BUSAC Fund Phase III

Introduction
The Business Sector Advocacy Challenge (BUSAC) Fund is a programme set up to strengthen the advocacy capacity of private sector business groups and associations in Ghana. Supported by DANIDA (the lead Development Partner), USAID and DFID, the first phase of the programme run from 2004 to February 2010, during which the Fund provided a total of 362 advocacy grants to various business groups and associations within the ten regions of Ghana.

The second phase of the BUSAC Fund was a five-year extension to BUSAC Fund I and was intended to consolidate the gains made in BUSAC Fund I and to further spread the concept of advocacy to all sectors of the economy in all the regions of Ghana. With the support of its Development Partners, DANIDA, USAID and the EU, the second phase of the BUSAC Fund run from March 2010 to 30th June 2016, during which the Fund provided 435 advocacy grants worth over 17.6 million USD to various Private Sector Organizations (PSOs) across the ten regions of Ghana to enable them advocate the removal of barriers within the business environment. For BUSAC Fund Phase II, PSOs eligible for support included business associations, trade unions, media houses and farm-based organisations (FBOs).

What is BUSAC Fund III?
The third phase of the BUSAC Fund (BUSAC III) builds upon the experiences gained from its predecessors (BUSAC I & II) and is aimed at further improving the business environment in Ghana to facilitate private sector growth. This involves reducing the spread and concentrating on fewer, larger private sector associations that have nationwide membership as well as building the long term sustainability of the PSOs to continue with structured and evidence-based business advocacy in the absence of BUSAC Fund support. BUSAC Fund III is funded by DANIDA as the lead development partner, the EU and Feed the Future Ghana. As was the case in phases I and II, the Fund management for BUSAC III has been contracted by DANIDA to COWI from Denmark.

Under BUSAC Fund III, which will be implemented from July 2016 to December 2020, special attention will also be given to legal and rights based challenges within the broader range of sustainable agriculture and energy as well as the facilitation of private-public sector policy dialogue to help improve the Ghanaian business environment.

Furthermore, BUSAC Fund III will establish a rapid response facility to address advocacy issues calling for urgent action. BUSAC Fund III will also establish a facility to support the implementation of agreed regulatory reforms and practices (called post-advocacy actions).

Expected outcome and outputs of BUSAC Fund III The BUSAC Fund III Engagement will contribute to achievement of the SPSD III objective through the following two outcomes:
Policies, laws and regulations relating to the private sector have been enhanced and contribute to an improved enabling environment for business at national and local levels,
Strengthened institutional, technical and financial capacity of PSOs to pursue business advocacy actions and to become more sustainable.

BUSAC III is expected to achieve six main outputs:
District and community level business constraints addressed through advocacy action
Capacity of PSOs to undertake advocacy activities significantly increased
Public-Private Dialogue Platforms created
Increased attention to post-advocacy undertakings
Increased capacity of PSOs to identify BDS needs of members and facilitate ways to address these
Capacity of research institutions and think-tanks to provide evidence on private sector advocacy issue increased
In order to achieve its six expected outputs, BUSAC Fund III will support private sector advocacy through five funding mechanisms /windows:

GRANT MAKING MECHANISMS
General Description of Funding Mechanisms (Windows)
The operations of BUSAC III have been structured around five funding mechanisms / windows to provide all potential applicants equal access to grant funds and to facilitate the achievement of the six outputs listed above and the following impacts which will ultimately reduce poverty:
Increased Turnover;
Increased Employment; and
Increased Income

1.1 Window 1 (For district-based PSOs, CBOs and rapid response business advocacy actions)
Applicants to be considered for advocacy grants under window one shall be district based PSOs or Community-Based Organizations (CBOs) catering for specific groups of business operators such as traders, farmers or miners. Examples of issues to be supported include land rights, especially for women, and workers' right, discriminatory treatment of weak groups, non-delivery of public services and goods etc. Window 1 will also provide a Rapid Response Facility to cater for issues that require an immediate advocacy action. Examples of such issues could be an urgent need to organise a consultative process to improve the quality of a bill being reviewed at parliamentary select committee for a given sector, etc.
The maximum grant size under Window 1 is GHC 80,000.00, constituting 90% of the total cost of the advocacy action for PSOs and civil society organisations (CSOs) that are applying for the first time. This implies that the remaining 10% of the cost of the action will be borne by the applicant. For PSOs and CSOs who have benefitted earlier, the maximum grant element will be 80%. The maximum grant element for the rapid response facility is GHC 50,000.00, which constitutes 90% of the total cost of the action.

1.2 Window 2(advocacy issues of national /sectoral significance, green growth issues)
Advocacy grants under this window will aim at providing support to PSOs advocating on issues of national /sectoral significance, including green growth issues. Applicants to be considered for advocacy grants under this window shall be medium to larger PSOs/business associations who intend to embark on advocacy issues that have a clear effect on the economic robustness of the PSO and its members. In addition to addressing specific legal or regulatory constraints affecting the business environment, the support will focus on strengthening the capacity of the supported PSOs to undertake evidence-based advocacy beyond the support of BUSAC III. The strategic partnerships between BUSAC III and a PSO, which may have several years' duration, will be based on a strategic plan which focuses on how to strengthen the advocacy capacity of the PSO, and how to collect the evidence needed to substantiate the PSO's arguments. Under this window, special attention will be given to the possibility of facilitating partnership arrangements between Ghanaian PSOs and regional/international PSOs through twinning arrangements. Moreover, the Fund's operations under this window will contribute to the green growth agenda by supporting initiatives relating to the institutional and regulatory frameworks for renewable energy and energy efficiency. The maximum grant size under Window 2 is GHC 200,000.00, which constitutes 80% of the total cost of the advocacy action.

1.3 Window 3 (a facility for the creation of public-private dialogue (PPD) platforms) Advocacy grants under window 3 are aimed at speeding business reform processes and enhancing the business environment through the facilitation of the private sector's collaboration with relevant government ministries, departments and agencies. The PPD platform may take the form of more permanent structures and become an integrative part of the Private Sector Working Groups (SWGs) or ad hoc platforms centred on specific topical issues relevant to the business environment. Examples of private sector issues that may warrant the creation of PPD platforms include the business taxation regime, export promotion initiatives and improvement of the supply of energy. The FMU will facilitate these PPD platforms in close dialogue with leading PSOs and key ministries such as Ministry of Trade & Industry, Ministry of Food & Agriculture and Ministry of Finance. BUSAC III's funding support under this window can cover consultancy services required to establish and operate the PPD platforms, the cost of meetings and workshops, relevant studies etc. BUSAC Fund III cannot pay for the members' participation in PPD events.

1.4 Window 4 (Post advocacy facility)
Advocacy grants under this window will primarily aim at providing support and assistance to PSOs to monitor and dialogue with relevant government agencies on the enforcement of agreed policies, laws and reforms. Applicants to be considered for advocacy grants under this window shall be PSOs who have successfully advocated the formulation / passage of laws, policies, agreements, etc. which need to be enforced / implemented by duty bearers. Funding under this window is aimed at providing support and assistance to PSOs to engage government agencies on the enforcement of agreed policies, laws and reforms that will help improve the business environment for the Ghanaian private sector. The specific post-advocacy action must be a follow-up initiative related to a successful advocacy action funded by BUSAC Fund phases I, II and III. The maximum grant size under this Window 4 is GHC 140,000.00, which constitutes 80% of the total cost of the advocacy action. Applicants are expected to contribute 20% of the cost of the advocacy action.

1.5 Window 5 (Support for PSOs to provide BDS to their members)
Advocacy grants under window 5 are aimed at supporting PSOs to identify the BDS needs of their members and provide appropriate BDS services to meet those needs. This window will apply a two-phased approach in funding. First, interested PSOs will be supported to develop their capacity to identify the needs of their members for the assistance of BDS providers. Secondly, the PSOs will, with the assistance of certified service providers, prepare training and coaching programmes for their members. It is expected that by offering this type of services, the PSOs will increase their credibility and attract more dues-paying members. Examples of membership services to be provided through the PSOs include assistance to develop bankable business plans, financial management training, guidance on market access (domestic and export) and general management principles, training and advice on Corporate Social Responsibility (CSR)-principles, coaching on production and productivity and quality standards and assurance. Furthermore, Window 5 will co-finance initiatives by PSOs to inform their members about changes to specific policies, regulations and standards, and how to apply. This may consist of a combination of information campaigns and training events. The maximum grant size under Window 5 is GHC 50,000.00, which constitutes 80% of the total cost of the advocacy action. PSO's applying under this window shall bear 20% of the cost of the BDS project, and are therefore expected to request participating member companies to contribute financially.