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Implementation Completion Report (ICR) Review - Poverty Reduction Support Credit (4)


  
1. Project Data:   
ICR Review Date Posted:
03/20/2006   
PROJ ID:
P078994
Appraisal
Actual
Project Name:
Poverty Reduction Support Credit (4)
Project Costs(US $M)
 60.0  60.0
Country:
Burkina Faso
Loan/Credit (US $M)
 60.0  60.0
Sector, Major Sect.:
Central government administration, Telecommunications, Primary education, Health, General energy sector,
Law and justice and public administration; Information and communications; Education; Health and other social services; Energy and mining
Cofinancing (US $M)
   
L/C Number:
C3900      
   
Board Approval (FY)
  04
Partners involved
 
Closing Date
06/30/2005
         
Evaluator: Panel Reviewer: Division Manager: Division:  
Martha Ainsworth
Jorge Garcia-Garcia Alain A. Barbu IEGSG

2. Project Objectives and Components:

a. Objectives
The three explicit objectives of PRSC-4 are: (i) economic growth and employment creation; (ii) human resource development; and (iii) good governance. A fourth, implicit objective was macroeconomic stability; macroeconomic outcomes are separately addressed in the ICR in the discussion of achievement of objectives, by the Bank and the Borrower, though they largely overlap with the first objective of economic growth.

b. Components (or Key Conditions in the case of Adjustment Loans):
The actions to be taken and 11 formal triggers are grouped according to three "components" in the Program Document (PD), that are organized around the three objectives:

  • Growth and employment creation, particularly in rural areas, including policies in the rural, telecommunications, and energy sectors, and in private sector development;
  • Human resource development, including policy actions in education, health, and water infrastructure;
  • Good governance, including policy actions in budget formulation and execution, procurement, budget management and ex-post control, public sector reform and decentralization, and environment.

c. Comments on Project Cost, Financing, Borrower Contribution, and Dates
This was the first in a new series of three programmatic operations (PRSC-4, 5, and 6) to support the implementation of the revised PRSP in 2004-2006. It was designed as an interim operation based on the 2003 PRSP progress report "to give authorities sufficient time to finalize the revised full PRSP for the period 2004-06 in early 2004." (PD, p. 1) The actual closing date is not reported in the ICR.


3. Relevance of Objectives & Design:

The relevance of PRSC-4 objectives and design is rated "high". The PRSC-4 objectives directly address the four strategic pillars of the original and revised PRSP: (i) accelerating broad-based growth; (ii) promoting access to social services; (iii) increasing employment and income-generating activities for the poor; and (iv) promoting good governance. PRSC-4 was also aligned closely with the 2004 budget cycle and with ongoing donor efforts to harmonize support, according to the PD. It reflects the priorities in the CAS and supports recently completed national plans in education and health. The relevance of PRSC-4 was likely enhanced by substantial analytical work sponsored by the Bank in the year prior to this operation and brought to bear on the proposed actions, including: a Medium-Term Expenditure Framework (MTEF); a public expenditure review; a risk and vulnerability study; technical assistance for macroeconomic modeling; a participatory poverty assessment; a gender assessment; a household survey; a study on health staff incentives, and studies on electricity sector reform. This is in addition to analytic work sponsored by other donors.

4. Achievement of Objectives (Efficacy) :

Many of the outcomes from these policy changes are expected to be realized in the longer term. Nevertheless, the ICR provides information on outputs and in some cases tracks trends in the outcome indicators that will eventually be affected.
(1) Growth and employment creation: Modest

Outcomes: The economic growth objective was achieved (see below); the growth rate of cotton seed production and cotton fiber exports in 2004 remained similar (17%) to the rate in 2003 (18%) (ICR, Appendix 4). The ICR suggests an increase in cotton productivity, though evidence is not provided. Cereal production declined by 19% in 2004, however, compared to a 17% increase in 2003 (Ibid). No evidence is provided in the ICR concerning employment creation. The contribution of the PRSC-4 policy measures to these outcomes is questionable, as several were not implemented and one would expect any impact to be lagged.
Outputs: The privatization of the cotton sector in the central and eastern zones (FASO COTON and SOCOMA, respectively), was achieved; The ICR does not mention whether the planned study on options for future evolution of the cotton sector was executed. Privatization of the national telecommunications company (ONATEL) was delayed by a lack of bids and preparation for privatization of the energy sector was delayed by disagreement between government and donors on revision of a 1998 law to adapt the legal and regulatory framework. A law was passed in September 2004 on labor market reform, but "limited progress has been made in the preparation of implementation decrees because of resistance from unions" (ICR, p. 8). A comparative study on labor market laws and regulation was launched after the PRSC-4 closing date.

(2) Human resource development: Substantial

(a) Basic education:
Outcomes: The gross enrollment rate rose from 48% to 57% between 2002-2004, and in the 20 most disadvantaged provinces from 33% to 42% (ICR, Appendix 4). Among girls, it rose from 41% to 51% in that period. However, no evidence is presented of an improvement of the quality of instruction and the PRSC series is not monitoring of trends in learning outcomes (basic numeracy and literacy) among those enrolled, which is what ultimately contributes to enhanced incomes and poverty reduction.
Outputs: Basic education rose as a share of the government budget from 12.4% to 14.4% in 2003-2004, exceeding the MTEF target, and resources have increased at the periphery due to decentralization. To improve educational quality, a sub-cycle system has been introduced. A survey of actual "time on task" in the schools was completed and the Ministry of Basic Education is preparing an action plan. The preparation of an MTEF to ensure a better balance of resources between primary and secondary education was delayed until the fall of 2005, with a first draft in 2006. The transfer of responsibilities for recruitment and assignment of teachers to DREBA was accomplished, although salaries continue to be paid through the central budget until the decentralization process has progressed further.
(b) Health:
Outcomes: The ICR text reports an increase in the number of new contacts at health centers, from 0.27 to 0.32 contacts/capita (although the years are not provided and this is not among the results indicators in Appendix 4 of the ICR) and an increase in vaccination coverage since 2001 (DTC3 coverage rose from 64% to 88%, for example, ICR, Appendix 4). Evidence for better access to prenatal services is weak: the rate of assisted births declined slightly from 2002-2003 and the percent of health centers with minimum staff remained constant at about 76%, with no data reported for 2004. Thus, it is highly unlikely that maternal mortality actually declined by a third (from 484 to 313 per 100,000) over this 2-year period, as suggested in Appendix 4 of the ICR.
Outputs: The share of health in the national budget rose from 9.4% to 10.2% from 2003-2004. The reductions in the price of generic essential drugs under the previous PRSCs have been verified in the field. A study on health worker incentives was completed in November 2003 and the action plan, though delayed, was completed in early 2005. The Ministry of Health (MOH) has increased allocations to regions and health districts by 10% annually. A MTEF for the health sector was completed in February 2005. A monitoring committee was established and a list of performance indicators was adopted prior to approval of PRSC-4 and the first review was conducted in August 2005 (ICR, p. 9).
(c) Water infrastructure:
Outcomes: These activities are intended to reinforce health outcomes -- the indicators of improved access for the water sector are missing data for 2004 in Appendix 4 of the ICR, with one exception: the share of urban households with hygenic latrines increased only slightly, from 33% to 35% between 2003-2004.
Outputs: An action plan for achieving the MDGs in the water sector was finalized and adopted and is being updated based on the results of a water availability survey completed in November 2005. The ICR reports launching of at least 5 pilot public-private partnerships in the water sector (ICR, p. 9, and Appendix 4). The review of water connections in public buildings, to reduce government water bills is reported to be under way. The ICR does not comment on preparation of an action plan for the public-private partnership in the water sector in urban areas, or a regulatory framework, both of which were in the PD.

(3) Good Governance: Modest
Outcomes: There are very few indicators of outputs or outcomes for good governance in the ICR or among the PRSC-4, 5, 6, results indicators, in Appendix 4. In terms of decentralization, the ICR text notes that the budget can now be spent in 8 regions without resorting to the central government.
Outputs: The ICR reports substantial progress in the "deconcentration" of budget execution and a new procurement code; texts for implementation were adopted and enforced. Guidelines for environmental assessment were made available to 5 line ministries and 4 IDA projects were evaluated with respect to environment. Software for budget execution was extended from 5 of the 13 regions at the time of PRSC-4 approval to 9 regions. Software for personnel management was implemented and an action plan to further develop it and extend it to line ministries and regions was adopted; it is being used by "several" line ministries already. However, the integration of foreign-financed investments into budget execution proved more complex and difficult than expected and has not yet been implemented. The ICR does not report on a number of actions in the PD that had not been fulfilled: progress on the integrated revenue circuit (CIR); preparation of arrêtés on the issuance and withdrawal of accreditation for public works, corresponding to norms of transparency and equity; progress on the computer application to follow the procurement process; and progress on implementation of the action plan for the accounting system for government property.

(4) Macroeconomic stability: Substantial.
Outcomes: At the time of the PD, growth in 2004 was projected to be 5% and inflation was expected to remain low, at 1%. Despite the increase in world oil prices and the sharp drop in world cotton prices at the end of 2004, nominal economic growth was 4.6% and inflation virtually nil (-0.4%). However, the ICR notes that these results are "fragile", as Burkina "remains vulnerable to external shocks" (ICR, p. 7), and that the sharp decline in Burkina Faso's terms of trade has reduced growth prospects for 2005.
Outputs: The ICR notes that the PRSC contributed to macroeconomic stability by financing the public deficit and aligning the disbursement with the budget cycle. The IMF assessment in the framework of the Poverty Reduction Growth Facility (PRGF) was a prerequisite for disbursement.

5. Efficiency:

Not rated.
6. M&E Design, Implementation, & Utilization:

This first project in the second series of PRSCs in Burkina Faso has adopted a more detailed results framework for the monitoring and evaluation of PRSC-4, 5, and 6 impact, presented in Appendix 4 of the ICR. This is a substantial improvement over the first series of PRSCs and provides some intermediate indicators by which to assess PRSC-4.

However, the PRSC-4,5,6 results indicators in Appendix 4 of the ICR do not include any indicators for employment creation (the first objective). The key education indicators being tracked in the PRSC-4, 5, 6 results framework are by and large limited to access (enrollment, admission, and completion rates). There are no indicators to track efficiency (drop out and repetition), the quality of inputs (teaching aids, class time), or learning outcomes (basic literacy and numeracy) in primary school, either in the aggregate or among the poor. This is a major weakness in M&E of the second objective. For the good governance objective, the only indicators for which data are provided relate to budgetary allocations. The numerous indicators for procurement, management, ex-post control, personnel management, public sector reform and decentralization are unspecified or specified with missing data.
7. Other (Safeguards, Fiduciary, Unintended Impacts--Positive & Negative):

Of the 11 triggers for PRSC-4, three had not been fully met at appraisal. However, the Bank proposed to approve the credit on the basis of the government's track record on previous PRSCs. The 3 triggers were subsequently met and activities were not delayed, according to the ICR (p. 12).

8. Ratings:
ICR
ICR Review
Reason for Disagreement/Comments
Outcome: 
SatisfactorySatisfactory
Institutional Dev.: 
ModestModestInstitutional development during this phase was modest, in light of lack of progress in privatization of telecommunications and energy sectors.
Sustainability: 
LikelyLikely
Bank Perf.: 
SatisfactorySatisfactory
Borrower Perf.: 
SatisfactorySatisfactory
Quality of ICR: 
Satisfactory

NOTES:
- When insufficient information is provided by the Bank for IEG to arrive at a clear rating, IEG will downgrade the relevant ratings as warranted beginning July 1, 2006.
- ICR rating values flagged with ' * ' don't comply with OP/BP 13.55, but are listed for completeness.

9. Lessons:

1. The experience in Burkina Faso suggests the need to involve more actively both the sector line ministries and Bank sector teams in strengthening the PRSC-related sectoral dialogue. Currently, line ministries and sector teams "are often overwhelmed by the preparation and supervision of several projects, and the transition from project to programmatic support has proved difficult" (ICR, p. 12) Related to this, the Bank's sectoral teams need to become involved earlier in budget preparation with line ministries.

2. Lack of coordination, delayed implementation or inadequate attention to the effectiveness of parallel capacity-building or support projects that are intended to complement implementation of PRSC reforms has sometimes delayed the implementation of PRSC measures.


10. Assessment Recommended?  Yes

          Why?  For a deeper understanding of the lessons higlighted in the ICR with respect to the links between PRSC sectoral activities and Bank & country sectoral inptus.

11. Comments on Quality of ICR:

The ICR is generally concise and well-written, both the parts submitted by the Bank and by the Borrower. The PRSC-4,5,6 results indicator matrix in Appendix 4 provided some useful intermediate indicators on achievement of objectives (both outputs and outcomes), but it needs more work. The actual indicators were often not specified or the data were missing, and there are no indicators to reflect some of the objectives (employment creation, for example). The lessons highlighted with respect to the need to work more closely with both line ministries and Bank staff were particularly insightful and could have been even more strongly made with evidence on the extent of participation of Bank sector staff in preparation and supervision, and a fuller discussion of the constraints to better coordination, particularly on the part of the Bank.

The ICR contained several anomalies on the ratings: (1) The ICR does not provide a rating on "sustainability", but rather on "risk to development outcome" -- a rating category that is not supposed to go into effect until FY07. IEG has interpreted the "modest" rating assigned by the ICR as equivalent to "likely" sustainability. (2) The ICR assigns a "moderately satisfactory" rating for Borrower Performance, which is not a valid rating under either the new or the current rating system. IEG has interpreted this as "satisfactory" on the 4-point scale.

There were only a few instances of internal inconsistencies or missing data (aside from the substantial problems in Appendix 4): (a) The revised/actual dates for effectiveness and closing were not reported on p. 5. (b) Appendix 3 presents nominal growth rates in GDP; the same figures are presented as real GDP growth rates in Appendix 4.

(ES-Rev4B-Dec/05)
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