Evaluation Team

Task Manager (OPEV): Mr. M. P. Madhusoodhanan

The evaluation was undertaken by an international team of consultants from the Performance Assessment Resource Centre, commissioned by the Bank’s Operations Evaluation Department (OPEV).

Objective

The overall aim of the evaluation is to inform and strengthen the AfDB’s approach to decentralisation, through systematic assessment of the decentralisation strategy and early experience of implementation; to review how far the process has progressed against plan and record the results to date.. The core evaluation questions relate to relevance, effectiveness, efficiency and management of the process. This provides the overall structure to the Report with a final concluding section on the extent to which the decentralisation process on its current track looks set to contribute to the overarching goal of enhanced development impact of AfDB resources.

Main Findings

• The decentralisation process is behind schedule. Whilst nearing completion in terms of the number of FOs opened, there are some significant gaps in terms of the planned FO network operating at full capacity. Much remains to be done to assign sector specialists to the field, increase levels of delegated authority and to improve ICT connectivity.

• The objectives of the Decentralisation Strategy were clearly expressed and have evolved in line with growing expectations over what decentralisation will deliver for the AfDB. There has not been sufficient clarity on the causal connections through which the objectives are to be achieved, nor a clear ‘results framework’ providing a comprehensive set of targets against which progress can be assessed and accountability determined.

• Overall, the objectives of the Decentralisation Strategy are being partially achieved: 1) There is clear evidence of change in some important activity areas associated with improving portfolio management through field presence. But this is not yet sufficiently strong nor widespread to deliver quality assured project processes. 2) There has been no significant change in the nature of the dialogue between the AfDB and ,the RMC. The proximity of FOs has brought a change in the frequency and responsiveness ,of dialogue, which are two important elements in the long term process of building trust. But ,the dialogue has yet to mature into a more challenging form which could have a more appreciable effect on improving development outcomes. 3) Decentralisation is improving the visibility of the AfDB within the national setting and within the donor coordination landscape. 4) There has been a minimal effect in terms of the AfDB strengthening its ties with regional economic entities and its links with the private sector and civil society. 5) Decentralisation is proving to be a positive factor in the growth of the lending volume of the AfDB, particularly in those countries eligible for ADB funding. The evidence is not sufficiently strong to establish causality and increases are likely to be the result of a combination of factors.

• The AfDB’s effort to establish FOs has been generally well appreciated by external stakeholders and there are strong centres of support for decentralisation, and further decentralisation, within the AfDB, its clients and partners.

• The final costs for the set-up of the network of FOs are predicted to be close to that originally budgeted for. We expect annual operating costs to be close to double that originally estimated with no or very limited cost savings in Tunis (at the TRA).

• The evaluation found clear immediate advantages to having some form of field presence in RMCs, as noted above. Decentralisation carries the promise of delivering stronger development results through a higher performing portfolio. But at this stage, the decentralisation process is neither complete nor mature enough to provide evidence of any benefits at scale. At this juncture, we see a case for the AfDB to adapt the existing FO formula (building on the investments already made in the decentralisation process) in a way that could optimise costs and benefits in different client segments

• Decentralisation has been an ambitious undertaking and has coincided with an intense period of wider reforms within the AfDB, placing considerable demands on management. Despite considerable efforts, these demands have not been fully met. One key area of weakness has been in maintaining a ‘whole Bank view’ on decentralisation in ensuring consistency and coherence between the decentralisation process and the wider AfDB reforms; and in making sure that small problems do not undermine big gains. Decentralisation has not been actively managed as a change project in itself or as part of a wider change process.

• The issues confronted by the AfDB in delivering its Decentralisation Strategy are similar to the experiences of other comparable agencies. These institutions found that decentralisation was associated with increased costs; efficiency gains were not automatic; decentralisation was not recognised (nor managed) as a key element of a wider change process; and there was weak monitoring of the process and results of decentralisation.

Main Recommendations

Recommendation(s) to the Bank:

• We therefore see three broad options for the AfDB in continuing with a decentralised approach: (A) Continue on current course and at current pace; (B) Continue on current course but with an accelerated push to complete a fully functioning network and associated delegated authority; © Adjust the course to address more closely the varied needs of different client segments Develop Option C through rationalisation and expansion of the existing FO network. A customised, ‘business-driven’ approach to Fos based on a model of three types of business unit servicing the different client segments of ADB-eligible, ADF-eligible and ADF-eligible (fragile state). The FO types would have resources and delegated authority levels adjusted to reflect the characteristic business environment, client capacity and needs, and the comparative advantage of the AfDB. The Fos will play different roles reflecting the different emphasis being given to specific corporate objectives and the strategic positioning of the AfDB at the continental, regional, sub-regional and national level. The details of this option would need to be developed through a scenario planning exercise that considers the predicted costs and benefits of different configurations. 

• Develop clear plans for using decentralisation (as one of the instruments at its disposal) to help meet its commitments under the Paris Declaration and the Accra Agenda for Action. Although the AfDB is formally committed to the undertakings set out in the Paris Declaration and the Accra Agenda for Action, there is scope for improving compliance. There exists an obligation and an opportunity, through the decentralization process, to greatly strengthen the Bank’s performance in this area, and to adapt to a more fully country-led approach with a view to stepping up aid effectiveness 

• Establish a clear structure for management of the decentralisation process, with clearly defined accountabilities. This is required to actively manage the challenges and risks associated with the proposed changes as well as those (often unanticipated) challenges arising from the decentralisation process itself. There is scope for establishing an overall coordination unit, with responsibility for chasing progress within an adequately resourced change management programme 

• Improve measurement of decentralisation and strengthen learning and accountability by developing a clear results framework for a continuing decentralisation process within the framework of the MTS (2008-12). Such a framework would not be limited to AfDB activities and outputs, but would seek to link these to measurable changes in the development status of RMCs and progression of the aid effectiveness agenda.