DSP is an initiative by the Government of Pakistan to promote decentralisation. The Ministry of Finance is the executing agency of the programme. Asian Development Bank is lending $300 million to the GoP to fund the programme.

ADB was involved in the design of DSP. ADB has set specific conditions for the release of DSP tranches, which the Government of Pakistan has to meet. Most of these conditions relate to decentralisation reform, to ensure it stays on track. ADB is also providing a grant of $2.9 million (with co-financing from DFID, CIDA and the Dutch government) to pay for a team of experts to work with the government on implementation of the programme. These experts provide strategic and technical assistance as required.

TA1 is a $23 million technical assistance programme to pay for capacity building, institutional development and other support needed to ensure that various stakeholders in the local government system can play their role effectively.

The bulk of DSP funding, $270 million, is for budgetary support for the federal government. This money will create the fiscal space to help the federal government meet the costs of decentralisation, and to ensure that 2.5% GST is transferred to local governments. There is also a $7 million TA2 Fund for Gender and Governance Mainstreaming. This fund will be used to promote women's participation in government, and to ensure that women's concerns are prioritized in decision-making.

TA1 support is specifically for capacity building and institutional strengthening. It cannot pay for development projects like schools, clinics and roads. The main programme fund of $270 million will enable the federal government to transfer resources to local governments to pay for development projects. But this fund cannot be accessed directly by local governments.

TA1 support has been limited to 11 thematic areas. Broadly speaking, these relate to fiscal decentralisation (audit, accounts, budgeting, the PFCs), monitoring and accountability, intergovernmental relations and communications. TA1 can only pay for capacity building and systems improvement related to these 11 thematic areas.

1) Audit; 2) Accounts; 3) Communication, strategic monitoring and social audit processes; 4) Balochistan medium-term policy-making, resource management systems; 5) Province training, capacity building and mentoring arrangements; 6) Local government regulation and inter-governmental relations; 7) Intergovernmental fiscal transfers and local revenue generation; 8) Performance budgeting and service delivery; 9) Political and institutional arrangements and administrative restructuring for improved local government performance; 10) Public access, information and internal audit/quality assurance; 11) Public grievance and dispute resolution, internal administrative process and functionality of Ombudsman office.

Political decentralisation has been implemented in Pakistan. The next and crucial reform step is to implement fiscal decentralisation. This will only succeed if those involved in local government have the skills to perform their assigned tasks, and if the necessary institutional mechanisms and processes are in place. A great deal still needs to be done before this is the case. This is why TA1 places so much stress on aspects of fiscal decentralisation: strengthening the PFCs; providing audit, accounts and budget training; strengthening council accounts committees; promoting performance budgeting; promoting local tax generation, etc.

The success of the local government system depends on effective participation by both elected representatives and civil servants. Thus TA1 support is as much for civil servants as for elected representatives. Officers working at the district, tehsil and union level can apply for TA1 support.

For obvious reasons, TA1 places stress on local governments (not least because the capacity gaps are much greater there than in higher tiers). But TA1 support is also for provincial departments and bodies associated with local government (PFCs, LGCs, LG departments), and for four federal bodies: NRB, CGA, AGP and MoWD.

Yes, civil society groups are also eligible for TA1 support. Indeed, some of the thematic areas in which TA1 can give support, e.g. social audit and communications, are far more suited for civil society groups than councilors or civil servants.
Civil society groups can also play a role in providing TA1 support, e.g. by training local governments.

No, the first stage to access TA1 support is to fill out a two-page Investment Proposal form. In this you will have to explain the problem you are facing, the effect of this, and the kind of support you are seeking from TA1 to address it. You can also give approximate costs and time frames for the assistance you are seeking, if you have some idea of these.

No, before filling out the IP form you have to engage in some form of participatory dialogue with your colleagues. This is because the guiding principle behind allocation of TA1 support is demand: those being given TA1 support must need and have asked for that support. In order to ensure that there is wide demand for a particular IP, it must be formulated after a consultative exercise.

The Ministry of Finance is the executing agency for DSP. Implementation of the programme is through a specially created National Programme Support Office (NPSO) within the MoF. In addition there are four Provincial Programme Support Offices, one in each provincial capital. Parallel with these PSOs are five Programme Steering Committees to lead the programme and provide strategic direction. Anyone applying for TA1 support will deal with the respective PSO.

An investment proposal is the initial application you make for TA1 support. This does not contain any detail about the proposal, e.g. cost breakdown, implementation arrangements, etc. The Technical Investment Proposal contains these details. You (or anyone applying for support) fill out the IP form. TIPs are prepared by the appropriate PSO, once they have appraised all the IPs submitted to them and filtered out those that do not meet the criteria for TA1 support (e.g. if they fall outside the 11 thematic areas).

An IP is first submitted to the appropriate PSO. PSO staff review the IP to ensure that it meets the criteria for TA1 support. They then convert the short-listed IPs into TIPs. These are appraised by the appropriate Technical Committee (there is one Federal and four Provincial Technical Committees). Once they have cleared the TIPs, these are collated into draft Annual Work Plans. Provincial draft AWPs are submitted to the respective Provincial PSC. Once the provincial AWPs are approved by the PPSCs, they are put together into an Integrated Annual Work Plan (federal and provincial TIPs) and submitted to the NPSC. This makes the final approval.

Among the most important criteria for TA1 support are:
i) Demand - there must be a need and desire for the support being sought among those it is to help;
ii) Eligibility - proposals must fall within the 11 thematic areas, and within the kinds of support (capacity building, systems development/installation, institutional strengthening) being offered by TA1;
iii) Mandate - the client seeking TA1 support for a proposal must be qualified to carry it out and have a comparative advantage over others in doing so;
iv) Time frame - proposals must fall within a one-year time frame.
In addition, priority will be given to proposals dealing with basic capacities.

20% of TA1 support will go to the four federal implementing agencies; 70% will be distributed among the four provinces in accordance with the NFC formula; 10% will be distributed among weaker agencies/departments at federal, provincial and local level.

No, if your proposal is approved the appropriate PSO will arrange for the support you requested to be made available. For example, if you applied for training in budgeting, the PSOs will arrange for a service provider to give you budget training. The PSO will pay the service provider directly. You will not receive any cash.

TA1 will run for four years. The TA1 Annual Work Plan (Part 1) for 2003-4 was finalized and approved by the NPSC in August 2003. But preparation of the AWP-Part II is now underway. IPs can be submitted for inclusion in this by 15 November 2003. In addition, there will be further opportunities to access TA1 support when next year's AWP is prepared.

Service providers have a vital role to play in implementation of the TA1 Annual Work Plan, since most of the proposals will be carried out by them. The PSOs will be looking for best service providers for each of the approved TIPs in their jurisdiction. Interested service providers should submit Expressions of Interest (EOIs) for the TIPs they wish to be involved in to the appropriate PSO. The PSO staff will appraise the EOIs they receive, and send Requests for Proposals (RFPs) to short-listed bidders. Once a bidder is selected for a particular project, contracts will be drawn up and implementation will start.

You can get more information from the rest of this website, or from any of the PSOs. Visit 'Contact Details'.