Evaluation Team

The report was prepared by James Sackey (Task Manager for IEG) and Foday Turay (Task Manager for OPEV), with background papers and other substantive inputs from Luis Alvaro Sanchez, Svenja Weber-Venghaus, Tim L. De Vaan, Albert-Eneas Gakusis, Erisa Ochieng, Yona Kanyomozi, and Bernard Bashaasha. This evaluation benefited from the comments from peer reviewers Ray Rist (Consultant, IEG) and Getinet Giorgis (Consultant, OPEV).

Objective

This evaluation is a joint product of the IEG and OPEV. An IEG-OPEV team visited Uganda in January 2008 and subsequently prepared the report using terms of reference set out in an Approach Paper (AP) endorsed on a no-objection basis by the relevant committees of the two institutions’ Board of Executive Directors. The decision to undertake a joint evaluation was motivated by the two institutions’ shift to using a common strategic framework, the UJAS, to guide the formulation and delivery of their programs. The use of a common strategic framework means, at least in 

Main Lessons

• In translating objectives into programs of assistance, it is necessary to review design and implementation options with attention to their appropriateness to the country and to the risks associated with each option. In interventions where program design and choice of policy options did not adequately factor in risk issues in design and implementation, such as in the power sector and in strengthening the capacity of anti-corruption institutions, unanticipated consequences led to weak outcomes. In the unbundling of the power sector, for example, weak assessment of the risk associated with supply failure was behind the poor outcome of both World Bank and AfDB assistance. 

• Support for policy reforms aimed at broad-based governance outcomes, such as the reduction in public sector corruption, needs to be built on an understanding of the causal links between the interventions and their expected outcomes. The assistance that the World Bank and the AfDB provided on governance was mainly in public financial management— with the objective of improving transparency and accountability in the public sector, thereby helping reduce corruption. Although the strategies and program designs underlying the support were relevant and aligned to the Poverty Eradication Action Plan (and emphasized the comparative advantage of multilateral institutions), they did not clarify the links between the interventions and how they were expected to lead to improved governance. Consequently, although the outputs of the public finance interventions of the two institutions were substantial (as noted by satisfactory project implementation), their impact on the reduction of corruption was not clear. 

• The untimely sequencing of policy measures in an environment undergoing major re-forms (as in the social sectors in Uganda) can lead to underperformance. Uganda has been at the forefront of development policy initiatives, especially in human development. However, the development outcome does not quite measure up. One reason may be the repeated introduction by the government of policy measures that may be desirable but are out of line with the agreed medium and long-term strategic planning framework. Some of these often rather sudden initiatives, such as universal primary education, universal secondary education, the abolition of user fees for basic health services, and salary increases for teachers and health workers beyond planned levels, affected the social sectors directly by reducing the effectiveness of ongoing reforms. Others have indirect bearing by decreasing budgetary space for allocations to basic service delivery. Examples include the abolition of the graduated tax and the creation of new districts with associated high costs and capacity building challenges. 
   
• The untimely sequencing of policy measures in an environment undergoing major re-forms (as in the social sectors in Uganda) can lead to underperformance. Uganda has been at the forefront of development policy initiatives, especially in human development. However, the development outcome does not quite measure up. One reason may be the repeated introduction by the government of policy measures that may be desirable but are out of line with the agreed medium and long-term strategic planning framework. Some of these often rather sudden initiatives, such as universal primary education, universal secondary education, the abolition of user fees for basic health services, and salary increases for teachers and health workers beyond planned levels affected the social sectors directly by reducing the effectiveness of ongoing reforms. Others have indirect bearing by decreasing budgetary space for allocations to basic service delivery. Examples include the abolition of the graduated tax and the creation of new districts with associated high costs and capacity building challenges. 
   
• In order to optimize aid effectiveness, the focus should be on improving aid predictability, resolving issues of coordination among the large number of donors, and resolving aid fragmentation. Uganda’s efforts at aligning donors behind the Poverty Eradication Action Plan, promoting the movement to joint assistance programs among donors (the Uganda Joint Assistance Strategy), and seeking broader use of the GBS instrument have helped improve the predictability of aid flows, initiated discussion on coordination and division of labour among donors, and will likely help reduce fragmentation (that is, the proliferation of donor-funded activities). 
   

Main Recommendations

Recommendations to the Co-Financers:

• Support the government in developing an analytic framework to guide decisions on governance reforms.  Such a framework will help define the causal links between various interventions and expected outcomes for improved governance.

• With the help of other development partners, encourage and support the govern-ment to develop medium-to-long-term master plans for infrastructure development in order to promote private sector participation, competition, and regulatory reform, and to enhance the process of timely institutional building.

• Encourage the government to coordinate major ongoing monitoring and evaluation initiatives by its development partners in order to secure reliable M&E of its overall poverty reduction strategy, thereby helping to facilitate adequate sequencing of policy reform.

Recommendations to the Bank:

• Strengthen the AfDB’s in-country presence by relocating sector specialists. This would raise its profile and ensure improved policy dialogue, and is particularly im-portant in the areas where the AfDB plans to stay engaged.  To avoid spreading AfDB’s staff too thinly, one option may be to deploy sector specialists to regional hubs.

• To use limited resources more effectively, seek deeper engagement in a limited set of areas

• Undertake regular, perhaps joint, economic and sector work and project-level, self-evaluation that is sufficient to underpin country strategy and deepen dialogue with the government

• Seek to reinforce the effectiveness of the GBS as an instrument for minimizing transaction costs and facilitating the use of country systems, as channeling funds through the recipient country’s institutions helps strengthen the governance structures and capacities and facilitate aid harmonization.  This will require a greater focus on reaching agreement with other UJAS members on a joint budget support mechanism and assisting the government in budget prioritization, monitoring, and evaluation