Ratification of Collaborative Africa Budget Reform Initiative (CABRI)

Presentation to Portfolio Committee on FinanceTuesday 13 November 2007

Lesley Fisher

Content

• Background and purpose• Objectives of legal status & GA

recommendation• Options• Current membership• Ratification process

– South Africa– Founding members

• Hosting agreement• Achievements to date

Establishment and objectives– Professional network of senior government

officials in ministries of finance and planning from across Africa.

– South African National Treasury played a leading role in establishment together with Mozambique and Uganda in 2004.

– Key objective of CABRI is the promotion of efficient and effective management of public finances to foster economic growth and enhance service delivery for the improvement of living standards of people living in Africa.

CABRI aims to:

– support senior budget officials in the management of public finance systems and develop approaches, procedures and practices for improving these;

– advance the development of Member States by building capacity and promoting training and research in the field of public finance management, in particular from a practitioner’s perspective; and

– develop and promote common African positions on budgetary issues of interest to Africa.

Objectives of Legal Status

• Draft memorandum of understanding forms the basis of existing structure of the informal network

• Enable financial and legal independence from any national government and other regional bodies

• Support funding arrangements - membership fees, donor funding etc.

• Enable formal engagement with regional and international bodies

Legal Study

• Considered a number of existing organisations e.g. AU, NEPAD, AFRU

• Identified two options:

– By an international legal agreement between member countries

– By resolution of another established pan-African body

Pros and Cons

Option Pros Cons

Formed by resolution of the

African Union

• Formalised structure in place and access to all African countries

• Access to resources• Possibly a faster route to

legal establishing the network

• No longer an autonomous body

• Bureaucratic procedures and complexities of governance

• Reduced importance and competition of funds with the AU structure

• Take on a political nature

Formed through an international legal

agreement

• Constitution clearly establishes the nature of the network

• Easier to establish fees and receive funding

• Takes on a more formal nature in terms of it operations

• Time-consuming and extensive process of negotiating an agreement between every country and for each country to sign and then seek ratification

General Assembly Recommendation December 2006

• To fast track process, International Agreement can be negotiated by 6 countries

• Thereafter, new members join through accession process

• Application for accession is presented at General Assembly meetings

• Countries have two years in which to present their application for accession

International Agreement

• Provide a founding instrument for CABRI, which can accommodate the various needs regarding institutions, powers, membership, finances, procedures

Negotiators mandated to negotiate on behalf of State (May & June)

The final product of negotiations is a signed text but this is not yet a binding treaty June 2007

Secretariat prepared draft agreement based on MoU. Agreement circulated to all countries

Each country is required to ratify the agreement. This process varies from country to country

Once all 6 countries have ratified the agreement, the agreement will come force

Countries participating in CABRI

Legal StatusTable 1: Status of the signatory countries of the International Agreement

Country Signed Ratification Remark

Ghana √ Ratification expected by the end of 2007

Kenya √ √ Waiting for instrument of ratification

Mali √ Ratification expected by the end of 2007/early 2008

Senegal √ Ratification expected by the end of 2007/early 2008

South Africa √ Ratification expected by the end of 2007

Rwanda √ Ratification expected by the end of 2007

South African process• Signed by Minister of Finance 7 August

2007• Cabinet approval 24 October 2007

• Dialogue and negotiations Mauritius• Training workshop & study tour SANT

• Financial contribution to be determined at next GAM – Between R1m – R1.5m per annum– Effective 2009/10

• Legal status – April to June 2008• South African government to host CABRI

and act as interim secretariat

Hosting agreement• South Africa will host CABRI• Agreement concluded as soon as reasonable

after legally established• Standard agreement concluded in consultation

with DFA, SARS, DHA • Priviledges, immunities, immigration, tax

exemptions• Disputes, amendments, inviolability of office• To be finalised between Secretariat and

Government of South Africa

Achievements in 2007– Membership increased from 17 countries to 28 in year

and fostered a more committed and active membership base

• Increased the relevance of activities• Dialogue and negotiations – Mauritius• Training workshop and study tour SANT

• Received a positive feedback from members on activities

• Established an institutional reputation• Launched CABRI as a legal entity• Received acknowledgment of CABRI’s publications

as resources for PFM• Strengthened relationship with development partners

and partnering institutions.

THANK YOU