The Public Administration Reform Fund (PAR Fund) consists of resources that a donor community has allocated to implement public administration reform in Bosnia and Herzegovina. The Fund is intended exclusively for financing specific measures outlined in Action Plan 1 for public administration reform.
The Memorandum of Understanding on the Establishment of the Public Administration Reform Fund was signed in Sarajevo on July 12, 2007, by the Prime Ministers of Bosnia and Herzegovina, the Federation of BiH, and the Republika Srpska; the Mayor of Brčko District; the Minister of Finance of BiH; the ambassadors of the donor countries—the United Kingdom, the Netherlands, and Sweden; and the Head of the European Commission Delegation to BiH. This fulfilled the formal prerequisites for investing 4.5 million euros in donor funds to finance public administration reform projects over a three-year period.
The Public Administration Reform Coordinator’s Office is not a beneficiary and does not individually manage the Fund’s resources. The use of funds is decentralized, meaning that decisions on the placement of donor funds are made at multiple levels to prevent misuse and arbitrary spending. The Fund is managed by a Steering Committee, and no project will be funded without its consent.
Donor contributions are deposited into a single, non-interest-bearing foreign currency account held by the Ministry of Finance and Treasury (MOFT) at the Central Bank of BiH. The money is a separate budget item to be spent exclusively on approved projects. Funding from the PAR Fund can be increased either by the participation of additional donors or by an increase in the contributions of existing donors. Donors will invest their contributions in their respective national currencies, and the funds will be transferred in phases. In determining the installment amounts, donors will consider the current progress and the PAR Fund’s need for maintaining liquidity. The Memorandum on the Establishment of the PAR Fund contains detailed notes on the use of the Fund’s resources.
