Assessment according to the five budget support principles

Assessment according to the five criteria at country level

When preparing a country programme, there has to be an updated assessment of the five budget support criteria at country level. This would normally be a copy (update if necessary) of the assessment made when preparing the Country Policy Paper. The assessment can be copied if it was carried out within the past two years and if no major changes have occurred. If the latest version is older than that, or non-existent, an updated or new assessment should be prepared. The Guidelines for Development Contracts [LINK] include checklists and other useful information.

There are no particular requirements regarding form or comprehensiveness, but each criterion has to be explicitly addressed. Hence, a joint analysis that covers all criteria can be used. The only separate thing that has to be added would then be the Danish Mission’s conclusions.

The five criteria to be assessed at country level:

Criterion	Comments
Fundamental values Fundamental values, encompassing a minimum respect for human rights, pluralistic democracy and rule of law, including independence of the judiciary.
Solid national policies and plans for poverty reduction, good governance and sustainable development. Solid public policies to achieve poverty reduction, good governance and sustainable development, including assessment of relevance, progress and political will as well as public sector capacity to implement policy and reforms. Policy framework for monitoring progress of public policies should also be assessed. The partnership between the development partners and the receiving country and experiences from cooperation up to date.
Stable macro-economic framework. Main macroeconomic aggregates identified including potential sources of instability; macroeconomic and fiscal policies are in place and the quality of these, vulnerability to external shocks and efforts to strengthen macroeconomic resilience; efforts to strengthen domestic revenue mobilisation.
Public financial management Expert appraisal of quality and capacity in public finance management, including credibility of the budget, anti-corruption measures, comprehensiveness and transparency, policy-based budgeting, predictability and control in budget execution, accounting, recording and reporting and external scrutiny and audit.
Transparency and oversight of the budget Disclosure of all relevant fiscal information in a timely and systematic manner. Scrutiny by parliament, auditors, local authorities, civil society organisations and media.
The Danish Mission’s conclusion – is it assessed to be feasible to provide budget support and if not which major obstacles have been identified.

Assessment according to relevant criteria at sector/thematic level

The following table indicates what to assess according to criterion 2 and criterion 4 adapted to the sector/thematic level. Regarding the other criteria, no sector-level assessments are required. As is the case with the assessment at country level, there are no specific requirements for form or comprehensiveness, but each criterion has to be explicitly addressed. Hence, a joint analysis that covers both criteria can be used. The only separate thing that has to be added would be the Danish Mission’s conclusions. The technical note provides explanations and guidance to assessments at sector level and how to design programmes using sector budget support.

Criterion	Specific SBS related analysis	Comments
2	Solid national policies and plans for poverty reduction, good governance and sustainable development.	Assessment of sector/thematic plan/strategy/programme Assessment of commitment and capacity to implement it Assessment of partnership with partner (results and performance, management, monitoring) and joint coordination etc. in the sector/thematic area Assessment of experience with cooperation with partner so far
4	Public financial management	Assessment of the financial management at sector/thematic level as a supplement to available general assessments (PEFA etc.). This includes procurement regulations and implementation in the sector/thematic area, budgeting etc.
The Danish Mission’s conclusion	Conclusion of whether it is feasible to provide sector budget support and if not which major obstacles there have been identified.