Recommendations for training in the MTS include that steps be taken to: integrate the training program of INS with the budget process; explore the scope for mobilizing additional external resources for training activities; develop a reliable database on costs for external training activities; and explore the scope for combining full charging for the direct cost of training with a trust fund to subsidize the costs for low-income countries. Other aspects of the Fund’s capacity building strategy are discussed in a separate paper on Enhancing the Impact of Fund Technical Assistance.
Data on training under the INS program are reasonably comprehensive, but the Fund has only recently begun compiling an integrated set of data on the training that takes place outside the INS program, and very little systematic information is available on the decisions and strategies that have governed such training. Recent efforts to strengthen data on training are discussed in a supplementary paper, Training as Part of Capacity Building: Report on IMF Training During 2007.
The RTCs (in order of establishment) are located in Vienna, Singapore, Abu Dhabi, Tunis, Dalian (China), Brasilia, and Pune (India).
This paper addresses training as a component of capacity building services for member countries. Therefore, the Internal Economics Training program for IMF staff, which is a significant part of the mandate of INS, is not covered.
See Section V below.
Based on participant weeks of training. A statistical description of the IMF training program is provided in a supplementary paper. The IMF Institute Training Catalog 08 provides a comprehensive description of the courses planned under the INS program for calendar year 2008; a link to the English version of this document can be found at http://www.imf.org/external/np/ins/english/index.htm.
Owing to different comparative advantages and training strategies, there is little overlap between the training programs of INS and WBI. However, the two organizations participate in jointly delivering a course on Applied Economic Policy at the Joint Vienna Institute (JVI), and a joint course on Economic Policies for Growth and Poverty Reduction in Africa, also involving the African Development Bank, is under development for delivery at the Joint Africa Institute (JAI). INS also draws on World Bank experts to make presentations in high-level seminars and give special lectures in some of its courses. In addition, the two organizations serve on the Boards of the JVI and JAI, the Directors of INS and WBI meet bilaterally on a regular basis, and the mechanisms in place for regular interactions have been effective in identifying various ways in which cooperation can be fruitful.
High-level seminars in recent years have focused, for example, on (i) the domestic and international implications of China’s exchange rate regime, (ii) the macroeconomic management of foreign aid, (iii) what we have learned from the financial crises of the past decade, and (iv) structured financial products and the implications of the crisis in asset-backed securities.
Even at the RTCs, there are elements of flexibility after the calendar-year program is established: there is some scope to add training events (especially short ones); already-planned courses can be adapted to take account of important changes in training needs; and the allocation of training places among countries served by the RTC can be modified.
This group includes members from all five area departments, the six main training departments (INS, FAD, FIN, LEG, MCM, STA), OBP, and OTM. It functions as a subcommittee of the Committee on Capacity Building, which is chaired by Management.
Detail is provided in the supplementary paper.
Unlike many e-learning courses, which typically involve learning in isolation and do not provide strong incentives to complete the course, IMF distance learning courses entail considerable interaction with Fund staff counselors via e-mail and among participants through a bulletin board. Only participants who satisfactorily complete the distance phase of the course are invited to participate in the concluding residential segment of the course.
In recent years INS has scheduled a number of overseas courses at the AFRITACs, CARTAC, METAC, and PFTAC, and it also offers courses in affiliation with other training organizations that can provide good facilities and administrative support. These include four regional training organizations in Africa (the Macroeconomic and Financial Management Institute of Eastern and Southern Africa (MEFMI), the West African Institute for Financial and Economic Management (WAIFEM), the Central Bank of West African States (BCEAO), and the Bank of Central African States (BEAC)), as well as the Reserve Bank of South Africa, Stellenbosch University in South Africa, the Center for Excellence in Finance in Slovenia (CEF), and the South East Asian Central Banks Research and Training Center (SEACEN).
The supplementary paper provides details on the distribution of IMF training and a compete listing of the courses provided during 2007.
The regional allocation of IMF training is discussed further in the supplement.
For example, INS collaborates with the Bank of Portugal to provide special courses for the Lusophone countries of Africa. In addition, interpretation is used in a number of cases to reach participants who cannot understand the language of course delivery.
The INS program includes courses for which countries are invited to nominate candidates and courses that are open to applicants from all eligible countries.
Course descriptions are published in the IMF Institute’s Training Catalog and are also posted on the INS website and the websites of the RTCs. INS makes efforts to identify appropriate contacts on training issues within member-country finance ministries, central banks, and other agencies. It sometimes asks Executive Directors’ offices to assist in disseminating information to their constituencies on the most appropriate types of candidates to nominate or encourage to apply, and it has recently created an electronic registry of training contacts to enhance its ability to communicate quickly with member-country agencies about prospective course participants and other issues.
The greatest increase in demand was for specialized courses on topics such as finance, inflation targeting, macroeconomic diagnostics, and macroeconomic forecasting. The level of interest in these courses was considerably higher than shown by the previous survey three years earlier. Demand remained strong, however, for long-standing courses on financial programming and policies and macroeconomic statistics.
The use of exams would not provide a good indication of what participants had learned unless their knowledge was carefully assessed at both the beginning and end of each course, which would be time consuming. And beyond the types of surveys that outside evaluators regularly conduct for INS, there is no proven methodology for analyzing the impact of training, none of the comparator organizations is currently conducting impact analysis, and the costs would be high.
Sponsors are asked to limit and prioritize applications. Nevertheless, the number of applicants is typically three times the number of available spaces.
This includes spending financed by donor funds flowing through the IMF accounts, but does not include spending financed by partners at the RTCs.
As personnel costs associated with the preparation and delivery of training by other departments are not part of the INS budget, the calculation is limited to training delivered by INS staff. INS expenses related to administering courses delivered by other departments have been excluded from the calculation for this purpose. Apart from this and INS time devoted to IET and other Fund outputs, all INS personnel costs are included in the calculation. The calculation does not include the cost of any support personnel at overseas locations who are not IMF employees.
Because of the fixed costs associated with staff and participant travel, one-week courses are quite expensive in participant-week terms. This consideration needs to be weighed against the fact that, with given capacity constraints on course size, two one-week courses provide training to more participants than one two-week course.
Undergraduate tuition at many private universities in the United States exceeds US$35,000 per academic year. Tuition at professional schools (such as law and business schools) is often above US$40,000.
While this consideration applies to official at all levels, it is interesting to note that there is a heavy presence of INS course participants in senior policy ranks in member countries. The 2007 Bank/Fund Annual Meetings were attended by 378 delegates who had taken INS courses, including 47 Central Bank Governors, 22 Ministers, 20 Deputy Central Bank Governors, and 8 Deputy Ministers.
There is, of course, no reason to expect donors to incorporate all aspects of the value of a course in their calculus. Moreover, some donors may consider a contribution from the Fund as an important incentive for cost management, or perhaps as a means of sharing the burden of training provision with the international community.
Overall INS output is a weighted average of INS-delivered training for officials (80 percent), INS administrative services and participant costs for training delivered by other departments (14 percent), and internal economics training (6 percent). In terms of participant weeks, INS training of officials has risen by 22 percent over the past four years, while training by other departments within the INS program has risen by 6 percent.
In most cases, allowances for participant living expenses are denominated in U.S. dollars, and the depreciation of the U.S. dollar has thus been an additional source of real cuts in these allowances. Where participants are provided a travel allowance, as opposed to a pre-paid ticket, INS is carrying out regular comparisons of actual ticket prices and these allowances.
This is measured in terms of the deflators for the individual components of spending.
The contribution in percentage points to net budget reduction is greater than the decline in training, as reduced training lowers gross costs, while the amount of external financing is assumed to be unaffected for the purpose of this calculation.
To the extent that training partners overseas need to hire additional staffing, these are not productivity gains in the broader sense of the word. This consideration applies particularly to the position at the JAI, where the Fund staff person will be replaced by an African Development Bank employee.
The projection for FY 2011 in the medium-term budget envisages IMF spending on participant costs of about US$2.8 million.
The imputation for Concordia rooms used by training participants would be based on a policy of recovering Concordia’s operating costs and depreciation expenses, net of revenues from sales to other users.
This issue is still under discussion in the Fund.
The administration of fees could be handled through a simple modification of the existing system of financial transactions with participants. In cases of default, participants from the defaulting agency would not be invited to subsequent courses until the default had been cleared.
This is based on the average weekly cost for longer courses at HQ in FY 2009, as all Fund-financed courses under the new course-length policy for HQ will be 4-6 weeks long, except for the residential segments of two Fund-financed DL courses.
The latter step would require strengthening of cost-allocation procedures to allow accurate billing of donors.
For example, a donor fund for fragile states might be used to finance participants from these states at training courses at the RTCs and at HQ.