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This topic guide aims to provide key sources of information on the governance aspects of the PRSPs. It is an evolving resource and the GRC Exchange would welcome your comments and contributions. This guide is supported by three other GRC Exchange topic guides which cover both the specific instruments of Sector Wide Approaches (SWAps) and budget support, as well as providing a generic guide to the broad topic of 'aid instruments.'

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"At the Annual Meetings of the World Bank and International Monetary Fund in 1999, the world community decided on a new approach. Countries are invited to design their own Poverty Reduction Strategy. This is written up into a Poverty Reduction Strategy Paper (PRSP), which becomes the basis for donor support. PRSPs are developed from existing government policies that set out the actions and strategies needed to reduce poverty. If the country does not already have a comprehensive strategy, an Interim PRSP (I-PRSP) is produced and this will include the timeframe and process for developing the full PRSP.

To access debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative, countries must have at least an interim PRSP. Final, irrevocable relief is delivered when countries have a full PRSP in place and have implemented key poverty reduction actions, agreed in advance with the international community. PRSPs are also used to access the IMFs new lending facility for low-income countries, the Poverty Reduction and Growth Facility (PRGF)" (DFID, 2001: 1).

• nature of poverty
• obstacles to, and opportunites for, poverty reduction and faster growth: macro-economic, structural, environmental, social and institutional
• trade-offs and win-win scenarios in policy choices: options

Goals

• long-term for key anti-poverty targets
• priority public actions
• indicators and monitoring system
   

Policy actions - economic, structural, environmental, social and institutional
Medium-term budget framework
Financing plan
External assistance - requirements & coordination
Participatory process

• who was consulted when and how?
   
• how the does PRSP content reflects the outputs of consultations?
   
• involvement of civil society and government in PRSP monitoring, implementation and dissemination
   

DFID Background Briefing: Poverty Reduction Strategies, June 2001.

This section provides links to an impressive resource on PRSPs, funded by DFID but managed by a team at ODI. It provides comprehensive coverage of the issues surrounding the implementation of PRSPs around the world.

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Making sure that PRS processes sufficiently respond to governance problems is essential if PRSPs are to meet their poverty reduction goals. Where governance issues are prioritised in PRSPs, how can these goals be put into practice in the context of weak institutions, low public capacity and unresponsive political systems?

These problems are addressed by the following DFID papers:

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Poverty reduction is impossible without reforming the whole system of public finances. Efficient and effective public expenditure management is an essential precondition for government to be able to do anything significant for poverty reduction. The paper below examines this issue in five African countries:

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PRSPs were introduced to promote poverty reduction strategies that are country-driven, results-oriented, comprehensive, partnership-based and long- term in perspective. PRSPs provide a framework and practical tool in the over-arching goal of achieving sustainable poverty reduction and are geared towards including civil society in the design and decision-making processes. The paper below examines the issues surrounding civil society inclusion in the PRSP process:

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Where PRS processes are introduced in countries that are still engaged in conflict or have recently experienced conflict, this raises important questions for governance. The following resources from a DFID commissioned study explore this issue:

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In 1999, the World Bank (WB), together with the International Monetary Fund (IMF), introduced its Poverty Reduction Strategy Papers (PRSPs). PRSPs aim to focus development efforts on poverty alleviation. Yet, what is new about PRSPs and can they really make a difference? The document below explores issues of poverty reduction and whether and how PRSPs will help reduce poverty:

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PRSP monitoring calls for fresh thinking. It needs to be geared to what is new and challenging about the PRSP initiative - particularly the effort to engage a wider range of stakeholders in policy dialogue about poverty reduction at the national level. It also needs an understanding of the relevant policy processes and the possible uses of information in enforcing new kinds of accountability and learning about poverty reduction. Further, the greater results-orientation that is a feature of the PRSP approach should not be taken to imply an exclusive interest in monitoring final results or impacts. The paper below looks at issues of monitoring and suggests good practice in developing indicators:

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The GRC Exchange has developed a topic guide on aid instruments. It aims to provide key sources of information on the governance aspects of design and decision-making choices, impact, assessment and evaluation of aid instruments.

In addition to this guide to PRSPs the GRC Exchange also holds a further three topic guides directly relevant to this topic. The first is a generic guide to the broad topic area 'aid instruments'. The other guides cover specific aid instruments:

• Aid instruments
• Sector Wide Approaches (SWAps)
• Budget support

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