De Ole Dawg – Part 9 2016: What about “value for money” and “catalytic” investments for economic transformation?

Contribution – Part 9/2016

BRADES, Montserrat, Feb 22, 2016 – In many DFID or FCO documents addressing the redevelopment of Montserrat (and other 9 - picOverseas Territories), we will find two concerns, value for money and risk management. They are key issues for  business cases to be made for the “catalytic” investments meant to spark transformation.

That is because DFID is interested in reliably getting good results for the moneys put in, so it has a right to expect convincing answers as to the options on the table, how risks will be managed, and as to why case A is better for us than case C, or why B is worth the extra investment costs over A. Backed up, by a clear track record of credibility. As in, he who is faithful in managing what is little will be faithful in what is much also.

Otherwise, we will be stuck at “business as usual small steps,” i.e. case C. After all, C is good enough to keep us going, without excessive risk of spectacular corruption scandals. (We have already seen headlines as to what £400 millions have bought over the past twenty years. Those headlines are just as painful for DFID as they are for Montserrat.)

No wonder, that in some DFID documents, we can sometimes find a subtle line being drawn between:

(a) meeting basic needs of OT’s that are not able to stand on their own two feet economically (as a first call on the DFID aid budget), and

(b) the (if justified . . . ) injection of major investments that could spark economic transformation and growth leading to self-sufficiency.

A key example of this is in the DFID 2012 report on its work with OT’s, where DFID plainly says[1]:

“DFID manages the British Government’s long-standing responsibility to meet the reasonable needs of those Territories that require assistance . . . But where the conditions are right, we have also been clear that we will deliver strategic investments in the aided Territories . . . designed to facilitate private sector driven economic growth and deliver a real prospect of both self-sufficiency and . . . elimination of long-term dependence on aid . . . .  [W]e expect these Territories, for their part, to undertake the necessary reforms to ensure an enabling environment for growth and develop their financial management capacity so that they can meet their budgetary obligations.”

Now, of the three territories on regular budget support from HMG, St Helena has received £250 millions to build an airport, and is a yardstick. Pitcairn, deep in the Pacific, has some 50 people there. Three on the list, one has successfully applied for a major investment, one is not a prospect, so there is just one member left. Us. In other words, DFID is speaking straight to us here in Montserrat.

Where also, we need to put on the table what has happened with the UK Aid Budget over the past ten or so years, to make it plain that there has been room for big investments:

9 pics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[1]             https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/67426/DFID-work-overseas-territories.pdf

Motive, means and opportunity were there on the UK end; the problem – never mind excuses – has been that we have not been able to make a convincing case as credible partners. And HMG has in effect said so and told us to set things right. This puts risk management on the table, right next to value for money – as, a key component of performance is reliability . . . how likely is it that a project will succeed (given (1) ideas and (2) would-be implementers):pics4

 

 

 

 

 

 

 

 

 

 

Sadly, recent reports on aid risk in Montserrat have consistently classified us as Amber-Red, with a clear message that we must address transparency, accountability, good governance and capacity/ credibility to act effectively. Whether we wish to agree with such reports is beside the point, DFID senor officers and responsible UK Secretaries of State cannot ignore them. Therefore, we must make a decisive change that shows adequate capacity, credibility and soundness of business cases for (a) governance improvement and (b) development and economy transformation programmes.

 

The logical step is to set up a centre of excellence with capable staff, a solid mandate, sound governance systems and excellent leadership backed by capable staff. Unfortunately, we have already had an attempt, and by 2011 – 12 (yes . . . four years ago) it is clear that DFID lost confidence. As the 2012 business case to try to reform the MDC plainly stated, . . . the MDC has not performed to date as had been expected. The diagnosis of this failure is clear.”  EC$ 5 millions were put in to back reforms, but by 2014 DFID clearly lost confidence again.  This, we have to face.

We have to make a fresh, major good governance and capacity building effort. One, covered by a solid development partnership agreement with DFID that also puts in place the charter for a programme of “strategic,” “catalytic” – DFID’s words –  development projects. Backed, by an agreed world-class project cycle management framework and joint GoM-DFID oversight. With, the sea port, fibre optics, tourism and energy development initiatives high on the list. On the good governance side, a good first step would be a resolution in our Assembly with an attached cabinet policy for its implementation. Such should include as a main transparency measure, creating a national community-based stakeholder consultative body for legislation, regulations, policies and major issues. Likewise, we urgently need to put in place the statutory corporation promised a year ago as a replacement for MDC; building on lessons learned from what worked well/poorly since 1995.

So, yet again, we must ask: if not now, when? If not here, where? If not us, who?

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Contribution – Part 9/2016

BRADES, Montserrat, Feb 22, 2016 – In many DFID or FCO documents addressing the redevelopment of Montserrat (and other 9 - picOverseas Territories), we will find two concerns, value for money and risk management. They are key issues for  business cases to be made for the “catalytic” investments meant to spark transformation.

That is because DFID is interested in reliably getting good results for the moneys put in, so it has a right to expect convincing answers as to the options on the table, how risks will be managed, and as to why case A is better for us than case C, or why B is worth the extra investment costs over A. Backed up, by a clear track record of credibility. As in, he who is faithful in managing what is little will be faithful in what is much also.

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Otherwise, we will be stuck at “business as usual small steps,” i.e. case C. After all, C is good enough to keep us going, without excessive risk of spectacular corruption scandals. (We have already seen headlines as to what £400 millions have bought over the past twenty years. Those headlines are just as painful for DFID as they are for Montserrat.)

No wonder, that in some DFID documents, we can sometimes find a subtle line being drawn between:

(a) meeting basic needs of OT’s that are not able to stand on their own two feet economically (as a first call on the DFID aid budget), and

(b) the (if justified . . . ) injection of major investments that could spark economic transformation and growth leading to self-sufficiency.

A key example of this is in the DFID 2012 report on its work with OT’s, where DFID plainly says[1]:

“DFID manages the British Government’s long-standing responsibility to meet the reasonable needs of those Territories that require assistance . . . But where the conditions are right, we have also been clear that we will deliver strategic investments in the aided Territories . . . designed to facilitate private sector driven economic growth and deliver a real prospect of both self-sufficiency and . . . elimination of long-term dependence on aid . . . .  [W]e expect these Territories, for their part, to undertake the necessary reforms to ensure an enabling environment for growth and develop their financial management capacity so that they can meet their budgetary obligations.”

Now, of the three territories on regular budget support from HMG, St Helena has received £250 millions to build an airport, and is a yardstick. Pitcairn, deep in the Pacific, has some 50 people there. Three on the list, one has successfully applied for a major investment, one is not a prospect, so there is just one member left. Us. In other words, DFID is speaking straight to us here in Montserrat.

Where also, we need to put on the table what has happened with the UK Aid Budget over the past ten or so years, to make it plain that there has been room for big investments:

9 pics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[1]             https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/67426/DFID-work-overseas-territories.pdf

Motive, means and opportunity were there on the UK end; the problem – never mind excuses – has been that we have not been able to make a convincing case as credible partners. And HMG has in effect said so and told us to set things right. This puts risk management on the table, right next to value for money – as, a key component of performance is reliability . . . how likely is it that a project will succeed (given (1) ideas and (2) would-be implementers):pics4

 

 

 

 

 

 

 

 

 

 

Sadly, recent reports on aid risk in Montserrat have consistently classified us as Amber-Red, with a clear message that we must address transparency, accountability, good governance and capacity/ credibility to act effectively. Whether we wish to agree with such reports is beside the point, DFID senor officers and responsible UK Secretaries of State cannot ignore them. Therefore, we must make a decisive change that shows adequate capacity, credibility and soundness of business cases for (a) governance improvement and (b) development and economy transformation programmes.

 

The logical step is to set up a centre of excellence with capable staff, a solid mandate, sound governance systems and excellent leadership backed by capable staff. Unfortunately, we have already had an attempt, and by 2011 – 12 (yes . . . four years ago) it is clear that DFID lost confidence. As the 2012 business case to try to reform the MDC plainly stated, . . . the MDC has not performed to date as had been expected. The diagnosis of this failure is clear.”  EC$ 5 millions were put in to back reforms, but by 2014 DFID clearly lost confidence again.  This, we have to face.

We have to make a fresh, major good governance and capacity building effort. One, covered by a solid development partnership agreement with DFID that also puts in place the charter for a programme of “strategic,” “catalytic” – DFID’s words –  development projects. Backed, by an agreed world-class project cycle management framework and joint GoM-DFID oversight. With, the sea port, fibre optics, tourism and energy development initiatives high on the list. On the good governance side, a good first step would be a resolution in our Assembly with an attached cabinet policy for its implementation. Such should include as a main transparency measure, creating a national community-based stakeholder consultative body for legislation, regulations, policies and major issues. Likewise, we urgently need to put in place the statutory corporation promised a year ago as a replacement for MDC; building on lessons learned from what worked well/poorly since 1995.

So, yet again, we must ask: if not now, when? If not here, where? If not us, who?