St Helena : Aide Memorie: Development Mission to St. Helena
Submitted by Saint Helena Herald (Met Office) 13.05.2004 (Article Archived on 27.05.2004)
A joint DFID and FCO team visited St Helena between 23 April and 9 May 2004 to discuss and negotiate a new three-year package of development assistance for the Island.
Development Assistance Planning Mission 23 April to 9 May 2004
1. A joint DFID and FCO team visited St Helena between 23 April and 9 May 2004 to discuss and negotiate a new three-year package of development assistance for the Island. The Team comprised Greg Hicks (Team Leader and DFID Programme Manager for St Helena), Caterina Alari (Governance Adviser), Karen Moran (FCO Desk Officer for St Helena) and Mark George (Economic Consultant).
2. A comprehensive itinerary of meetings and discussions with elected Members, SHG officials, private sector organisations, civil society organisations and members of the public was prepared by SHG. The Team was very grateful for the time and valuable insights provided by all the people and organisations met during the two-week mission. Particular recognition is recorded for the professional and constructive way in which the negotiations proceeded.
What was discussed and agreed
3. The purpose of the mission was to discuss, in detail, the development assistance requirements of St Helena for the period FY 2004/5 to 2006/7. The starting point for these discussions was a review of the current situation on St Helena. One of the most important aspects of this review was to understand the implications of population decline. Since the last framework of development assistance was agreed in 2000, the population of St Helena has fallen by nearly 1000. The Team agreed with the views of many of the people on the island that this has had, and is having, a significant negative impact on the economic and social situation on the island.
4. The Team was very pleased to see that SHG had responded positively to the challenge of population decline and its impacts, as well as broader economic challenges. In particular, after undertaking extensive consultation in the last three years, SHG has adopted a number of strategic objectives as a basis for future action and to guide budget preparations for the next three years. There is a strong recognition by SHG that this strategic framework will require new policies and approaches and that it should clearly direct the use of resources (finance and people) in the most appropriate way. In particular, SHG has recognised the importance of striving for efficiency in its operations (not least to release funds to pursue strategic objectives) and doing its utmost to support private sector development. Some of the key elements of SHG’s programme over the next three years will be to:
- review the fiscal regime in St Helena to encourage more domestic and inward investment and to promote improved incentives for private sector growth;
- adopt more appropriate pricing policies for government services whilst protecting the vulnerable; and
- introduce more widespread competitive tendering for the delivery of government services.
5. After extensive negotiations, the Team has agreed to recommend to UK ministers that DFID provide a sum of around £37 million over the next three years for budgetary support, development projects, technical cooperation and the shipping subsidy. The proposed support represents a substantial increase on the £29 million provided by DFID in the last three-year assistance package, which covered the period FY 2000/1 to 2002/3. It also represents a significant increase on the one-year agreement reached in FY 2003/4 that provided £10.7 million to SHG.
6. In reaching the proposed figure of around £37 million, the Team has honoured commitments made in the past by DFID to consider the impacts of loss of fisheries revenues and the fact that SHG can no longer make contributions to expenditure from its own reserves.
7. The proposed package incorporates provision for additional funding for development projects that will be released on the achievement of significant reforms mutually agreed between the Team and SHG. The majority of these reforms relate to the adoption of an improved fiscal regime to be phased over the next three years.
8. The proposed support identified by the Team still needs to be approved by UK Ministers. The Team is committed to making the case for this level of assistance and to this end will be submitting a full report of the mission no later than one week after returning to the UK.
9. As part of the process of reaching an agreement with the Team, SHG undertook an extensive and realistic reprioritisation and reassessment of its financial needs in the forthcoming period. This involved SHG making its own decisions regarding the allocation of expenditure in support of its strategic objectives. The Team recognised SHG’s professional and diligent approach in this regard, which enabled negotiations to be brought to conclusion in a timely and fruitful manner.
10. During the mission, DFID’s Governance Adviser devoted specific attention to how DFID can assist the Island during the ongoing processes of constitutional reform and modernising government. Following discussions on these issues, DFID has proposed a number of ways in which support could be provided to St Helena. Members and officials will now consider these proposals with a view to agreeing a future programme of assistance from DFID. Any support provided for constitutional reform and modernising government will be additional to the proposed package agreed during the mission.
11. During the mission, DFID and FCO reconfirmed the UK’s strong commitment to continue providing access to St Helena. At present, an extensive feasibility study is being conducted to examine access issues. This study should report before the end of the year. In discussions with SHG, the Team confirmed that any support relating to future access would be considered as additional to that which will ultimately be agreed for the three-year development assistance package.
12. This Aide Memoire records the broad agreement reached with Executive Council, and the Team would welcome its publication to a wider audience.
John Styles Greg Hicks
Acting Governor Programme Manager
St Helena DFID
Jamestown, St Helena
8 May 2004