MEMORANDUM SUBMITTED BY THE DEPARTMENT
FOR INTERNATIONAL DEVELOPMENT
1. The Department for International Development's
strategy for its development partnership with China is outlined
in the Country Strategy Paper (CSP), published in November 1998.
We consulted widely on the paper before publication.
2. Section E of the CSP outlines the strategy
which DFID proposes to adopt in light of the analysis which precedes
it. We are implementing the commitments made in the paper and
are looking for new areas where DFID believes it can optimise
its contribution to the globally agreed International Development
Targets.
3. The Committee asked that a number of
specific issues be addressed in a memorandum prior to the hearing.
These are dealt with below.
A LIST OF
ALL OUTSTANDING
ATP PROJECTS
4. Remaining commitments made under the
now discontinued aid and trade provision in China are set out
in Annex 1. Virtually all the work on projects under the aid and
trade provision in China has been completed. The continuing expenditure
mostly consists of commitments to soften the terms of loans on
the basis of fixed schedules.
A LIST OF
ALL CURRENT
DEVELOPMENT PROJECTS
AND ALL
DEVELOPMENT PROJECTS
PLANNED FOR
FUTURE IMPLEMENTATION
5. The list is attached as Annex 2.
ANTI-CORRUPTION
MEASURES IN
DFID PROJECTS
6. Design of projects under DFID's bilateral
aid programme recognises the need to be vigilant to the possibilities
of corruption and to minimise the opportunities of it occurring.
Some activities are financed under technical co-operation arrangements:
these are contracted and paid for in the UK by DFID staff and
are subject to government accounting procedures.
7. Funds provided for local costs under
financial aid arrangements are dealt with by nominated local project
managers, many of whom have worked on DFID or other donors' projects.
These funds have to be kept in separate dedicated bank accounts
and payments into accounts are only made against receipts or certified
statements of expenditure. Payments are normally made as reimbursement
of expenditure incurred, although there are occasions where funding
is provided on an advance basis: ie when the resources to meet
initial expenditure are not available. Requests by project managers
for topping up of accounts are subject to an independent local
check (this is normally by a UK-based TC adviser to the project)
and are routed through DFID staff in London for payment. Procurement
procedures and contracts for major items purchased under financial
aid arrangements are also subjected to independent review.
8. It is the responsibility of individual
project managers to produce periodic statements of the monies
for which they are responsible. These statements and supporting
documents such as vouchers and bank reconciliations are subject
to annual audit certification by China's own National Audit Office
in accordance with terms of reference set by DFID. The CNAO has
been used on many donor projects. Managers are also required to
produce reports on physical project activity and spending. Depending
on the size of the project these reports are typically required
every three or four months. Projects are also subject to physical
monitoring by the relevant sector managers in the DFID office
in Beijing. This should identify significant mismatch between
expenditure and activity. In their visits to the project areas
these staff (the majority of whom speak fluent Chinese) will also
be expected to look out for any other indications or risks of
corruption.
9. DFID has a successful project which involves
skills transfer from the UK National Audit Office to the China
National Audit Office. This is helping to build their capacity
to undertake their responsibilities more efficiently and effectively.
WHAT ENGAGEMENT
DFID WILL HAVE
WITH CIVIL
SOCIETY AND
NON-GOVERNMENTAL
ACTORS
10. This issue is more complex than in many
other countries where DFID works. In China it is hard to draw
clear distinctions between Government and non-government organisations.
Also the definition and respective roles of state and civil society
in China are changing rapidly: one of the consequences of a growing
movement in China away from centralised planning towards a more
decentralised demand-led approach means that welfare provision
formerly undertaken by the state or by state owned enterprises
are now being passed to civil society. Despite relinquishing some
of its responsibilities, the state is still powerful in defining
the role that is acceptable for different elements in civil society.
11. DFID's Country Strategy Paper and White
Paper on International Development both commit us to a rights
based approach that implies a strong emphasis on participation.
In the context of China this means working with existing organisations
to promote greater participation, consultation and involvement
of people in decision making.
12. DFID is involved with civil society
in a number of priority areas. Plans for implementation of the
Health VIII project contain a strong commitment to participative
consultation with primary stakeholders. In this and other projects
we are supporting social science training to build capacity in
qualitative methodologies that facilitate consultation and better
understanding of user needs and demands. In the planned HIV/AIDS
Prevention and Care Project, an innovation fund will support NGOs
who wish to pilot innovative approaches to care and prevention.
We are supporting a water project being implemented by Save the
Children Fund in Tibet that also works closely with village committees
and elected leaders. DFID's basic education project in Gansu will
work to develop the role and capacity of village school committees
to plan and implement school development and to make the committees
more responsive and accountable to parents. We are also supporting
a small British NGO in Shanghai to assist the Civil Affairs Bureau
to establish a scheme to place and support foster children in
the community. As part of our support to State Owned Enterprise
reform we have ensured the involvement in project design of managers'
organisations, business organisations, trade unions and the All
China Women's Federation, and stressed the need for the ongoing
involvement of these groups in the implementation of the project.
HOW WILL
DFID ACTIVITY BE
INDEPENDENTLY MONITORED,
AUDITED AND
EVALUATED
13. DFID has in place a rigorous project
cycle in which all staff receive training and support.
14. At the time of project design, a monitoring
plan is developed which identifies the stages in the life of the
project at which project monitoring should take place. Monitoring
will report against the project Logical Framework and work plans
of those involved. The monitoring programme will normally include
a major review half way through the project which considers whether
the project outputs are likely to contribute to achievement of
the project purpose. DFID does sometimes use external consultants
to monitor progress, but the bulk of project monitoring is carried
out by DFID's own staff—although key monitoring is not carried
out by those who are involved in the day to day management of
the project. The Head of the relevant DFID Department is required
to endorse the conclusions of any major review. Independent assessments
of project success—in the form of evaluations—are
normally made at the end of the projects (see below).
16. DFID has recently introduced more rigorous
"impact assessment studies" to check in a more systematic
way the effectiveness and impact of DFID-assisted projects and
to aid lesson learning. We are looking for opportunities for employing
such studies on projects in China.
17. A response to the question of independent
audit is covered in paragraphs 7 and 8 above.
18. Evaluation is a key activity for DFID
and we have a specific Department responsible for managing that
work. As each of our projects is completed, a Project Completion
Report (PCR) is prepared which reviews project performance and
achievement. This is done using a common format issued by DFID's
Evaluation Department and assesses the extent to which that set
of activities has contributed to the stated project purpose. At
the stage of preparing that Report, a judgement is made by the
individual Department whether an independent valuation would be
useful. If it is felt appropriate—based mainly on whether
it will inform future activities—it is commissioned and
the results disseminated widely. Once completed the PCRs are submitted
to Evaluation Department to ensure consistency before being added
to the database of such reports. This database is systematically
analysed each year to generate synthesis reports which identify
broad performance trends across DFID's portfolio.
19. Evaluation Department also commissions
independent evaluations of a series of projects, mainly the bigger
ones, which are published and then feedback into the project cycle.
We fully expect to commission evaluations on our major projects
in China once they are finished. This will be important for feeding
back into new work given that our poverty focused programme is
still relatively new.
Department for International Development
December 1999
Annex 1
ATP PROJECTS—CHINA
| Title | Commitment (£m)
| End Date | Description
|
| Container Ship for China Ocean Shipping Company
| 6.897 | 2007 | Provision of high capacity shallow draft container ship
|
| Yue Yang: Power Station | 51.414
| 2003 | Provision of boilers and turbine generators
|
| Bohai: Aluminium Plant | 8.802
| 2008 | Aluminium rolling plant
|
| Dushanzi: Ethylene Plant | 41.179
| 1999 | Petrochemical plant
|
| Urumqi: Pure Terephthalic Acid (PTA) Plant |
39.000 | 1999 | Petrochemical plant
|
| Urumqi: Paraxylene (PX) Plant | 13.045
| 1999 | Petrochemical plant
|
| Hepu: Water | 1.210 | 2000*
| Domestic water treatment plant |
| Wuxi & Zhangzigang: Water | 2.995
| 2000* | Domestic water treatment plants
|
| Weifang: Sewage | 1.645 |
2000* | Solid waste disposal plant
|
| Rizhao: Water | 1.235 | 2000*
| Domestic water treatment plant |
| Guangzhou: Overhead Catenary System | 3.265
| 2000 | Overhead power supply system for city metro
|
| Guangzhou: Ventilation System | 1.314
| 2000 | Ventilation system for city metro
|
| Jiangyin: Bridge | 21.100 |
2000 | Bridge construction and advisory consultancy
|
* Projects with physical works ongoing.
Annex 2
LIST OF CURRENT DEVELOPMENT ACTIVITIES IN CHINA (AT 30
NOVEMBER 1999)
| Name of Project | Purpose
| Duration | Amount
|
| 1. Support to World Bank Health VIII Project
| To strengthen and add value to major Ministry of Health/World Bank Project (Health VIII). The project aims to improve accessibility, effectiveness and efficiency of health services for the rural poor. It covers 71 designated poor counties in seven provinces
| Aug 99-6 years | £15.14m
|
| 2. Gansu Basic Education Project | To enable more girls and boys to enter and complete the primary and junior middle school cycles in Gansu, especially in four target counties, and to reduce inequalities within the education system
| Oct 99-Sept 2004 | £11.5m
|
| 3. Adult Education Project: Hubei | To raise language competence of key Chinese workers in Hubei
| 1996-2000 | £0.73m |
| 4. English Language Examinations Reform Project
| Assisting the National Education Examination Authority (NEEA) to reform and rationalise public English Language Examinations
| 1996-1999 | £0.417m |
| 5. British Council English Language Teaching
| Programme of specialist attachments to Universities throughout China and training of counterparts in UK, to improve teaching in ELT
| 1980-2000 | £12.45m |
| 6. Sichuan Urban Environment Project (SUEP)
| Consultancy support linked to a World Bank project to assist Sichuan authorities to prepare for major investments in water and land resources. Emphasis is on institutional strengthening in finance, policy and management
| March 97-Dec 99 | £0.87m
|
| 7. Nuclear Safety Standards: Beijing |
To transfer UK best practices in design and qualification of inspection methodologies to ensure structural integrity of civil nuclear power stations
| Oct 96-March 2000 | £0.231m
|
| 8. Guizhou and Shanxi Energy Efficiency Project (GASEE)
| To assist Provincial authorities and industry in Shanxi and Guizhou Provinces to assess the costs and benefits of low cost techniques for the implementation of energy efficiency measures, with an emphasis on clean coal technology
| April 95-Dec 99 | £2.1m
|
| 9. Ocean University of Qingdao Institutional Development (QUID)
| To enhance the University's technical knowledge, training capacity and experience of marine disposal techniques and to improve China's coastal environment through better marine disposal of sewage
| March 95-Dec 2000 | £0.431m
|
| 10. Study of Toxic Organic Pollutants (STOP)
| Strengthening the Department of Environment Science and Engineering's capacity in Nanjing University to analyse and advise on pollution of rivers by toxic organic compounds
| Jan 95-Dec 99 | £0.598m
|
| 11. Zhongshan Institutional Development Project
| Strengthening the Department of Geography to enable it to meet demands for trained urban planners and environmentalists for Guangdong Province
| Oct 94-March 2001 | £0.65m
|
| 12. China Council for International Co-operation on Environment and Development (CCICED): Working Group on Environmental Economics
| Assisting with the integration of environmental concerns and economic development by contributing to the working group run by CCICED
| Jan 1993-Sept 2000 | £0.645m
|
| 13. State Owned Enterprises—Restructuring and Enterprise Development
| To help develop and facilitate the replication of effective approaches to socially responsible SOE restructuring and enterprise development
| Nov 99-Nov 2002 | £19m
|
| 14. Co-operation with the Chinese Supreme People's Procuratorate
| To improve the performance of the SPP in its supervision of the courts and criminal procedures. In particular the project aims to improve the SPP's record in the tackling and prosecution of corruption
| July 99-2 years | £0.208m
|
| 15. Financial Sector Training Scheme (FIST)
| To strengthen the institutional capacity of Chinese financial sector organisations, both government and commercial, by offering working attachments with UK city firms, for dynamic young Chinese managers
| 1998-2001 | £3.4m |
| 16. Investment Appraisal Assistance |
Assist the Chinese state sector to make investment decisions based on objective procedures and methodologies
| July 1996-Feb 2000 | £0.806m
|
| 17. Co-op with the Chinese National Audit Office (CNAO)
| Assist the CNAO to improve its audit and internal management methodologies through a programme of collaborative activities with the UK National Audit Office
| Oct 95-Dec 99 | £0.51m
|
| 18. Judicial Studies Training Project |
To help develop a cadre of Chinese Judges with improved knowledge of common law systems, including studies covering an understanding of human rights issues in law
| July 98-5 years | £0.55m
|
| 19. Investment Training and Research Project
| To help establish an Investment Training Centre to support training and research in investment policy and analysis
| Sept 1995-April 2000 | £0.82m
|
| 20. Young Lawyers Training | Training young Chinese lawyers in the use and application of commercial law
| March 89-April 2001 | £1.67m
|
| 21. Shanghai Municipal Finance Reform |
Development of a public finance system which is appropriate to a market-based economy both as a macro regulatory instrument and as a stimulus to the economy
| March 94-April 2000 | £3.5m
|
PROJECTS FUNDED THROUGH NGOS
22. Shanghai Foster Care—Care for Children
| To assist Chinese authorities improve systems of child care by placing orphans and abandoned children in long term family foster care
| Oct 1998-3 years | £621,000
|
| 23. Environmental Health Programme in Tibet—SCF
| To improve the livelihoods in the Lhasa valley through sustainable water and sanitation improvements
| Sept 1999-4 years | £825,000
|
| 24. Tibet Education Programme—SCF
| To enable local education authorities to use learner centred and participatory methods in teacher training, and to improve Primary School conditions
| April 1998-2002 | £414,989
|
PROJECTS NOT YET APPROVED:
1. HIV/AIDS project
| To develop replicable models of HIV prevention, treatment and care in two pilot provinces to assist in the creation of a more effective national response to HIV/AIDS in China
| 2000-5 years | approx £15.3m
|
| 2. Urban Health | To support the ministry of Health to pilot a model for a comprehensive community based health care, which can be sustained from local resources and is accessible to all
| 2000-4 years | approx £6m
|
| 3. Yunnan Environmental Development Programme (YEDP)
| To help the Government of Yunnan to prepare and implement pro-poor, environmentally sustainable development programmes
| 2000-4 years | approx £7m
|
| 4. Water Sector Development Programme (WSDP)
| To strengthen China's capacity to address key institutional and technical issues constraining the availability and quality of water supply, and its equitable allocation
| 2000-3/4 years | approx £6m
|
| 5. SOE Social Security | To help in the promotion of equity and efficiency in the service delivery of welfare benefits carried out by the Labour and Social Security Services
| 2000-3 years | approx £3m
|
| 
