Consultancy Assistance Program for North Caucasus

RegionsOctober 2005 – October 2006

Share of federal transfers in total revenues of the NC republics, 2005

Republic Transfers, %

Adygeya 69.3

Chechnya 89.1

Dagestan 85.8

Ingushetiya 90.0

Kabardino-Balkariya 60.1

Kalmykiya 71.9

Karachayevo-Cherkesiya

75.4

North Ossetia 65.3

78%

0%

19%

3%

Tax revenue Non-tax revenue Federal transfers

North Caucasus regions in the program

National Republics- Adygeya - Chechnya- Dagestan- Ingushetiya- Kabardino-Balkariya- Kalmykiya- Karachayevo-

Cherkessiya- North Ossetia

Other regions- Rostov oblast- Stavropol kray- Krasnodar kray*

* Civil servants from Karsnodar attend only training events hosted in the region

VladikavkazMagas

Astrakhan

CherkesskElista

Groznyy

Krasnodar

Makhachkala

Maykop

Nalchik

Rostov-na-Donu

Stavropol

Volgograd

North Caucasus regions

- Republics of the North Caucasus- "Better-off" regions- Regions excluded from the program

Program objectives

Improve regional and local public finance management

Improve performance of regional and local governments

These objectives were presented in the Medium Term Action Plan of the Presidents’ Envoy to the South District (strengthening public administration in the regions)

Core program components

I. Training regional and municipal civil servants in public financial management and intergovernmental fiscal relations

II. Development of performance monitoring systems on the regional and local levels

III. Assistance in rehabilitation of the regional governments’ finance systems

I. Training public and municipal civil servants in public finance and IGFR

Major beneficiaries Regional and municipal administrations Civil servants from 11 participating regions

Training themes Intergovernmental fiscal relations Management of public expenditures Sources of local and regional government revenues and policies

aimed at strengthening revenue autonomy Regional and local borrowing

Training events Round table for top regional finance officers (October, 2005

Moscow) Core training courses (December, 2005 Essentuki) Extensive training courses (February, 2006 Tuapse) Extensive training courses (March, 2006 Tuapse) Core training courses (May, 2006 Tuapse)

Means and forms of training

Roundtable discussions Interactive moderated sessions and group

assignments Traditional class-room lectures

Training in facts and figures

Overall people trained – 298 Number of training events - 5 Female\male participation ratio – 1.2 Municipal\regional participation ratio –

5.6 Highest participation rate - Karachaevo-

Cherkessia

Participation in training by regions

Adygeya 12%

Chechnya7%

Dagestan4%

Ingushetiya1%

Kabardino-Balkaria4%

Kalmykia9%

Karachaevo-Cherkesiya18%

North Ossetia4%

Rostov oblast14%

Stavropol kray14%

Krasnodar kray13%

Participants and trainers of the first seminar

Top-rated municipal issues, based on seminar participants survey

Delimitation and transfer of real property and revenue sources from municipal districts to settlements, titling of the municipal property

Taxation on the local level, i.e.: land tax administration, introduction of the property tax

Equalization transfers to municipalities (estimation of expenditure needs and revenue capacity)

Development strategies for municipalities Public services delivery improvement Introduction of the public expenditure reviews on

municipal and regional level Public participation in budget process

Major beneficiaries of the technical assistance

Administration of the Presidential Envoy in the Southern Federal District

Pilot regions

II. Development of performance monitoring systems on the regional and local levels

Deliverables

Development of the system of indicators for Rating of the level of public administration in the NC regions

Development of a system of indicators for evaluation of the impact of the federal, regional and municipal public administration bodies on social and economic development of the regions

A program for setting up monitoring systems in individual regions of the Northern Caucasus

Rating of the level of public administration in the NC regions

1. Development of public administration a. Financial managementb. Property managementc. Human resources management

2. Social and economic developmenta. Business activityb. Social and demographic situation

3. National projectsa. Quality educationb. Healthcarec. Affordable and comfortable housingd. Agricultural complex development

4. Other social institutions5. Provision of infrastructure

General unemployment rate (ILO methodology), per cent

0,05,0

10,015,020,025,030,035,040,045,050,0

Russia, average

Gross regional product per capita, thousand roubles

0,0

20,0

40,0

60,0

80,0

100,0

120,0

Russia, average

Child mortality per 1000 children born alive

0,0

5,0

10,0

15,0

20,0

25,0

30,0

Russia, average

Number of students in state and municipal secondary schools, per 1 personal computer

0,010,020,030,040,050,060,070,080,090,0

Russia, average

Number of registered crimes, committed by under aged (14-17) per 10000 people

0,020,040,060,080,0

100,0120,0140,0160,0180,0

Russia, average

Impact of federal, regional and municipal governments on regional economic and social development

How the situation in the region depends on activities of each level of government?

Areas of government responsibilities: General government issues National defense Public security and law enforcement National economy Public utilities and housing Environmental protection Education Culture and sport Healthcare Social security

Indicators - Public security and law enforcement

Indicators - Education

Indicators - Public utilities and housing

III. Regional finance rehabilitation

Article 132 of the RF Budget Code: if federal transfers account for more than 50% of

regional government revenues, the region should conclude an agreement with the RF Ministry of Finance on improving its

financial position

1-st pilot region - Republic of Adygeya other regions under consideration –

Dagestan, Kabardino-Balkaria, Karachaevo-Cherkessia

Deliverables

Consultations & needs assessment study Diagnostic and training seminar with

municipal finance officers and heads of municipalities

Implementation of performance budgeting approaches on the regional level - development of the performance oriented budget bids of the republican government departments

Upcoming activities

1. Continuation of consultancy activities in the first pilot region - Adygeya

2. Selection of another pilot region3. Implementation of monitoring systems4. Continuation of training NC public servants

3 more training events for regional and municipal public servants

Round table for regional Finance Ministers

5. Local capacity building Strengthening local partner – Pyatigorks Branch of the

Northern Caucasus Academy of Public Administration Selection of the local trainers Training of the local trainers