1. A Practical Guide to Developing Good Indicators – Based on Uganda’s Experience
Lars Christian Moller
Poverty Monitoring and Analysis Unit
Ministry of Finance, Planning and Economic Development (Uganda)

2. Guiding Question
Uganda has come relatively far in developing a viable poverty monitoring system with a comprehensive list of poverty indicators. What are the lessons learnt and what are their relevance to Malawi?

3. Structure of Presentation
Poverty Monitoring in Uganda
Poverty Monitoring and Evaluation Strategy
The Process of Consultation
Technical Approaches
Characteristics of a Good Indicator

4. 1. Poverty Monitoring in Uganda
Poverty Eradication Action Plan
Poverty Reduction Strategy Paper
Poverty Monitoring and Analysis Unit
Poverty Status Reports
PRSP Progress Reports
PRSC Sector Reviews
Poverty Monitoring and Evaluation Strategy

5. 2. Poverty Monitoring and Evaluation Strategy
Enables systematic monitoring of outcomes of government policies and programmes.
Specifies institutional roles and responsibilities in poverty monitoring.
Contains a list of 100 poverty indicators, of which 30 serve as priority indicators.
Maps out short-, medium- and long-term activities related to poverty monitoring and evaluation.

6. 3.1 Consultations
The situation of Malawi today resembles that of Uganda in 1997.
How can Malawi perfect its preliminary set of poverty indicators?
In Uganda, a process of intensive multilateral and bilateral negotiations co-ordinated by the Poverty Monitoring Unit has helped to achieve this objective.

7. 3.2 Consultations Objectives
To ensure that choice of indicators is decided by stakeholders with specialist knowledge.
To ensure broad ownership.

8. 3.3 Consultations

9. 3.4 Multilateral Consultations: Poverty Monitoring Network
Overall objective: To ensure co-ordination of to exploit synergies and avoid duplication.
A key objective: To agree on indicators.
Membership (30): Government ministries, Bureau of Statistics, Civil Society, Donors, Research organisations.
Secretariat: Poverty Monitoring Unit.
Formal meetings: Twice a year.

10. 3.5 Bilateral Consultations
Based on sector initiative.
Focal point: Poverty Monitoring Unit.
Sector financial incentives: To show that they are working to reduce poverty.

11. 3.6 Illustration of different types of indicators
Sector Poverty Indicators
All Sector Indicators

12. 3.7 How many indicators? Q: How many indicators are enough?
A: The minimum number that answers the question: Has the goal been achieved?
Caution: There is always the danger of including to many indicators to satisfy different stakeholders!
Prepare your counterarguments!

13. 3.8 Effective consultations
Trade-off between broad consultation with many stakeholders and effective working processes.
Identification of poverty indicators is primarily a technical exercise.
Workshops need to be well-managed to be effective. Technical working groups are useful.
Give expert groups time to develop their ideas and then introduce consultation.

14. 4.1 Technical Approaches to Choosing Indicators
In Uganda, we have had good experiences with survey-based and participatory approaches to analyzing and monitoring poverty.
Both approaches are also useful for selecting poverty indicators.

15. 4.2 Poverty Correlates A survey-based approach.
Poverty defined in terms of income/consumption.
Question: Which household characteristics are associated with being poor?
Example: If it is found that households living under a thatched roof are much poorer than households with iron sheets then we can conclude that type of roof is a good poverty indicator.

16. 4.3 Poverty Correlates
In Uganda, poverty correlates were used to examine 34 indicators in the draft Poverty Monitoring Strategy.
20 indicators were found relevant.
14 indicators had a low level of correlation without being intrinsically valid and were recommended excluded from the Strategy.
An additional 18 new indicators were recommended to be included.

17. 4.4 Participatory Poverty Assessments
In Uganda, national PPAs were conducted in and in
Poor people are experts about their own life and can help to identify indicators of poverty.
Results from the PPA are remarkably similar to those found in the poverty correlates exercise.

18. 5.1 A good indicator is… Clear (Easily interpreted)
Relevant (to poor people’s lives)
Economic (cost-effective)
Adequate (to assess performance)
Monitorable (independent evaluation)

19. 5.2 A good list of indicators must have…
For each indicator:
A category (input, output, outcome).
A description of the purpose of the indicator.
A clearly identified data source.
An indication of monitoring frequency.
A baseline (value, year).
A target (value, year).

20. 6. Concluding remarks
You will need to develop your own indicators to meet your own needs.
Developing indicators often takes more than one try and will take time.
Try to find the balance between satisfying different stakeholder interests and arriving at a limited set of indicators.
Know that over time, it is expected that new indicators are added and others are dropped.

21. Thank you for your attention!