact, the information and analysis resulting from monitoring activities must be compiled into outputs and disseminated across government and to the public. A dissemination strategy should be a central part of PRS monitoring systems.
3. Links with budget and planning. Perhaps the most promising strategy for building demand is to link PRS monitoring to the budget process. When linking a PRS monitoring system to the budget, care needs to be taken to avoid creating perverse incentives that may distort the monitoring process.
4. Links with parliament. The lack of involvement of parliaments in existing PRS monitoring systems represents a missed opportunity to help ensure parliaments are able to carry out their role of oversight and control of the executive and their role of representation for their constituencies.
5. Links with civil society. Nongovernmental organizations, private interdisciplinary research entities, universities, unions, lobby groups, and other members of civil society can play a role in PRS monitoring on both the supply side and the demand side.

Conclusions

One of the lessons learned from PRSP countries is that the system should be kept simple and flexible, and be built progressively. It is also important to recognize that changes will be gradual. A general tendency is to design complex systems, without prioritizing activities, and often with little connection with existing monitoring activities and agencies. Since capacity is limited, the resulting systems are often not able to perform their functions.

Another lesson from early experience is that systems should build on existing elements and processes. The aim should be at starting a process of change rather than at designing a “perfect” system There is no blueprint for appropriate institutional arrangements, but rather appropriate arrangements depend on country circumstances, such as existing data collection systems, management system, and reporting mechanisms. Efforts need to focus on strengthening existing primary data producing systems, integrating responsible agencies into the PRSP process, and establishing good relationships between the central units and these agencies.

Systems should also be built with the ultimate purpose of feeding back into policy-making processes. In numerous PRSP countries, there is still little evidence of widespread effective use of monitoring outputs for decision-making. Strengthening demand and promoting the use of results in policy and budget decisions will require clearly defined relations, incentives, and activities which reward performance, effective dissemination and communication of data and analysis, as well as building analytical capacity among decision-makers. The introduction of sustainable monitoring systems that effectively feedback into decision making processes requires strong political will and commitment, to establish and enforce the required the incentive structure.

Related Sections:

• See Training Events and Materials for more resources.
• See Country Documents for national monitoring plans and studies on the poverty monitoring systems and statistical systems of various countries.