Crisis Recovery Support Program

The program provided lessons in allocating counterpart funds generated from program proceeds. Budget earmarking should only be considered if the government has adequate mechanisms to track expenditures. Otherwise, technical assistance is important to provide this capacity. Programs should also rethink strict budget earmarking. While placing strict conditions on how a government spends the funds seems desirable, implementation could be difficult when budget precision is low. In the case of the program, the government could not fully execute the strictly allocated utility expenditures because it had already maximized its spending below the budget allocation. A better solution might be to provide governments with sufficient flexibility in spending across several identified items. Also, the scope and coverage of independent audits of special accounts to fund specific items should be very clear and precise if they are to be useful.