Transcript The Policy Development Process and the Agenda for Effective

The Policy Development Process
and the Agenda for Effective
Institutions: the Philippines
Gilberto M. Llanto
The Micro Foundations of East Asian Economic
Integration
Hotel Okura, Tokyo, Japan
February 26, 2007
Institutions and the policy
development process

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Implementing institutions
Supporting institutions: (a) coordinating
body and (b) independent policy review
institution
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Development Process and the
Agenda for Effective Institutions
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
The paper discusses role of supporting
institutions in the policy development
process and offers suggestions on how
to make them more effective.
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Development Process and the
Agenda for Effective Institutions
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Current economic situation

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Modest economic performance (GDP
growth Q1 to Q3 at 5.4%; fiscal deficit,
2.7% of GDP in 2005; expected to
decline to 0.9% in 2007.
Low level of productivity
Huge public debt
BUT growth potential is considerable
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Development Process and the
Agenda for Effective Institutions
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What to do?
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Need to accelerate economic policy
reform efforts
As economies evolve, so should
structures and institutions
Economic reform has to be continuous.
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Development Process and the
Agenda for Effective Institutions
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Supporting institutions

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Coordinating institutions: National
Economic and Development Authority
(NEDA) and the Department of Budget
and Management (DBM)
Independent policy review institution:
Philippine Institute for Development
Studies
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Development Process and the
Agenda for Effective Institutions
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Recent reform effort by DBM

Public expenditure management
reform: (a) medium term expenditure
framework (MTEF), (b) organizational
performance indicator framework
(OPIF), and (c) accountability,
monitoring and evaluation framework.
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Development Process and the
Agenda for Effective Institutions
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OPIF

Outcomes and outputs framework: (a)
support policy development process, (b)
strengthen departments’ internal
management and (c) strengthen
external reporting for accountability
purposes
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Development Process and the
Agenda for Effective Institutions
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Logical frameworks done for 20
departments
OPIF document to accompany the
budget documents to be submitted to
Congress (national expenditure program,
President’s budget message)
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Development Process and the
Agenda for Effective Institutions
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Main challenge to OPIF, MTEF
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Congress acceptance of three year
MTEF framework and OPIF which
fosters accountability
Convincing congress that good
economics is good politics; coordinating
bodies (DBM, NEDA) need to improve
technical and political skills
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Development Process and the
Agenda for Effective Institutions
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Independent policy review
institution
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Philippine Institute for Development
Studies has statutory independence and
capable research staff, but it is
financially weak and dependent on
government subsidy for operations.
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Development Process and the
Agenda for Effective Institutions
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Need to improve capacity of policy
review institution
Australian experience shows benefits of
good evaluation: (a) pinpoints
accountability, (b) reduces cost, and (c)
leads to good policy choices.
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Development Process and the
Agenda for Effective Institutions
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Concluding remarks
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The policy development process needs
supporting institutions: (coordination tasks as
well as independent review)
Policy development process is not a
disembodied phenomenon.
The message (content) of the reform is
important but the medium (effective
institutions, both implementing and
supporting) is also critical.
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Development Process and the
Agenda for Effective Institutions
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Thank you!
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Development Process and the
Agenda for Effective Institutions
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