US$ 2,743,087 (US$391,800 has been pre-financed by the PSF Main Fund as a bridge financing for the top-up proposal)

Transcription

1 Field Operations and Governance and Fiduciary Support Quarterly Progress Report: July to September, 2013 Summary Information Status Activity Number Task Team Leader(s) Executing Agency(ies) Start date to Closing Date Geographic Coverage Active P (TF010808) Sentot Surya Satria PSF 26 September 2011 to 31 March 2014 (30 months) National Approved Budget US$ 2,530,000 Disbursements during the Quarter Cumulative Disbursements US$ 105,294 US$ 2,743,087 (US$391,800 has been pre-financed by the PSF Main Fund as a bridge financing for the top-up proposal) Progress Project Overview: The massive scale up of PNPM Mandiri since its establishment as a mainstream, nationwide program has increased the need for oversight and action by multiple stakeholders and put strain on the program s management and governance frameworks. The PSF provides additional supervision and reporting support to the GOI to strengthen the management and oversight systems of PNPM's core and special programs, thus ensuring full supervision coverage. A number of trust funds and teams contribute to this objective. A dedicated team of field analysts was formed in January 2010 to provide portfolio-wide implementation assistance and to engage with locallevel project stakeholders. Its field-level analyses are aggregated to assist PNPM s oversight bodies, implementing agencies and development partners in identifying areas for strengthening and opportunities for pilot development. Organizationally, the field team works closely with the PSF s governance and fiduciary team, which is funded through the same Field Operations and Governance and Fiduciary Support Trust Fund. The fiduciary team routinely assesses the strength of PNPM s formal and

2 informal controls; supports the GOI in resolving complaints and corruption cases; and produces in-depth analyses on the program s governance framework to facilitate continuous improvements. 1 The Trust Fund also co-finances or provides field-level support for numerous thematic reviews and studies led by other PSF teams on aspects of fundamental importance to the program s performance, such as local government integration, quality of infrastructure, revolving loan funds and other similar issues. These studies and reviews are intended to complement the findings derived from the regular supervision processes. The findings derived from these processes are analyzed in collaboration with program stakeholders and translated into action plans and a program of follow-up technical assistance and implementation support. Overall Progress Towards Development Objective: In the period from July to September 2013, the project continued to support the intensification of fieldbased supervision of the PSF portfolio. This field-based supervision has involved the increased participation of GOI and local government agencies in both formal and routine missions and in the preparation of the program extension. In this reporting period, the field-based supervision covered the activities of 69 sub-projects in 13 provinces, 26 districts, 39 sub-districts, and 38 villages. The subprojects covered by this supervision ranged across 12 programs included in the PSF portfolio, these being: PNPM Rural, PNPM Generasi, PNPM Green (phase out), PNPM Peduli, PNPM Integration, PNPM Disaster, PNPM Respek, PNPM IFAD Agriculture, PNPM BKPG (Bantuan Keuangan Pemakmoe Gampong), Papuan Women Empowerment (PAWE), Empowerment of Overseas Women Migrant Worker and Family, Creative Community and the Barefoot Engineers' program. Findings at the provincial level were shared with all relevant stakeholders through a number of means, including back to office reports, thematic or national/regional workshops, provincial and national coordination meetings, and issue notes. These findings were discussed with stakeholders to support the development of a consensus regarding key benchmarks for a strengthened management and governance framework for PNPM Rural and PNPM Generasi. The involvement of multiple stakeholders, particularly representatives of local governments, in the supervision and monitoring of the PSF portfolio has resulted in improved due diligence in the implementation of corrective actions. The findings from the field-based supervision have been complemented by in-depth studies and thematic reviews on specific aspects of the programs. The project also continued to support the introduction and utilization of implementation results framework instruments and tools. These instruments and tools are intended to build clients' capacities to identify systemic issues and to implement corrective actions to support the achievement of the project development objective. During the period of this report, supervision increasingly focused on the overall framework of input, output and outcome, while corrective actions were increasingly focused on improving systemic issues and outcomes. The project supported the introduction of a tools performance rating system in each province, with performance measured in terms of seven main indicators, these being 1) progress towards project development objective; 2) overall project implementation; 3) project management; 4) financial management; 5) procurement; 6) counterpart projecting; and 7) project monitoring and evaluation. Updates are provided to clients on a quarterly basis to assist them to focus on concrete planning to improve the performance of sub-projects at target locations in terms of the seven stated indicators. The project continued to support the provision of technical assistance to PMD to overhaul PNPM Rural's web-based management information system and complaints-handling system, both of which are now fully functional. The project also facilitates the provision of assistance to develop 1 Both teams coordinate their work with the PNPM Rural Implementation Support team, which provides national-level oversight and thematic reviews and engages in higher level policy dialogue with PNPM-Rural s implementing agency (PMD) and TNP2K

3 and update standard operating procedures and program guidelines in accordance with operational recommendations. A collaborative approach, grounded in field knowledge, has helped to strengthen project oversight, fiduciary controls and the implementation of safeguards. The analysis of studies and reviews facilitated by this project has contributed to the development and implementation of the GOI's Road Map agenda for community empowerment programs. The project has facilitated the regular assessment of the level of robustness of formal and informal controls and provided support for local and national government agencies to implement corrective actions and to resolve complaints and corruption cases. It has also facilitated in-depth analysis of various aspects of program implementation, particularly the programs' technical aspects and governance frameworks. Field-based supervision continued to be implemented on the basis of an analysis of known risk factors, prioritizing sub-projects associated with a high staff turnover and empty positions, multiple block grants, large gaps between disbursement and absorption, and location in remote areas and/or areas infrequently visited by clients, amongst other factors. This approach contributed to the program's capacities to mitigate risk, to establish appropriate bench marks, and to respond in a timely fashion to various problems. With co-financing from this project, several workshops, thematic reviews and studies have been conducted to investigate aspects of project implementation important to program performance and related to the Road Map agenda, with these activities including the following: 1. Workshops and discussion on strengthening implementation support result framework; 2. Workshop on the decentralization of community development programs in four provinces with Pokja Pengendali; 3. Comparative studies field implementation of nine PNPM programs with TNP2K (PNPM PISEW, PNPM Rural, PNPM Urban, PNPM PUAP, PNPM PUGAR, PNPM Pariwisata, PNM Green, PNPM Peduli, PNPM PPIP); 4. Workshops and discussion on governance and fiduciary controls in the context of the formulation and implementation of the Road Map; 5. Workshop on the development of a Risk Management Framework for PNPM and the provision of related assistance to Pokja; 6. Review of the revision of Petunjuk Teknik Operasional (PTO); 7. Review of the training materials and curriculum for refresher training for district facilitators and sub-district facilitators, with these materials in curriculum covering topics including auditing will, risk management, and conflict resolution; 8. Review of financial management practices under PNPM Rural, TAF, LSM Aceh; 9. Review of the results of an external audit; 10. Review of the results of BPKP audits of Rural, Disaster Recovery, Generasi, and Green. The project has also continued to provide technical assistance to TNP2K and Pokja Pengendali in their endeavors to prepare the action agenda for the Road Map, particularly in the area of the integration of community development programs, governance and fiduciary agendas. This collaborative approach, based on knowledge gained through field operations, has helped strengthen project oversight, fiduciary controls and the implementation of safeguards.

4 Key Developments during the Quarter: The project continued to support the introduction and utilization of instruments and tools associated with the implementation results frameworks. These instruments and tools are intended to build clients' capacities to identify systemic issues and to implement corrective actions to support the achievement of the project development objective. During the period of this report, supervision increasingly focused on the overall framework of input, output and outcome, while corrective actions were increasingly focused on improving systemic issues and outcomes. The project supported the introduction of a tools performance rating system in each province, with performance measured in terms of seven main indicators, these being 1) progress towards project development objective; 2) overall project implementation; 3) project management; 4) financial management; 5) procurement; 6) counterpart Projecting; and 7) project monitoring and evaluation. Updates are provided to clients on a quarterly basis to assist them to focus on concrete planning to improve the performance of sub-projects at target locations in term of the seven stated indicators. The project continued to support the provision of technical assistance to PMD to overhaul PNPM Rural's web-based management information system and complaints-handling system, both of which are now fully functional. The project also supports the provision of assistance to develop and update standard operating procedures and program guidelines in accordance with operational recommendations. A collaborative approach, grounded in field knowledge, has helped to strengthen project oversight, fiduciary controls and the implementation of safeguards. The analysis of studies and reviews facilitated by this project has contributed to the development and implementation of the GOI's Road Map agenda for community empowerment programs. A number of positive developments have been noted, including the following: A joint work plan with implementing agencies and tools for result framework supervision and monitoring have been developed; In total, 287 new corrective actions or actions carried over from previous quarter have been agreed upon portfolio-wide. Of these, 58% have been completed, while the remaining 42% are currently in process. Most of the actions are intended to improve project management and to strengthen the fiduciary system. Most actions have been delayed, as they rely on PMD actions to address fiduciary issues and project management issues, such as vacant positions and recruitment, provision of training, and similar matters, and on law enforcement agencies to apply sanctions in fraud cases; Systems for the management of complaints and case reporting have been improved, resulting in a higher number of complaints resolved and cases detected. This indicates a high level of community participation in program oversight and demonstrates the effectiveness of the oversight provided by facilitators; The Revised PTO of PNPM Rural has been finalized; Provincial consultants and facilitators have been recruited to fill empty positions, particularly for positions in the Papuan provinces; Workshops and discussions on issues related to the Roadmap have been conducted in four provinces, with these workshops and discussions focusing particularly on the integration and decentralization of community development programs, governance and fiduciary controls; Results of a comparative study of nine PNPM programs with TNP2K and sectoral agencies have been used to further the development of the Road Map agenda;

5 The results of the 'Learning on Livelihood' program in South India have been used to support Bappenas in the design of MP3KI planning and the development of an associated pilot project; A summary of the findings of the internal audit, BPKP audit, and follow ups to the BPKP audit has been published on the project website. Critical Challenges: Despite these positive developments, supervision and implementation reviews show that the performance of PNPM Mandiri programs continues to face a number of constraints, including the following: Missions continue to observe an increasing number of cases of misused funds. PMD is still responding too slowly to these received reports of fraud and/or misuse of funds, even though a governance team has been established at Pokja Pengendali in the Social Welfare Office to support PMD's ability to address and resolve such complaints more rapidly; NMC and RMC are not performing well. That has been a lack of technical assistance from NMC and RMC to support overall field implementation, administrative compliance and a top down approach. The new policy on travel to remote areas has not been properly communicated to RMCs, which has resulted in a lack of supervision by RMCs in these areas, even when funds have been allocated and are available for travel and operational expenses. Overall, on average, only about 25% of the available supervision budget is being utilized; The use of supervision result framework tools and risk based assessment by implementing agencies is still not performing well; The rate of turnover and the number of empty positions for provincial consultants and facilitators remain high, particularly in remote areas. Increases in the salaries and allowances for facilitators in remote and difficult areas agreed upon in September 2012 are still not being provided; A number of sub-projects under the PMPM Green program are still being implemented, despite the fact that the program has closed. The fact that the program has closed has meant that these ongoing sub-projects have not received adequate technical assistance and oversight. Activities Planned during the Next Quarter: Continued joint field supervision and support based on risk assessment, particularly in remote areas outside the Papuan provinces Continued support for the Road Map agenda; Stakeholders workshop for Papua and West Papua; Preparation of support for the holding of a local government stakeholders workshop to strengthen accountability and governance in PNPM programs; Finalization of the risk management framework and guidance for PNPM; Financial management review for PNPM Rural, Community Ranger, Ranger Empowerment. Thematic mission review on RLF and case resolution;

6 Thematic mission review on gender in PNPM programs; Review of Consultant ASF Firms performance; Support for PMD in the procurement of consultant firms (NMC and RMC) with a contract for current consultant firms ending in February 2014; Support for PMD in the implementation of the web based CHS and disbursement application system; Support for PMD in the development of the MIS; Support for PMD in fixing current MIS problems and improving current MIS and associated database and reporting systems.

7 Key Performance Indicators Indicator Baseline Cumulative Target (to 2014) 2 Cumulative Achievements VAR Target for 2013 Achieved in 2013 VAR Remarks Project Development Objective: To respond to the increased need for oversight and action by multiple stakeholders under a scaled up program, while building government capacity to undertake integrated, risk-based supervision in support of its priority objectives # of corrective actions delivered -- 1, (or 66 % of 1525 in action plans) delivered (out of 404 agreed) +83 On track. # of meetings/workshops to discuss systemic implementation issues at national and regional levels On track. Component 1: Field supervision of overall implementation performance, inc. fiduciary, procurement and governance # of provinces, districts, subdistricts visited at least once during the year -- Each year 32 Provinces 150 District 300 Sub-districts In 2012: 32 Provinces 241 Districts 445 Sub-districts Over target last year 32 Provinces 150 District 300 Subdistricts 32 Provinces 134 District Province: 0 Districts: Subdistricts Subdistricts: 70 On track # of joint-supervision missions involving GOI/LG On track 2 Original targets have all been revised upward to account for the extension of the PSF to December 2014, as well as higher output levels than initially anticipated. These targets are not fully financed, however, their realization in 2013/4 would require additional financing.

8 # of thematic reviews Component 2: TA and follow-up on systemic issues to strengthen management systems and capacity # of action plans/program quality improvement plans -- As needed 73 n/a As needed 8 n/a Web-based project performance management platform -- Fully functional by January 2013 Testing completed; improvement ongoing Two-month delay Redesign, testing and running Testing and improvement completed; Twomonth delay Delays because the platform needs to be further simplified # and type of sanctions applied as a result of findings (e.g. suspension of payments etc.) -- As needed Suspension of 2 districts & 30 subdistricts n/a As needed Suspension of 1 districts& 31 sub-districts n/a # and type of SOPs/Guidelines etc. revised with inputs from field supervision On track GOI web-based complaints handling overhauled -- Fully functional by January 2013 CHS fully functional On target Up & running CHS up and y running On target Component 3: Stakeholder involvement in field supervision and governance and anti-corruption efforts. # and type field visit with Local Legislature, NGOs, CSOs, Media, University, # Regional Workshop with Local Government, Local Legislature, NGOs, CSOs, Media, University etc Terms of Reference and planning are still being discussed with stakeholders Join activity with Pokja Pengendali

9 # and type of cross visit/comparative study Awaiting PMD s confirmation, particularly of cost-sharing arrangements