The cabinet of Solomon Islands approved the national budget last Thursday February 2nd , increasing dramatically the resources allocated to Provincial Governments by 4.1 million USD. This amount is in addition to the existing 830 thousand USD, allocated under the Provincial Governance Strengthening Programme - PGSP. The delivery mechanisms of the increased budgets will follow the performance based grant systems spearheaded by UNCDF.
The decision of the Solomon Island Government to increase the budget and adhere to minimum conditions and performance measures, was motivated by the increase of provincial governments in passing minimum conditions and the significant improvement in their performance. The Solomon Islands Prime Minister, Hon. Gordon Darcy recently stated that ‘... together with the government, I shall make genuine attempts to improve the provincial capacities in terms of infrastructure and financial support. We cannot keep on arguing over the fact that provincial governments need resources to deliver when very little is being done’.
In order to create incentives for provincial governments to adopt improved governance, financial and administrative practices, a Provincial Capacity Development Fund (PCDF) was established. The first provincial government to be disqualified in the PCDF assessment back in 2008 was the Isabel province, which is now one of the top performing provinces. Moreover the PGSP is registering a positive impact of performance measures which encourage competition among provincial governments. This goes to prove that ensuring robust minimum conditions helps the non-performing provinces to work harder and improve their performance.
Provinces suffered from low capacity, low financial resources available and low confidence of central government and citizens. The Cabinet’s approval of the budget, together with the minimum conditions and performance measures regulating the allocation of resources breaks the vicious circle Provincial Governments found themselves in, at least on the financial resource side. While logistics and the specific geography of Solomon Islands remain a big challenge for Provincial Governments, these will have more funds to deliver services and their local development projects.
With regards to this issue, the Permanent Secretary from the Ministry of Provincial Government and Institutional Strengthening, Mr Lennis Rukale stated that ‘...If the provinces account and deliver on these numbers there are big prospects for the budget to be further increased in the coming years’. The Ministry of Provincial Government and Institutional Strengthening is providing the provinces with staff to further develop their Public Financial Management capacities and deliver their projects efficiently and effectively and in accountable way. Projects delivered by Solomon Islands Provincial Governments are all MDG related, with Education and Health as top priorities.