bangladesh governing cc finance in bangladesh final draft (1)
TRANSCRIPT
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Governing
ClimateChangeFinance
inBangladesh
AnAssessmentoftheGovernanceofClimateFinanceandTheParisDeclarationonAidEffectiveness
REVIEW DRAFT
FOR LIMITED CIRCULATION ONLY
A Report to the Capacity Development for Development Effectiveness Facility
Prepared by Clifford Polycarp, World Resources Institute
21 September 11 October 2010
NOTE: The views expressed in this report are those of the author only and do not in any way
represent those of the donors to the CDDE Facility, organisers of the climate change finance and
aid effectiveness initiative, or the World Resources Institute
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TableofContentsAbbreviations and Acronyms ........................................................................................................ 3
Executive Summary............................................................................................................................ 4
1. Introduction.......................................................................... ........................................................ 7
2. Climate change and development in Bangladesh ......................................................... 8
3. Ownership ..................................................................................................................................... 9
3.1 Evolving strategies and action plans ........................................................................... ... 9
3.2 Emerging institutions and funds ................................................................................... 10
3.3 Challenges to enhancing ownership ............................................................................ 11
4. Alignment ........................................................ ........................................................................... 12
4.1 Progress with ODA .............................................................................................................. 12
4.2 Aligning climate finance .................................................................................................... 13
5. Harmonisation .......................................................................................................................... 14
6. Managing for results .............................................................................................................. 14
7. Mutual Accountability ........................................................................................................... 15
8. Conclusions and recommendations ................................................................................ 16
References ...................................... ..................................................................................................... 19
Annex 1: Matrix of questions ...................................................................................................... 20
Annex 2: List of stakeholders interviewed............................................................................ 24
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AbbreviationsandAcronyms
ADB AsianDevelopmentBank
AWGLCA AdhocWorkingGrouponLongtermCooperativeAction
BCCRF BangladeshClimateChangeResilienceFund
BCCSAP BangladeshClimateChangeStrategyandActionPlan
CCTF ClimateChangeTrustFund
COP ConferenceofPartiestotheUNFCCC
GEF GlobalEnvironmentFacility
GHG GreenhouseGas
IMED Implementation,MonitoringandEvaluationDivision
NAPA NationalAdaptationProgrammeofAction
NSAPR
NationalStrategy
for
Accelerated
Poverty
Reduction
ODA OfficialDevelopmentAssistance
UN UnitedNations
UNFCCC UNFrameworkConventiononClimateChange
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Executive
Summary
This report is one of five country studies that have been commissioned by the
CapacityDevelopmentforDevelopmentEffectiveness(CDDE)Facility1supportedby
the Asian Development Bank, Government of Korea, Government of Japan, and
UNDP, as part of a regional dialogue process also supported by the Swedish
International Development Cooperation Agency (SIDA) and the OECD DAC. The
purpose of the initiative is to develop a set of recommendations regarding the
programmingofclimatechangefinanceatthenational level.The initiativeseeksto
strengthenthemanagementofclimatechangefinancebybeneficiariesanddonorsthrough
aconsiderationofAidEffectivenessprinciples. Findingsfromthecountrystudieswillbe
discussedinaworkshoptobeheldinBangkok,October19202010.
Withmore
than
84
81
percent
of
its
population
living
under
$2
aday,
Bangladesh
is
amongthepoorestcountries intheworld. It isalsoamongthemostvulnerableto
the impacts of climate change particularly affecting the poor. Recognizing this,
politicianshaverespondedconstructivelyandconsistently,evengovernmentshave
changed,toputinplacepolicies,strategies,institutionstorespondtothechallenge.
Whilehistoricallythegovernmentand its internationaldevelopmentpartnershave
worked to enhance the countrys resilience to climate variability and shocks, only
recentlyhavetheystartedtodedicatefinancialresourcestoaddressthethreatsof
longtermclimatechange.
ThecountryfirstdevelopeditsNationalAdaptationProgrammeofActionin2005to
identifyadaptationneeds.Buildingonthiseffort, in2009,thegovernmentadopted
theBangladeshClimateChangeStrategyandActionPlantobuildthecapacityand
resilienceofthecountrytomeetthechallengeofclimatechange.Thestrategyhas
six pillars covering social aspects, disaster management, climate proofing
infrastructure, building research capacity, low carbon development and building
governancecapacity.Effortstomainstreamclimatechange intodevelopmentplans
andarethelineministriesarealsonowstartingtotakeshape.
AsclimatefundsstarttoflowinBangladesh,institutionsarestillevolving.Aclimate
changeunithasbeensetupintheMinistryofEnvironmentandForests(MoEF),and
is in the process of being fully staffed. This unit is expected to provide secretarial
functions for thegovernments$100 millionClimate Change Trust Fundas well as
the $110million multidonor Bangladesh Climate Change Resilience Fund (BCCRF).
Thiscoversthebulkoftheroughly$300millionthatisexpectedtobeprogrammed
toaddress
climate
change
in
the
coming
years.
The
unit
is
also
expected
to
MoEF
Secretary also coordinates the climate changecells focal points in the various line
ministries.
Coordinationhasgenerallybeenachallengewithinothersectorsaswell,as isthe
coherence between priorities in the national development and the sectoral plans.
Thisalsohasimplicationsforclimatechangeplanningandprogramming,whichrisks
1 More information on the CDDE Facility can be found atwww.aideffectiveness.org
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being decoupled from core poverty reduction and development agenda posing a
systemic challenge to mainstreaming climate change in the poverty reduction and
developmentagenda.AddressingthisissuewillmayrequiretheMoEF,togetherwith
theMinistryofPlanning,andtheMinistryofFinancetoensurethatclimatefinance
resources are integrated into the mediumterm budgetary framework and the
AnnualDevelopmentPlanningprocesses.
Giventhescaleoftheneedsforcoordinationthereisstillconsiderabledebateover
howtobeststrengthen institutionalcapacities inthisregard.Several ideasarestill
being discussed. There appears to be some convergence around the idea of line
ministriesleadingcoordinationonclimatechangemainstreamingforspecificsectors
due to technical expertise and convening power, but also to enhance ownership,
whiletheMoEFwouldberesponsible foroverallcoordinationandcoherence.This
will
require
the
MoEF
to
empower
the
line
ministries
to
take
the
lead
for
their
respective sectors, and the line ministries to put in place enduring institutional
arrangementstoensurethatleadershipisexercisedeffectively.
Thegovernmentanditsdevelopmentpartnershavemadesomeprogressinaligning
their strategies and resources in support of priorities, and in harmonizing their
efforts. The development of the Joint Cooperation Strategy (JCS), which has
expandedfrom4donorsto18donors,andtheperformanceofthefourdonorsthat
were partof the initial JCS are indicative of concertedefforts to make progress in
thisarea. Intheclimatechangespace,thepoolingofresourcesbymultipledonors
intotheComprehensiveDisasterManagementProgrammeandtheBCCRFarealso
indicatorsofeffortstomakeprogressonalignmentandharmonization.
AsthenewchairoftheclimatechangeandenvironmentWorkingGroupsubgroupin
the Local Consultative Group (LCG) process, the UN agencies UK Department for
InternationalDevelopment (DFID)canworkwith leadclimate financecontributors,
the MoEF and the MoF, to ensure that climate change is addressed more
comprehensively intheLCGprocessto improveharmonisation,andtoensurethat
climate funds are also more closely aligned with poverty reduction plans and the
mediumtermandannualbudgetaryplanningprocesses.
Although donors are making progress in aligning behind the governments stated
priorities,progress intheuseofPublicFinancialManagement (PFM),procurement
andauditingsystemsisslowerwithongoingconcernsoverfiduciaryrisk.Theyfacea
challenge in balancing fiduciary risk controls with more flexible measure to
programme
resources.
These
concerns
have
also
affected
climate
change
programming where the government and the donors, for nearly three years,
debated who would manage the BCCRF. Addressing this issue will require the
strengthening institutions for financial accountability such as the comptroller, the
auditor general and the AntiCorruption Commission to better implement and
enforcerules.
The challenge of weak capacity is also a concern when it comes to monitoring
results.WhiletheImplementation,MonitoringandEvaluationDivision(IMED)ofthe
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Ministry of Planning has the overall responsibility of monitoring publicly funded
projects,theactualresponsibilityofcollectingandcompilingdata,andanalysing it
lies with the line ministries. The capacity to measure and report on climate
outcomesneedstobebuiltintothisexistingarchitecture.However,bothIMEDand
thelineagenciesremainunderstaffedtoperformthisaddedfunction.
TheMoEFneedstoworkwithIMEDandthroughitwiththerelevantmonitoringand
evaluationstaffinthelineministries,tobuildthegovernmentscapacitytomeasure,
reportandverify(MRV)climateoutcomes.Thiscapacitybuildingeffortcanbebuilt
into the technical assistance programmes of the United Nations Development
ProgrammeandtheAsianDevelopmentBanktomainstreamclimatechange inthe
planningandlineministriesrespectively.
Despite
the
enormous
challenges
in
governing
climate
finance
effectively
in
Bangladesh, the government and its development partners have made good
progress in a relatively short period of time. Addressing the coordination and
capacity constraints will go a long way in enhancing the effectiveness of not only
climatefinancebutaidmoregenerally.
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AidEffectiveness(seeAnnex:Listofstakeholdersinterviewed).Thedraftreportwas
alsoreviewedbyrelevantstakeholdersinthecountrybeforefinalization.
ThereportbeginsbysituatingclimatefinanceinBangladeshwithinthedevelopment
contextinthecountryinsection2.Sections37capturethecurrentstatusofclimate
finance in relation to the five aid effectiveness principles, as well as the views of
various stakeholders on challenges and opportunities in ensuring that the climate
finance is governed effectively. Section 8 draws out some of the key issues and
conclusions, and suggests some of the key areas that the government, its
development partners and other stakeholders can focus on to improve the
governanceofclimatefinance.
2. ClimatechangefinancingandaideffectivenessinBangladeshBangladeshisoneofthepoorestcountriesintheworld.Eightyfouronepercentof
itspopulationof144158millionpeopleliveonlessthan$2aday(OECD2008UNDP
2009). It is also one of the most vulnerable countries to climate risks, particularly
tropicalcyclones.Thepoorareparticularlyvulnerableasamajorityofthe50million
poor live in areas that are especially vulnerable to natural disasters, such as river
islandsoralongthecoast(MoEF2009).Whileinternationaldevelopmentassistance
hashistoricallysupported thecountrysefforts toenhance its resilience toclimate
variability and shocks, only more recently are funds being channelled to address
longterm climate change. The issue is also gradually making its way on to the
agendaoftheinstitutionsforaddressingaideffectivenessinthecountry.
2.1ClimatefinanceandODA
Recognizing its particular vulnerability to climate shocks, the Government of
Bangladesh, with support from international development agencies, has invested
over$10billionsinceitsindependencetomakethecountrymoreresilienttonatural
disastersandotherclimateshocks(MoEF2009).Theseinvestmentsareapartofthe
Official Development Assistance (ODA) provided and would not meet the
additionalityandincrementalcostscriteriaoftheUNFCCC.Nonetheless,itdoeshave
significant cobenefits of enhancing the countrys resilience to climate change as
well. Inthecomingyears,thegovernmentand itsdevelopmentpartnerswillneed
scaleuptheirinvestmentstoenhancethecountriesresiliencetoclimateshocksand
alsofocusmoreexplicitlyonthreatfromlongtermclimatechange.
Thegovernment
has
already
stepped
up
its
efforts
over
the
last
five
years
by
putting
inplacepoliciesandstrategies,andbyevenprovidingsubstantialfinancialresources
totacklethechallenge.Thissupportmayhavebeenpartlydrivenbythedamaging
climaticeventsthathaveaffectedthecountry inrecentyears,includingtwosevere
floods, and a massive cyclone. What is more significant is that it has taken these
actionsevenasthegovernmenthaschangedsignallingbroadbasedsupportforthe
climatechangeagenda.
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As a least developed country, Bangladeshs contribution to the climate change
problemthrough itscarbonfootprint isrelativelysmalland is likelytoremainso in
the foreseeable future. Nonetheless, the government recognizes that as it grows
economicallysowillitsfootprint,andinresponse,ithasidentifiedaclimatechange
mitigation pillar in its climate change strategy. However, the emphasis in the
allocationofresourcesisappropriatelyfocusedonclimatechangeadaptationinthe
short tomediumterm.
2.2ODAandaideffectivenessThe responsibility for enhancing the aid effectiveness agenda in the government
restswiththeAidEffectivenessUnit(AEU)intheEconomicRelationsDepartmentof
theMinistryofFinance(MoF).LedbytheMoF,thegovernmentanditsdevelopment
partnershave
created
aplatform
for
dialogue
the
Local
Consultative
Group
and
the
high level Bangladesh Development Forum to review progress on the countrys
poverty reduction strategy and plan joint work. A working groupsubgroup on
climatechangeandtheenvironment ledbytheUNagencies isoneoftheworking
groups bodies responsible for review progress and planningjoint work on climate
change in relation to the poverty agenda. Until very recently, it was led by the
UnitedNationsDevelopmentProgrammeforthelastfouryears,andwillnowbeled
bytheUKDepartmentforInternationalDevelopment.
While the performance of ODA in relation to the aid effectiveness principles has
been mixed, it is somewhat early to assess the consideration of aid effectiveness
principles in relation to climate finance. Some early efforts to assess progress are
beingmadethroughthisstudyandasimilarassessmentthatisbeingundertakenby
theAEU.
3. OwnershipThe Government recognizes that the climate change is likely to exacerbate the
climatic risks that the country faces, thus threatening itsaspiration of becoming a
middle income country by 2020. Even through the government changes that the
countryhasbeenthrough inrecentyears,successivegovernmentshavecontinued
toshowaunifiedpoliticalcommitmenttoaddresstheclimatechangerisksthatthe
countryfaces.Whilethishasresulted inclimatechangebeingaddressed invarious
strategies and action plans, and supported bydomestic and international financial
resources, a coherent effort to coordinating strategies and resources is yet to
emerge.
3.1Evolvingstrategiesandactionplans
In2005,throughaconsultativeprocess,thegovernmentdevelopedanactionplan
foradaptation,theNationalAdaptationProgrammeofAction,toidentifytheurgent
and immediate needs of the country to address the present threats from climate
change. This was supported by the United Nations Development Programme.
Following the2007climate changeconference inBali, thegovernment launcheda
process of developing a comprehensive climate change strategy supervised by a
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Steering Committee chaired by the Special Assistant to the Chief Adviser of the
caretaker government. The outcome of this process was the Bangladesh ClimateChangeStrategyandActionPlan(BCCSAP),whichwasadoptedbythenewlyelectedgovernmentinJuly2009.
TheActionPlanhassixpillars:
Providing food security, social protection and health to the poorest and mostvulnerableeveninthefaceofclimatechangestresses;
Strengthening the countrys disaster management system to deal withincreasinglyfrequentandseverenaturalcalamitiesresultingfromclimatechange
Ensuringthatexisting infrastructure isabletowithstandthe impactsofclimatechange,andnewinfrastructureisbuilttodealwithit;
Buildthecountrysresearchcapacityto improve itsabilitytobetterpredictthescale
and
timing
of
climate
change
impacts
on
different
sectors
and
socio
economicgroups;
Developlowcarbondevelopmentoptionsandimplementthem;and Build the institutional capacityof governmentand nongovernmental actors to
addressclimatechange.
Besides the BCCSAP, the government also has its threeyear poverty reduction
strategy, the National Strategy for Accelerated Poverty Reduction (NSAPR) for FY
200911,whichdrawson theBCCSAP. Thestrategy isstructured around fivemain
themesandfivesupportingstrategies.Tacklingclimatechange,alongwithcaringfor
the environment, is one of the supporting strategies. Since 2006, the government
has been using a strategic budgeting process to align its expenditure with the
nationalpriorities identified in theNSAPR.Recently,new initiativestomainstream
climate change have been launched. These initiatives are supported by the UN
agenciesfortheplanningprocess,andbyADBforthelineministries.
3.2Emerginginstitutionsandfunds
TheinstitutionalarchitectureputinplacetoimplementtheBCCSAPincludes:(i)the
National Environment Committee/Council chaired by the chief adviser/prime
minister to provide strategic guidance and oversight; (ii) a National Steering
CommitteeonClimateChangeforoverallcoordinationandfacilitation,(iii)aClimate
Change Secretariat/Unit at the MoEF for coordination and management, and (iv)
climate change cells in all ministries to plan and implement activities in their
respective ministries. While the higher level committees are in place, the Climate
ChangeUnit
is
still
being
staffed,
while
the
cells
in
the
line
ministries
are
still
in
the
processofbeingestablished.
TheGovernmentestimates that the costof implementing theplanwouldbe$500
millioninthefirsttwoyears,andthetotalcostforthefirst5yearswas likelytobe
on the order of $5 billion (MoEF 2009). In 2008, the government established a
ClimateChangeTrustFund(CCTF)(formerlytheNationalClimateChangeFund)with
an initial capitalization of 3 billion takas ($45 million) from its budget to support
climate change programs to be managed by the MoEF. Earlier in 2010, the
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government ramped up its contribution to this fund up to 7 billion takas ($100
million).LateinSeptember2010,anewlawwaspassedbyParliamentgoverningthe
operationoftheCCTF.
In addition to the CCTF, the government also
concluded a Memorandum of Understanding
with four EU member countries and the
European Commission to set up the Bangladesh
Climate Change Resilience Fund (BCCRF) with at
least $110 million. While this fund will also be
managed by the government with both
governmentanddonoroversight,theWorldBank
willcontinuetoplayarole intheadministration
of
the
funds.
While
the
extent
of
the
World
Banksroleisstilltobeworkedout,itisintended
thatitsinvolvementisphasedoutovertime.
Othersourcesofinternationalclimatefundsavailableincludemultidonorresources
pooled into the Comprehensive Disaster Management Programme (CDMP),
channelled through the UNDP, the Climate Investment Funds Pilot Program on
Climate Resilience (PPCR) channelled through the World Bank, and GEF resources
channelledthrough its implementingagencies, includingtheWorldBankandsome
UNagencies.
3.3Challengestoenhancingownership
Coherence and implementation challenges are having an adverse impact on have
affected progress on enhancing the countrys ownership of its poverty reduction
agenda,andarealsoaffectingitseffortstotackleclimatechange.Forexample,the
NSAPRprioritiesarewerenotalwaysstronglyconnectedwithsectoralprioritiesand
can be improved if required improvements in the institutions and capacity to
coordinate external assistance is improved (OECD 2008). This continues to be a
challengeand isalso likelytoaffecttheBCCSAP,which isyettobefully integrated
into the NSAPR and sectoral strategies. Where efforts have been made to align
resources with poverty reduction priorities, implementation has suffered due to
external factorsandweak implementationcapacity. For example, in2007,only25
percentoftheAnnualDevelopmentPlan(ADP)hadbeencarriedoutduetonatural
disasters
and
revenue
projections
not
keeping
up
with
forecasts,
and
weak
financial
managementcapacities(OECD2008).
The challenge with coherence is also faced in the allocation of climate finance
resources. The CCTF, as currently designed, is decoupled from aligned with the
BCCSAP,andnotdirectlylinkedwiththepovertyreductionprioritiesidentifiedinthe
NSAPR and the ADP process. It is expected that through the participation of the
variousministries in theCCTFTrusteeBoard,coherencewillbeensured.However,
this may not necessarily occur effectively in practice due to the limited
understandingofclimatechangeissuesinthelineministries.
ClimateFundsforBangladesh:Sizeoffundsandscaleofprojects(inmillionUSdollars)Fund Size Scale
CCTF 100 ~3.5
BCCRF 110 ~10
CDMPII 50 ~0.01
PPCR NA NA
GEF5 1218 0.053
AF NA NA
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Intermsofprioritization,theCCTFsupportsprogrammesandactivitiesprioritisedin
the BCCSAP. However, the methodology for prioritisation is not outlined in the
BCCASP and the criteria for funding specific projects have not been made public
evenasnearly$60millionoftheroughly$66millionavailableforfundingprojects
from the CCTF has alreadybeen allocated to 38 projects.4 Officials have indicated
that these projects fall within the scope of the 44 programmes identified in the
BCCSAP.Theypointtothethreestagereviewprocessasindicativeofthedegreeof
scrutinythatprojectshavebeenputthroughbeforeselection.This includesreview
by working groups for each of the five thematic areas in the BCCSAP, review and
recommendationbyatechnicalcommitteelevelchairedbytheMoEFsecretary,and
selection the Trustee Board level also chaired by the MoEF secretary. CSOs are
representedatall levelsandtheMoEF intendstomakeallrelevant informationon
theproject
available
publicly
as
it
builds
capacity
in
the
CC
unit.
Some stakeholders have also highlighted capacity constraints in relation to the
MoEFs role in convening and coordinating the various line ministries, and in
supporting them to take the necessary steps to mainstream climate change into
theirplansandprogrammes.Abalancewillneedtobestruckbetweentheneedfor
acentralcoordinationrole intheMoEFandtheneedforownershiptobenurtured
in other ministries that are central to any effort to address climate change at the
sectorlevel.
4. AlignmentDonors inBangaldesharedoingwelltoaligntheirODAsupportwithstrategiesand
priorities laidoutby the government.However, theydoperceivesomechallenges
with the governments financial management and procurement systems, and are
seeking to strengthen the governments capacity in these areas. These challenges
apply also to the programming of resources for climate change, as has been
witnessedinthecaseoftheBangladeshClimateChangeResilienceFund(BCCRF).
4.1ProgresswithaligningODAandclimatefinance
Inrecentyears,donorshave increased theireffortstoaligntheirsupportwith the
governmentsplansandstrategies.Inone indicatorofalignment,theproportionof
theaiddisbursedin2007thatwasaccuratelyestimatedinthegovernmentsbudget
hadincreasedfrom88percentin2005to92percentin2007(OECD2008).Fourof
the donors thatperformed particularly well against this indicator, the ADB, Japan,
the
United
Kingdom,
and
the
World
Bank,
also
had
ajoint
strategy
to
align
their
assistancewiththegovernmentspovertyreductionstrategy.
AnewBangladeshJointCooperationStrategyfortheperiod20102015wasfinalized
inJune2010andnowincludes18donorsthathavesignedontothestrategy(MoF
2010). While the existence of ajoint strategy, by itself, does not ensure better
4 The Fund Board has decided to retain 34 per cent of the funds in a fixed deposit. See
http://www.thedailystar.net/newDesign/newsdetails.php?nid=153153
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alignment,thewillingnessofseveralotherdonorstocommittoajointstrategyfor
thesecondperiodisindicativeofcombineddonorandgovernmentcommitmentto
makeprogressinthisarea.
Progress in using the countrys public financial management and procurement
systems, however, continues to show mixed results. In 2007, the use of public
financial management systems increased from 53 to 77 per cent and for
procurementsystems from48 to66percent (OECD2008).However, thegainson
PFMwere ledbythreedonors,whichmasksdeclines intheuseofPFMsystemsby
morethanhalfthedonors.Thegainsonprocurementwerelargelyinthehealthand
education sectors driven by legislative progress made in passing the Public
ProcurementAct in2006,thenotificationofthePublicProcurementRules in2008,
andtheimplementationofanewprocurementtrackingandmonitoringsystem.
Evaluating the experience of aligning international climate finance with national
prioritiesissomewhatpremature.Themajorsourcesofclimateinvestmentsthatare
in the works through the BCCRF and the PPCR is yet to start flowing. It is also
expectedthattheClimateChangeUnitintheMoEFwillalsoserveasasecretariatfor
theBCCRF.Perhaps,theonlyfundwithatrackrecordistheComprehensiveDisaster
ManagementProgramme,apooled fundtoreducedisasterrisks, includingclimate
change risks, at the local level.The programme is implementedby theMinistry of
FoodandDisasterManagementand issupportedwithresources froma fundwith
multiple donors pooling in their resources, and is managed by the United Nations
Development Programme. It is closely aligned with government institutions and
strategies,UNDPsrole inmanagingthe fundspoints todonorconcernsaboutthe
financial
management
capacity
of
the
government.
4.2Challengeswithalignment
Althoughprogressisbeingmadeinthisarea,donorscontinuetobeconcernedwith
fiduciary risks, and face a challenge in balancing fiduciary risk controls with more
flexiblemeasurestoprogrammeresources.Further,whilethesystemsandlawsare
inplace, implementationcontinuestoremainweakandtrackinginformationatthe
sectoralandsubnationallevelscontinuetoremainamajorchallenge.
ThechallengesthatafflictthealignmentofODAhavealsohadanadversebearingon
the willingness of contributing countries to align with country systems for
channelling
climate
finance.
This
concern
was
witnessed
in
the
debate
between
the
government and the donors that support the BCCRF regarding who manages the
funds.Currentlythe institutionalarrangementsgivetheBangladeshigovernmenta
leadroleintheprogrammingfunds,whilsttheWorldBankcontinuestoplayarolein
maintaining the fiduciary standards that satisfy the donors. The precise roles and
responsibilities of the government agencies and the World Bank are still being
workedoutinanevolvingoperationsmanual.
Notwithstanding the challenges faced regarding the management of the funds,
countriescontributingclimatefinancetoBangladesharekeentoaligntheirsupport
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withtheBCCSAP.Somedonorsremainconcernedaboutthe lackofprioritization in
existing strategies, and at least one donor referred to it as a reason for their
reluctancetoprovideclimatefinancesupportatthisstage.Attheotherend,some
governmentofficials remainconcerned thatthedonorsactionsaredrivenby their
owngovernmentsstrategiesanddirectivescontrolledbyofficialsinthecapitals.
5. HarmonisationWhile donors have been far better at aligning their resources with government
priorities,progressonharmonizingproceduresandusingcommonarrangementsfor
ODAremainsweak.Thestorywithclimatefinance isyettoplayoutalthoughearly
indicationsrevealincipienteffortsintherightdirection.
Themain
vehicle
for
donor
harmonization
is
the
Local
Consultative
Group
(LCG)
and
highlevelBangladeshDevelopmentForum,whiletheemergingpreferredinstrument
fordoingsoappearstobetheJointCooperationStrategy(JCS)providestheoverall
framework.Donorsandthegovernmenthavebeenmakingeffortstopoolaccounts
particularly in the education and health sectors. They have also made progress in
implementing common procurement procedures, performancebased financing,
common audit and reporting requirements, and conducting joint missions and
analytical work. Despite progress, only 50 per cent of aid was disbursed using
programmebasedapproaches,only24percentofthemissionsconductedjointly,
andonly42percentofanalyticalworkundertakenjointly(OECD2008).Withmany
moredonorsparticipatingintheJCSfor20102015,togetherwiththegovernments
efforttoreformitspublicfinancialmanagementsystems,itishopedthattheuseof
commonarrangementsandsystemswillimprove.
The main institutional mechanism for coordinating strategies and joint work on
climate change is the Working Group LCG subgroup on Climate Change and
Environment in the LCG. This group made important development partner
contributions to national climate change policies and strategies. No other
mechanism exists for the coordination of climate finance per se. Currently, noclimate funds appear to be using budgetary support or other programmebased
approaches either. Some donors have undertakenjoint missions and analysis in
establishingtheBCCRFandalsopooledtheirfundsthroughtheadaptationpillarof
the CDMP and the BCCRF. Recently,joint missions were also undertaken for the
PPCR, while fund from the GEF and Adaptation Fund have their own institutional
arrangements and channelling mechanisms nationally. The responsibility for the
coordinationof
these
funds
rests
with
the
MoEF,
where
the
capacity
to
perform
the
responsibilitiesstillneedstobedeveloped.
6. ManagingforresultsBangladesh has made some progress in developing a resultsbased monitoring
framework for development outcomes, but it continues to be affected by weak
capacities. This is likely to pose a challenge in monitoring climate outcomes, for
whicharesultsbasedframeworkisyettobedeveloped.
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ThecountrymovedfromaratingofDin2006toCin2008onascaleofAtoEwhere
A is indicative of a well developed resultsbased monitoring framework and E the
leastdeveloped(OECD2008).Theresponsibilityformonitoringresultslieswiththe
line ministries although the Implementation, Monitoring and Evaluation Division
(IMED) of the Ministry of Planning, with its mandate to monitor publicly funded
projects,providesthemwithsupportbystructuringthecollection,compilationand
analysisofproject information.Thecoordinationofcollectingdataandthe lackof
technical capacity both at IMED and the line ministries continue to remain
challenges.
The Climate Change Action Plan for 20092018 in the BCCSAP outlines as its
overarching goal: to build the capacity and resilience of the country to meet the
challenge
of
climate
change.
Under
the
six
pillars
identified
in
the
strategy,
the
ActionPlanidentifies28outcomesthatitwouldliketoseeachievedform20092013
(MoEF 2009). While the articulation of these outcomes could serve as a starting
point for developing a resultsbasedmonitoring framework, itneeds to be further
developed to include measurable performance indicators to track progress over
time.Abiggerchallengewouldbetoimplementsucharesultsframework.AsIMED
andthe lineministriesarealreadycapacityconstrained, itwillbedifficultforthem
to meet the added requirement of monitoring climate outcomes unless their
capacitytodoso isalsorampedup.Moreover,theministriesareyettofullymake
thetransitiontomonitoringdevelopmentresultsmoreeffectively.
7. MutualAccountabilityTheBangladeshDevelopmentForum(BDF)providesaspaceforvariousstakeholders
to engage on climate change issues. However, no mechanism for formal mutual
assessment involvingallstakeholdersexists(OECD2008).Civilsocietyorganisations
(CSOs)engageinplanningandresourceallocationdecisionmakingprocesses,andin
implementing projects depending on their varying capacities to do so. The
ParliamenthasbeeninvolvedinconsideringabillontheClimateChangeTrustFund
but information on its role in overseeing Overseas Development Assistance (ODA)
andclimatefinanceissueswasnotavailable.
The BDF provides the platform for various stakeholders to engage with the
government and donors on the development agenda. It includes a Working
Groupsubgroup for environment and climate change issues. However, uneven
capacities
make
it
difficult
for
organisations
with
weaker
capacities
to
participate
effectively,ifatall.SomeofthestrongerCSOsareinvolvedinplanningandresource
allocation decisionmaking processes, in including in the formulation of the
BangladeshClimateChangeStrategyandActionPlan,andtheallocationofresources
from the CCTF. However, some other CSOs feel that they have not been able to
engagemoredeeplyintheseprocesses.
CSO capacities in implementing projects are believed to be somewhat stronger at
thelocallevel.Thisisbecausemanylocalorganizationshavebeendirectlyinvolved
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in implementing development projects for several years. In some cases, the
implementationcapacitiesof localnongovernmentalorganizationsarebelievedto
bestrongerthanthegovernmentcapacityandthetwoneedstobecombinedmore
effectivelytodeliverresults.Withthisstrongdevelopmentcapacityatthelocallevel,
building climate change to existing interventions is unlikely to pose a significant
hurdle.This isbeingborneoutbythedevelopmentofdevelopmentofdisasterrisk
reduction plans taking into account likely climate impacts at the local level in the
ComprehensiveDisasterManagementProgramme.
CSOshaveexpressedadesiretoseemoretransparency indecisionmakingrelated
totheCCTF.Forexample,beyondthenamesoftheprojectsandthetotalamounts
allocatedtothe38projectsapprovedforfundingbytheCCTF,furtherdetailsarenot
availableandthecriteriaforselectingprojectsarealsonotpubliclyavailable.
MuchinformationontheparliamentsroleinoverseeingODAorclimatefinancewas
not available. However, there exists an AllParty Parliamentary Group on Climate
ChangeandtheEnvironmentthathasengagedwithpolicymakersinEurope,theUK
andtheUSonclimatechangeissuesperiodicallyandalsomeetsasawholeattheir
annualgeneralmeetings.
8. ConclusionsandrecommendationsBangladeshs progress towards improving governance of its climate and
development agenda is mixed. Stronger government leadership and greater
development partner coordination is needed. More focus on improving technical
and governance capacities across government agencies, as well within country
systemswillberequired.
Sinceclimateisacrosscuttingissue,multipleagencieshavearoletoplay.However,
forthegovernmenttorespondtothischallengeeffectively, itwillneedastructure
wherethere isstrong leadershipandownershipacrossthegovernment. Giventhe
scale of the needs for coordination there is still considerable debate over how to
best strengthen institutional capacities in this regard. Several ideas are still being
discussed.SomestakeholdershighlightedcapacitygapsinrelationtotheMinistryof
EnvironmentandForests(MoEF)roleinconveningandcoordinatingthevariousline
ministriesandtosupportthemintakingthenecessarystepstomainstreamclimate
change intotheirplansandprogrammes.Moreover,there isbalancethatwillneed
tobestruckbetweentheneedforacentralcoordinationrole intheMoEFandthe
needfor
ownership
to
be
nurtured
in
other
ministries
that
are
central
to
any
effort
toaddressclimatechangeatthesectorlevel.
The capacity challenges for managing the climate change agenda and resources
effectively are concerns that were consistently highlighted by a range of
stakeholders.Thislackofcapacitymanifestsitselfinmanydifferentways:
weak financial management systems pose a particular challenge for improvingalignmentwithcountrysystems,
Comment [CP1]: This is indicative of somelegislative engagement on the issue, howevercontroversial. So, would it be worth qualifying its
role and performance rather than not
acknowledging it at all?
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weak
implementation
and
enforcement
capacity
of
existing
laws
and
regulations
has an impact on both aligning resources and enhancing the use of country
systems,
weak technical capacity to account for and measure progress against climateindicatorsovertimehasimplicationsforprogressonmanagingforresults,and
weak capacity of CSOs to contribute substantively to planning and otherdecisionmakingprocesses.
Asystemicchallengethatspeakstoboththecoordinationandcapacitychallengesis
the risk that climate finance institutions and mechanisms, as is being currently
designed, risks being decoupled from the core poverty reduction and national
development planning and programming. This is also evident in the disconnect
between the Climate Change Trust Fund (CCTF) and the Annual Development
Planning(ADP)
process,
which
make
the
challenge
of
mainstreaming
climate
change
intothedevelopmentagendamorepronouncedinthefuture.
Recommendations:
A.Improvingcoordinationandcoherence The MoEF, in its overall coordination role, can seek to empower the line
ministries by encouraging them to take the lead on coordinating efforts to
mainstreamandaddressclimatechangeinthesectorstheycover.
The line ministries need to ensure that the climate change plans andprogrammesarealignedwithandintegratedintowiththesectoralstrategiesand
programmes.
Thelineministriesalsoneedtofocusondevelopingenduringinstitutionswithinthe
ministries
to
take
the
lead
for
their
respective
sectors
and
ensure
continuity
inaddressingclimatechangeissuesinthesector.Onewayofdoingsoistovest
theresponsibilityforclimatechangemainstreamingnotinanyoneindividualat
theministrybutinacommitteeledbyseniorofficialwithintheministry.
The MoEF and the Ministry of Planning jointly need to ensure that climatechange is effectively mainstreamed into the poverty reduction and national
developmentvisioningandplanningprocesses.
Finally, the MoEF, the Ministry of Planning and the Ministry of Finance (MoF)need to work together to ensure that the resources allocated by the various
climate change funds, including the CCTF, is integrated into mediumterm
budgetaryframeworkandtheAnnualDevelopmentPlanningprocesses.
The UN agenciesUK Department for International Development (DFID), as thenewchair forclimatechangeandenvironment intheLocalConsultativeGroup
(LCG) process, can work with lead climate finance contributors, the MoEF andthe MoF, toensure thatclimatechange isaddressedmore comprehensively in
theLCGprocessandintegratedintodiscussionsacrosssectors.
In its lead LCG role, the UN agencies DFID will also need to work with leadclimate finance contributors to ensure that climate funds are more closely
aligned with poverty reduction plans and the mediumterm and annual
budgetary planning processes, in addition to the Bangladesh Climate Change
StrategyandActionPlan.
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B. Improvingfiduciaryandtechnicalcapacities Both the government and donor agencies need to focus on strengthening
institutions for financial accountability such as the comptroller, the auditor
general and the AntiCorruption Commission to better implement and enforce
rules. While this may be motivated in part by the need to improve the
effectiveness of climate finance, itwillhavespinoffbenefits for improving aid
effectivenessmoregenerally.
The MoEF, with its technical capacity to define climate outcomes and identifymeasurement techniques and issues, needs to work with the Implementation
MonitoringandEvaluationDivisionoftheMoPandthrough itwiththerelevant
monitoringandevaluationstaff inthe lineministries,tobuildthegovernments
capacitytomeasure,reportandverify(MRV)climateoutcomes.
Donors including the United Nations Development Programme and the AsianDevelopment
Bank
could
build
MRV
capacity
building
component
into
their
respectivetechnicalassistanceprogrammestomainstreamclimatechangeinthe
planning and line ministries respectively, and draw on the expertise of the
reporting, data and analysis programme of United Nations Framework
Convention on Climate Change, the Global Environment Facility Evaluation
Office,aswellasrelevantacademicandcivilsocietyorganisations.
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References
MoEF 2009. BangladeshClimateChangeStrategyandActionPlan2009. Ministry
of Environment and Forests (MoEF), Government of the People's Republic of
Bangladesh. Dhaka, Bangladesh.
MoF 2010. BangladeshJointCooperationStrategy2010-2015. Aid Effectiveness
Unit, Economic Relations Department, Ministry of Finance (MoF), Government of
the Peoples Republic of Bangladesh. June. Dhaka, Bangladesh.
OECD 2008. SurveyonMonitoringtheParisDeclaration:MakingAidMore
Effectiveby2010. Organisation for Economic Cooperation and Development
(OECD). Paris.
OECD 2005/2008. TheParis
Declaration
on
Aid
Effectiveness
and
the
Accra
AgendaforAction. Organisation for Economic Cooperation and Development
(OECD). Paris.
UN 1992. UnitedNationsFrameworkConventiononClimateChange. United
Nations (UN). New York.
UNDP 2009. HumanDevelopmentReport2009. United Nations Development
Programme (UNDP). New York.
Formatted: Font: Italic
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Annex1:Matrixofquestions
Policy
Capacity
Incentives
Ownership
Whatisthepoliticalcommitmenttohavinga
climatechangepolicy?
Doesthegovernmenthaveanoverallpolicy
frameworksettingoutitspolicyobjectives
respondingtoclimatechange?
Isclimatechangeintegratedintonational
developmentplans?
Dolineministrieshaveclimatechangepolicies
andplans?
Areclimatechangeactionsidentifiedinnational
andsectoral
budgets?
Whatisthelinkbetweenplanningandfinancing
forclimatechangeatlocal,sectoralandnational
level?
Whodevelopedthestrategies(e.g.sector
ministries,provincialauthorities,legislature,
privatesector,civilsociety,mediaetc)?
Whatistherelationshipbetweeninternational
policyprioritiesandinstitutionalrequirements
andthepoliciesandstructuresinBangladesh
(UNFCCC,NAPA,CDMfocalpointsetc)?
Whoisresponsibleforformally
coordinatingpolicyandplanningwithinthe
governmentforclimatechangeactivities?
Whoisresponsibleforcoordinatingclimate
changefinancing?
Whatistherole,inoperation,oftheNCCC,
MoE,lineministries,MoF,donorco
ordinationagenciesothers?
DotheCCcoordinatingbodieshavethe
appropriateauthoritytoleadand
coordinate
cross
government
policy?
Dotheyhavesufficientcapacitytoidentify
needs,prioritizeplansandallocate
financing?
Whoisresponsibleforreportingand
overseeingtheflowoffunds? Isthere
sufficientcapacity?
Towhatextentwilldifferentstakeholders
beinvolvedinimplementingand
monitoringclimatechangeactions(inside
andoutsidegovernment)?
Whatlevelofawarenessof
climatechangeisthere
amongstthegeneral
citizenry?
Isthereapolitical
commitment?
Whataretheincentivesfor
governmenttoleadthe
agenda?
Dodifferentpartsof
government
(for
instance
MoE,NCCCandline
ministries)havedifferent
incentivesrelatingto
climatechangeandits
financing?
Wha
cha
coo
gov
Are
inte
fund
own
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Policy Capacity Incentives
Harmonization
Isthere,
either
formally
or
operationally,
a
specificcommitmentfromexternalpartnersto
coordinatefundingforCC?
Isthissetoutin(forinstance)aHeadofMissions
statement/MoU?
Isasinglecomprehensiveprogrammeand
budgetframeworkusedforallsourcesoffinance
forclimatechange?
Dodonors
meet
together
regularly
to
co
co
ordinatetheiractivities?
Isthereanupdatedregisteroffundedand
plannedactivities?
Isthereaformalprocessfordonorco
ordinationandharmonisationofdonor
proceduresforanyofthefollowingsystems
aspartofthegovernancearrangements:(i)
reporting,(ii)budgeting,(iii)financial
managementand(iv)procurement?
DodonorshavetechnicalcapacityonCCin
country,ordotheymanagetheirCC
financingfrom
regional
or
international
HQs?
Howdodonorscaptureadditionality?
Whatare
the
incentives
fromdonorsforandagainst
harmonization?
Aretheincentivesdifferent
atlocaland
regional/internationallevel?
Whatarethegovernment
incentivesfor/against
harmonizationofdonors?
Aretheseincentivesthe
sameforall
government/donor
stakeholders?
Whaharo
fina
Doi
offi
harm
Results
Whatresultsframeworkhasbeendevelopedfor
measuringtheimpactofexternallyprovided
climatechangefinance?
Whatistherelationshiptootherresults
frameworksfornationalclimatechange
programmingandoveralldevelopmentpolicy?
Isthereasingleresponsibleagencyora
networksofagenciescapableofmonitoring
resultsofCCactivitiesfundedbyexternal
donors?
Howwillreportingofresultstakeplace?
Whataretheimplications
fornationalresults
frameworksresultingfrom
internationalstandardsfor
measureable,reportable
andverifiableactions(MRV)
onclimatechange?
Wha
capt
resu
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Mutual
Accountability
Whatlevelofpredictabilityistheretothepublic
sourcesofclimatechangefinance?
Are there annual or longer 35 year
commitments?
What are the donor commitments to
predictabilityoffinancing?
Towhatextentareprovidersofclimate
changefinanceaccountabletocitizensin
recipientcountries?
Arecivilsociety,themediaandotherother
bodiesoutsidegovernmentcapableof
monitoringccfunding?
Towhatextentdo
governancearrangements
allowfor
reporting
to
parliamentandallowaccess
toinformationforcitizens
withaninterestin
monitoringprogresson
climatechange?
Wh
dev
accofina
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Annex2:
List
of
stakeholders
interviewed
A. Governmentagencies1.MihirKantiMajumder,Secretary,MinistryofEnvironmentandForests1.2. AbuM.KamalUddin,ClimateChangeAdaptationSpecialist,Ministry
ofFoodandDisasterManagement2.3. FakrulAshsan,Chief,GeneralEconomicsDivision,MinistryofPlanning
B. Civilsocietyorganizations3.4. Prof.ZahurulKarim,Chairman,CentreforAgriresearchand
SustainableEnvironment&EntrepreneurshipDevelopment5.Md.KhalidHossain,CampaignCoordinator,Oxfam4.6. QuamrulIslamChowdhury
C. Donor/Internationalagencies5.7. AsianDevelopmentBank
a)ArifMohammedFaisal,ProjectImplementationOfficer(Environment)b)JiangfengZhang,SeniorCountryEconomistc)MeriatySubroto,SeniorCountrySpecialist
6.8. DepartmentforInternationalDevelopmenta) JimMcAlpine,SeniorProgrammeManagerb)JoanneManda,ClimateChangeandEnvironmentAdviser
7.9. JohanWllert,FirstSecretary,UrbanEnvironment/ClimateChange,EmbassyofSweden
8.10. JapanInternationalCooperationAgencya)TatsuhikoSunouchi,Representativeb)ZafarIqbal,SeniorProgramManager
9.11. KhawajaM.Minnatullah,SeniorSpecialist,Environment&Water,TheWorldBank
10.12. UnitedNationsDevelopmentProgrammea)M.AminulIslam,AssistantCountryDirector,ClimateChange,
Environment&
Disaster
Management
b)MohammedSifayetUllah,ProgrammeAnalyst,DisasterManagementc)K.Morshed,AssistantCountryDirector,PolicySupportand
Communications
D. WorkingGrouponAidEffectiveness11.13. Representative,EmbassyofDenmark12.14. Representative,JapanInternationalCooperationAgency
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13.15. DileepKumarDas,JointSecretary,EconomicRelationsDivision,MinistryofFinance
14.16. MonowarAhmed,AidEffectivenessUnit,EconomicRelationsDivision,MinistryofFinance
15.17. SiddiqurRahmanChoudhury,TeamLeader,EvaluationoftheParisDeclarationPhaseII,AidEffectivenessUnit,MinistryofFinance
16.18. DoraNsuwaCudjoe,EnvironmentalSpecialist,SouthAsiaRegion,TheWorldBank