A critical task is to construct a development state---a set of democratically-accountable institutions capable of effective policy design and implementation. The new state agenda is ambitious and resource intensive. It cannot therefore be achieved unless the fiscal crisis of the African state is resolved, especially low and distorted spending on pro-poor services, weak budgetary institutions, distortions in civil-service expenditure, and the weakness of customs and taxation institutions in raising much-needed revenue. These problems are common across SSA but they are severe in the conflict/post-conflict country group. Reform is therefore urgent, and this issue illustrates how reform---if it is well designed---can support reconstruction. Furthermore, reduced military spending, more grant aid, and more debt relief all release or add resources for core spending.