Islamic Republic of Afghanistan - Enhanced Integrated Framework ...

public services and (vii) improved humanrights.Developing Priority Policies: Increasing aideffectiveness is a joint effort between Government,donors and agencies involved in the implementationof programs and projects. TheGovernment will implement reforms that willlead to higher transparency and absorptioncapacities. Donors will be expected to undertakemeasures to improve aid delivery in linewith the Paris Declaration.Building Greater Ownership: The Governmenthas demonstrated a genuine commitmentto lead the development process and make aidmore effective by establishing the AfghanistanCompact and signing the Paris Declaration in2006. Afghanistan’s long-term developmentvision as set out in the ANDS, identifies andarticulates national priorities in the mediumterm. All assistance should be aligned withANDS priorities as presented in the sectorstrategies. To this end, the Ministry of Financewill monitor the Government’s total aid portfolioand it will, in collaboration with line ministries,encourage donors to channel their resourcesin a manner that is consistent with theprinciples of Islam, the Government’s Aid Policyand the ANDS priorities.Improving Public Finance Management:Although the tax system does not directly relateto aid effectiveness, its further strengtheningwill increase domestic revenues and theGovernment’s potential to allocate more resourcesto fund recurrent costs of donorfundedprojects. The tax system is in the processof being strengthened. Institutional capacityfor efficient tax collection will improve taxadministration at all levels. The Government’sdomestic revenue collection has significantlyimproved to the point where today it covers asmuch as 64 percent of recurrent expenditures.Even though the Government is putting inplace increasingly effective public financialmanagement systems, it still faces major challenges.The Government seeks cooperationfrom its development partners to channel morefunds through the Core Budget, an importantstep for enhancing financial management systems.The capacity to implement the DevelopmentBudget more efficiently will improve,resulting in a higher donor contribution to theoverall Core Budget. The Government’s targetis for 75 percent of aid to be channeled throughthe core budget.Major public administration reforms being implementedor planned—such as the introductionof a merit-based civil service system, andprofessional management of government ministriesand departments, or the creation of amore formalized budget, procurement, andaudit processes and agencies—had their rootsin the desire of the Government to avoid earlierabuses of graft and political patronage.Equally important will be the Government’saccountability to the Afghan people with regardto the expenditure of aid money, whichwill be supported by the ongoing efforts of theMoF to develop the Public Expenditure FinancialAccountability (PEFA) framework.This process will be strengthened by: (i) deepeningthe linkages between the ANDS, MTFF,MTB and in the future with the MTEF; (ii) enhancingthe ‘budget literacy’ of citizens andcivil society organizations through engagementin budget processes; (iii) support to civil societyorganizations and downward accountability inthe context of decentralized service delivery;(iv) assessing the experience gained under theNational Solidarity Program and the NationalRural Access Program and disseminating theselessons; (v) regular reporting to National Assemblyand other public entities in how budgetaryresources (core and external) are beingspent; (vi) better communication with the publicusing the ANDS framework on plans, aidreceived, disbursed, outcomes and impact and(vi) supporting civil society organizations andnon-governmental organizations to ensure thatlocal governments are held accountable on howaid money is being spent to improve the people’swelfare.Curbing Corruption: The drug trade, porousborders, and informal markets have led to increasedcorruption in public institutions. TheGovernment is conscious of the fact that corruptionand aid effectiveness are inversely correlatedand is therefore committed to significantlyreducing corruption. Some mitigatingmeasures to improve anti-corruption in thearea of aid delivery will be as follows: (i) increasepublicly available information aboutdonor aid provision at the national and provinciallevels; (ii) harmonization of donor supportaround the Government’s anti-corruptionstrategy as prescribed in the ANDS; (iii) in-158Afghanistan National Development Strategy (ANDS)