Document o f The World Bank

FOR OFFICIAL USE ONLY

Report No: 40743 - TZ

PROJECT APPRAISAL DOCUMENT

ON A

PROPOSED CREDIT

IN THE AMOUNT OF SDR 26.2 MILLION (US$40.0 MILLION EQUIVALENT)

TO THE

UNITED REPUBLIC OF TANZANIA

FOR THE SECOND PHASE OF THE

PERFORMANCE RESULTS AND ACCOUNTABILITY PROJECT IN SUPPORT OF THE TANZANIA PUBLIC SERVICE REFORM PROGRAM (APL)

SEPTEMBER 7,2007

Public Sector Reform and Capacity Building (AFTPR) Eastern Africa Country Cluster 1 Africa Region

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. I t s contents may not otherwise be disclosed without World Bank authorization.

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CURRENCY EQUIVALENTS (Exchange Rate Effective July 3 1,2007)

AAP APL ATIP AWPB BEST BPR CAG CAS CEO CFAA CIDA csos CSRI CSRP DANIDA DAP

DE DEI DFID DHRD DIC DMS DO DMIS DPD DPG DPs DRAM EAs EC ESMF F N I D A F M

D-by-D

CurrencyUnit = TSh US$1 = Tsh 1,276

FISCAL YEAR US$1.52992 = SDR 1

July 1 - June 30

ABBREVIATIONS AND ACRONYMS

Africa Action Plan Adaptable Program Lending Accountability, Transparency and Integrity Project Annual Work Plans and Budgets Business Environment Strengthening in Tanzania Program Business Process Re-engineering Controller and Auditor General Country Assistance Strategy Chief Executive Officer Country Financial Accountability Assessment Canadian International Development Agency Civi l Society Organizations Cross-Sector Reforms Integration Civi l Service Reform Program Danish International Development Agency Director o f Administration and Personnel Decentralization by Devolution Director o f Establishment Director o f Ethics and Integrity Department for International Development (UK) Director o f Human Resources Development Department for International Cooperation (France) Director o f Management Services Development Objective Director o f Management Information Systems Director o f Policy Development Development Partner Group Development Partners Director o f Records and Archives Management Executive Agencies European Commission Environmental and Social Management Framework Department for International Development Cooperation (Finland) Financial Management

FOR OFFICIAL USE ONLY FY GBS GDP GOT GTZ HCMIS HIV/AIDS

HR HFW HRPs IBRD I C B I C T IDA IEC IFRs I M T C IMWG IP ISDS ISG JAST JICA JIPRC KRA LGAs LGRP LGSP LSRP M&E MDAs M D C MKUKUTA

M O F MOHSW M O U MPEE MTEF MTPP MTPRS MTSPB NACSAP N A O NGOs

Fiscal Year General Budget Support Gross Domestic Product Government o f Tanzania Federal Ministry for Economic Cooperation and Development Human Capital Management Information System Human Immunodeficiency Virus /Acquired Immune Deficiency Syndrome Human Resources Human Resources Management Human Resource Plans International Bank for Reconstruction and Development International Competitive Bidding Information and Communication Technology International Development Association Information, Education and Communication Interim un-audited financial reports Inter-Ministerial Technical Committee Inter-Ministerial Working Group Implementation Progress Integrated Safeguards and Data Sheet Information System Group Joint Assistance Strategy for Tanzania Japan International Cooperation Agency Joint Implementation Program Review Committee Key Results Area Local Government Authorities Local Government Reform Program Local Government Support Project Legal Sector Reform Program Monitoring and Evaluation Ministries, Departments and Agencies Ministry o f Development Cooperation o f Netherlands National Strategy for Growth and Reduction o f Poverty, June 2005 (popular Kiswahil i acronym)

Ministry o f Finance Ministry o f Health and Social Welfare Memorandum o f Understanding Ministry o f Planning, Economy and Empowerment Medium-Term Expenditure Framework Medium-Term Pay Policy Medium-Term Pay Reform Strategy Medium-Term Strategic Plans and Budget National Anti-Corruption Strategy and Action Plan National Audit Office Non-Governmental Organizations

This document has a restricted distribution and may be used by recipients only in the performance o f their off icial duties. I t s contents may not be otherwise disclosed without Wor ld Bank authorization.

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NRC - O&E - O&M - oc O M OPR OPRAS PAD PCCB - PCN - PEFAR - PER PFM PFMRP - PIRC - PMC -

PMS - PMU PO-PSM - PPA - PPRA - PRAP PSC PSR PSRP - PSRPI PSM-WG - PSRP-WG - PSS RCF RCIP RCU RPF RVP - SASE SBD SDC SDP - SFIA

PMO-RALG -

SIDA - S IL SWAP TACAIDs TCTF

National Records Center Operation and Efficiency Operations and Maintenance Other Charges Operations Manual Output to Purpose Review Open Performance Review and Appraisal System Project Appraisal Document Prevention and Control o f Corruption Bureau Project Concept Note Public Expenditure and Financial Assessment Review Public Expenditure Review Public Financial Management Public Financial Management Reform Program Program Implementation Review Commitee PSRP Management Committee Prime Minister’s Office-Regional Administration and Local Government Performance Management System Procurement Management Unit President’s Office - Public Service Management Public Procurement Act Public Procurement Regulatory Authority Performance Results and Accountability Project Public Service Commission Public Sector Reform Public Service Reform Program Public Service Reform Program Phase I Public Sector Management Working Group Public Service Reform Program Working Group Permanent Secretaries Reform Coordination Framework Regional Communication Infrastructure Project Reform Coordination Unit Resettlement Policy Framework Regional Vice President Selective Accelerated Salary Enhancement Standard Bidding Documents Swiss Agency for Development and Cooperation Sector Development Program Strategic Framework for International Development Association Assistance in Africa

Swedish International Development Cooperation Agency Sector Investment Lending Sector-Wide Approach Program Tanzania Commission for AIDS Tanzania Cultural Trust Fund

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TFCS TGDLC TPSC Tanzania Public Service College UNDP United Nations Development Program

Tanzania Foundation for Civil Society Tanzania Global Development Learning Center

Vice President: Obiageli K. Ezekwesili

Sector Director: Sudhir Shetty Acting Sector Manager: Lisa Bhansali

Country Director: John Murray McIntire

Task Team Leader: Denyse E. Morin

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TANZANIA Tanzania Performance Results and Accountability Project . APL I1

CONTENTS

Page

STRATEGIC CONTEXT AND RATIONALE .................................................................. 1 1 . Country and sector issues ................................................................................................ 1 2 . Rationale for Bank involvement ...................................................................................... 6 3 . Higher level objectives to which the project contributes ................................................. 7

PROJECT DESCRIPTION .................................................................................................. 8

1 . Lending instrument .......................................................................................................... 8 2 . Program objective and phases ......................................................................................... 8 3 . Project development objective and key indicators .......................................................... 9 4 . Project components ........................................................................................................ 10 5 . Lessons learned and reflected in the project design ...................................................... 18 6 . Alternatives considered and reasons for rejection ......................................................... 20

IMPLEMENTATION ......................................................................................................... 20 Partnership arrangements ............................................................................................... 20 Institutional and Implementation Arrangements ........................................................... 21 Monitoring and Evaluation Of Outcomes/Results ......................................................... 28

4. Sustainability ................................................................................................................. 29 Critical risks and possible controversial aspects ........................................................... 30 Credit conditions and covenants .................................................................................... 33

1 . 2 . 3 .

5 . 6 . APPRAISAL SUMMARY .................................................................................................. 34

Economic and financial analyses ................................................................................... 34 2 . Technical ....................................................................................................................... -34 3 . Fiduciary ........................................................................................................................ 34 4 . Social ............................................................................................................................. 35 5 . Environment ................................................................................................................. -36 6 . Safeguard policies .......................................................................................................... 36 7 . Policy Exceptions and Readiness .................................................................................. 37

1 .

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Annex 1: Country and Program Background .......................................................................... 38 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies .................. 47

Annex 3: Results Framework and Monitoring ......................................................................... 50 Annex 4: Detailed Project Description ...................................................................................... 55 Annex 5: Project Costs ................................................................................................................ 67

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Annex 6: Annex 7: Annex 8: Annex 9:

Implementation Arrangements .................................................................................. 68 Financial Management and Disbursement Arrangements ..................................... 76 Procurement Arrangements ....................................................................................... 85 Economic and Financial Analysis .............................................................................. 94

Annex 10: Safeguard Policy Issues ............................................................................................. 95 Annex 11: Project Preparation and Supervision ...................................................................... 97 Annex 12: Documents in the Project Fi le .................................................................................. 99 Annex 13: Statement of Loans and Credits ............................................................................. 100

Annex 14: Country at a Glance ................................................................................................ 102

Annex 15: Maps ......................................................................................................................... 104

... - V l l l -

(IDA) CANADA: Canadian International Development Agency (CIDA) DENMARK: Danish Intl. Dev. Assistance (DANIDA) UK: British Department for International Development (DFID) (GBP 20 million) Total:

TANZANIA

8.3 9.7 18.0

1.5 1.7 3.2

18.5 22.1 40.6

47.4 56.4 103.8

PERFORMANCE RESULTS AND ACCOUNTABILITY PROJECT

PROJECT APPRAISAL DOCUMENT

AFRICA AFTPR

Date: September 7, 2007 Country Director: John Murray McIntire Sector ManagedDirector: Lisa Bhansali

Team Leader: Denyse E. Morin Sectors: Central government administration (80%); General public administration sector (20%) Themes: Administrative and civil service reform (P);Other public sector governance ( S ) Environmental screening category: Partial Assessment (B)

Project ID: PO92898

Lending Instrument: Adaptable Program Lending (Credit) - Phase I1

[ ] Loan [XI Credit [ ] Grant [ ] Guarantee [ 3 Other:

For Loans/Credits/Others: Total Bank financing (US$m.): 40.00 Proposed terms: Standard Credit Grace period (years): 10 Commitment fee: 0.5%

Years to maturity: 40 Service charge: 0.75%

Borrower: United Republic o f Tanzania, Ministry o f Finance P.O. Box 91 11 Dar es Salaam, Tanzania Tanzania Tel: +255 22 21 12854Fax: +255 22 21 17090 / 21 10326 www.mof.go. tz

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I I

:Y 08 09 10 11 12

Responsible Agency: President’s Office-Public Service Management Kivukoni Front Dar es Salaam Tanzania permsec@,estabs.no.tz

lnnual hmulat ive

6.00 8.00 14.00 10.00 2.00 6.00 14.00 28.00 38.00 40.00

[XIYes [ ] N o Does the project meet the Regional criteria for readiness for implementation? Re$ PAD D. 7 Project development objective Re$ PAD B.2, Technical Annex 3

To enhance capacity, performance and accountability o f ministries, departments and agencies (MDAs) in the use o f public resources and service delivery to levels consistent with timely and effective implementation o f the strategic and priority programs under the National Strategy for Growth and Reduction o f Poverty (MKUKUTA). Enhanced performance will be evidenced by: (i) improvements in the policy-making and regulatory capacity o f Ministries, Departments and Agencies (MDAs) that will contribute to a more predictable and well regulated environment for service delivery institutions and for private sector development; (ii) improved use o f performance management systems by MDAs and their linkages to service delivery; (iii) improved management o f public servants; and (iv) greater access to information and responsiveness to the demands o f stakeholders that contribute to greater transparency and accountability o f government and improved governance.

Project description Re$ PAD B.3, Technical Annex 4

Component 1 : Systems to support service delivery will be in place including the use o f e- government applications.

Component 2: Policy development capacity will have been developed in MDAs and central agencies will be able to monitor development and implementation o f policies across government.

ComDonent 3: Pav. incentives and rewards will be immoved to attract and retain kev

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categories o f public servants.

Component 4: Accountability and responsiveness mechanisms will provide the opportunity to citizens to be aware o f and proactively demand quality services from the public.

Component 5 : Systems for managing public servants including human resources management practices will be improved and a comprehensive human capital management information system wi l l provide accurate data on the public service. Human resources development will also provide training to upgrade ski l ls o f the overall public service.

Component 6: Leadership development will ensure that at the most senior level, Tanzania i s led by top managers who understand and deliver on the government's vision and are able to inspire the public service.

Component 7 : Change management and reform coordination will be prominent, and cross- cutting interventions will complement the other components to ensure satisfactory results o f implementation.

Which safeguard policies are triggered, if any? Re$ PAD 0.6, Technical Annex 10

Environmental Assessment (OP/BP/4.01) and Involuntary Resettlement (OP/BP 4.12) as a result o f civil works.

Significant, non-standard conditions, if any, for: Re$ PAD C.6 Board presentation: none Credit effectiveness: none Covenants applicable to project implementation: (a) Submission o f annual work plans and budgets; and (b) Signed Memorandum o f Understanding (MOU) between the Recipient, the Association and the Co-financiers providing for common arrangements and procedures on procurement, disbursement, accounting, monitoring, reporting, auditing, coordination and exchange o f information required for the implementation o f the Project.

A. STRATEGIC CONTEXT AND RATIONALE

1. Country and sector issues

1. Since the mid-1990s, the Government o f Tanzania (GOT) has implemented a comprehensive program o f reforms that has yielded sustained macroeconomic stability, an increasingly liberalized economy, and scope for the private sector to become the main agent o f economic activity. These reforms have created the foundation for accelerated economic growth and poverty reduction. Average annual rate o f economic growth for the past five years has been about 6 per cent (even after a big drop in 2003 due to drought). Poverty levels have decreased from about 5 1 per cent o f the population in the first half o f the 1990s to about 35 per cent in the 1999-2005 period. However, poverty remains widespread and the average GNP per capita in 2005 i s only o f US$380 (Atlas Method). Thus Tanzania remains one o f the poorest countries in the world.

2. In 2005, GOT launched a National Strategy for Growth and Reduction o f Poverty (MKUKUTA)' that provides an overarching framework for resource allocation, development management and fighting poverty. I t i s based on three clusters: (i) growth and reduction o f income poverty; (ii) improved quality o f l i f e and social well-being; and (iii) good governance and accountability. This last pillar i s regarded by the Government to be the bedrock o f the other two clusters. It encompasses cross-cutting public sector reforms, Le., public service reform program (PSRP), public financial management reform program (PFMRP), local government reform program (LGRP), legalljudicial sector reform program (LSRP), national anti-corruption strategy and action plan (NACSAP) and business environment strengthening program (BEST). In this context, MKUKUTA reflects the strategic perspective that a capable and efficient public service i s at the core o f an effective state, and therefore would provide an enabling environment for rapid economic growth and poverty reduction.

3. There have been sustained and serious efforts to reform Tanzania's public service for the last ten years or so. The early phases, focusing on costs containment and capacity building, were generally successful. Building on these results, a more comprehensive PSRP was launched in early 2000. The Bank decided to support this program with an adaptable program lending (APL) facilityV2 Several other development partners (DPs), namely DFID, DANIDA, CIDA and Ireland have also cooperated with GOT in the implementation o f the PSRP. The key results areas (KRAs) comprised: (i) performance improvement with focus on installing performance management systems (PMS); (ii) restructuring and private sector participation, including contracting out or hiving-off non-core functions and services; (iii) decentralization and institutional pluralism including creation o f executive agencies (EAs); (iv) development o f management information systems; and (v) leadership and management development.

4. The current phase o f the PSRP (PSRPI), which had as i t s strategic focus the installation o f PMS, wi l l close in December 2007, two years later than planned. The pace o f implementation was significantly slower than anticipated. An assessment o f PSRPI undertaken in 2006 emphasized progress in developing public service management systems and institutional capacity

' Popularly known by its Kiswahili acronym MKUKUTA. * Project Appraisal Document, Report No. 19216-TA and IDA Credit 3300 - TA.

de~elopment.~ The latest Bank and other DPs' joint supervision o f the program indicated that areas such as the EAs program and private sector participation were also successful and should continue to be deepened. Over time, a number o f assessments and joint DPs' supervision missions have indicated that the PSRP i s progressing at a slower pace than anticipated but in the right direction.

5. To map the way forward, a review o f PSRPI implementation was commissioned jointly by President's Office - Public Service Management PO-PSM) and DPsS4 It pointed out areas that would need further attention in the second project o f the APL, to include: I

completing the installation and rolling-out o f an integrated/computer-based Human Capital Management Information System (HCMIS), including strengthening establishment controls and payroll management;

enforcing compliance and accountability by public service managers, including linking performance to pay reform and other incentives;

deepening the utilization o f PMS; especially ensuring quality o f plans and performance reporting;

extending the program for the creation o f EAs, especially with effectiveness o f the current governance framework and accountability;

regard to the

broadening private sector participation, including ensuring the cost efficiency and effectiveness o f out-sourcing non-core roles, functions and services by ministries, departments and agencies (MDAs);

improving human resources planning and development as reflected by capacity and performance gaps in most MDAs; and

coordinating better cross-cutting6 and sectoral reforms to take advantage o f the synergies among them.

6. At the same time, over the years, GOT has recognized that it requires a comprehensive approach to transform public sector management and achieve efficiency, effectiveness and quality o f public services to foster growth and reduce poverty on a sustainable basis. Therefore, the PSRP i s complemented by other public sector reform programs. Through PFMRP, GOT pursues improvements in the management o f financial resources, including revenue collection. Through the LGRP, Government seeks to increase citizens' direct involvement and bring greater accountability at local government level. The goal o f the LSRP i s to create the environment necessary to uphold the ru le o f law and facilitate access to justice for all, especially the poor. BEST i s creating a better enabling environment for private sector development, and investment

See Annex 1 for details. Steedman, D., D.Poate, C. Barnett & C. Kinyeki, Tanzania Public Service Reform Programme Independent

Performance Results and Accountability Project (PRAP). PSRP, PFMRP, LGRP, LSW, NACSAP.

Review, April 29" 2006.

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and business growth. NACSAP aims at restoring integrity in the management o f public resources and national ethos. The cross-cutting reform programs should support and facilitate sector development programs and projects (SDPs) to influence access and improvements in quality public services, especially by the poor. I t i s through this comprehensive public sector reform framework that Tanzania has, over the past decade, made comparatively major strides in the transformation o f i ts public sector management.7

7. Yet, in the recent comprehensive evaluation o f the PSW, it has become evident that the range o f GOT’S cross-cutting reform programs and the SDPs are not yielding optimal results in terms o f improvements in public service delivery’ for the following reasons:

(i) Weaknesses and gaps in the coordination o f cross-cutting reforms and SDPs. Currently, institutional arrangements for coordination are not clear in terms o f responsibilities and mandate. There i s a need to harmonize interventions across reform programs, to integrate them into national planning, monitoring and evaluation (M&E), and reporting frameworks, and to remove unnecessary duplications. There are instances when reform programs, both cross-cutting and sector-wide, contradict themselves in terms o f policies, strategy and implementation modalities.

(ii) A weak sense of ownership of the cross-cutting reforms. In principle, the cross- cutting reform programs are generally designed to improve service delivery at the level o f the MDAs and local government authorities (LGAs) that are concerned with the delivery o f services. A PSRPI stakeholders’ perception review suggested that cross-cutting reforms are generally perceived to be owned and driven by the coordinating MDAs.~

8. In that context, there i s a consensus among Tanzania’s public service managers that, to pursue rapid and sustainable improvements in public service delivery and poverty reduction, it i s strategically imperative to: (i) ensure that MDAs and LGAs have a strong sense o f ownership in the implementation o f the basic elements o f the cross-cutting reforms, and (ii) achieve integration o f the cross-cutting reform programs and SDPs at MDAs and LGAs levels, as illustrated in Figure 1 below. These are crucial challenges for the GOT’S public sector reform programs, including the PSRP.

Kiragu, K., Tanzania- A Case Study in Comprehensive Approaches to Public Sector Reform, June 2005, (a paper prepared for the World Bank publication, Building Effective States - Forging Engaged Societies, September 2005).

Kiragu, K. and al, Stakeholders ’ Perspectives and Imperatives in the Formulation of PSRP Phase II Strategv, Final Report, August 2006.

President’s Office-Public Service Management (PO-PSM), Ministry o f Finance (MOF), Prime Minister’s Office- Regional and Local Government (PO-RALG), Ministry o f Justice and Constitutional Affairs (MOJCA), and the Good Governance Coordination Unit (GGCU) in the President’s Office.

7

8

9

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Feedback Feed back

Figure 1 - Public Sector Reforms Coordination Framework

9. The APL-based support to the Performance Results and Accountability Project (PRAP) i s based on the achievement o f certain triggers determined at the outset o f PSRP I, these are summarized in Table 1 below. DPs and the Bank have assessed these triggers and concluded that three o f the five triggers have been fully met and the other two are progressing positively. This performance provides a good basis for moving to the second project o f the APL.

’able 1: End of PSRPI triggers End of Phase 1: Transition to Phase 2 Triggers

Seventy-five percent o f MDAs will have developed a strategic plan and fifty percent will show results in line with the agreed performance targets.

In 10 Ministr ies initially targeted for strategic planning and performance budgeting, PSs will have been working for the last two years in keeping with performance

ir moving to PRAP

Summary of results monitored by end of Phase 1

All MDAs were trained and supported by teams o f consultants to develop results-oriented strategic plans to implement a comprehensive PMS. Follow-up to ensure consolidation and institutionalization o f the changes, including the use of an M&E framework, remains weak and make it difficult to unequivocally confirm the results intended by this trigger. From the MTEF process, it i s clear that a significant number o f MDAs are on course as envisaged. Government prepared a manual that institutionalizes the integration o f strategic planning and budgeting for the entire government. FULLY ACHIEVED All PSs lead their ministries in developing and promulgating client service charters with specific performance and service delivery targets, which are increasingly a focus of public and mass media scrutiny and thereby o f PSs’ performance. This scrutiny i s also informed by service delivery surveys commissioned by PO-PSM.

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achieved. All MDAs will have in place a

agreements linked to results to be I However performance agreements were not formalized. PARTIALLY ACHIEVED - Quick-wins were initially identified and implemented successfully

quick-win that will demonstrate improvement in service delivery with the same or fewer budgetary inputs.

The real wages of professional and technical staff, adjusted for variations in the expected GDP growth and revenue collection, will show significant increase as per the MTPP targets.

All the last year’s new appointments will have been made by the PSC (PSC) consistent with the new legislation establishing its independence.

by 11 MDAs. Upon evaluation of these pilot initiatives, it was decided that quick-wins should be embedded in the strategic planning and performance improvement processes. Furthermore, a Business Process Re-engineering (BPR) manual was developed to guide al l MDAs to implement quick-wins. FULLY ACHIEVED A successful SASE scheme targeting professional and technical staff was initiated in 2001 but a political decision was made to terminate it in 2005 to develop more sustainable approaches to implementing the MTPP. Nonetheless, since September 2000, salaries have increased by an average annual rate of 13.2%. By May 2006, salary levels were on average 82% o f the MTPP targets. The salary adjustments made in the 2006/07 budget have raised salary levels to about the medium-term targets identified in 1999. However, on the basis o f the recommendations o f a 2006 Presidential Public Service Pay Commission, new targets will be promulgated in FY 2007/08. FULLY ACHIEVED Recruitment and appointments in the public service, except for PSs and Directors, have been decentralized to MDAs. The role o f the PSC has shifted from being a recruitment organization to a regulatory and appellate authority in relation to the Public Service Act. However, according to results of latest inspection by the PSC, there i s no full compliance with laid down rules and procedures to ensure adherence to meritocratic principles and practice in about a third of MDAs. PARTIALLY ACHIEVED

10. Even with the launch o f the PRAP, GOT s t i l l recognizes that achieving the program’s ultimate goals will continue well beyond the medium-term time frame covered by this project. This i s consistent with the original long-term strategic perspective o f the program. As planned, there will be a follow-on third phase o f the program. In the context o f the APL framework, Bank support for the third phase will be subject to meeting the triggers proposed for the transition from the P U P to PSRP 111, see Table 2 below

KRA 1

2

Trigger All MDAs are managing for service delivery results, in line with standards disseminated to the public and the monitoring and evaluation o f outcomes and impact. Fifteen MDAs are formulating their policies using participatory and evidence-based processes and are monitoring whether their policies are being implemented and are effective.

3

4

5

Wages o f public servants are increasing in real terms, are in line with targets set in the Medium-Term Pay Policy (MTPP), and are increasingly competitive with comparable private sector positions. The use o f allowances i s more transparent and rational. Al l MDAs are responding to their clients’ demands using a variety o f tools, systems, and instruments. Human Resources (HR) processes and systems have been strengthened and

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6 decentralized, especially in terms o f recruitment, appraisal, HR planning and training. Leadership sk i l ls and competencies are identified, developed, nurtured and valued in

7 overlap and to exploit opportunities for synergy. MDNLGA level to ensure ownership.

Reforms are integrated at the

line with career development plans. Under the lead o f the Chief Secretary’s Office, reforms are coordinated to minimize

1 1. The triggers for Phase I11 have been agreed with Government and form part o f the PAD. The triggers, as determined at the outset o f PSRP I, are presented in Annex 1 and include the discussion o f the results so far and need for adjusting the triggers for Phase 111. Progress towards achieving the triggers will be incorporated into the regular review process that has been institutionalized between GOT and DPs. Should there be changes in the institutional environment that could affect the achievement o f the triggers, these would be discussed with Government and agreement would be reached on what would constitute a more appropriate trigger.

2. Rationale for Bank involvement

12. PSRP i s at the core o f the interventions contemplated in the third pillar o f the MKUKUTA, Le., good governance and accountability. In turn, this pillar i s the bedrock supporting the other two pillars o f the MKUKUTA. Furthermore, a key MKUKUTA result indicator under this pillar i s an “effective public service framework to provide foundation for service delivery improvements and poverty reduction.” In this perspective, the successful implementation o f the PSRP i s crucial to the attainment o f the MKUKUTA goals.

13. To support MKUKUTA, DPs, including the World Bank, have supported the Government in the preparation o f the Joint Assistance Strategy for Tanzania (JAST), which was discussed and endorsed by the Board in April 2007. In the JAST, DPs have agreed that funding the public service reform program will continue to be vital to improving the performance o f the entire government. Canada, Denmark, the United Kingdom’s DFID and the World Bank supported the PSRPI (Credit 3300-TA) and DPs pledged their continued support for the second project o f the APL, PRAP. Experience in Tanzania and elsewhere shows that the Bank’s continued commitment to the program i s crucial to sustaining the confidence o f the other DPs regarding the merit and feasibility o f public sector reforms.

14. GOT i s taking a phased approach to implement the PSRP over 15 years, recognizing that the transformation o f the public service i s a long-standing exercise. The Bank’s long-term commitment, through an APL and substantial financial support to PSRPI (US$41.2 million) have been instrumental in mobilizing funding for the program from other DPs and sustaining their participation. Overall, the Bank’s leadership on public sector reforms and i t s global knowledge have helped shape the dialogue with Government. The Bank presently chairs the PSRP DP working group (PSRP-WG) in harmonizing the views o f DPs in the dialogue with Government. The Bank’s and other DPs’ commitment to the PSRP, the frank and open dialogue around issues o f implementation, and the Bank’s global, comparative experience o f public sector reforms have contributed to the positive trends and results so far achieved by the PSRP. PSRPI focused on introducing PMS in the public service. The second project will intensify the reforms introduced

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in PSRPI, in particular, deepening the culture o f performance management and involving a broader range o f stakeholders in the accountability process.

15. Within the Bank, the Africa Action Plan (AAP) seeks to provide a new impetus to the implementation o f the Strategic Framework for IDA’S assistance in Afr ica (SFIA). I t acknowledges that the “principal means available to Africa’s economies to achieve [the MDGs] include building honest and capable states; raising the rate o f growth, and enabling the poor and women to participate in and benefit f rom growth.” Operationally, the Bank recognizes countries that “benefit from reform-minded state leadership, capacity for strategic decision-making, and have the organizational and institutional capacity for pol icy and program implementation”. Thus Bank support for interventions that improve public sector management in such countries i s viewed as key by the AAP. Further, the 2005 World Bank Task Force on Capacity Development in Afr ica reckons that DPs should support home grown strategies and stronger domestic accountability systems. In the latter context, it i s noteworthy that GOT has put considerable efforts in the past year to develop a comprehensive strategy for the reform o f the public service and has devoted considerable effort to design the follow-on operation to support the objectives o f i t s next phase o f reforms.

16. It i s also significant that President Jakaya Kikwete in his inaugural speech’’ emphasized that the new government will continue to implement the cross-cutting reforms started under the government o f his predecessor, Benjamin Mkapa, to provide more efficient and effective delivery o f services to the public. H e highlighted the need for good governance, transparency and accountability. The political rallying motto o f the new government, Le., “new zeal, new vigor and new speed” has been strongly focused on public service transformation. Thus, the political commitment to demand performance results and accountability by the public service i s particularly strong.

3. H i g h e r level objectives to which the project contributes

17. PSRP contributes to the GOT’S efforts to achieve the outcomes o f the governance pillar o f the MKUKUTA. These broad outcomes include: (i) good governance and the ru le o f law are ensured; (ii) leaders and public servants are accountable to the people through the effective reduction o f corruption and public access to information; (iii) democracy and political and social tolerance are deepened; and (iv) peace, political stability, national unity and social cohesion are cultivated and sustained. Through the project, the Bank and DPs will support the outcomes o f the MKUKUTA. Goal 3 o f MKUKUTA specifies that an “Effective public service framework will be in place to provide a foundation for service delivery improvements and poverty reduction” and therefore that “administrative systems o f public institutions are managed transparently and in the best interests o f the people they serve.” The document goes o n to identify the key cluster strategy as to “Strengthen and deepen the Public Service Reform Program”. I t i s in that context that P U P will be implemented.

18. The PSRP will also generally contribute to enhancing the capacity and creating the enabling environment for MDAs to implement their SDPs that seek to expand and improve the quality o f public service delivery. Thus, the program should have an impact on the efficiency,

Speech to inaugurate the Fourth Phase Parliament on December 30, 2005. 10

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effectiveness and timeliness o f implementing the priority economic growth and poverty reduction programs led by various MDAs. Furthermore, PSRP will take the lead in promoting improved coordination in the implementation o f the cross-cutting reform programs and SDPs. This collaboration i s critical to maximize the impact o f the broad GOT public sector reform agenda.

B. PROJECT DESCRIPTION

1. Lending instrument

19. The Bank i s committed to supporting the Government’s long-term PSRP through an APL. The f i rs t phase o f the APL in the amount o f SDR29.9 million to support the Government’s long-term PSRP costing approximately US$201 .O million was presented and approved by the Board on December 2, 1999. IDA’S contribution i s envisaged to continue through a basket arrangement with other DPs, namely Canada, Denmark and the United Kingdom.

2. Program objective and phases

20. As promulgated by GOT and captured in the PSRPI PAD, “the overall purpose o f the Public Service Reform Program (PSRP) i s to support the attainment o f a high rate o f economic growth and ensure that delivery o f quality public services within priority sectors conforms to public expectations for value, satisfaction, and relevance by the end o f 201 1 .” The aims o f the program reflect the Government’s vision o f the future public service as stated in the National Vision 2025, “The Public Service will be an institution o f excellence playing a pivotal role in achieving sustained economic growth and prosperity, and eradication o f poverty in the 21st century”. l1 The vision and long-term objective remain valid.

21. In 1999, the Government designed an eleven-year public service reform program that would seek to improve accountability, transparency and resource management for service delivery. GOT designed this long-term program in three phases: (i) installation o f performance improvement systems (2000-2004); (ii) performance management culture (2005-2008); and (iii) quality improvement cycles (2009-201 l), as illustrated in Figure 2. The implementation o f such broad institutional reforms i s taking more time than originally envisaged by Government. Phase 1 wi l l be completed in December 2007. GOT now envisages that the PSRP will need to continue until 201 5, with the second phase closing in 2012.

” World Bank (October 1999), Report No. 19216-TA, p. 3.

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m: dates are those described in PSRP documents and do not reflect delays in implementation

Quallty Improvemen t

I Phase11: I PerfoPmance Menagement I Cutture (2005-

I 200’8) I

CSRP I (Cost Containment): 1991 to 1995

Figure 2 - I l lustration of the PSRP Long-Term Strategic Perspective

3. Project development objective and key indicators

22. The project development objective o f the proposed second-phase i s to enhance the capacity, performance and accountability o f MDAs in the use o f public resources and improve service delivery to levels consistent with the timely and effective implementation o f the strategic and priority programs under the MKUKUTA.

Strategic Theme

Demanding Results and Accountability

23. During this phase enhanced performance will be evidenced by: (i) improvements in the policy-making and regulatory capacity o f MDAs that will contribute to a more predictable and well regulated environment for service delivery institutions and for private sector development, measured by satisfaction surveys in the policy environment by private institutions, EAs and LGAs; (ii) improvements in the use o f PMS by MDAs and their linkages to service delivery, as measured by client service charters, self-assessment tools; (iii) improvements in management o f public servants, measured by the percentage o f staff targets realized in MDAs; and (iv) greater access to information and responsiveness to the demands o f stakeholders as measured by feedback on client service charters that contributes to greater transparency and accountability o f government and improved governance.

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4. Project components

24. In PRAP, GOT has identified the need to deepen the broad-ranging reforms introduced during PSRPI to ensure there i s significant improvement in the performance in service delivery and a more transparent and accountable framework to stakeholders in line with the MKUKUTA. The Government has developed PRAP around the seven key results areas (components), which are briefly described below under the fol lowing headings:

(i) Systems to support service delivery;

(ii) Policy development;

(iii) Pay, incentives and rewards;

(iv) Accountability and responsiveness to the public;

(v) Systems for managing public servants;

(vi) Leadership development; and

(vii) Change management and reform coordination.

Component 1: Systems to Support Service Delivery (USS35.2 million o f which IDA i s USS13.6 million)

25. Under this component, GOT plans to: (i) institutionalize PMS; (ii) restructure MDAs and re-engineer service delivery; (iii) continue to outsource internal non-core services; (iv) promote e-government and knowledge management systems with a particular focus on enhancing access to basic services b y the poor; and (v) continue to improve records management. Consolidating these systems will provide a strong foundation for public service organizations to meet the MKUKUTA objectives.

26. Institutionalize Performance Management Systems (PMS), Under P U P , there will be an emphasis on ensuring that the elements o f performance management are internalized, applied and customized according to the needs o f individual M D A s by providing good practice tools for strategic planning, open performance appraisal and client service charters. PO-PSM will support the customization o f the strategic planning process and M&E processes for both MDAs and EAs. In addition management standards will be updated.

27. Restructure MDAs and re-engineer service delivery. Organizational restructuring o f the public service will be implemented in order to improve service delivery and government operations. PO-PSM in collaboration with MDAs will seek opportunities to continue to streamline the central government to focus mainly on pol icy development, regulatory functions, public safety and security. With greater decentralization, the provision o f services will continue to shift closer to the intended beneficiaries. Reorganization o f the public service has been ongoing and will continue to take place through further decentralization, creation o f more EAs and re-engineering o f business processes.

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28. Continue to outsource internal non-core services. The GOT will continue to identify services that can be outsourced to private sector providers. Whi le the focus has been on outsourcing generic services such as security and office cleaning, during PRAP MDAs will identify opportunities for outsourcing non-generic services.

29. Promote e-government and knowledge management systems. The e-Government initiative aims to develop the capacity o f PO-PSM to harness e-Government opportunities in improving the delivery o f public services. The Bank has a regional initiative, Regional Communication Infrastructure Project -TA (RCIP) through which it would support the development o f e-Government infrastructure for Tanzania. Therefore, the focus o f support under PRAP will be limited to: (i) development and implementation o f organizational arrangements for managing e-government, including setting up o f an e-Government executive agency, which under the oversight o f PO-PSM, will guide, support and oversee the use o f information and communication technology (ICT) across government in the future; (ii) capacity building, including human resources management in support o f e-Government and (iii) preparations for enhanced e-Government services. These interventions will ensure appropriate institutional structures and human resources capacity exists for implementing the e-Government project once the infrastructural connectivity i s secured under the RCIP.

30. Continue to improve records management. Work on improving records management and decongestion in the storage o f f i les has been an important feature o f PSRPI. One o f the critical elements in achieving further improvements i s the establishment o f a National Records Center (NRC). As part o f the Accountability, Transparency and Integrity Project (ATIP) initial preparation for the establishment o f a N R C has been undertaken including a feasibility study and detailed construction designs as well as an environmental impact assessment. PRAP will extend this effort by facilitating construction and equipping the center. The center will provide space for storing non-current records and thus make it possible to utilize registry space more effectively in MDAs and LGAs. This will enhance the access and retrieval o f information while improving the working environment o f records personnel and records users. PRAP will essentially focus on facilitating MDAs in charge o f specialized records systems to take the lead in the reform o f their records management systems. The interventions will also help to integrate paper records reforms with I C T tools and to professionalize the personnel who handle records- from clerks to managers.

Component 2: Policy Development (US$5.5 million o f which IDA i s US$2.1 million)

3 1. GOT i s reviewing i t s policy development and coordination functions in order to identify bottlenecks in the policy process and improve on it. The Cabinet Secretariat i s leading this exercise with support from PO-PSM. PRAP acknowledges the importance o f pol icy development capacities both at central level and in the ministries as a vital function that influences the implementation o f key government priorities. Some capacity was put in place in M D A s under phase I but remains generally inadequate.

32. The component intends to: (i) strengthen central institutions and the Cabinet Secretariat in al l aspects o f policy management (from development to M&E); (ii) enhance policy development and regulatory capacities within MDAs; and (iii) improve the climate for participatory policy formulation and development.

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33, Strengthen central institutions and the Cabinet Secretariat in policy development. Measures will be taken to improve processes based on the review mentioned above. They will relate to pol icy formulation, scrutiny, evaluation and coordination o f the policy process. Capacity development packages to strengthen policy development, quality assurance and evaluation will be implemented in central ministries and agencies.

34. Enhance policy development and regulatory capacities within MDAs. MDAs will seek to collaborate with local research organizations and think tanks to create learning networks that will support their pol icy development capacity. Lastly, structures and staffing patterns in al l sector ministries will be reviewed to better align them with their core functions o f policy management and regulation.

35. By the end o f PRAP, the quality o f policies will have improved and they will be more realistic and consistent within and across sectors. Moreover, MDAs will have learnt to develop and oversee implementation o f policies that support national development goals and strategies. Finally, there will be an improved M&E system for policy implementation that will be operational within the Cabinet Secretariat.

Component 3: Pay, Incentives and Rewards (US$3.4 million of which IDA i s US1.3 million)

36. In the development o f the strategy for the PSRPI, it was clear to Government that rapid and significant enhancements in public service pay and other incentives were critical to the attainment o f the program objectives. Therefore, pay reform was considered to be a critical complement to the strategies for major improvements in public service capacity development and performance. Thus, in 1999, just before the launch o f the PSRPI, Government adopted a MTPP as part o f the PSRP. The pol icy guides decisions on pay across Government, including M D A s and LGAs. To implement the policy, a Medium-Term Pay Reform Strategy (MTPRS) was adopted. I t included the fol lowing features: (i) a medium-term target salary structure that systematically enhances pay for all public servants; (ii) a j o b evaluation and re-grading exercise to facilitate improved link between pay and performance; and (iii) a Selective Accelerated Salary Enhancement (SASE) scheme, targeting key professional, technical and managerial personnel occupying strategic position within government.

37. Progress in enhancing public service pay in l ine with the MTPP has been slower than anticipated. Although in July 2006, at the turn o f the 2006/07 financial year, significant increases in pay were realized, and pay targets were almost met, salaries remain l o w and continue to be cited as one o f the key impediment to a more professional public service. This has also given r ise to the use o f allowances to supplement a remuneration package that i s not competitive. Therefore, work on the consolidation o f remunerative allowances into salaries, which started in the mid- 1990s to achieve a more transparent pay structure, has not been completed. SASE was terminated for reasons related to equity. Annex 1 describe in more details the accomplishments and challenges o f pay reform.

38. least five reasons:

The MTPP has not delivered the outcomes n o w targeted under this component, for at

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First, the salary targets set under the MTPP were far below the market comparators, and yet they were not even adjusted sufficiently to provide for either erosion o f purchasing power by inflation or the escalation in the general rise in market salaries in Tanzania, especially for the technically and professionally skilled cadres.

Second, the pace o f implementation was slow because inadequate resources were budgeted for pay enhancement and the right balance between recruitment o f new staff and pay enhancement was not coherently struck.

Third, in connection with the latter point, key constituencies responsible for resources allocation (including political leaders and top administrators) could enhance non- transparently their compensation through allowances or other perks.

Fourth, which in part explains the point made above, egalitarianism continues to influence the Government’s decisions against transparent decompression o f public service pay.

Fifth, in light o f these facts, there was less efficient utilization o f the available wage bill resources.

39. These remain the major issues that wi l l need to be addressed with more vigor during P U P . In this regard, on a positive note, the present government has prioritized public service pay reform. On the inauguration o f the “Fourth Phase Parliament” the President said:

“I am aware that pay levels in the public service remain a concern. We wi l l look at it. I intend, as soon as possible, to establish a Commission on Public Service Remunerations that I wi l l task to produce short, medium and long-term strategies to improve pay levels and other benefits”. l2

40. In May 2006, the President appointed a Presidential Pay Commission to work closely with PO-PSM to find solutions to the issue o f remuneration. This component wi l l support the implementation o f the Commission’s recommendations, not yet known, and the subsequent decisions o f Government.

4 1. The basic goal o f the interventions under this component i s to accelerate the pace o f pay reform in the context o f the MTPS to enable Government to recruit and retain a critical mass o f technical and professional personnel, as well as to motivate the entire public service. This remains a critical objective o f the overall PSRP.

42. Key interventions to address the challenges in pay wi l l include (i) supporting the implementation o f the recommendations o f the Presidential Pay Commission; (ii) setting up a flexible system for resource allocation between personnel emoluments and other charges; (iii); supporting Government in designing a performance-based rewards and incentive scheme; and (iv) establishing clear guidelines for the use o f allowances that will remove present distortions.

President Jakaya Mrisho KikweteIGoT, 30 December 2005. 12

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43. Key outcomes wi l l include: (i) decisions on pay will be made through new institutional arrangements on a yearly basis; (ii) increasingly transparent remuneration; and (iii) steady improvements in the salaries o f public servants based on a revised pay reform strategy.

Component 4: Accountability and Responsiveness to the Public (US$8.7 million of which IDA i s US$3.3 million)

44. Despite the installation o f mechanisms for securing enhanced levels o f accountability in the public service at both institutional and individual levels, the issue o f accountability remains. Systems and tools for strategic planning, open performance review and appraisal and client service charters are nevertheless in place. New rules and regulations for securing enhanced discipline and ethical conduct within the public service have been approved.

45. Under ATIP, (IDA Credit N o 41710 - TA) the Bank i s supporting the Government to, among other measures, strengthen the demand side o f accountability by direct interventions to build capacity and fund strategic interventions by Tanzania’s watchdog and oversight institutions, including Parliament and i t s committees, professional associations, and civil society organizations (CSOs). PRAP wi l l complement ATIP by, firstly, enabling MDAs to enlist participation o f citizens so that they have the information and education needed to make realistic and effective demands for performance and accountability on the service delivery un i t s and employees o f MDAs. Secondly, PRAP wi l l strengthen capacity and service delivery by the public service ethics oversight and compliance institutions. Thirdly, PRAP will support MDAs to respond effectively to enhanced demand for accountability. In other words, PRAP wi l l seek to enhance accountability: (i) to citizens, (ii) across government; and (iii) within each organization. This wi l l be done through the provision o f information, the development o f legal instruments, and the development o f systems, processes, and procedures. Strategically, the program will build the capacity o f key government institutions o f accountability, e.g., the Ethics Secretariat, Prevention and Control o f Corruption Bureau (PCCB) and the PSC. PRAP wi l l create a framework for internal government accountability and reporting requirements. PRAP wi l l also support MDAs in developing adequate responses to demand made by non-state actors.

46. The main interventions planned under this component are to: (i) strengthen the demand side o f accountability for service delivery in collaboration with other institutions; (ii) create and enhance channels for feedback from citizens and clients; (iii) improve the capacity o f ethics- oversight and compliance institutions; (iv) strengthen internal accountability mechanisms; (v) promote ethical conduct in the public service; (vi) enhance the capacity o f the PSC in performing i t s oversight role and functions. 47. Strengthening the demand side of accountability for service delivery. PRAP will create fora for citizens to interact with Government to offer views, suggestions and to help explain government policies and services to other clients and citizens. The Information, Education and Communication (IEC) activities within MDAs will be strengthened so that they inform the public more effectively about public services and receive and take into account feedback from citizens. A framework wi l l require MDAs to report on their performance results to the public periodically and to collect views from the public in order to adjust their activities accordingly.

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48. Create and enhance channels for feedback JFom citizens and clients. PRAP aims at improving the process o f handling feedback including complaints and grievances from clients and citizens within MDAs. To ensure the smooth handling o f feedback and complaints from clients and public, a Complaints and Grievances Handling Mechanism, which i s currently being tried in five MDAs, will be introduced in al l MDAs. Other measures are also being considered, including citizens’ report cards.

49. Develop and operationalize an institutional accountability JFamework for use by MDAs. Government will introduce a comprehensive and coherent accountability regime to enable MDAs to strengthen their management capacity and improve performance. An institutional accountability framework will be developed and used by MDAs. The framework will demand that MDAs report to the President and the public on agreed indicators. Rewards and sanctions will form elements o f the framework.

50. Promote ethical conduct in the public service. Efforts to make public service employees comply with the rules and practices o f the service will be increased. While efforts to educate employees on ethics will continue, the focus will be to operationalize a compliance framework that will focus on promoting discipline.

5 1. Strengthen the capacity of the PSC in the performance of its oversight role and functions. PO-PSM will undertake a restructuring review for the PSC. It will expand, improve and implement the HR compliance inspection routine. Furthermore, the PSC will elaborate i t s plan to improve i t s capacity to put in place a more transparent public service.

52. This component will result in citizens and clients being increasingly aware o f the availability o f public services and rights to access them with a public service that i s more responsive. Public service managers will share more freely information and will be more accountable for results.

Component 5: Systems for Managing Public Servants (US$23.3 million o f which IDA i s USS9.0 million)

53. PSRPI focused on modernizing systems to manage public servants. A key intervention was the adoption of the Public Service Management and Employment Policy, which articulated the principles to be adopted in improving the way public servants are managed. PSRPI operationalized the policy. This component will continue to deepen and make available appropriate HR systems and tools that effectively enable MDAs to have an optimal, adequate and competent staffing capacity.

54. (i) strengthening and decentralizing HR processes and systems, especially in terms o f recruitment, appraisal, HR planning and training; (ii) combating HIV/AIDS in the workplace; (iii) taking affirmative measures in favor o f disadvantaged groups in the public service; (iv) strengthening the management o f HR information; (v) transforming HR administrators into HR managers; and (vi) strengthening local training institutions to provide the courses needed for improving public service performance.

The component will implement the following interventions:

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55 . Strengthening and decentralizing HR processes and systems. The policies and regulatory frameworks for strengthening HR management and decentralization are already in place. PRAP will institutionalize HR planning that will ensure the public service has the capacities and competencies needed to meet i t s strategic and operational objectives. This will entail that policies, laws and regulations and systems are reviewed and revised. MDAs wi l l put in place mechanisms to manage better their human resources and report on their challenges and opportunities.

56. Combating HIV/AIDS in the workplace. The Government has formulated a policy for managing HIV/AIDS in the public service. I t has to be translated into guidelines on designing HIV/AIDS interventions at work places. Accordingly PO-PSM, in collaboration with the Ministry o f Health and Social Welfare (MOHSW) and the Tanzania Commission for AIDS (TACAIDs) will facilitate MDAs to better plan these interventions and to make them more relevant and effective.

57. Taking affirmative measures in favor o f disadvantaged groups i s necessary to extend diversity interventions among the population and, where appropriate and necessary, take affirmative measures in favour o f those affected groups. PRAP capacity development strategies and activities will take into consideration GOT’S commitment as outlined in the Tanzania National Strategy for Gender Equality. In addition, guidelines for the management o f disability in the public service are anticipated to be completed in 2006/07. Following this, (i) awareness needs to be created; and (ii) MDAs need to design interventions to ensure their workplaces are conducive to physically-challenged people. Work i s presently ongoing to address the issue o f diversity throughout the reform program and more specifically how each o f the components o f PRAP can contribute to enhancing diversity. Once the study i s completed, i t s recommendations will be translated into specific interventions.

Managing diversity in the public service.

58. Strengthening the management of HR information. Work to put in place a comprehensive Human Capital Management Information System (HCMIS) has been ongoing and has presented substantial challenges despite positive results in salary administration. Activities under PRAP will lead to: (i) physical payroll inspection and annual audit in all MDAs and local authorities; (ii) the HCMIS reviewed, expanded in accordance with business processes review and decentralized; and (iii) improved personnel records management system. It i s expected that the system will provide a “global view” o f available human resources and therefore wi l l enable MDAs and central agencies to move from a record-keeping personnel function to human resources and knowledge management.

59. Transforming HR administrators into HR managers. Many MDAs and LGAs continue to use their personnel and administrative officers as “clerks o f works” or “welfare officers”. HR Departments do not undertake strategic Human Resources Management (HRM) functions such as integrating HRM in the strategic plans o f their organizations, human resource planning, preparation o f need-based training and development plans, and performance review and evaluations. Programs to emphasize the importance o f HR in the success o f an organization as well as to train top officers how to better manage their HR wi l l be offered. Other capacity building interventions are envisaged,

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60. Strengthening local training institutions. For the government to transform the public service into a pool o f skilled, experienced employees there i s a need to strengthen and expand the capacity o f local training institutions including both the Tanzania Public Service College (TPSC) and the Tanzania Global Development Learning Centre (TGDLC). Since both institutions are supposed eventually to be independent, during this phase the Government w i l l also take measures to gradually ensure the sustainability o f their operations. As a result o f this component, the public service wi l l benefit from optimal and adequate staffing levels to effectively support service delivery; human resources will be efficiently and effectively utilized; the public service will be staffed with up-to-date sk i l ls and competences and these will be continuously upgraded; HIV-AIDS will have been adequately addressed in the service; recruitment processes will result in the selection o f the best available candidates in a diverse public service. Finally, recruitment, appointment, and promotions will be based on merit and appraisals will be more transparent.

Component 6: Leadership Development (USS16.5 million of which IDA i s US$6.4 million)

61. During PSRPI leadership was addressed as an issue relating to training. During PRAP the focus wi l l be on identifying, creating and developing leaders for the public service. Training will only be one o f many inputs. Nevertheless the lessons learnt from the leadership-related training will be integrated into a PRAP leadership development program. PRAP will identify key competencies for public service leaders and use a competency framework to identify individuals with potential for leadership positions. Moreover, the component will seek innovative ways to engage leadership in strategic thinking and supporting the long-term vision o f government. The program will also set up a senior executive service into which officers above certain levels in all cadres wi l l belong. This wi l l also be complemented by a senior executive succession plan. GOT wi l l also seek to establish innovative approaches to sustainable leadership development.

62. This intervention will: (i) identify, develop and nurture leadership capacity o f public service managers; (ii) recognize and reward exemplary leadership; and (iii) organize and deliver top leadership training programs. This component will examine how best to use both the TPSC and the TGDLC to expand further access to innovative training and ways o f doing things. The use o f the TGDLC wi l l promote throughout the country some important views on the program. As a result o f these interventions, there will be leaders who envision and initiate strategic changes, are entrepreneurial and facilitate the realization o f the national development goals, promulgated in MKUKUTA; leaders will inspire, guide, and manage their organisations to improve service delivery and demonstrate accountability, integrity and transparency.

Component 7: Change Management and Reform Coordination ( U S 1 1.2 million of which IDA i s US$4.3 million)

63. The current PSRP implementation arrangements have proven to be successful and will continue for PRAP. However, PRAP will be more MDA-driven and integrated with other reforms. In addition, PO-PSM will design a plan that ensures the sustainability o f the program through succession planning and development o f the necessary capacity o f senior public servants. A capacity building plan wi l l be implemented with specific outputs and outcomes to be

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achieved within a time-bound action plan. Technical assistance will be focused on specialized skills that are not readily available within the public service. In cases, where PO-PSM believes that i t can hire under contract the necessary skills, it will be for a well-defined period with a view to absorbing these ski l ls within the service and pay them from government's own resources. The objective o f this component i s to ensure that the outputs o f the reform are being realized in an efficient and effective manner. Under this component, support will be provided to PO-PSM to effectively manage PRAP. This will include capacity development activities to build the relevant competencies o f PO-PSM staff to effectively support MDAs. Resources have also been provided under this component to support MDAs in implementing PRAP interventions contained in their strategic plans. In addition, support will be provided for initiating the dialogue with the Government o f Zanzibar on public sector reforms.

64. This component will include the following interventions: (i) continue to build PO-PSM's capacity to coordinate, manage and implement reforms in MDAs; (ii) ensure that PO-PSM provides administrative support services for PRAP, Le., procurement and accounting; (iii) coordinate and harmonize public sector reforms; (iv) strengthen the awareness, participation and commitment to public sector reforms at al l levels; (v) integrate effectively PSRP reforms interventions into MDAs sector strategies; and (vi) support public sector reforms in Zanzibar.

65. The expected outcomes o f this component will be: (i) a PSRP implementation process owned and predominantly driven by MDAs; (ii) collaboration and coordination realized amongst public sector reforms; and (iii) strategic communication creating awareness and appreciation o f public sector reforms across al l levels o f Government.

5. Lessons learned and reflected in the project design

66. Since this i s the second project under an APL program, many lessons were learnt from implementing PSRP I and the international exposure o f PO-PSM to reforms in other countries. In addition, PO-PSM asked an independent team to get views from both internal and external stakeholders to the reform program to incorporate this feedback into the design o f PRAP. The PSRP was designed over a 15-year period on the understanding that the transformation o f the public service would be a long-term venture. I t also meant that some aspects o f the program would take time to implement and others would need to go further and to be internalized. Government had recognized that changing the mindset and culture o f the public service would be complex and laborious. This remains a key challenge o f P U P . This will require that Government intensify the communication on and sensitization to the reform program and find ways to invite more feedback from the public. These aspects are the focus o f this second project o f the APL.

67. PRAP will approach the client organizations (MDAs) as a system with performance expectations (service delivery). This system i s made up o f several sub-systems that constitute the components o f PRAP. Thus the overall level o f performance within an MDA will depend on the relative levels o f performance o f the sub-systems, and how they relate with each other, and the external environment. Therefore, each MDA will need to assess the relevant health o f situation o f the internal sub-systems and identify the combination o f interventions that would yield optimal improvements in the overall capacity o f each MDA. In this perspective, this phase o f the reform will be predominantly MDA-driven.

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Figure 3 - An Illustration o f the Systems Perspective in the Design o f the PSRP

Institutionalize reforms

68. Although a number o f activities took place during PSRPI to sensitize Permanent Secretaries (PSs) o f the need for reforms o f the public service, it was s t i l l perceived that the P S W belonged to PO-PSM. Therefore PRAP intends to broaden ownership o f reforms, starting with the political leadership o f individual MDAs. The second project puts more emphasis on PO-PSM facilitating a reform process in MDAs by providing tools, systems and capacity that will help MDAs deliver on their MKUKUTA objectives. This will be linked with greater accountability o f MDA management.

69. During PSRPI, several systems and processes have been introduced, e.g., open performance appraisal, client service charters, HCMIS and others that require consolidation. The reforms need to go deeper rather than broader. The introduction o f HCMIS focused on the technology rather than business processes. Clients service charters proved to be a good instrument, but beyond the introduction there has been l i t t l e monitoring o f the delivery o f services. PRAP seeks to address these shortcomings.

Strengthen implementation and coordination mechanisms

70. PO-PSM tried to standardize i t s approaches to introducing new systems and tools in MDAs. I t did not take into account the great difference in the capacity and objectives o f MDAs. PO-PSM understood at the outset o f PSRPI that it would not be enough to introduce systems and that it would need to give more guidance to MDAs and facilitate the linkages among strategic planning, the budget and the MKUKUTA. PO-PSM needs to modify i t s approach to PRAP and

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to become a facilitator to MDAs and an integrator o f the cross-cutting reforms. This will require PO-PSM to improve i t s own internal capacity in terms o f both number and quality o f staff. It also means that it needs to focus on showing more tangible results than during phase I if MDAs are to embrace such a comprehensive reform agenda. The l inks among the cross-cutting reforms have to improve. Although PRAP recognized the need for coordination o f reforms, this was not strongly pursued except by promulgating regular meetings to address specifically this agenda. With the proposed approach for PRAP, this presents an opportunity and a risk, recognizing that the PRAP cannot deliver improved performance o f the public service on i t s own. Figure 1 illustrates well the necessary linkages among cross-cutting and sectoral reforms to deliver the objectives o f MKUKUTA. The DPs will pay particular attention to this feature o f the PSRP through their joint dialogue with GOT.

Facilitate public demand and participation

71. During PSRPI, PO-PSM put a lot o f effort into publicizing the reform program, i ts objectives and activities. I t also used every possible opportunity, public event and debate to ensure that the program was well known. This has worked well and there i s a good knowledge o f the PSRP in the public. PO-PSM has also put effort into collecting feedback, but not in a systematic way. It i s also not clear that this feedback has been integrated into re-aligning the program during phase I. Early on in PSRPI, service delivery surveys were undertaken and their results were disseminated in the State o f the Public Service report. PO-PSM has since searched for more nimble and less costly ways to seek feedback. However, except for the more visible events, much remains to be done to have in place an effective feedback mechanism linked to the introduction o f client service charters and other components. This remains necessary to understand citizens’ needs and perceptions and to adjust the program accordingly. PRAP plans to have more regular interactions and means to invite the public to share i ts views on service delivery with public servants and to use more fully IEC as a tool that can help achieve a better balance in the program.

6. Alternatives considered and reasons for rejection

72. The experience o f implementing the PSRP I as a Sector-Wide Approach program (SWAP) with basket funding modalities have been positive and resulted in greater harmonization, coordination and dialogue between Government and DPs. Therefore, no other alternatives were considered, particularly since the proposed project (PRAP) i s the second project o f the APL.

C. IMPLEMENTATION

1. Partnership arrangements

73. The government has asked the Bank and other DPs to maintain the same arrangements for PRAP as were in place for PSRPI, Le., a SWAP with basket funding modalities. The GOT letter asking DPs to maintain the same mode o f financing i s based on the argument that cross- cutting reforms have less visible impacts than social programs and are therefore more prone to cuts if funds are not ring-fenced in a basket funding modality. DPs are inclined to agree with GOT that maintaining the arrangements, for the time being, i s appropriate.

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74. DPs have organized themselves to be more responsive to government’s request for greater harmonization. Therefore, a PSRP-WG was established. At present, the World Bank i s the chair o f the group. Other members include UK-DFID, Canada and Denmark. Government would like the membership and support to the program to expand. The group operates under an elaborate Development Partner Group (DPG) architecture with specific Terms o f Reference describing the roles and responsibility o f the group, i t s members and the governance. The PSRP- W G interacts regularly with government on issues related to public service management and dialogue more specifically on the implementation o f the PSRP through the joint implementation program review committee (JIPRC) under PSRPI.

2. Institutional and Implementation Arrangements

Building on a legacy of strong leadership of the program

75. A World Bank team remarked in a comparative study o f PSRPs in three African countries that, so far, an important aspect o f the success o f the Tanzania PSRP was i t s effective leadership and management arrangement^.'^ PSRPI had five important features in the implementation arrangements that P U P will espouse. They are highlighted below:

(a) Public Sector Reforms Steering Committee guides program implementation. The overarching organ for steering PRAP, especially on policy and strategic issues, i s the committee o f all Permanent Secretaries chaired by the Chief Secretary, who i s also Secretary to the Cabinet and Head o f the Public Service. While, the Steering Committee has not discharged i t s policy and strategic leadership and coordination role for PSRPI as effectively as initially envisaged, the merits o f retaining that arrangement remain overwhelming. With further insight in the implementation o f the cross-cutting reforms, it has become increasingly apparent that their effectiveness will depend on their synergy and capacity o f MDAs to integrate them in their SDPs to provide the necessary tools and enabling environment to achieve the objectives o f the MKUKUTA. However, PRAP will seek to improve the coordination arrangements to aid the steering committee and the Chief Secretary to perform more effectively a steering and coordinating role.

(b) PO-PSM as the champion, leader and coordinator o f P U P implementation. Located in the Presidency, which i s the center o f both political and administrative authority, PO-PSM has demonstrated that i t has the organizational locus and authority to lead and coordinate effectively MDAs in the implementation o f PSRP. Furthermore, PO-PSM has internally organized i tse l f to carry out these roles and functions in a mainstreamed framework with the Permanent Secretary (PS) as the overall coordinator o f the reform program. PO-PSM will continue to assign oversight for each component o f PRAP to a directorate within PO-PSM. It coordinates internally through i t s own internal Program Implementation Review Committee (PIRC) mechanism.

j 3 Stevens, M. and S. Teggemann, Comparative Experience with Administrative Reform in Ghana, Tanzania and Zambia, World Bank, 2003.

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(c) PSRP Management Committee (PMC). PMC wi l l evolve from what was the Inter-Ministerial Working Group (IMWG) under the PSRPI. However, i t s membership will not significantly change. Chaired by the PS, PO-PSM, it will provide technical coordination o f the project. PMC includes all Deputy PSs and senior officers appointed by PSsI4 in MDAs. However, unlike the IMWG, it will also include representatives o f the DPs. PO-PSM Directors wi l l be in attendance to provide technical support. The role o f PMC will be to provide overall strategic guidance as well as to monitor and review continuously progress o f program implementation and i t s results. PMC wi l l perform this role by reviewing and approving plans, budgets and reports, and receiving and reviewing regular program M&E reports, as well as the PSRP reform coordination memorandum. The Committee will be supported through a sub-committee on PSRP resources as well as the PIRC.

(d) PMC Sub-committee on Resources. This sub-committee was established to oversee the management o f the PSRP Basket Fund. The role o f this body i s to scrutinize plans and budgets, to review performance reports, as well as audit the use o f PRAP resources. The sub-committee prepares recommendations for consideration by the PMC. It i s chaired by the Deputy PS, PO-PSM and members include a select number o f Deputy Permanent Secretaries and officers representing DPs.

(e) PRAP Implementation Review Committee (PIRC). The PIRC examines the day- to-day implementation o f PRAP and prepares working papers (draft implementation and performance reports), lead program reviews (joint, internal, and external), draft strategic and operational plans, draft reform coordination memos to support the work o f PMC. The PIRC i s chaired by the PS and members encompass the Deputy PS; all directors and assistant directors and all PRAP technical advisors.

( f ) Effective cooperation and coordination among Government and DPs. Tanzania’s PSRP has a proven track record o f effective DP coordination. It i s a mark o f the maturity and effectiveness o f this coordination that the Government and DPs agreed to adopt a SWAP and basket funding modality to conduct i t s dialogue. PRAP will rely on the same modalities for coordination and harmonization o f the support from DPs.

Measures to strengthen implementation mechanisms

76. A review o f the legacy o f the implementation mechanisms o f PSRPI has showed that more robust and effective coordination mechanisms are needed to ensure results and accountability for the program implementation. Therefore PRAP will undertake the following:

(a) Adopt a predominantly MDA-driven implementation strategy.

(b) Revamp the existing coordination mechanisms.

l4 Where there i s no Deputy Permanent Secretary.

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(c) Establish a Reform Coordination Unit (RCU) in the Chief Secretary’s Office.

(d) Facilitate integration o f cross-cutting reforms and SDPs at MDA and LGA levels.

Adopt a predominantly MDA-driven implementation strategy

77. Accountabilities in an MDA-dr iven implementation are different than they were under a centralized approach. In PSRPI, PO-PSM was accountable for the program key result areas (KRA) initiatives. PO-PSM adopted a “blue print” approach and dominated the implementation o f activities, which led to MDAs not really owning the reforms and labeling them as PO-PSM’s program. The effectiveness o f the implementation strategy for PRAP i s predicated on a decisive shift to predominantly driven by MDAs.

78. In PRAP, MDAs will become accountable for a range o f specifically defined program outputs, as well as outcome^.'^ MDAs will be responsible for designing and implementing their PRAP interventions. In particular, MDAs will:

Identify their needs and priorities.

Decide what interventions to implement and how to implement them. This may involve adaptation and customization o f standard products or processes.

Implement the intervention, including i t s procurement.

Control the intervention’s finance through the Government’s accounting system, including the authorization to pay contractors and suppliers.

Monitor, evaluate, report progress and be accountable for the results.’6

Take a more central role in reviewing the program’s design and implementation arrangements.

79. Each MDA will report on the implementation progress and achievement o f the PSRP performance results indicators to the Public Sector Reforms Steering Committee. PO-PSM will report on the overall Program. Table 3 below provides an overview o f h o w responsibilities and accountability for results will be shared between M D A s and PO-PSM.

Outcomes are largely under the control of MDAs since the overall objectives i s to improve the performance o f the public service to achieve the objectives o f the MKUKUTA. l6 Accountability arrangements follow those currently in practice in Government. Essentially, if an institution (PO- PSM or an MDA) receives, in their budget, resources to implement an intervention, then their PS or Chief Executive Officer--CEO (accounting officer) i s responsible for the use o f those resources.

I 5

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Table 3: Sharing responsibilities and accountability between MDAs and PO-PSM

KRA / Broad Strategies PO-PSM tasks (menu Items)

KRA 1: SYSTEMS TO SUPPORT SERVICE DELIVERY Institutionalize P M S

M D A tasks (menu Items)

Develop P M S products and ensure their proper usage

Build capacity, customize, and undertake SP, Self Assessments, OPRAs M&E & Client Service Charters , ......................................................................................................... ........................................................................................... ............

Restructure MDAs and Devolve services to LGAs, restructure, Reengineer Service restructuring opportunities; review EA re-engineer services, implement quick Delivery framework; develop management wins, form new Executive Agencies

Develop restructuring products; identify

standards and inspect them

Outsource internal non- core services

Promote E-Government And Knowledge Management

Improve The Management Of Records That Support Service Delivery

Undertake reviews and quality assurance; Monitor and evaluate

Form an Executive Agency, undertake preparation of ecovernment

outsource services to the private sector

Build capacity through training and T A support, identify and articulate priorities

................................................................................................................................................................................................................................................................(�

Develop, monitor and evaluate records management systems, Develop and operate a records management centre

Implement records management systems

KRA 2 POLICY DEVELOPMENT Strengthen Central Institutions guidelines & other instruments

................................................................................................................................................................................................................................................................� Improve policy making processes, prepare

Enhance Policy Identify restructuring opportunities Design and implement capacity building Development capacities

Improve participatory Provide guidancelregulation concerning Form partnerships or collaborations with policy development partner-ships and collaborations, including non-state actors. climate Dolicv forums

plans (both for central policy agencies, and MDAs); restructure ......................................................................................... ........................................................................................................................... ~ ......................................................................................................................................................................................................................

................................................................................................................................................. ........................ ........... I KRA 3 PAY, INCENTIVES A N D REWARDS Support recommendations of the presidential pay comm.

Develop & implement performance based rewards

Organize studies as need arises; develop a new MTTP, decompress pay structures

Develop processes and schemes; review their effectiveness; undertake job regarding

................................................................................................................................................................................................................................................................k�

Allow a more flexible allocation of resources cabinet papers

Undertake studies, design systems, prepare

KRA 4: ACCOUNTABIL ITY A N D RESPONSIVENESS TO THE PUBLIC Strengthen the demand Implement capacity building plans to side of accountability improve IEC; collaboration / engagement

with non-state actors

Create and enhance Monitor and evaluate complaints handling De laints h channels for feedback systems

Strengthen ethics and compliance oversight plans institutions

............................................................................................................................................................................................................ " ........................................................................................................................................................................................................... IEC guidelines, develop mechanisms for engaging non-state actors; develop performance reporting frameworks ................................................................................................................................................................................................................................................................ � ............................

......................................................................................................................................................... ................................................................................................................................................................................................. Identify restructuring opportunities Develop and implement capacity building

Strengthen Internal Develop accountability frameworks, Accountability monitor, evaluate, and ensure their I Mechanisms compliance

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.. KRA.5: SYsTEMsF0.R .MANAG!,NG..PUBLIC .SERVANTS ..................................................................................................................................................................................... Strengthen and decentralize HR processes

Review OPRA instruments; review HR management and employment regulations,; develop improved recruitment tools; prepare HR planning, monitoring & reporting frameworks

Review implementation of H IV-A IDS guidelines

Develop, review, disseminate guidelines; train disadvantaged groups; mainstream diversity issues

Inspect the payrolls, upgrade H C M I S system (product development); monitor and eva I u at e

Implement customized OPRAs and recruitment processes; prepare HR plans

........................................................................................................................................... ......................................................................................................................................... ......... Combat HIV Aids

Manage Diversity in the Public Service

Strengthen the management of HR

................................................................................................................................................................................................................................................................»�

................................................................................................................................................................................................................................................................�� ..................................................... Installation of H C M I S (including training). Installation of improved HR records systems (paper based). I information

KRA / Broad Strategies

Promote Ethical conduct

Conduct Ethics Conduct campaigns Awareness campaigns

Strengthen the capacity of public service commission

PO-PSM tasks (menu Items)

Inspect code of ethics compliance, develop induction courses for ethics

M D A tasks (menu Items)

Train staff in issues of ethics ................................................................................................................................................................................................................................................................7�

................................................................................................................................................................................................................................................................­� Develop compliance inspection routines; reorganize, build HR capacity

Transform HR Administrators

Develop in-service training; implement compulsory training; restructure the DAP’s office

Strengthen Local training institutions

Build capacity of TPSC and TGDLC

KRA 6:. .LEADEPSY!P.PEVELOSMENT ............................................................................................................................................................................................................................................................... Identify, develop and nurture leadership capacities

Recognize & reward leadership

Organise & deliver Implement training leadership training and develomnent

Develop leadership schemes and frameworks. Operate an assessment centre

Implement a rewards scheme .................................................................................................................................................................................... ...................................................

............................................................. ................................................................................................................................................................................................................................................................2�

KRA 7: CHANGE M A N A G E M E N T A N D build capacity; support coordination efforts reforms REFORM COORDINATION

Manage PSRP, ensure it is well governed; Build capacity to oversee internal

80. The incentive framework to ensure that MDAs respond to the challenge o f self-driven implementation o f PRAP interventions i s included in the basic strategy o f the program. There are four major and related features in this framework. First, under the PMS installed under PSRPI and to be consolidated and institutionalized in this phase, MDAs complying with the PMS standard^'^, will have better chances to be allocated adequate resources, as reflected in the Medium-Term Strategic Plans and Budget (MTSPB) manual. This will be clearly reiterated in the planning and budget guidelines issued in future. Second, the new phase o f PMS

” Including budgeting, work planning and reporting.

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consolidation, under components 4 and 5 ’*, wi l l entail the effective operationalization o f the open performance review and appraisal system (OPRAS) at all levels o f MDAs, including the use o f performance agreements. Accordingly, MDAs and their PSs will be rewarded and sanctioned on the basis o f their performance and in accordance with the OPRAS scheme. Third, under the leadership development interventions (Component 6), PSs and other senior executives in MDAs will be trained, coached, mentored and motivated to lead in setting and implementing realistic but ambitious strategic goals for their respective MDAs, to undertake self-assessments and report on the same to the Chief Secretary and their respective ministers. Finally, and very pertinently, PRAP i s designed to enable MDAs to develop their capacity and improve their performance. Therefore, resourceful PSs/CEOs will be expected to take advantage o f the program in order to enhance and sustain their capacity and service delivery improvements. The M&E system will, under component 719, capture and report on the indicators o f the effectiveness o f these incentives.

Revamp the existing coordination mechanisms

81. The results of an independent review commissioned by PO-PSM confirmed that the existing PSRP leadership and coordination mechanisms need improvement. Simultaneously, some positive contribution o f these mechanisms over the years has been recognized. Therefore, the challenge i s to make them more effective for PRAP. Specifically, measures have been identified in terms o f

Enabling the Public Sector Reforms Steering Committee to exercise i t s policy and strategic oversight and coordination role more proactively, not just for PRAP but for all cross-cutting and sectoral reforms. The establishment o f the Reform Coordination Unit (RCU)20 in the Chief Secretary’s Office will support the Chief Secretary to ensure that this committee i s more effective in exercising i ts roles with respect to the overall GOT reform agenda.

Enhancing capacity and re-orienting PO-PSM in i t s leadership and coordination roles. In summary, the job descriptions and performance criteria for PO-PSM’s directors and other senior officers will be redefined to stipulate effective coordination o f PRAP components. Their performance will be monitored accordingly.

Reinvigorating the Public Sector Management Working Group (PSM-WG). The group i s responsible for linking the work o f cross-cutting reforms within the framework o f the Public Expenditure Review (PER) process. I t s members are: Directors o f Policy and Planning from MDAs involved in cross-cutting reforms, DPs and representatives from the MKUKUTA monitoring unit.

Reinstating the annual Public Sector Reforms Stakeholders’ Conference as a regular and more effective consultative forum. This forum, held only once, proved to be

Accountability and responsiveness to the public, and the systems for managing public servants components. 18

l 9 Change Management and Reform Coordination. 2o Details provided below.

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very valuable. Key stakeholders have lamented the fact that it did not happen regularly. I t provided a platform for diverse stakeholders including senior public servants to exchange and share experiences on the challenges o f implementing reforms and efficient means o f collaboration to achieve the Government’s national development objectives.

Establish a Reform Coordination Unit in the Chief Secretary’s Office

82. The RCU wi l l be a new, mainstreamed organizational unit in the Chief Secretary’s office located in State House. The unit i s established to serve all the cross-cutting and sectoral reform programs. Furthermore, as a coordinating unit, it will not be involved in the implementation o f PRAP or any other reform programs. I t s role wi l l be to ensure that: (i) opportunities for synergy and complementarity between all reform programs are identified and exploited; (ii) areas o f overlap, conflict or systemic impediments are identified and expeditiously eliminated; (iii) satisfactory progress i s achieved in the implementation o f all the programs and their results are supporting the MKUKUTA objectives; and corrective measures are taken where inertia has been identified; and (iv) well performing programs and agencies are identified, and accorded appropriate rewards. The unit wi l l provide the Chief Secretary with the information necessary to generate a meaningful dialogue with PSs towards achieving the national development goals. To this end, a robust M&E system wi l l be a key instrument for the unit. It wi l l also be crucial that the unit have high caliber and competent staff, public servants with a proven track record. The process o f establishing the RCU i s already underway. I t s location i s intended to provide it with the leverage necessary for i t to coordinate the various public sector reforms. It i s important that the RCU has the authority to call to account each o f the Accounting Officers o f MDAs, regional administrations and LGAs to assume their responsibilities in driving the government’s reform agenda.

83. The unit will advise the Chief Secretary on the best ways to coordinate the Government’s reform initiatives. I t will also act as Secretary to the Public Sector Reforms Steering Committee and the Stakeholders Conference on Public Sector Reforms. In brief, the Unit’s main tasks will include:

(a) Reviewing periodically program design and liaising with reform program management to identify overlaps, conflicts, and areas o f synergy.

(b) Monitoring and evaluating progress in the implementation o f the programs to ensure they are operating effectively and are meeting the needs o f their client MDAs/LGAs.

(c) Acting as secretariat for the various mechanisms governing cross-cutting reforms, including the Public Sector Reforms Steering Committee.

Facilitate integration of cross-cutting reforms and SDPs at the MDA and LGA levels

84. In developing the strategy for PRAP, and to increase i ts focus on results and impact on service delivery, the need better to integrate national strategies, cross-cutting reforms and SDPs at the levels o f service delivery agencies, Le., MDAs and LGAs became clear. While MDAs and LGAs recognize the benefits o f integration, i t has not happened as effectively as it could have

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due to a number o f challenges. One o f them i s the lack o f effective mechanisms and modalities to integrate reforms. GOT had underestimated the level o f effort required for this integration and coordination. Government has initiated measures to address this issue by integrating cross- cutting reforms with sector activities through the MDAs’ MTSPB. In preparing PRAP, there has been a comprehensive assessment o f what would facilitate the integration. On the basis o f this assessment, a strategic framework has been developed (see Figure 1 in Section I), and modalities to enable the integration o f national strategies, cross-cutting reforms and SDPs to achieve improvements in service delivery have been laid out for MDAs and LGAs. The modalities are documented in detail in an Operations Manual.

3. Monitoring and Evaluation Of Outcomes/Results

85. GOT (PO-PSM) has developed a detailed results framework. PO-PSM i s very conscious o f the emphasis put by DPs on having clear results for PRAP. Discussions have centered on the need to link PRAP activities to MDAs’ capacity to deliver improved services. With respect to M&E, PO-PSM has made considerable progress since the inception o f PSRP1. GOT has adopted a national framework for monitoring the MKUKUTA. Generally, PO-PSM has set high standards o f reporting during the implementation o f PSRPI. Improvements for PRAP include a clearer focus on results and on linking other cross-cutting reforms to the achievement o f results by MDAs. The PMC wi l l seek to focus i ts monitoring on selected areas o f high impact.

86. In Table 3 (Section 111) above, the shared responsibility and accountability for results between MDAs and PO-PSM has been illustrated. This framework will guide the M&E reporting arrangements. As part o f the GOTs planning process, an MDA’s results framework i s derived by the MDA, not PO-PSM. However, a MDA’s results framework i s influenced by the PRAP results framework because: (i) the planning process for MDAs’ reforms wi l l be facilitated by PRAP, and (ii) new instruments, especially the mandatory Cross-Sector Reforms Integration (CSRI) Memorandum, w i l l guide M D A planning and reporting. In particular:

MDAs are directed by the CSRI memorandum to have at least one PSRP-derived objective and related outputs. This may take the form o f improved management o f service delivery and policy development processes, HR, accountability, etc.

0 Since MDAs need to measure these outcomes (as part o f the Government’s performance reporting requirements), they are likely to piggyback on PRAP’s performance indicators to derive their own results frameworks.

87. MDAs will monitor and evaluate results o f PRAP interventions they are implementing. Because PRAP results are part o f their plan, this i s a Government-wide obligation, not a PRAP obligation. As such, MDAs will adhere to the Government’s reporting requirements, including the preparation o f quarterly progress reports, annual performance reports, and a three-yearly outcome report. These requirements are documented in the budget guidelines for 2007/08 to 2009/10 and include reporting to Parliament, the public and Central Government organs (such as the MOF, and MPEE). According to these requirements, MDAs will prepare:

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0 Short cumulative quarterly reports focusing on implementation progress. Reports will include (i) cumulative progress in reaching targets (outputs); and (ii) summary (aggregate) financial expenditure reporting. An annual performance report which includes, amongst others: (i) progress in meeting outcome indicators; (ii) progress in improving service delivery; (iii) reporting on milestones and key interventions; (iv) achievement o f annual targets (outputs); and (v) financial reporting and analysis. A three year outcome report. This report wi l l assess the degree to which an MDA i s meeting i t s planned objectives (i.e,, achieving the envisioned results or outcomes documented in i ts strategic plan). The report will summarize the findings o f key evaluations, analytical studies, and reviews undertaken during the period. For each objective the report wi l l describe what the expected achievements were, how they were measured, and what the main findings or results were. The assessments should be linked to the goals and operational targets o f MKUKUTA.

88. Implementation o f these arrangements i s scheduled to begin during the F Y 2007/08. Since these arrangements represent a significant departure from previous reporting requirements (which tended to focus on financial and activity implementation rather than service delivery targets and outcome indicators), it wi l l take time before reporting procedures are fully implemented and before the quality o f reporting i s wholly satisfactory. Despite this, it would not be prudent to impose parallel reporting requirements on MDAs.

0

0

89. In addition, the overall reform program o f government will be monitored through the “reform coordination framework” described in Table 2 above, which will give a better indication o f how all reforms need to work together to fulfill the objectives o f MKUKUTA.

4. Sustainability

90. PRAP i s fully aligned to MKUKUTA, the overriding government development framework that has been elaborated after broad consultation with key stakeholders. The PSRP i s recognized as a key element in achieving the MKUKUTA goals, Le., growth and reduction o f income poverty and improvement in the quality o f l i f e and social well being, particularly since it focuses on changing the mindset o f the public service towards greater orientation for performance. The Government designed the second project in consultation with Cabinet, a broad range o f other stakeholders, including MDAs, LGAs, private sector and CSOs. PRAP received Cabinet approval in terms o f both i ts orientation and modalities for financial support.

Government i s committed to continuing reforms in the public service.

91. During PSRPI, Government has adopted critical measures to sustain public sector reforms. The approved strategic planning, budgeting, monitoring and evaluation and reporting framework wi l l be used in allocating budgetary resources towards strategic plans o f MDAs that include capacity building and performance improvement measures for better service delivery. This mechanism, which i s detailed in a manual, i s expected to provide the incentives to MDAs to adopt key public service reform measures developed collaboratively with PO-PSM. Complementary to the manual, the budget guidelines are now consistently used to guide MDAs in the preparation o f annual work plans and budgets that adopt public service reform measures

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Risks

T o Project Development Objective Decline in political will

agreed with stakeholders. However, by placing MDAs at the center o f PRAP, PO-PSM recognizes their fundamental role in having in place a workforce whose main responsibility i s to serve the public.

Risk Mitigation Measures Risk Rating with Mitigation

Strong commitment, with “new zeal, new M

92. The design o f PRAP also considers critical factors that will improve sustainability o f the program. These include: (i) human resources planning with a focus on increased demand for staffing in social services; (ii) the need for enhancing pay in l ine with socio-economic conditions and prevailing labor markets; and (iii) strong leadership commitment to reforms across government. PRAP is designed to address these issues by:

(i) Strengthening and decentralizing HR processes and systems, especially in terms o f recruitment, appraisal, HR planning and training to ensure that MDAs have the right staff strength to deliver services to clients.

(ii) Providing resources to implement the recommendations o f the Presidential Pay Commission. The President tasked the Commission to review pay policies and recommend measures that would enhance pay across the public service in line with socio-economic conditions.

(iii) Identifying and creating a leadership cadre in the public service that will be able to pursue and sustain the reforms over the long-term.

93. The proposed coordination o f cross-cutting reforms also demonstrates that Government has learnt lessons from the implementation o f the first phase and has taken into account the recommendations made in the report commissioned by PO-PSM to examine the strengths and challenges o f PSRPI.

5. Critical risks and possible controversial aspects

amongst the leadership to continue with the cross- cutting reforms

vigor, new speed” to public service performance transformation has been demonstrated by the new government. Also, past political analysis carried out on Tanzania reflects that there i s a large constituency o f reformers within the executive and in the general public. Furthermore, GOT has been moving towards a more inclusive policy- making environment and this wil l increase the public’s understanding and hopefully support for reforms. Interventions under the Accountability and responsiveness to the

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Risk Mitigation Measures

public component, as wel l as in other cross- cutting reform programs will strengthen the demand side for public sector reforms. Moreover, these are embedded in MKUKUTA and thus are monitored for the entire government. There i s no indication o f a potential reversal o f broader national policy and strategic direction. On the contrary, the new government has reaffirmed the commitment to accelerate reforms.

to substantially enhance pay for public servants, to the extent that it i s affordable within the budgetary constraints. To this end, in 2006, the President appointed a

GOT has publicly acknowledged and pledged

Risks Risk Rating with Mitigation

H Incentives will not be conducive to attracting, motivating and retaining staff and ensuring capacity for reform implementation.

at senior levels with government.

around overcoming this risk. Hence, the emphasis on MDA-driven choice o f interventions to be implemented. At the same time, there i s a drive to make MDAs more responsive and accountable for results. On the part o f the Bank and other DPs, the GBS performance assessment framework includes dialogue on continued public sector reforms and incentive structure to build capacity and commitment o f managers to service delivery. More efforts will be made to dialogue with

The strategy for PRAP primarily revolves The depth o f MDAs’ sense o f ownership and commitment to the reform program remains shallow.

H

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Risks

Weak commitment and capacity o f public service managers, especially PSs, to improve service delivery and good governance.

T o component results PO-PSM does not rapidly develop the internal capacity and culture needed to champion, lead and coordinate effectively a predominantly MDA- driven implementation o f PRAP ,

Weak coordination o f reforms leads to delays and ineffective implementation o f reforms

Non-strategic allocation and inefficient and ineffective utilization o f the limited available resources undermines the pursuit o f capacity development and improved performance.

Risk Mitigation Measures

sector colleagues and seek their support in monitoring the implementation o f PRAP in their respective sectors. PSs wi l l be required to prepare and commit to annual public service reform performance targets, and to report back to the Public Sector Reforms Steering Committee semi-annually. The newly established Reform Coordination Unit wi l l support the Chief Secretary to monitor and evaluate performance by the PSs, and to report this upwards to the President.

PO-PSM has already undertaken a self- assessment that highlighted the need to develop capacity and change i t s modus operandi vis-a-vis MDAs in the implementation o f PRAP. A priority initiative i s to define the precise sk i l ls and competency required in PO-PSM and to address the gaps. Measures will be integrated into the change management and reform coordination strategies, encompassing changes in MDAs, which wi l l be imdemented under ComDonent 7 o f PRAP. PO-PSM wi l l collaboratively with the other “center o f Government” offices and ministries vigorously to pursue the institutionalization and use o f the newly crafted framework and instruments for strengthening coordination and integrating cross-cutting reforms and SDPs at MDA and LGA levels. This wi l l be a key focus o f the supervision o f the program. PO-PSM wi l l sustain collaboration with Ministries o f Finance and Planning to pursue enhancements in strategic planning, budgeting and operational efficiencies in MDAs through both PRAP and PFMRP. In this regard, the MTSPB manual will be improved and all senior officers across all MDAs more thoroughly trained in i t s use. Further, the OPRAS implementation will place particular emphasis on the pursuit o f the strategic prioritization o f objectives, economy, efficiency and effectiveness in the use o f

Risk Rating with Mitigation

S

H

H

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Risks

Technological developments outpace GOT’S capacity development for e- Government implementation.

Risk Mitigation Measures

resources by public service managers. PRAP will intervene with capacity building and knowledge management interventions to empower public service managers to make informed decisions on choices and modalities for the implementation o f ICT applications in public service delivery. The measures for capacity development within the Bank regional RCIP could also mitigate this risk under PRAP.

Risk Rating with Mitigation

M

95. The seven components o f PRAP contribute to strengthening good governance. As indicated in Annex I, the PSRP i s considered with other cross-cutting reforms as the bedrock o f the MKUKUTA governance pillar. It intends to put in place mechanisms, systems and other means to foster greater transparency, accountability and integrity in the performance o f the public service.

96. The Bank i s also taking steps to ensure that the risks o f corruption in this operation are minimized. The financial and procurement assessments have been carried out to ensure that the risks o f weak fiduciary capacity are minimized. Detailed operations manuals including procedures for financial management and procurement have been developed during PSRPI and proven to be adequate instruments to ensure transparency in these processes. Lessons learnt from PSRPI are integrated into the design o f PRAP and reflected in the updated operations manual. Since the entire Bank project team i s decentralized and works in close collaboration with other DPs in the field, regular and as-needed supervision o f P U P will take place over the l i f e o f the project.

6. Credit conditions and covenants

97. There are no Board conditions. Condition o f effectiveness i s the submission o f a legal opinion in accordance with the General Conditions. There are two conditions o f disbursements namely:

(a) The Memorandum o f Understanding (MOU) has been signed on behalf o f GOT and IDA; and

(b) The Annual Work Plan and Budget for the respective fiscal year has been approved by IDA.

98. The financial covernants are:

(c) Maintenance o f a financial management system satisfactory to IDA;

(d) Preparation o f interim un-audited financial reports covering six months o f the project for submission not later than 60 days after the end o f six calendar months; and

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(e) Submission to IDA o f audited Financial Statements covering the period o f one fiscal year o f GOT no later than six months after the end o f the fiscal year.

99. The procurement covenant i s the preparation and submission to IDA o f an audit report prepared by independent procurement auditors on the procurement o f goods, works and consultants’ services carried out under the Project no later than six months after the end o f each Fiscal Year.

D. APPRAISAL SUMMARY

1. Economic and financial analyses

100. The project will have a positive economic impact through improving capacity o f the public service. This will result in efficient and effective use o f public resources and ultimately contribute to the achievement o f the objectives o f the MKUKUTA.

2. Technical

10 1. PRAP will continue building the capacity for mainstreamed implementation initiated under PSRPI. Substantial capacity i s already in place and PRAP incorporates the lessons from the f i rs t project as demonstrated throughout the PAD. There are no major technical challenges in the implementation o f PRAP except for the HCMIS which has already proven to be problematic under PSRPI. Therefore this component will continue to be closely supervised to ensure that no further delays are experienced. This has been discussed at length with GOT and measures are being taken to supplement the capacity o f the implementing team. The technical issues have been wel l addressed by the GOT team that learnt f rom PSRPI and designed the second project o f the APL.

3. Fiduciary

Financial

102. The overall program risk for financial management i s MODEST.21 Existing government structures and systems will be used to record and account for project funds. More specifically, the country’s own public financial management systems (Le,, applicable financial laws, rules and procedures in terms o f accounting & reporting, planning & budgeting, internal & external auditing, and disbursement) will be used to account for project funds.

103. Each MDA will receive project funds through the existing government exchequer system and account for the expenditure through the existing government mechanism in accordance with the guidelines provided in the PRAP operations manual (OM). Each quarter PO-PSM will receive from each MDA a summary o f the financial performance o f funds received in the previous period (i.e., sources and uses o f funds) by component, statement o f actual and budget expenditures, both cumulatively and for the period covered by the said report, explanations o f variances between the actual and planned uses o f such funds, and their cash

For details on financial management and procurement assessments see Annex 7 and 8. 21

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forecasthequirements (based on the approved annual work plans) for the next six months. PO- PSM wi l l consolidate these financial reports and submit them to the PMC - sub-committee for resources for review before approval o f the PMC. Disbursement to the PRAP Basket Fund Holding Account wi l l be semi-annual.

104. The National Audit Office (NAO) wi l l audit PRAP Basket Fund Account and annual financial statements. In addition, during the project implementation (supervision missions), the Bank jointly with other DPs will review various MDAs’ annual audit report to monitor the quality o f the financial management systems in MDAs. Details o f these arrangements are highlighted in Annex 7 and the MOU.

Procurement

105. PO-PSM has already established a procurement management unit (PMU) and a tender board in accordance with the Public Procurement Act (PPA) o f 2004. Currently, P M U has been strengthened and has a sufficient number o f staff to carry out procurement under PRAP. It has six people out o f which three are procurement experts (two are consultants and one i s an employee o f PO-PSM - head o f PMU), and three are supplies officers. Contracts o f the two procurement experts expire on December 31, 2007. In this respect, PO-PSM must retain adequate capacity for procurement through outsourcing or other internal government arrangements. PMU has two sections. The first section deals with procurement function and the second section deals with supplies and stores function including logistic function. The tender board meets regularly in accordance with PPA o f 2004. There has been no delay in procurement processes related to tender board meetings.

The overall program risk for procurement i s AVERAGE.

106. Procurement activities will be carried out by the following entities: (i) PO-PSM and (ii) 67 MDAs. Besides conducting normal procurement o f items under their jurisdiction, PO-PSM will also be responsible for clearance o f contracts below prior review thresholds from MDAs, which have inadequate procurement capacity as one o f the mitigation measures. In addition, PMU wi l l have the following role: (i) consolidate procurement plans o f other MDAs and submit to DPs for clearance; (ii) in collaboration with DPs, carry out a joint procurement capacity assessment o f MDAs, which will be able to access the funds, and revise the mitigation measures accordingly; (iii) consolidate procurement progress reports; (iv) in collaboration with the Public Procurement Regulatory Authority (PPRA), prepare a capacity building program for MDAs with inadequate capacity; and (v) liaise with PPRA to ensure that the annual procurement audit i s conducted on time and a report shared with DPs, or hire an independent consultant to carry out the annual procurement audit.

4. Social

107. N o significant negative social consequences are foreseen to result from the implementation o f PRAP. On the other hand, enormous social benefits, both direct and indirect, are expected to accrue from the project. Successful implementation o f the project will contribute to the realization o f a public service that i s more responsive and accountable to the public in terms o f services delivery, use o f public resources and the creation o f an enabling environment for non-state actors to contribute to economic development, services delivery and poverty

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reduction. Moreover, this project aims to provide to the public and others stakeholders information on the Government’s performance plans and MDAs’ commitments to clear targets; it will educate the public with a view to improving citizens’ demand for results and accountability from i t s public service.

108. I t i s also significant that the preparation o f PRAP has been widely inclusive; much more than was the case with the first project. PO-PSM has involved stakeholders from both within government and non-state actors to ensure that they received as much feedback as possible on the performance o f PSRPI. Therefore, as a result, a stronger focus on the demand side has been included in PRAP. GOT wi l l develop a communication strategy and wi l l use IEC interventions that will motivate the public to provide constructive feedback to the public service and expect from them greater performance and accountability.

5. Environment

109. The project wi l l not have any interventions directly related to environmental issues, apart from those that address safeguards below. PRAP will finance civil works for a completely new building in Dodoma to house the National Records Center (NRC). ASPEN has reviewed the project’s safeguards status and categorized i t as B - partial assessment.

1 10. An environmental and social management framework (ESMF) and a resettlement policy framework (RPF) for the NRC have been prepared under the Accountability, Transparency and Integrity Project (IDA Credit No. 4 17 1 O-TA) preparation fund. The ESMF and RPF have been reviewed, commented upon and approved by the Bank and the Borrower. Although these documents were disclosed under ATIP, for the purpose o f PRAP, they have been disclosed again at appropriate client sites and at the Info Shop in Washington D.C.

6. Safeguard policies

Safeguard Policies Triggered by the Project Yes No Environmental Assessment (OP/BP 4.0 1) [ XI [I Natural Habitats (OP/BP 4.04) [I [ XI Pest Management (OP 4.09) [I I: XI Physical Cultural Resources (OP/BP 4.1 1) [I [X 1 Involuntary Resettlement (OP/BP 4.12) [X 1 [I Indigenous Peoples (OP/BP 4.10) [I [X 1 Forests (OP/BP 4.36) [I [ XI Safety o f Dams (OP/BP 4.37) [I [X 1 Projects in Disputed Areas (OP/BP 7.60)* [I [X 1 Projects on International Waterways (OP/BP 7.50) [I [ XI

’ By supporting theproposedproject, the Bank does not intend to prejudice thefinal determination of the parties’ claims on the disputed areas.

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7. Policy Exceptions and Readiness

1 1 1. There i s no policy exception and no conditions o f effectiveness. The M O U i s expected to be signed on or before Credit effectiveness. The project i s ready for implementation since it i s a continuation o f an ongoing program under existing institutional structures. Furthermore, the work plan and the 18-month procurement plan have already been finalized. The ESMF has been publicly disclosed and the appropriate safeguards policies will be adopted by GOT during implementation o f the proposed project.

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Annex 1: Country and Program Background Tanzania Performance Results and Accountability Project - APL I1

1. Country Governance and Poverty Reduction Trajectory Context

112. Against historical legacies o f very high levels o f poverty at independence in 1961, and at least a decade o f slow progress in undertaking reforms until mid- 1990s, Tanzania’s governance trajectory i s positive and promising. In i t s “White Paper” publication, “Making Governance Work for the Poor”, UK-DFID observes that “Tanzania i s an increasingly effective state. . . .The economy has grown at 6% per year since 2000 and there appears to be less corruption. The proportion o f children in primary school has leapt f rom 58% in 2000 to 95% in 2005. And infant mortality rates are down a third since 1999”.22 These observations also reflect the trends in the Bank’s CPIA ratings for Tanzania.

113. However, there are s t i l l major gaps and challenges in the strides made by Tanzania in recent years. The comprehensive public sector reform programs (PSRP, PFMRP, LGRP, LSRP, and NACSAP) that the Government has been implementing over the past several years aim to address these gaps.23 GOT anticipated that this transformation o f the state would be a long-term endeavor and sought to address inadequate capacity, weak performance and disenabling culture over several years. Therefore, GOT elaborated a long-term strategic framework for PSRP to foster changes in the culture and behavior o f public servants. This i s presented in the next section.

114. The impetus for a new phase o f PSRP also emanates from the imperative to develop and implement a public service reform program that is more strongly aligned with the MKUKUTA24 that i s pursued by the present Government. Despite the comparatively high rates o f economic growth, much remains to be done to fully address poverty in Tanzania. The proportion o f the population living below the poverty line has decreased only f rom about 51 per cent o f the population in the f i rst ha l f o f the 1990s to about 35 per cent from 1999 to 2005. Thus poverty remains widespread and the average GNP per capita in 2005 i s only US$380 (Atlas Method). Thus, Tanzania remains one o f the poorest countries in the world.

115. PSRP i s at the core o f the interventions contemplated in the third pillar o f the MKUKUTA, Le., good governance and accountability. In turn, this pillar i s the bedrock o f the other two pillars o f the MKUKUTA. Furthermore, a key MKUKUTA result indicator under this pillar is “effective public service framework to provide foundation for service delivery improvements and poverty reduction”. In this perspective, the successful implementation o f the PSRP i s crucial to the attainment o f the MKUKUTA goals. Goal 3 o f the MKUKUTA specifies “effective public service framework in place to provide foundation for service delivery improvements and poverty reduction” and therefore that “administrative systems o f public

22 DFID (July 2006), p. 19. 23 Kiragu, K., in his paper “Tanzania - A Country Case Study of Capacity Development” concluded that: “restoring integrity and ethics in Tanzania’s public service remains a most daunting challenge”. This document was prepared for the World Bank publication, Building Effective States: Forging Engaged Societies, September 2005. 24 Tanzania’s comprehensive National Strategy for Growth and Reduction of Poverty, popularly known by its Kiswahili name MKUKUTA.

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institutions are managed transparently and in the best interests o f the people they serve”. The document goes on to identify the key cluster strategy as to “Strengthen and deepen the Public Service Reform Programme”.

116. In the latter context, GOT is committed to implementing the second phase o f i t s public service reform program, with a strong focus on accountability and results in the performance o f the public service. The good governance and accountability pillar i s the bedrock o f the other two pillars o f the MKUKUTA, Le., (i) growth and reduction o f income poverty and (ii) improvement o f quality o f l i fe and social wellbeing. Through PRAP, the Bank will be responding to a strategic priority o f the GOT.

The PSRP’s Long-Term Strategic Perspective

117. The long-term strategic perspective developed at the conception and design o f the PSRP recognized that the transformation o f the public service would require more than a decade o f sustained reform to realize its development objectives. It also entailed progress beyond structural and process changes in the operations o f public service organizations to an ambitious cultural, behavioral reorientation o f the public service as well as the general public o f Tanzania. Therefore, f rom the outset, the program was planned to have three overlapping phases (see Figure Al):

(1) Phase 1 : Instituting Performance Management Systems (2000-2005);

(2) Phase 2: Instituting a Performance Management Culture (2005-2008); and (3) Phase 3: Instituting Quality Improvement Cycles (2008-20 1 0).25

118. The f i rst phase o f the PSRP was launched in 2000 and scheduled to end in 2005. However, two years into i t s implementation DFID requested an output-to-purpose review (OPR) and stakeholder reviews to assess the pace, direction, and impact o f the program. The review confirmed that good progress was being made and that the focus was appropriate. At the same time, it recommended a review to improve the implementation strategy including the possibility o f implementation through a sector-wide approach to be financed through basket funding modalities. This lead to some delays in implementing the program, even though it has realized greater consistency among DPs in dialoguing with GOT. I t was agreed to extend PSRPI until December 2007.

2. Bank Choice of APL

119. The rationale for the Bank’s choice o f an A P L to support GOT’S public service reform program was well elaborated in the project appraisal document o f the PSRPI and was endorsed by Bank management. It was then recognized that “The PSRP i s a comprehensive, long-term program o f action for transforming the public service through a combination o f horizontal and vertical interventions, and the process-orientation o f the implementation strategy needs to be

’’ Tanzania Public Service Reform Project, Project Appraisal Document, Report No. 192 16-TA, World Bank, October 1999.

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supported by a long-term commitment o f flexible and programmatic funding, such as the APL,,.~~

Phase I X X :

N.Q&: dates are those described in PSRP documents and do not reflect delays in implementation Performance

Management Culture (2005-

CSRP X (Cost Containment): 1991 to 1995

I I

n n p P Figure 1.1: Illustration o f the PSRPs Long-Term Strategic Perspective

120. Subsequent independent reviews have validated this choice. For example, Morgan and Baser observe that, by using the A P L instrument, “the Bank accepted the PSRP for what i t was l ikely to be-a comprehensive, long-term program o f reform that would need 15-20 years o f steady, patient and flexible support, much l ike reform efforts in high-income countries. Quiet persistence, both within the Government o f Tanzania and the international development community, paid o f f and reinforced the sense o f a long-term partnership. This different sense o f time represented a departure for many o f the funding agencies and points to the need for adaptation on al l sides if such complex reform programmes are to be effective”.27 This observation remains relevant as Government proceeds to P U P .

3. Triggers to PRAP

121. achievement o f certain triggers as summarized in Table 1.1 below.

The APL-based support to the second and third phases o f the PSRP i s based on the

26 Ibid.

Discussion Paper No. 57Q, European Centre for Development Policy Management (ECDPM) & The African Capacity Building Foundation (ACBF), January 2007.

Morgan, P. and H. Baser , Building the capacity for managingpublic service reform: The Tanzania Experience, 27

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Table 1.1: Triggers set at the beginning of the PSRP Phase 1 for moving to Phases 2 and 3

End of Phase 1: Transition to Phase 2 Seventy-five percent o f MDAs will have developed a strategic plan and fifty percent will show results in line with the agreed performance targets. Results will be linked to improved service delivery that will be known by the population, and proper mechanisms will be in place to deal with the population’s feedback on the services. In the ten Ministries initially targeted for strategic planning and performance budgeting, PSs wil l have been working for the last two years in keeping with performance agreements linked to results to be achieved. A l l MDAs will have in place a quick win that will demonstrate improvement in service delivery with the same or fewer budgetary inputs. The real wages of professional and technical staff, adjusted for variations in the expected Growth Domestic Product (GDP) growth and revenue collection, will show significant increase as per the MTPP targets. Al l the last year’s new appointments will have been made by the PSC consistent with the new legislation establishing i t s indeDendence.

End of Phase 2: Transition to Phase 3

Performance Improvement Model (PIM) effectively operational in al l MDAs. MDAs to be regularly disseminating service standards through social pacts, service delivery surveys and other instruments. Monitoring and evaluating outcomes and impact of service improvements wil l have been institutionalized. Balance between personnel and Operations and Maintenance (O&M) expenditures reflected in MDAs’ performance budgets.

Planning and policy units in MDAs properly equipped and staffed with competent policy analysts. In-service training programs readily accessible to public servants.

Public service in position to recruit and retain critical skills, especially in policy and regulatorv functions.

122. The understanding between GOT and the Bank was that, should the triggers for PSRPI not be met, the Bank would reassess the results achieved and work with Government to adjust the program to identify relevant results more adapted to the emerging situation.

123. As the Government’s PRAP strategy underscores, whereas the overall strategy o f the PSRPI remains largely intact, i t s implementation modalities have changed significantly since i t s launch in 2000. For example, from 2003, the program has been regarded by both Government and DPs as a SWAP with a pooled funding arrangement. A Joint Implementation Program Review Committee (JIPRC) comprising representatives o f GOT and DPs was established to conduct semi-annual reviews o f the program. Decisions for the release o f funds have been linked to satisfactory implementation and achievements o f key results. Furthermore, the JIPRC has factored in triggers in the semi-annual review meetings with a view to assessing their continued relevance or to discuss more appropriate benchmarks for monitoring.

124. A t this stage, it i s pertinent to review and explain any variations to the original triggers as reflected in Table 1.1 above. Table 1.2 below summarizes the achievement o f the original triggers. Government has made substantial progress in realizing some o f the triggers, but others have been overtaken by events and changes in the implementation environment. In particular, it i s important to note that, with regard to the implementation o f the performance improvement

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component2* a political decision was made not to pi lot the approach but rather to ro l l i t out to all MDAs .

’able 1.2: End of PSRP I triggers f End of Phase 1: Transition to Phase 2 Triggers

Seventy-five percent of MDAs will have developed a strategic plan and fifty percent will show results in line with the agreed performance targets.

In 10 Ministries initially targeted for strategic planning and performance budgeting, PSs will have been working for the last two years in keeping with performance agreements linked to results to be achieved. All MDAs will have in place a quick- win that will demonstrate improvement in service delivery with the same or fewer budgetary inputs.

The real wages of professional and technical staff, adjusted for variations in the expected GDP growth and revenue collection, will show significant increase as per the MTPP targets.

All the last year’s new appointments wi l l have been made by the PSC consistent with the new legislation establishing its independence.

- moving to P U P Summary of results monitored by end of Phase 1

All MDAs were trained and supported by teams of consultants to develop results-oriented strategic plans to implement a comprehensive PMS. Follow-up to ensure consolidation and institutionalization of the changes, including the use o f an M&E framework, remains weak and make it difficult to unequivocally confirm the results intended by this trigger. From the MTEF process, it i s clear that a significant number o f MDAs are on course as envisaged. Government prepared a manual that institutionalizes the integration of strategic planning and budgeting for the entire government. All PSs lead their ministries in developing and promulgating client service charters with specific performance and service delivery targets, which are increasingly a focus of public and mass media scrutiny and thereby o f PSs’ performance. This scrutiny i s also informed by service delivery surveys commissioned by PO-PSM. However performance agreements were not formalized. Quick-wins were initially identified and implemented successfully by 1 1 MDAs. Upon evaluation of these pilot initiatives, it was decided that quick-wins should be embedded in the strategic planning and performance improvement processes. Furthermore, a Business Process Re-engineering (BPR) manual was developed to guide all MDAs to implement quick- wins. A successful SASE scheme targeting professional and technical staff was initiated in 2001 but a political decision was made to terminate it in 2005 to develop more sustainable approaches to implementing the MTPP. Nonetheless, since September 2000, salaries have increased by an average annual rate o f 13.2%. By May 2006, salary levels were on average 82% of the MTPP targets. The salary adjustments made in the 2006/07 budget have raised salary levels to about the medium-term targets identified in 1999. However, on the basis of the recommendations o f a 2006 Presidential Public Service Pay Commission, new targets will be promulgated in FY 2007/08. Salary levels are now 100% on average o f the MTPP targets. Recruitment and appointments in the public service, except for PSs and Directors, have been decentralized to MDAs. The role o f the PSC has shifted from being a recruitment organization to a regulatory and appellate authority in relation to the Public Service Act. However, according to results of latest inspection by the PSC, there i s no full compliance with laid down rules and procedures to ensure adherence to meritocratic Drincides and Dractice in about a third of MDAs.

125. I t i s pertinent to reiterate that the strategic core o f the PSRPI was the installation o f PMS, with a view to creating a platform for launching P M P . The latter would focus on achieving a public service performance management culture. Accordingly, PSRPI devoted considerable

Introduction of strategic plans linked to results. 28

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efforts to defining and putting in place what would be the foundation o f the reform agenda, Le., PMS across all MDAs as illustrated below.

Figure 1.2 - Core PMS implemented in MDAs under Phase 129

126. the installation o f PMS in MDAs:

The excerpt below from a PricewaterhouseCoopers report describes the results related to

a) ". . .the PMS installation process involved extensive participation by ministry/office personnel via formal training and through working sessions. Throughout the process of installing the PIM, each ministry/office's senior management, change management and/or self-assessment teams, or staff were given the opportunity to evaluate working sessions or awareness workshops by completing a questionnaire. The overwhelming majority o f management and staff who participated in the process rated it useful.

b) In this report, we have assessed and reported on the achievements o f the PMS in the five client ministriedoffices in three main facets. These are as follows:

29 From PricewaterhouseCoopers that supported a group o f MDAs in the implementation o f PMS.

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(9

a.

b.

C.

d.

One, laying the foundation for public service management transformation. The PO-PSM’ s management and stakeholders identified four key factors that have a bearing on the successful outcome o f the installation o f PMS:

First, the buy-in and ability o f ministries/officers to adopt the PIM as a tool for identifying options for improved organizational effectiveness.

Second, ensuring effective linkages between PMS and sector reforms. These linkages are well articulated in each M D A ’ s strategic plan.

Third, forging linkages between PMS and other components o f the PSRP. Ministries/offces have identified between five and eight areas (e.g., launch o f executive agencies, private sector participation, integrity etc.) o f the PSRP for implementation over the period o f the strategic plan

Fourth, promoting effective interface between PMS and the MTEFbudget process. Each ministry/office identified and costed activities needed to deliver the relevant targets contained in i t s strategic plan. Cost estimates constituted each ministry’s/office’s MTEF submission for other charges.

(ii) Two, knowledge and sk i l ls passed on to public service managers. Through the PMS process, the senior and top management o f the client ministries/offices received extensive training. Besides the formal sessions, there was knowledge and skills transfer through the process consulting and participatory activities that were prominent throughout the process. Furthermore, at the end o f the process, it was evident that some officers in these client ministries/offices were, given an enabling environment, sufficiently knowledgeable and empowered to sustain the essentials o f the PMS in their organizations.

(iii) Three, Impact on organizational culture. This phase o f PSRP focuses on installation o f PMS. Cultural changes are anticipated in the next phase. Nevertheless, we have been keen to observe if the current initiative yields signals o f the onset o f the anticipated cultural transformation. In brief, we are o f the view that so far the PMS process has positively and significantly impacted on the organization culture in the following aspects: outcome orientation; people orientation; and ~tabi l i ty ” .~ ’

127. A similar process was conducted in al l MDAs and lead to comparable results. In that context, it i s opportune and in accordance with the original strategic perspective o f PSRPI documentation to advance to the next phase o f the PSRP.

128. The results o f PSRPI are confirmed by a number o f independent reports. For example, a comparative study o f public service reform programs in three Afr ican countries has highlighted the following promising features o f the Tanzania program: (i) the effectiveness o f i t s leadership and management; (ii) the introduction o f an incentive and capacity-supported PMS; and (iii) a

PricewaterhouseCoopers (2005), Report on Completion o f Assignment to support the Installation o f Performance 30

Management Systems in Ministries in Tanzania.

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SASE facility, a bold and pioneering pay reform scheme.31 The strengths and challenges o f the PSRPI were also confirmed by the review32 completed in preparation for PRAP. These findings, described below, have informed the design o f phase I1 and so has the report by Morgan and Baser mentioned previously.

4. The Unfinished Agenda of PSRPI

129. indicates two broad agendas that were not completed in the current phase:

The assessment o f the triggers to move to PRAP, as summarized in Table 1.2 above,

(i) the effective transfer o f responsibility and accountability for results in MDAs to public service managers (primarily the Permanent Secretaries); and

(ii) enforcing application o f new systems and tools, and compliance with rules and procedures, by MDAs.

130. These observations echo those o f an independent review o f building the capacity for managing public service reform by a two-person team (Morgan and Baser) for the European Centre for Development Policy Management (ECDPM). The team found that, “by mid-2004, progress in the PSRP was uneven, as might be have been expected. Changes in central ministries proceeded much faster than those in sector ministries with major service delivery responsibilities. Put another way, the urgency at the strategic level at the top o f the ublic sector was evident. Less enthusiasm existed at the middle and lower operational level^."^' Therefore, there are gaps in deepening knowledge, commitment and implementation focus o f the reforms at al l levels in MDAs, where capacity and performance in service delivery takes place. O n a more comprehensive basis, a 2006 review o f PSRPI implementation that was commissioned jo int ly by PO-PSM and DPs, pointed out that there were gaps and loose ends in the PSRPI implementation in the following areas:

(i) an integrated/computer based H C M I S , including the strengthening o f establishment controls and payroll management;

(ii) enforcing compliance and accountability by public service managers, including the links to pay reform and other incentives;

(iii) installation o f the PMS; especially ensuring quality o f plans and perfonnance reporting;

(iv) implementation o f the program for creation o f EAs, especially with regard to the effectiveness o f the current governance framework and accountability;

Stevens, M. and S. Teggemann, Comparative Experience with Administrative Reform in Ghana, Tanzania and 3 1

Zambia, World Bank, 2003. 32 Kiragu, K. and al, Stakeholders’ Perspectives and Imperatives in the Formulation of PSRP Phase II Strategy, Final Report, August 2006. 33 P.Morgan & H. Baser (ibid).

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(v) private sector participation, including ensuring the cost efficiency and effectiveness o f out-sourcing non-core roles functions and services by MDAs;

(vi) human resources planning and development, as reflected by capacity and performance gaps in most MDAs; and

(vii) coordination o f the PSRP with other cross-cutting reforms (PFMRP, LGRP, LSRP, NACSAP), so that synergies are realized.34

131. private sector participation are successful and should continue to be deepened.

The latest supervision o f the PSRP indicated that areas such as the EAs program and

132. In the backdrop o f the findings and recommendations o f the above reviews, PO-PSM has carried out more comprehensive and in-depth analysis o f the issues that have informed the development o f the strategy and program for P U P . Therefore, the design o f the next phase i s well informed by the lessons o f experience from the current phase, as wel l as several relevant sources o f comparative knowledge.

34 D.Steedman, D.Poate, C. Bamett & C. Kinyeki (April 29" 2009), Tanzania Public Service Reform Programme Mid Term Review (unpublished report submitted to GOT and DPs).

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Latest Supervision

(Bank-financed projects only) Sector Issue Ongoing Projects (ISR) Ratings3’

Implementation Development

S S

I Progress (IP) Objective (DO) l Improved functioning and icapacity building o f the Ipublic service Phase I

Public Service Reform Program (Cr 3300-TA) - APL

Annex 2: Major Related Projects Financed by the Bank and/or other Agencies

TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

Legal and judicial reform, public financial management reform and strengthening oversight and watchdog institutions Fiscal decentralization, use o f government resources, improved management Improved legal framework

MS S Accountability, Transparency and Integrity (Cr 4 17 1 -TA)

S S Local Government Support (Cr. 4003-TA)

Tax Modernization (Cr. 4 190- ITA) & administrative S S

nla

infrastructure HIV and AIDS

nla

MS S Multisectoral AIDS Project (H095-TA)

Public expenditure, financial management and

I I I Outcome I Sustainability 1 IPImpact

Poverty Reduction Support (5) (Cr 4294-TA)

procurement Public enterprise privatization support, banking restructuring

Sector Issue

Ratings: HS=Highly Satisfactory; S=Satisfactory; MS=Moderately Satisfactory; MU= Moderately Unsatisfactory; 35

U= Unsatisfactory; HU= Highly Unsatisfactory; NA= Not applicable; NR= Not rated.

S S Privatisation and Private Sector Support (Cr. 3304-TA)

Completed Projects IEG Ratings

Legal and judicial system and gaps in procedures and controls for public expenditure management Procedures and controls for public expenditure management

Financial and Legal Management Upgrading (not rated by IEG) (Cr. 24 13-TA)

Poverty Reduction Support Credit 4-DPL (not rated by IEG)

nla nla nla

n/a nla nla

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Related Projects/Programs Funded by Other Agencies and the Bank in support of MKUKUTA Cluster 3 Goals

Development Partner36

NACSAP: SIDA, FINIDA, NORAD, DANIDA, UNDP

MKUKUTA Goals World Bank LGSP ATIP. PSCP TASAF3'

1. Structures and systems of governance as well as the rule o f law are democratic, participatory, representative, accountable and inclusive.

UNDP PSRP: DFID,

2. Equitable allocation o f public resources with corruption effectively addressed.

LGSP 3. Effective public service framework in place to provide foundation for service delivery improvements and poverty reduction.

DANIDA, CIDA

LGRPLGSP: SIDA(Sweden), DFID, CIDA, GTZ, FINIDA, UNDP, EC LSRP: CIDA,SIDA, DANIDA, GTZ, UNDP

BEST: DFID, DANIDA, SIDA, MDC (Netherlands)

TFCS: DFID, IDA (Ireland), MDC

4. Rights of the poor and vulnerable groups are protected and promoted in the justice system.

PSRP TASAF TAP

ATIP TASAF PSCP

5. Reduction of political and social exclusion and

Government Program

NACSAP

Local Government Support Program (LGSP)

LGRP

Public Financial Management Reform Program (PFMRP)

NACSAP

PSRP

LGSP

LGRP

LSRP

BEST

Tanzania Foundation for Civil Society (TFCS)

LGRPLGSP SIDA(Sweden), DFID, CIDA, GTZ, FINIDA, UNDP, EC PFMRP: SIDA( Sweden): IFMAP3' , National Audit Office (NAO)39, DFID, CIDA, EC, NORAD, DANIDA, SDC (Switzerland), JICA

NACSAP: FINIDA, I

TASAF A T P

36 Excludes General Budget Support DPs. 37 Tanzania Social Action Fund Project (TASAF). 38 Integrated Financial Management and Accountability Programme covers PFMRP component 4. 39 Supported together with Swedish NAO and covers PFMRP component 10.

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MKUKUTA Goals

intolerance.

6. Improved personal and material security, reduced crime, eliminate sexual abuse and domestic violence 7. National cultural identities enhanced and promoted.

Government Program Development PartnerJ6 World Bank

(Netherlands), SDC (Switzerland), DIC (France)

Legal and Human Rights Center: SIDA

LSRP LSRP: CIDA, SIDA, DANIDA, GTZ, UNDP

Tanzania Cultural Trust Fund TCTF: SIDA (TCTF)

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Annex 3: Results Framework and Monitoring

TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

Results Framework

PDO

To enhance capacity, performance and accountability o f MDAs for use of public resources and service delivery to levels consistent with timely and effective implementation of the strategic and priority programs under the MKUKUTA.

Intermediate Outcomes

Systems and structures improvement program implemented

Improved policy development processes and systems in place in MDAs and centrally

Project Outcome Indicators

1. % of MDAs use PMS and structures (strategic plans, rapid results, results- based monitoring) to enhance service delivery.

2. % of population reporting satisfaction with Central Government Services. (MKUKUTA INDICATOR)

3. Annual exit rate (in %) of public servants with Masters degree or higher

4. % of client service charter commitments met.

Intermediate Outcome Indicators

% o f MDAs with fully operational M&E systems and reporting against their strategic plan targets.

% o f MDAs that implement annual work plans consistent with Strategic Plans.

% of business oriented EAs own revenues to total expenditures

% of sampled MDA policies which are feasible, effective and consistent within and across sectors.

% of MDAs with operational I effective policy review processes that include external stakeholders

Use of Project Outcome Information

Assess the increase in number of MDAs using improved systems and structures to enhance capacity and performance (in terms of access and efficiency) in service delivery.

To assess improved retention o f competent public servants that improves capacity of MDAs to deliver services.

To assess improved accountability of Government to clients in providing services.

Use o f Intermediate Outcome Monitoring

Ensure MDAs have the systems and tools to improve performance in service delivery

Ensure MDAs develop policies that improve regulatory environment for service delivery and private sector development

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Intermediate Outcomes

Pay and incentives systems developed and operational

Accountability and responsiveness improvement programs implemented.

Human Resources Management of the Public Service improved

Leadership development programs implemented

Reforms better integrated and coordinated

tc

Ratio of the average salary of Permanent Secretaries to the average salary of an operational staff member (salary decompression ratio)

Ratio of actual to target salaries in the MTPP targets

% of citizens' requests for information that were met by Government and feedback provided to the public

% of MDAs who publish their Client Service Charter commitments and performance in at least one English and one Swahili newspaper annually

YO of MDA programs using IEC feedback from clients to improve service delivery

% variation in quality and integrity of personnel and payroll data based on periodic audit inspections

Percentage o f women with post graduate training who have assumed "decision making posts"

Average leadership competency score according to the leadership competence framework

Number of MDAs with PRAP activities integrated into their MTEFs and reporting on results

Government has the right pay policies to attract, recruit and retain qualified staff, particularly technical and professional staff

Growing access to information and improved demand for accountability by non-state actors contributes to improved performance of MDAs

Greater use of client feedback in the design o f improvements to service delivery

Size o f the public service i s controlled in line with established posts and wage bil l

Public service reflects the diversity of the population

Senior public servants ability to effectively provide leadership and ensure public servants are ethical and client oriented

Policy dialogue at the highest level i s centered on the performance of government vis- a-vis MKUKUTA objectives

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Annex 4: Detailed Project Description Tanzania Performance Results and Accountability Project - APL I1

Introduction

133. originally in the program’s long-term strategic perspective:

PRAP i s the intermediate o f three overlapping phases o f the PSRP as described

(a) Phase 1 : Instituting Performance Management Systems (2000-2005);

(b) Phase 2: Instituting a Performance Management Culture (2005-2008); and

(c) Phase 3: Instituting Quality Improvement Cycles (2008-20 1 0).42

134. The phases have been revised to take into account the experience with PSRPI:

(a) Phase 1 : Instituting Performance Management Systems (2000-2007);

(b) Phase 2: Instituting a Performance Management Culture (2007-20012); and

(c) Phase 3: Instituting Quality Improvement Cycles (2012-201 5).

135. Annex 1 explained that the pace o f implementation o f PSRPI was not as originally planned and that it wi l l be extended to December 2007 at which time PRAP should become effective. The annex also laid out the progress made in Phase I, and thereby what i s the take- o f f point for PRAP, including the unfinished agenda o f the previous phase.

136. Phase I focused on installing the systems that would be needed to effectively make the shift to a strategic pursuit o f a results-oriented public service management culture. While some o f the systems are not deeply embedded, GOT considers that the foundations have been laid for the management systems, and that the institutional and political environments are positive and should form the basis to launch the PSRP into the next level o f reforms. The strategic emphasis o f PRAP i s to transform the culture o f public service by demanding, especially o f public service managers, improved performance, with an emphasis on results and greater accountability.

Demanding Results and Accountability

137. PRAP comprises seven key results areas:

(a) Systems to support service delivery by MDAs;

(b) Policy development;

(c) Pay, incentives and rewards;

42 World Bank (October 1999), Project Appraisal Document, Tanzania Public Service Reform Project, Report NO. 19216-TA.

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(d) Accountability and responsiveness to the public;

(e) Systems for managing public servants;

( f ) Leadership development; and

(8) Change management and reform coordination.

Component 1- Systems to Support Service Deliverv NJS$35.2 million of which I D A is US$13.6 million)

138. The interventions under this component will directly build on the outputs and outcomes of the PSRPI and the earlier civil service reform program (CSRP) in terms of having in place improved systems, processes and structures to enable MDAs to possess the necessary capacity to provide efficiently and effectively the expected services. This component expects to produce the following intermediate outcomes:

(a) Reduced bureaucracy and red tape in the delivery of services;

(b) Systems and structures in place to enhance access and efficiency of service delivery;

(c) Efficient delivery of internal operational and administrative services in MDAs; and

(d) Improved management of information that supports service delivery.

The following interventions are needed to achieve the outcomes that fall under the 139. following categories:

Institutionalize PMS. The main intention of this intervention i s to deepen applications of the PMS installed in PSRPI. Specific key outputs will include: (i) an EA monitoring framework to help parent ministries and PO-PSM to hold EAs accountable for their performance, (ii) good practice tools for MDAs; (iii) higher quality strategic plans by MDAs; (iv) effectively applied OPRAS by MDAs, (v) more relevant client service charters and better utilized by clients; and (vi) timely and quality M&E reports by MDAs to be used for decision-making.

Restructure MDAs and re-engineer service delivery. This intervention will also advance work initiated under PSRPI particularly enabling MDAs to decentralize the provision of services by: (i) creating additional EAs; (ii) outsourcing to private sector providers and hiving off non-core services, and (iii) re-engineering business processes. As a result of these activities measures to enhance cost efficiency, and effectiveness in service delivery will have been deepened.

Promote e-Government and knowledge management systems. The two primary objectives of this intervention are: (i) to develop a robust, cost-effective and appropriately-funded program for rolling out e-Government applications in the Tanzania public service; and (ii) to develop the institutional environment and capacity needed for the Tanzania public service to exploit e-Government

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applications that will enhance the efficiency and quality of public services. To these ends, the key outputs of the sub-component will include: (i) appropriate institutional and organizational structures for e-Government established, including the setting up of an e-Government agency under the oversight of PO- PSM to guide, support and oversee the use of ICT across Government in the future; (ii) human resources capacity for e-Government in place, including the elaboration of staffing structures for ICT in MDAs and LGAs and training of staff in ICT for e-Government, (iii) preparations for e-Government implemented by supporting the preparation of e-Government policy and a feasibility study and design for an e-Government portal.

(d) Improve the management o f records. This intervention will support GOT to construct the NRC to provide adequate space to house and make records easy to preserve and access, thus increasing transparency in the management and provision of information. The construction of the NRC was identified under PSRPI, and the necessary environmental assessment was carried out under the preparation of the Accountability, Transparency and Integrity Project (IDA Credit 41710- TA). The availability of this center will support the continuation and consolidation of records management reforms that started in earnest under CSRP and continued under PSRPI. Other outputs of this intervention will include activities that will enhance access to comprehensive records, including specialized records management systems such as land registration and the administration of the criminal justice system.

Component 2 - Policv Development (US$5.5 million of which IDA i s US$2.1 million)

140. The common objectives of the interventions under this component are three-fold:

(a) to develop the orientation and capacity of MDAs to focus and discharge effectively the cross-cutting roles and knctions of policy development and regulation in their sectors, as envisioned in the past initiatives in rationalization of roles and functions, and decentralization by devolution (D-by-D);

(b) to enable sector MDAs to prepare higher quality policy papers, and to develop the capacity o f the central MDAs to fulfill their responsibilities, and

(c) to strengthen the capacity of the Cabinet Secretariat to: (i) guide and coordinate policy-making; and (ii) monitor and scrutinize policy outputs from sector MDAs.

(d) to enhance policy development and regulatory capacities within MDAs through collaboration with local research organizations and think tanks to create learning networks that will support their policy development capacity.

14 1. To these ends, broad interventions under the component include: (i) strengthening central institutions and the Cabinet Secretariat in a l l aspects of policy-making including development, implementation and monitoring; (ii) enhancing capacities of the policy development and regulatory units within MDAs; and (iii) improving the climate for participatory policy development by MDAs including consultation with the broader public.

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Component 3 - Pay, Incentives and Rewards (US$3.4 million of which IDA is USS1.3 million)

142. The two main outcomes of this component are: (i) a significant rise in the levels o f a motivated, disciplined and ethical public service; and (ii) Government’s ability to recruit and retain adequate numbers of technical, professional and managerial staff to efficiently, effectively and timely implement GOT’S priority service delivery and development programs under the MKUKUTA. To these ends, it i s critical that public servants are paid at levels comparable to market prices for their skills, knowledge, experience and level of responsibility. Indeed, this was the thrust o f the 1999 public service MTPP that Government has been implementing during PSRPI.

143. In the development of the strategy for the PSRPI, it was clear to Government that rapid and significant enhancements in public service pay and other incentives were critical to the attainment of the program objectives. Therefore, pay reform was considered to be a critical complement to the strategies for major improvements in public service capacity development and performance. Thus, in 1999, just before the launch of the PSRPI, Government adopted a MTPP as part of the PSRP. The policy guides decisions on pay across Government, including MDAs and LGAs. To implement the policy, a Medium-Term Pay Reform Strategy (MTPRS) was adopted. I t included the following features: (i) a medium- term target salary structure that systematically enhances pay for al l public servants; (ii) a job evaluation and re-grading exercise to facilitate improved link between pay and performance; and (iii) a Selective Accelerated Salary Enhancement (SASE) scheme, targeting key professional, technical and managerial personnel occupying strategic position within government.

144. Progress in enhancing public service pay in line with the MTPP has been slower than anticipated. Although in July 2006, at the turn of the 2006/07 financial year, significant increases in pay were realized, and pay targets were almost met, salaries remain low and continue to be cited as one of the key impediments to realizing a more professional public service. This has also given rise to the use of allowances to supplement a remuneration package that i s not competitive. Therefore, work on the consolidation of remunerative allowances into salaries, which started in the mid-1990s to achieve a more transparent pay structure, has not been completed. SASE was terminated for reasons related to equity. Annex 1 describe in more details the accomplishments and challenges of pay reform. With the benefit of hindsight, and lessons of experience, the MTPP has not delivered the outcomes now targeted under this component, for at least five reasons:

(a) First, the salary targets set under the MTPP were far below the market comparators, and yet they were not even adjusted sufficiently to provide for both erosion of purchasing power by inflation and the escalation in the general rise in market salaries in Tanzania, especially for the technically and professionally skilled cadres.

(b) Second, the pace of implementation was slow because inadequate resources were budgeted for pay enhancement and the right balance between recruitment of new staff and pay enhancement was not coherently struck.

(c) Third, in connection with the latter point, key constituencies responsible for resources allocation (including political leaders and top administrators) could enhance non-transparently their compensation through allowances or other perks.

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(d) Fourth, which explains in part the point made above, egalitarianism continues to influence the Government’s decisions against transparent decompression of public service pay.

(e) Fifth, in light of these facts, there was less efficient utilization of the available wage bill resources.

145. PRAP.

These remain the major issues that will need to be addressed with more vigor during

146. Fortunately, President Jakaya Kikwete i s keen to address decisively these issues and pursue the target outcomes under this component. In his inaugural speech to Parliament he vowed to accelerate pay reform and accordingly declared a pay increase that put the salaries in line with the MTPP targets. In 2006, he also set up a commission of eminent Tanzanians to advise him on the policy and strategy to move forward on the issues of public service pay. The findings and recommendations of this Commission are not yet public. A team of technical experts has been charged to review the feasibility of the Commission’s recommendations. However, it i s expected that with this latest Presidential initiative, the way forward with reform of public service pay will soon be clear. DPs will continue to request government to adopt clear targets and a transparent remuneration. This would also include setting clear rules of the game for the use of allowances. This has been captured in the triggers to move to PSRP 111.

147. will comprise the following:

In the context of the above background, the key interventions under this component

(a) Support the implementation of the recommendations of the Presidential Commission on Salary Review for the Public Service and the outcome of the technical application of these recommendations.

(b) PO-PSM will develop and implement a central performance-based rewards and incentives system.

(c) MDAs develop and implement non-salary rewards and incentive systems.

(d) Review the planning and budgeting framework to maximize the opportunity for strategically allocating and utilizing the wage bill resources transparently.

(e) Establish clear guidelines for the use of allowances that will remove present distortions.

Component 4 - Accountability and Responsiveness to the Public IcTS$8.7 million of which IDA i s US$3.3 million)

148. This component i s the strategic focus of P U P . The first three components in many ways reflect efforts to sustain and consolidate the PMS installed under PSRPI. Component 4, on the other hand, aims to take the PSRP to a performance culture phase, as originally envisioned in the program’s long-term strategic perspective. The lessons of experience and the analysis of the current state o f the public service have demonstrated that the key to the transformation of the public service culture i s to make public servants accountable and responsive to the citizens and their representatives. Under the PSRPI, the institutions and

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systems for enabling this drive for accountability and responsiveness to the public by public servants, are largely in place.

149. Despite the installation o f mechanisms for securing enhanced levels o f accountability in the public service at both institutional and individual levels, the issue o f inadequate accountability remains. Systems and tools for strategic planning, open performance review and appraisal and client service charters are nevertheless in place. New rules and regulations for securing enhanced discipline and ethical conduct within the public service have been approved.

150. Under ATIP, IDA Credit No 41710-TA, the Bank i s supporting GOT to, among other measures, strengthen the demand side o f accountability by direct interventions to build capacity and h n d strategic interventions by Tanzania’s watchdog and oversight institutions, including Parliament and its committees, professional associations, and CSOs. PRAP wil l complement ATIP by, firstly, enabling MDAs to enlist participation o f citizens so that they have the information and education needed to make realistic and effective demands for performance and accountability on the service delivery units and employees o f MDAs. Secondly, PRAP wi l l strengthen capacity and service delivery by the public service ethics oversight and compliance institutions. Thirdly, PRAP wi l l support MDAs effectively to respond to enhanced demand for accountability. In other words, PRAP wi l l seek to enhance accountability: (i) to citizens, (ii) across government; and (iii) within each organization. This wi l l be done through the provision o f information, the development o f legal instruments, and the development o f systems, processes, and procedures. Strategically, the program wi l l build the capacity o f key government institutions o f accountability, e.g., the Ethics Secretariat, Prevention and Combating o f Corruption Bureau (PCCB) and the PSC. In addition to creating Erameworks for internal government accountability, and reporting requirements, PRAP wi l l promote demand-driven accountability by working with a wide range o f non-state actors.

151. The strategic thrust o f pursuing accountability and responsiveness to the public i s consistent with one o f the themes o f the Fourth Phase Government demanding that public servants be more responsible and accountable. The President and the Prime Minister are particularly active in asking public servants to act with “new zeal, new vigor and new speed”. By strengthening the demand side o f accountability, public servants wil l need to be responsive in delivering services and accountable in the use o f public resources. The key intermediate outcomes under this component wi l l be:

(a) Citizens and clients o f MDAs wi l l be increasingly aware o f the availability o f public services and their rights to access them.

(b) The emergence o f “voices” to demand better access and quality services.

(c) A public service that listens better, and i s courteous and responsive to the needs and demands o f citizens and other clients.

(d) Increased propensity by public service managers to share information and to be accountable for service delivery results.

152. To achieve these outcomes, the following interventions are planned:

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(a) Strengthen the demand side of accountability for service delivery. A pre- requisite i s the provision of non-biased information about service delivery to the public. To achieve this, PRAP will create fora for citizens to interact with government proactively to offer views and suggestions, and help explain government policies and services to other clients and citizens. NGOs will be key players in creating the required environment for the public to demand better services and hold the government accountable for its actions. Also, the IEC activities within MDAs will be strengthened through various capacity development interventions so that they inform the public about public services more effectively. Another key intervention under this strategy will be the introduction o f a mandatory performance reporting framework that will be implemented by a l l MDAs requiring them periodically to report on their performance results to the public.

Create and enhance channels for feedback from citizens and clients. Feedback and complaints from clients and citizens are important sources of information for improving the delivery of public services and to ensure client satisfaction. Towards this end: (i) a complaints and grievances handling mechanism which i s currently being piloted in seven MDAs will be rolled out in al l MDAs, and (ii) PO-PSM will train staff in MDAs on how to use this system.

Develop and operationalize an institutional accountability framework for use by MDAs. Activities focusing on capacity building and rationalizing the functions will be part o f this intervention. The key outputs under this intervention will include:

rationalized functions o f five ethics oversight institutions (GGCU, CHRGG, Ethics Secretariat, PO-PSM Ethics Department, and PCCB;

(ii) strengthened capacity of the ethics oversight institutions.

(d) Strengthen internal accountability mechanisms within Government. Under this intervention an institutional accountability framework will be developed and used by MDAs. MDAs will use the framework to report to the President and the public on agreed indicators including rewards and sanctions that form part of the framework. This framework will complement the accountability mechanism at the individual level (OPUS). Key outputs under these interventions will include: (i) management accountability framework implemented, (ii) ethical conduct of promotions in the public service, (iii) compliance framework on code o f ethics implemented by a l l MDAs, (iv) strengthened compliance with codes of ethics for professional groups, (v) measures of anti-corruption implemented by MDAs; and (vi) annual ethics awareness campaigns conducted by PO-PSM.

(e) Enhanced capacity of the PSC for the performance o f the oversight role and functions. The outputs under this intervention will be: (i) restructuring of the PSC and (ii) a capacity building plan for PSC developed and implemented.

(f) Promote ethical conduct in the public service. Efforts to make public service employees comply with the rules and practices of the service will be increased. While efforts to educate employees on ethics will continue, the focus will be to

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operationalize a compliance framework that will promote discipline in the public service.

Component 5 - Systems for Managing Public Servants KJS$23.3 million of which IDA i s US$9.0 million)

153. The basic strategic objective of the interventions under this component i s to develop and make available appropriate HR systems and tools that effectively enable MDAs to have optimal numbers of competent personnel. The outcomes for this component are:

Optimal and adequate staffing levels effectively to support service delivery and implementation of MKUKUTA priority programs.

Efficient and effective use of human resources.

A public service with state of the art skills and competence.

HIV/AIDS Infection rates reduced in the public service.

Public servants with HIV treated with dignity and fairness and with improved welfare.

Best available candidates recruited through fair and transparent processes.

Improved knowledge, skills, and job performance through targeted training interventions.

Public service composition reflects the diverse character of the nation.

Recruitment, appointments, appraisals, and promotions based on merit.

154. The strategy to achieve the above targets has two prongs: (i) MDAs will be strengthened and enabled to effectively undertake strategic HRM fbnctions including their integration into the strategic plans of their organizations, HR planning, preparation of need- based training and development plans, and performance review and evaluations; (ii) MDAs will institutionalize the HR planning function and prepare medium-term human resource plans (HRPs). The plans will guide MDAs to have the right number of staff with the required competences and at the right time.

155. categories:

The interventions under this component will fall broadly under the following

(a) Strengthening and decentralizing HRM processes and systems. Policies and regulatory frameworks are already in place. The challenge of PRAP i s to carry out reviews of the current management capacities, defining HR areas for decentralization and improving HR processes including recruitment, planning, training and appraisal to meet the expectations o f clients and other stakeholders. The key outputs that will be associated with this intervention include: (i) reviewed and revised HRM policies, laws and regulations and systems, (ii) an expanded, customized set of recruitment tools developed and used by MDAs, (iii) a HRP framework developed, (iii) HRPs implemented in all MDAs, (iv)

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reporting requirements for MDAs to produce annual HR reports including the summary of OPRAS score; (v) medium-term training and development plans implemented by MDAs; (vi) OPRAS implemented in MDAs.

(b) Combating HIV/AIDS in the workplace. With respect to the impact of HIV/AIDS in public service delivery, and the extent to which it hampers the capacity of government to realize implementable HRPs, PRAP calls for specific, gender-based interventions to reduce the already existing high level of attrition and wastage among public servants.

(c) Managing diversity in the public service. Government i s the largest single employer and service provider in any community. It must lead in extending diversity interventions among the population and employers. The two main outputs under this intervention will be: (i) an expanded range of gender mainstreaming measures implemented in al l MDAs, and (ii) policies and programs in support of the physically challenged public servants implemented in all MDAs. A study presently being carried out under the auspices of PO-PSM will identify more precise ways to mainstream diversity through al l the components of PRAP.

(d) Strengthening the HCMIS. This component will build on the considerable investment made in this area during PSRPI. However, until now these investments have failed to yield concrete results or to provide a robust system to control human resources and to provide adequate information on the state of the public service. During PRAP, particular attention will be given to this intervention considering that it constitutes a vital and basic element of a well functioning public service. The key outputs under this intervention will comprise: (i) HCMIS functionality expanded in accordance to the HR business processes review of 2006/07; (ii) physical payroll inspection and audit undertaken annually in al l MDAs and LGAs; (iii) decentralized HCMIS operational in MDAs, Regional Secretariats, and LGAs; and (iv) improved personnel records management system operational in MDAs.

(e) Transforming HR administrators in MDAs and LGAs into HR managers. Many MDAs and LGAs continue to use their personnel and administrative officers as “clerks” or “welfare officers”. HR Departments do not undertake strategic HRM functions In this context, the main outputs of this intervention will be: (i) HRM development programs completed for PSs, Directors and Assistant Directors; (ii) compulsory in-service training programs for the HRM cadre in a l l MDAs; (iii) special intensive programs to address immediate skills and knowledge gaps of 670 officers implemented by 2008; and (iv) reviewed and enhanced structure and functions of the Directors of Administration and Personnel to serve better as HR managers of their organizations.

(f) Strengthening local training institutions to provide effectively programs needed for improving public service performance. For the government to transform the public service into a pool of skilled and experienced employees there i s a need to strengthen and expand the capacity of local training institutions. In this respect the following outputs are planned: (i) local training providers conduct training courses in 15 identified areas, (ii) the Tanzania Public Service

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College’s capacity building programs implemented, and (iii) the TGDLC’s capacity i s expanded and programs implemented.

Component 6 - Leadership Development (UW6.5 million of which I D A i s US$6.4 million)

156. During PSRP Phase I, leadership was addressed as an issue relating to training. The interventions involved providing skills and changing attitudes among public servants. During PRAP the focus will be on identifying, creating and developing leaders for the public service. In other words, training will only be one of many inputs. The leaders of the future public service will need to demonstrate abilities of openness, innovation, creativity, and adaptability to changing situations. The interventions under this component will fall under the following broad areas:

(a) Identify, develop, and nurture the leadership capacities of public service managers. The interventions will seek to create and develop a cadre of leaders for the Tanzania public service that will have the vision and commitment to participate actively in the transformation of the public service. The main outputs will comprise the following: (i) a leadership competence framework operationalized, (ii) competence-based leadership development programs implemented; and (iii) a leadership succession scheme implemented. PO-PSM will seek innovative approaches to identify potential leaders and to provide them with the tools necessary to spearhead the public service of the future.

Recognize and reward exemplary leadership. Currently, it i s rare that accomplished public service leaders receive accolades or are even formally acknowledged for their contributions. Under PRAP, a “Distinguished Award Scheme” will be developed and implemented. PO-PSM in collaboration with MDAs will also identify other ways to energize the leadership by rewarding innovations and vision.

Organize and deliver top leadership training programs. This intervention seeks to develop the leadership qualities of persons occupying top positions in the public service. I t complements the above proposed measures by developing competency based leadership training programs, exposing top leaders to strategic contemporary issues and operationalizing a mechanism to coordinate top leadership training.

ComDonent 7 - Change Manapement and Reform Coordination (US$11.2 million of which I D A i s US$4.3 million)43

157. The primary objective of this component i s to ensure that public sector reforms are implemented efficiently, effectively and on a timely basis through: (i) a stronger coordination mechanism at the apex of government; and (ii) the provision on a continuous basis of a stronger sets o f skills to enable PO-PSM to remain a leader and pace setter for the government’s PSRP agenda, whilst at the same time promoting greater MDAs ownership in implementing the PRAP. Secondarily, under this component, strategic measures and seed funding to promote public sector reforms in the federal state o f Zanzibar will be made

43 Including support for reforms in Zanzibar,

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available. interventions:

Interventions under the component will broadly fall under the following six

(a) Develop PO-PSM’s capacity to champion, lead and coordinate the implementation o f PRAP. Given the strategy to have MDAs drive the reforms, PO-PSM needs to transform itself into a more proactive and effective champion, leader, facilitator, coordinator and change agent for the reform program. Furthermore, day-to-day administration of PRAP as well as general capacity building efforts to provide enhanced support to the management of the program will be part o f this intervention. The following main outputs will be produced under this broad intervention: (i) PO-PSM’s capacity building plan to manage better PRAP reforms i s implemented; (ii) periodic reviews and evaluations completed to assess PRAP design, implementation and effectiveness throughout the five-year period including independent assessment as required by the Memorandum of Understanding (MOU) between GOT and DPs; and (iii) strengthened PO-PSM administrative support to implement PRAP in compliance with the MOU and Operations Manual.

Promote the effective integration of reforms at M D A level. According to PRAP overall strategy, it i s crucial for realizing a positive impact on services delivery that the interventions of the cross-cutting reforms, including PSRP, are integrated with the SDPs and service delivery initiatives by MDAs. To this end, there i s need for the institutional capacity building at MDAs level which will be addressed through these interventions. In this regard, the following main outputs are targeted: (i) regular consultations between PO-PSM and MDAs and greater facilitation by PO-PSM; (ii) PRAP-funded activities reflected in MDAs work plans and budgets as Appropriation-in-Aid; and (iii) MDAs’ capacity building plans better to manage reforms implemented.

Strengthen capacity for reforms coordination. The establishment of a new Reform Coordination Unit (RCU) in the office of the Chief Secretary will be supported both in terms of developing clear roles and responsibilities and supporting capacity building needs. The main outputs will include: (i) develop a series of new mechanisms to strengthen coordination amongst cross-cutting reform programs; and (ii) establish regular formal fora involving the leaders and managers of cross-cutting reforms.

Enhance knowledge, participation and commitment to PSRP at all levels. In this phase of PSRP, a communication strategy will be developed to inform and gain the support for reforms at all levels and to manage risks associated with such reforms. Support to develop the capacity of key agents to communicate more clearly with government and the public will be provided. Campaigns aiming at providing information and building a consensus for government’s reforms will be initiated.

Assist with the initial development o f public sector reforms for Zanzibar. Under PSRPI, the Government of Zanzibar conducted studies on the core issues affecting the public service such as the wage bill and the composition of the service. Under this intervention, support such as further diagnostic work, policy development, and implementation of low-cost interventions will be made available to the Government of Zanzibar. This intervention could also support the

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design o f a Zanzibar PSRP. This support will be administered through PRAP implementation arrangements.

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Total Phase I1 Program Cost Total Financing Required

Annex 5: Project Costs TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

47.4 56.4 103.8 47.4 56.4 103.8

1. Systems to support service delivery 2. Policy development 3. Pay, incentives and rewards 4. Accountability and responsiveness to the public 5 . Systems for managing public servants 6. Leadership Development

1. Systems to support service delivery 2. Policy development 3. Pay, incentives and rewards 4. Accountability and responsiveness to the public 5. Systems for managing public servants 6. Leadership development 7. Change management and reform coordination

Total Baseline Cost Physical & Price Contingencies

14.7 19.3 34.0 2.5 2.8 5.3 1.5 1.7 3.2 4.0 4.5 8.5 10.6 12.1 22.7 7.4 8.4 15.8

6.1 8 .o 14.1 0.8 0.9 1.7 0.5 0.5 1 .o 1 .o 1.1 2.2 3.5 4 .O 7.5 2.7 3 .O 5.7 3 .O 3.4 6.4 17.6 21.0 38.6 0.6 0.8 1.4

100.2 7. Change management and reform coordination

Total Baseline Cost Physical & Price Contingencies

(of which IDA)

IDA Contribution I 18.2 21.8 40.0

3. Consultant Services

Total US$million

3.2 20.7 44.3 32.5 3.1

103.8

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Annex 6: Implementation Arrangements

TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

Building on a legacy of strong leadership and coordination of the reform programs

158. In a comparative study of PSRPs in three African countries, a World Bank team remarked that an important aspect of the success of the Tanzania PSRP was its effective leadership and management arrangement^.^^ PRAP will continue to benefit from the implementation arrangements set-up under PSRP Phase I, which includes the following key features:

(a) The Public Sector Reforms Steering Committee steers implementation o f all public sector reform programs. The overarching organ for steering public sector reforms, especially on policy and strategic issues, i s the committee of a l l Permanent Secretaries (Inter-Ministerial Technical Committee-IMTC), chaired by the Chief Secretary, who i s also Secretary to the Cabinet and Head of Public Service. The IMTC clears al l policy papers before they are forwarded to Cabinet. In the region, this practice i s unique to the Tanzania public service. For PSRPI, it was envisaged that the Steering Committee would hold a special session quarterly with the exclusive agenda of reviewing implementation progress and plans in each of the major areas of reforms (particularly public service, public financial management and local government). The participation of al l the PSs would be important to share information and discuss the particular challenges brought about by the implementation of the cross-cutting reform programs in their MDAs. Such a forum would also facilitate effective coordination of the PSRP with SDPs and other ongoing reforms. While, the Public Sector Reforms Steering Committee has not discharged i ts policy and strategic leadership and coordination role as effectively as initially envisaged, the merits o f retaining that arrangement remain overwhelming. With further insight in the implementation of the cross-cutting reforms, it has become increasingly apparent that their effectiveness will depend on their synergy and capacity of MDAs to integrate them in their SDPs to provide the necessary tools and enabling environment to achieve the objectives of the MKUKUTA. Therefore, for PRAP GOT has thought through on how to improve the coordination arrangements to facilitate the Steering Committee to perform the leadership and coordinating role more effectively. This committee will meet twice every fiscal year. It will be supported by the RCU.

(b) PO-PSM as the champion, leader and coordinator of PRAP implementation. Located in the President’s Office, which i s the center of both political and administrative authority, PO-PSM has demonstrated that it has the organizational locus and authority to guide and coordinate effectively MDAs in implementing the PRAP. Furthermore, PO-PSM has internally organized i tse l f to carry out these roles and fimctions in a mainstreamed framework with the PS as the overall coordinator o f the reform program. PO-PSM coordinates internally through i ts

Stevens, M. and S. Teggemann, Comparative Experience with Administrative Reform in Ghana, Tanzania and 44

Zambia, World Bank, 2003.

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own Program Implementation Review (PIR) mechanism which i s discussed later in this annex.

(c) Effective cooperation and coordination among Government and DPs. Tanzania’s PSRP has a proven track record of effective DP coordination. It i s a mark of the maturity and effectiveness of this relationship that GOT and DPs agreed to adopt a SWAP with basket fimding modality to conduct their dialogue. PRAP will rely on the same modalities for harmonizing the support from DPs.

Governance arrangements for PRAP

159. The governance arrangements of PRAP will provide for: (i) strategic guidance to the program; (ii) approval of plans and budgets; (iii) assurance that the program’s management i s meeting the needs of the client; and (iv) monitoring of the implementation of the reform program. This will be achieved through the following arrangements:

PSRP Management Committee (PMC). The PMC will evolve from what was the Inter-Ministerial Working Group (IMWG) and the JIPRC under PSRPI. However, i ts membership will not significantly change. Chaired by the PS, PO- PSM, it will provide technical coordination of PRAP. The PMC includes al l Deputy PSs and senior officers appointed by PSs4’ in MDAs. However, unlike the IMWG, it will also include representatives of the DPs. PO PSM’s Directors will participate to provide technical support. The role of the PMC will be to provide overall strategic guidance as well as to monitor and review continuously progress of program implementation and i ts results. This will be done by reviewing and approving plans, budgets and reports, and receiving and reviewing regular program M&E reports, as well as PRAP Reform Coordination Memo. The PMC will meet twice every fiscal year. The committee will be supported through a sub-committee on resources as well as the PIRC.

The P M C Sub-committee on Resources. This sub-committee i s established to oversee the management of PRAP basket fimd. The role of this body i s to scrutinize plans and budgets and review performance and audit reports. The sub- committee prepares recommendations for consideration by the PMC. It i s chaired by the Deputy PS, PO-PSM and members include a select number o f Deputy PSs and officers representing DPs. This sub-committee will hold at least four meetings every fiscal year.

Program Implementation Review Committee (PIRC). The PIRC will examine the day-to-day implementation of PRAP and prepare working papers [draft implementation and performance reports, lead programme reviews (‘joint, internal, and external), draft Strategic and Operational plans, draft Reform Coordination Memo’s etc.] to support the work of the PMC. The PIR will be chaired by the PS, PO PSM and will consist of the Deputy PS PO-PSM; all Directors and assistant directors of PO-PSM; and all PRAP technical advisors. PO-PSM will continue to assign oversight for each component o f PRAP to a directorate within PO-PSM as shown in Table 6.1 below. However an important

4 5 Where there i s no Deputy Permanent Secretary.

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Strengthen Central institutions and the Cabinet Secretariat in policy development Enhance oolicv develooment caoacities within MDAs

feature of PRAP i s that it will adopt a predominantly MDA-driven implementation as explained in paragraph 167.

DPD Cabinet Office DPD, DMS

Table 6.1: PO-PSM Framework for Leading and Coordinating Program Implementation

Strengthen the capacity of Ethics oversight and compliance institutions Strengthen Internal Accountability Mechanisms within Government

KRA 1 : Systems to support Service Delivery

KRA 2: Policy Development

DEI

DMS

k KRA 3: Pay,

Promote Ethical Conduct in the Public Service Strengthen the capacity o f the PSC in the performance of the oversieht role and functions

incentives and rewards

KRA 4: Accountability and Responsiveness to the Public

DEI PSC

Management o f Public Servants

a Strengthen and decentralise HR processes and systems, especially in terms o f recruitment, etc) Combat HIV/AIDS in the workdace

Leadership Development

Management and Reform Coordination

DE

DU

Management Services

Transform HR administrators into HR managers Strengthen local training institutions Identifv. develoo and nurture leadershio capacities of

Policy Development

DE DHRD DHRD

Policy Development

Effectively integrate reforms at MDA level especially through the MTSPBF Coordinate and harmonise Public Sector reforms Build MDAs caoacitv to manage reforms

Management Services

DPDDMS

DPD DPD

Establishment

Human Resource Development

Policy Development

Institutionalise Performance Management Systems [ DMS Restructure MDAs and re-eneineer service deliverv I DMS Out source internal non-core services [ DMS

a Build E-government and knowledge management caoacitv I DMIS Improve the management o f records supporting service DRAM deliverv

Improve the climate for participatory policy development Support implementation of the recommendations of the

1 DPD I DPD

Prds-identiai Commission on Pay I I Develop and implement a central performance based DPDDE rewards and incentives systems

flexibility in allocation o f resources Strengthening the demand side o f accountability for service deliverv

I Create and Enhance Channels for Feedback from Citizens and Clients

I DU Take affirmative measures in favour o f disadvantaged eroum in Public Service

1 DE I a Strengthen the management of HR information

I . . . Public Service managers I I Recognise and reward exemplary leadership Transform the TPSC into a h l l v fledged staff college

I DEDPD I TPSC

I IEC Strengthen the awareness, participation and commitment to PSRP at all levels

Build PO-PSMs capacity to manage reforms Provide generic PSRP programme support services

I DAP

I DAP

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MDAs-driven implementation strategy

160. Accountabilities in a MDA-driven implementation are different than they have been under a centralized approach. In PSRPI, PO-PSM was accountable for the program KRA initiatives. Essentially, the design of PSRPI provided for the responsibility and accountability for the implementation to be shared between PO-PSM and an individual MDA. In practice, PO- PSM dominated the implementation, and adopted a “blue print” approach to the implementation of activities. This situation led to MDAs not really owning the reforms and labeling them as PO-PSM’s program. The effectiveness of the implementation strategy for PRAP is predicated on a decisive shift to a predominantly MDA-driven implementation.

161. In the MDA-driven PRAP, the MDA will become accountable for a range of specifically-defined program outputs, as well as outcomes.46 In this implementation strategy, MDAs, with support from PO-PSM, will be responsible for designing and implementing their PRAP interventions. In particular, MDAs will:

Identify their needs and priorities.

Decide what interventions to implement and how to implement them. This may involve adaptation and customization of standard products or processes.

Implement the intervention, including its procurement.

Control the intervention’s finances through the Government’s accounting system, including the authorization to pay contractors or suppliers.

Monitor, evaluate, report progress and be accountable for the results.47

Take a more central role in reviewing PRAP’s design and implementation arrangements, including participating in joint meetings with DPs.

162. During the planning stage, MDAs will adopt performance indicators (at output and outcome levels) and document these in their results framework. Using Government processes, they will report on these results. In this way, MDAs and PO-PSM will agree on who i s accountable for which performance indicators.

163. Table 6.2 below shows for each of the program components the sharing of responsibilities and accountability for results between MDAs and PO-PSM. In PSRPI, PO- PSM was accountable for overall program KRA initiatives. As we shift to a MDA-driven PRAP, this will not be the case anymore. Column 2 illustrates the kinds of initiatives to be undertaken. Columns 3 and 4 identify accountability for different performance requirements. Each will report on the implementation progress and achievement of these indicators to the Public Sector Reforms Steering Committee. PO-PSM will report on the overall PRAP.

Outcomes are largely under the control o f MDAs since the overall objective i s to improve the performance of the public service to achieve the objectives o f the MKUKUTA.

Accountability arrangements follow those currently in practice in Government. Essentially, if an institution (PO-PSM or an MDA) receives, in their budget, resources to implement an intervention, then their Permanent Secretary or CEO (accounting officer) i s responsible for the use o f those resources.

46

41

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Table 6.2 Sharing Responsibilities and Accountability between MDAs and PO-PSM

KRA / Broad Strategies PO-PSM tasks (menu Items) M D A tasks (menu Items)

.............................................................................. Institutionalize P M S Develop P M S products and ensure their

proper usage

Develop restructuring products; identify restructuring opportunities; review E A

standards and inspect them

Undertake reviews and quality assurance;

Build capacity, customize, and undertake SP, Self Assessments, OPRAs M&E & Client Service Charters

Devolve services to LGAs, restructure, re- engineer services, implement quick wins,

......................................................................................... ......................................... " ...... "".." ................................................................................................................................................................................................................... Restructure MDAs and Reengineer Service Delivery framework; develop management form new Executive Agencies

Outsource internal non- core services Monitor and evaluate

........................................................................................................................................................................................................ " .................. " ............. " .......................................................................................................................... outsource services to the private sector

Promote E-Government And Knowledge preparation of eGovernment support, identify and articulate priorities Management

Form an Executive Agency, undertake Build capacity through training and T A

Improve The Management O f Records That Support Service Deliverv

Develop, monitor and evaluate records management systems, Develop and operate a records management centre

Implement records management systems

KRA 2 P O L I C Y DEVELOPMENT Strengthen Central Institutions

Enhance Policy Identify restructuring opportunities Design and implement capacity building Development capacities

Improve policy making processes, prepare guidelines & other instruments . . . " " ."" . "

plans (both for central policy agencies, and MDAs); restructure

Improve participatory Provide guidancelregulation concerning Form partnerships or collaborations with policy development partner-ships and collaborations, including non-state actors. climate policy forums

KRA..? !!!X,.!?ICENT!.Y!?S .AND REWARD? ......................... .................................................................. Support recommendations of the presidential pay comm.

Develop & implement performance based rewards

Allow a more flexible allocation of resources cabinet papers

Organize studies as need arises; develop a new M T T P , decompress pay structures

Develop processes and schemes; review their effectiveness; undertake job regarding

Undertake studies, design systems, prepare

.............................................................................................................................. " ....................................................................................................................................

............................................................................................................ " ......................................................... ," ..... " ................ . "" ....... " ...............................................................................................................................

KRA.4 .:... ACCoVNTBBILITY .. AND . . . ~ s ~ . ~ ~ s ~ . ~ ~ . ~ ~ . ~ . . ~ ~ . . ~ , ~ E . ~ ~ ~ ~ ~ . ~ , ............................................................................................................................ Strengthen the demand side o f accountability

Create an channels for feedback systems

Strengthen ethics and compliance oversight plans institutions

IEC guidelines, develop mechanisms for engaging non-state actors; develop performance reporting frameworks

Monitor and evaluate complaints handling

Identify restructuring opportunities

Implement capacity building plans to improve IEC; collaboration / engagement with non-state actors

Develop complaints handling systems

Develop and implement capacity building

........................... ............................................................................................................................................................................... .................................................................................................

...................................................................................................................... "" .......... .......................... ..............................................................................................................

Strengthen Internal Develop accountability frameworks, Accountability Mechanisms compliance

monitor, evaluate, and ensure their

Promote Ethical conduct Inspect code of ethics compliance, develop induction courses for ethics

Train staff in issues of ethics

Conduct Ethics Conduct campaigns 4wareness campaigns " .

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I K R A I Broad Strategies PO-PSM tasks (menu Items) M D A tasks (menu Items)

Strengthen the capacity of I public service commission Develop compliance inspection routines; reorganize, build HR capacity

.................................................. K R A 5: SYSTEMS " F O R M A N A G I N G PUBLIC SERVANTS .............................................................................................................. " ...................................... " ...................................................................................................................................................................... Strengthen and decentralize HR processes

Review OPRA instruments; review HR management and employment regulations,; develop improved recruitment tools; prepare H R planning, monitoring & reporting frameworks

Implement customized OPRAs and recruitment processes; prepare HR plans

Combat HIV Aids

Manage Diversity in the Public Service

Strengthen the management of HR information

Transform H R Administrators

.........................................................................

..........................................................................................

Review implementation of HIV-AIDS guidelines

Develop, review, disseminate guidelines; train disadvantaged groups; mainstream diversity issues

Inspect the payrolls, upgrade HCMIS system (product development); monitor and evaluate systems (paper based).

Develop in-service training; implement compulsory training; restructure the DAP's office

................................................ " .................................................................................. """ .........................................................................................................................................

.................................................. " ....................................................................................................................................................................................................................................... Installation of H C M I S (including training). Installation of improved HR records

................................................................................................................................................................................................................................................................�

Strengthen Local training institutions

Build capacity of TPSC and T G D L C

K R A 6: LEADERSHIP DEVELOPMENT Identify, develop and nurture leadership capacities

Recognize & reward leadership

.............................................................................................................................................................................. ._ ..................................................................................................................................................................... Develop leadership schemes and frameworks. Operate an assessment centre

Implement a rewards scheme ....................................................... " ............................. " ................................................................................................................................................................................................................................................................%�

Organise & deliver Implement training leadership training and I develomnent

K R A 7: C H A N G E M A N A G E M E N T A N D R E F O R M COORDINATION

Manage PSRP, ensure it i s well governed; build capacity; support coordination efforts

Build capacity to oversee internal reforms

PRAP coordination wi th other cross-cutting and sectoral reforms

164. A review of the legacy o f the implementation mechanisms of PSRPI has showed that more robust and effective coordination mechanisms are needed to achieve results and accountability for program implementation. Therefore, PRAP will espouse the following approach :

(a) Revamp the existing coordination mechanisms for cross-cutting reforms.

(b) Establish a Reform Coordination Unit (RCU) in the Chief Secretary's Office.

(c) Facilitate integration of cross-sectoral reforms and SDPs at the MDA and LGA levels.

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Revamp the existing coordination mechanisms

165. To improve the leadership and coordination mechanisms for PRAP, specific measures have been identified in terms o f

(a) Enabling the Public Sector Reforms Steering Committee to exercise i t s policy and strategic oversight and coordination roles more proactively, not just for PRAP but also for all cross-cutting and sectoral reforms. The establishment o f the RCU48 wi l l support directly the Chief Secretary to ensure that the Steering Committee i s more effective in exercising oversight, steering and coordination roles with respect to the overall GOT reform agenda.

(b) Enhancing capacity and re-orienting PO-PSM in its leadership and coordination roles. In summary, the job descriptions and performance criteria for PO-PSM’s directors and other senior officers wi l l be redefined to stipulate effective coordination o f PRAP components and their performance wi l l be monitored accordingly. PO-PSM wi l l support the integration o f cross-sectoral reforms and SDPs at the M D A and L G A levels.

(c) Reinvigorating the Public Sector Management Working Group. This group i s responsible for linking the work o f cross-cutting reforms within the framework o f the Public Expenditure Review (PER) process. I ts members are: Directors o f Policy and Planning from MDAs involved in cross-cutting reforms, DPs and representatives from the MKUKUTA monitoring unit.

(d) Reinstating the annual Public Sector Reforms Stakeholders’ Conference as a regular and more effective consultative forum. This forum, held only once before, proved to be very valuable. Key stakeholders have lamented the fact that it did not happen regularly. It provided a platform for diverse stakeholders, including senior public servants, to exchange on the challenges o f implementing the reforms and means to collaborate more closely to achieve the Government’s national development objectives.

Establish a Reform Coordination Unit

166. The RCU wi l l be a new mainstreamed organizational unit in the Chief Secretary’s Office. It wi l l advise the Chief Secretary on ways to coordinate better Government’s reform initiatives. It wi l l also serve as the Secretariat o f the Public Sector Reforms Steering Committee (IMTC). In brief, the Unit’s main tasks wi l l include to: (i) review periodically program design and liaise with reform program management to identify overlaps, conflicts, and areas o f synergy; (ii) monitor and evaluate progress in the programs to ensure they operate effectively and meet the needs o f their client MDAsLGAs; (iii) act as a Secretariat o f the various mechanisms governing cross-cutting reforms, including the Public Sector Reforms Steering Committee and the Public Sector Management Working Group.

167. The process o f establishing the RCU i s already underway. I t s location wi l l provide the RCU with the necessary leverage in its coordination o f the various public sector reforms. It i s important that the RCU has the authority to call to account Accounting Officers o f

48 Details provided below.

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MDAs, regional administrations and LGAs to perform their respective roles in driving the government's reform agenda.

Integrate cross-sectoral reforms and SDPs at the M D A and LGA levels

168. In developing the strategy for P U P , and to increase i t s focus on results and impact on service delivery, the need to integrate better national strategies, cross-cutting reforms and SDPs at the levels o f service delivery agencies, Le., MDAs and LGAs, became clear. While MDAs and LGAs recognize the benefits o f integration, it has not happened as successfully as envisaged, particularly due to the lack o f effective mechanisms and modalities to do so. GOT had underestimated the level o f effort required for this integration and coordination. Government has addressed partly this issue by integrating cross-cutting reforms with sector activities through the MDAs' MTSPB process. The MTSPB i s already linked to national development strategies such as MKUKUTA. The Reform Coordination Framework (Figure 6.1 below) illustrates how this wil l happen.

__ __ - . . . . . . .. -. . . . . . __ -. -. . . ... " . .

Feedback Feed back

Figure 6.1 Public Sector Reforms Coordination Framework

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Annex 7: Financial Management and Disbursement Arrangements TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

Back ground

169. PRAP i s the second project of an APL that will be implemented and managed by the same government ministry - PO-PSM, which i s managing the existing project closing December 31, 2007. A unit under PO-PSM was established to manage financial aspects of PSRPI and one accountant in PO-PSM was assigned to work with this unit in order to build capacity o f staff. The assessment of the financial arrangements for PRAP therefore essentially implies a review of continuing adequacy of the financial management arrangements for PSRPI in MDAs and an assessment of any changes thereto to incorporate Phase I1 of the program. This included an assessment of the current capacity of the Accounts and Finance unit of PO-PSM which will now take full responsibility to coordinate and consolidate the quarterly Interim Financial Reports (IFRs) and annual financial statements.

Executive Summary o f the financial management (FM) assessment

170. During the pre-appraisal mission, a financial management assessment was carried out at the PO-PSM Accounts and Finance unit in line with the World Bank Financial Management Practices Manual issued by the Financial Management Sector Board in November 2005. This includes identification of financial management risks that may affect project implementation and risks mitigation measures to address these risks.

171, The assessment also draws on the following reviews: (i) March 2005 PEFAR; and (ii) FM performance during Phase I implementation; and (iii) statutory audit reports of the PO- PSM for FY 05 and 06 which were unqualified (clean) opinion.

172. The review missions revealed that in the past six years the government continues to strengthen its public financial management systems, which i s now assessed as satisfactory. Significant progress has been made to ensure that the risk associated with lack of clear rules and regulations has been reduced, and also capacity o f finance staff at MDAs has been enhanced. The timelines and quality of financial reporting and audits has improved.

173. The FM assessment identified the fiduciary risks and measures to mitigate the risks. These risks are: (i) funds may not be used in an efficient and economical way; and (ii) the oversight bodies (i.e. Public Accounts Committee, NAO, Audit Committee) and internal control systems may not be fully effective. Appropriate risk mitigating measures have been identified. Subject to the implementation of these measures, the overall conclusion of the assessment i s that the program’s financial management arrangements satisfy the World Bank’s minimum requirements under OPBP10.02. The overall Government public financial management system that included PO-PSM i s satisfactory. Financial management risk i s assessed as modest.

174. There are no project audits outstanding for this sector.

Overview o f Financial Management Implementation Arrangements

175. PRAP implementation arrangements will continue to be mainstreamed into the existing government structures and systems, including FM arrangements. The accounting

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Risk Risk Risk Mitigating Measures Incorporated into Project Rating design

Inherent Risk Country level: Funds may not be used in an efficient and economical way.

M MDAs are strengthening the internal audit and audit committee’s functions through various trainings. The government i s strengthening the oversight bodies (NAO and Public Accounts Committee) including the

officers of the respective MDAs will assume overall financial management responsibility for project funds. They will ensure that the project FM activities are carried out efficiently and in accordance with Government Public Finance Act 2001, and Financing Agreement. The government computerized accounting system called ‘Epicor’ will be used to report on project finances.

Condition of Negotiations,

Board or Effectiveness Conditions.

176. PO-PSM has experience in executing programs financed by other multi-lateral institutions and international DPs including IDA under SWAP financing modality. As such, capacity enhancements have been undertaken during PSRPI at PO-PSM and MDAs to ensure that the FM functions are efficiently implemented. PO-PSM has maintained a satisfactory FM rating during the PSRPI. PSRPI project audits received clean /unqualified opinions.

177. Country Issues and Risks. The various Public F M (PFM) assessments carried out for the last six years revealed that the Government of Tanzania has taken significant steps to improve i ts public financial management system and i s now regarded as satisfactory. Most of the recommendations contained in these reviews have either been implemented or are being implemented under the ongoing PFMRP. Significant progress has been made to ensure that the risk associated with lack of clear rules and regulations has been reduced. Also more useful information i s now provided in the annual accounts. The quality and timeliness of financial reporting has improved with all Central Government ministries submitting their annual financial statements within the statutory period. For the last two years (FY 05 and 06), NAO submitted the GOT audit report within the statutory period. GOT continues to strengthen the capacity of accountants and auditors at MDAs and LGAs through various training programs. This includes recruitment of additional qualified accountants and auditors. The 2005 PEFAR lowered the level of country-level fiduciary risk from high to modest. An update of the overall PFM risk will be carried out jointly by DPs and the Government in FY 2008.

178. Despite the above efforts taken to reform government PFM, challenges remain to ensure effectiveness, transparency and accountability in the use of public funds. More specifically, strengthening of the oversight bodies and internal controls.

179. With a number of development partner-assisted initiatives, such as PFMRP, LGRP and LGSP, GOT i s working to enhance rapidly the financial accountability framework in order to mitigate fiduciary risks in public expenditure management; achieve economy, efficiency and effectiveness in the use of public funds; enhance transparency and accountability; and enhance staff capacity in PFM.

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Risk

Implementing Entity & Project Level: . Weak oversight and

internal controls.

Overall Inherent Risk Control Risk Planning & Budgeting: Poor planning budget monitoring.

Accounting: Accounting Policies and Procedures and Information Systems

Staflng: Lack o f adequate qualified internal auditors, external auditors and accountants

Internal Control : Controls, compliance and sanctioning, including enforcement may not be fully effective

Risk Rating

M

M

M

L

M

S

Risk Mitigating Measures Incorporated into Project design

internal audit functions by providing training. These will therefore ensure better follow-up of internal & external audit reports by these functions. The PFM systems are reviewed and monitored during the annual PEFAR and PFMRP reviews. In addition, fiduciary risks are reviewed and monitored during the annual PEFAR mission. MDAs will be subject to performance and procurement audits to be conducted by the PPRA annually in addition to the normal financial audits.

1 The Audit Committee already established in each MDA will play an oversight role in ensuring that the project funds are used for intended purposes, accountability and that value for money i s achieved. There will also be follow up on the implementation o f the recommendations arising from the annual audit report and internal audit reports. . There will be linkages between physical output and financial outcomes, including M&E functions within the program. PMC- Subcommittee will review these performance reports before any MDA receive additional funds.

PRAP disbursement requirement will be incorporated into MDAs MTEF planning and budgeting processes. PMC- Subcommittee will review these performance reports before MDA receive additional funds. Approval of the annual workplan and budget

Semi-annual IFRs which highlights project financial performance will be reviewed jointly by the DPs and the government.

Will follow government accounting and financial policies as detailed in Public Financial Regulations and Public Finance act 2001. The existing computerized accounting package called ‘Epicor’ will be used to produce the financial reports and statements.

A long-term training plan to al l accountants and auditors i s being undertaken by the Accountant General and Auditor General through PFMRP. GOT has recently recruited qualified accountants and auditors to strengthen MDAs’ finance units.

. MDAs are strengthening internal audit and audit committees’ functions through training. The audit committees’ major role i s to review internal and external audit reports and follow up on implementation o f the recommendations arising from these reports. . There will be a strong supervision and quality assurance o f the project by the oversight agencies and DPs.

Condition of Negotiations,

Board or Effectiveness Conditions.

Condition of disbursement

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Risk

Funds Flow: Delays in release of funds by DPs and the Government

Financial Reporting and Monitoring: Delay in the submission o f quarterly IFRs, and annual financial statements

External Audit : Inadequate audit capacity and techniques.

Overall Control Risk

Overall Risk Assessment

Risk Rating

M

M

M

M

M

Risk Mitigating Measures Incorporated into Project design

Specific timetable for the semi-annual release o f funds by MOF to the implementing agencies will be developed.

8 The schedule and timetable will be included in the MOU.

PO-PSM will coordinate and prepare a summary of the IFRs, and the annual financial statements. Samples of the formats will be detailed in the operations manual and will be agreed upon during negotiations.

8 There are ongoing efforts to strengthen NAO by way o f capacity building (including more training, hiring of additional qualified auditors, putting in place o f an effective organizational structure) under the PFMRP. This i s aimed at enabling NAO to use modernized audit techniques and to focus more on value for money audit.

8 A Public Audit Act with the aim of further strengthening NAO will be submitted to the Parliament in November 2007.

Condition of Negotiations,

Board or Effectiveness Conditions.

Formats of IFRs and annual financial statements were developed and agreed at Negotiations

Risk rating: H (High Risk), S (Substantial Risk), M (Modest Risk), L (Low Risk)

Main Strengths and Weaknesses

181. The Government FM system will be used for the project. MDAs will be involved in processing the project financial transactions and will strictly follow the government budgetary discipline and regular reporting mechanism. The PFM review has revealed that the GOT financial system i s satisfactory.

182. satisfactory FM rating during the PSRP I. opinions. PO-PSM audits for the previous two years received clean opinions.

PO-PSM has good experience in managing IDA funds and also has maintained a Project audits received clean /unqualified

183. The Government i s implementing key recommendations of the 2003 CFAA, PEFAR 2005 to improve the PFM system. Additionally, there i s an ongoing PFMRP that i s being implemented to further strengthen the PFM system.

184. Although the government has now a sound system of formal rules for financial management challenges remains on the application of the financial rules and regulations. There i s a need to continue implementing reforms to address the following areas:

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(a) Weak internal controls;

(b) Inadequate follow up on audit recommendations and enforcement of compliance with financial regulations and rules by Accounting Officers and Audit Committees; and

(c) Inadequate scrutiny and oversight over public finances.

185. Planning and Budgeting: The overall project budget and a disbursement schedule have been included in the PAD (see Annex 5 and data sheet). IDA funds will be provided in line with this disbursement schedule (as may be subsequently revised). The Annual Work Plans and Budgets (AWPB) will be prepared and approved based on the policy guidelines issued by Ministry of Finance under MTEF framework. MDAs will ensure PRAP contributions are fully reflected in the ministry’s budget and annual national budget.

186. The PMC sub-committee on Resources will approve the AWPB submitted by PO- PSM and other MDAs. The AWPB will be furnished to the PMC early June in each year of implementation. PMC will jointly confirm the AWPB by late June of each year of project implementation in the light of any changes that may have been made to the approved AWPB by PMC sub-committee on PSRP Resources. Since DPs contributing to the basket will be members of the PMC, the approval of the AWPB by the PMC will trigger the release of funds by DPs to the holding account.

187. The AWPB will be furnished to DPs by June 1 in each year of implementation. This information will guide the DPs on the amount of funds required and help them make their individual commitments for program financing in the relevant FY. Comments and views o f the DPs on the AWPB as expressed in the course of consultations during the annual public expenditure review process will be taken into account. DPs will jointly confirm the AWPB by June 30 of each year of project implementation, in the light o f any changes that may have been made to the approved ceilings.

188. Accounting Policies & Procedures: The government accounting system i s based on integrated government computerized systems. The project accounting arrangements shall comply with the requirements stipulated in GOT Public Finance Act and Regulations of 2001; the accounts will be maintained on a cash basis. In addition, all project transactions will be processed on the integrated financial management system called Epicor and in accordance with Regulation 25 Sub-section (1) of the Public Finance Act. The accounting policies are based on generally accepted accounting practices.

189. Staffing and Training: All MDAs have accounting units that are headed by Chief Accountants. Generally, the capacity of the accounting staff at a l l levels i s now at a satisfactory level, i.e. after the recent hiring of additional qualified accountants and internal auditors. In addition, staff capacity has been strengthened through the on going PFM reform programs with the support of DPs. Staff in MDA finance units have undergone training in the use of ‘Epicor’ the GOT accounting package. More training i s planned in the future on any upgrades of the software.

190. Periodic Reporting for Project Monitoring: Formats of the IFRs, Le. periodic financial monitoring reports, are designed to provide quality and timely information to GOT,

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Audit Report Special opinion on PRAP basket hnd holding account and annual financial statements.

the DPs and various stakeholders on the performance of PRAP. (Samples of these reports are included in the PRAP Operations Manual). Within 40 days of the end of each quarter, the reports would be prepared by each MDA and submitted to PO-PSM for consolidation with copies to MOF. The contents of these reports should, at a minimum include the financial reports which sets forth sources and uses of funds by project activity/component, and statement o f actual and budget expenditures, both cumulatively and for the period covered by the said report, and explains variances between the actual and planned uses of such funds. PO-PSM will consolidate the IFRs from MDAs and submit these to the World Bank and other DPs within 60 days of the end of the quarter. The same IFRs will be used to request disbursements from IDA.

Due Date By December 3 1 (within six months after end o f the government FY).

191. In addition to the consolidated IFRs, PO-PSM will prepare an annual financial report which will include the summary of Basket Fund holding account operations and utilization of funds received by MDAs from the Basket Fund, submit to NAO within 3 months after end o the financial year for auditing purposes. The formats of the annual financial statement have been agreed at negotiations.

192. Internal Control and Internal Auditing: The internal control systems of MDAs indicated satisfactory levels of segregation of duties and control. Al l MDAs have established internal audit units. Internal audit guidelines have been developed and training completed for the internal auditors. In addition, a long-term training program i s planned under PFMRP. There are now qualified and adequate internal auditors in MDAs.

193. The internal auditors will develop an audit strategy and plan for the project based on the risk assessment. The internal auditor’s work would be monitored and reviewed by MDAs audit committees on quarterly basis to ensure that the internal control systems are functioning adequately and that the issues raised in the internal auditor’s report are addressed by the ministry.

Bank Account and Flow of Funds Arrangements

195. PSRP Holding Account: A US Dollar designated PSRP holding bank account will be established and operated by the Accountant General. This account will be maintained at the Bank of Tanzania (BOT). DPs will deposit funds in the holding bank account on a semi- annual basis to finance activities for one year based on the cash forecast. The first deposit

49 The audit wi l l have to cover the summary of utilization of funds in MDAs, i.e. cumulative IFRs as of June 30 of each FY notjust the transferspom the Basket Fund.

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Category

Subprograms

should be made anytime prior to the commencement o f the GOT financial year in July so that funds will be available at the beginning of the Fiscal Year (FY). On the basis of the credit advice received from the BOT, the Accountant General will issue a receipt voucher within 3 days to each DP for the amount deposited. The aforementioned bank account shall be opened by credit effectiveness date.

Amount of the Financing Allocated

(expressed in US$)

40,000,000

Percentage o f Expenditures to be Financed

Such percentage o f Eligible Expenditures as the Association shall determine for each Fiscal Year

196. Disbursement of funds from the Holding Account to MDAs: The Accountant General upon receipt of request from PO-PSM will transfer PSRP funds from the Holding Account into the Development Account at the Treasury from which all MDAs will be paid using the Exchequer System. Al l payments will abide by the Government Payment Procedures. The first release of funds to the Development Account will be the total o f expenditures projected for the first two quarters. Subsequently, two quarterly disbursements will be made based on cash flow estimates (for the approved WP) for the financial year. Approvals and Exchequer releases to the participating MDAs will be made on quarterly basis subject to satisfactory physical and financial performance in the previous quarters as reflected in the submitted quarterly progress reports by MDAs.

I 4090009000 T O T A L AMOUNT

Disbursement Method: Disbursements from the IDA Credit will be based on semi-annual IFRs. Disbursements to meet eligible expenditures under SWAP modalities will follow the agreed disbursement modalities as stipulated in the Memorandum of Understanding (MOU) to be signed by contributing DPs. Funds from the IDA Credit will be disbursed to the PRAP basket fund holding account to be established at BOT and to be maintained by MOF.

198. Documentation requirements for report-based disbursement: The following reports are required:

(a) IFRs (sources and uses of funds by project activity/component, and statement of actual and budget expenditures, both cumulatively & for the period covered by the said report, and explains variances between the actual and planned uses of such funds.

(b) PSRP Holding Account Activity Statement.

(c) PSRP Holding Account Bank Statements.

(d) Summary Statement of PSRP Holding Account Expenditures for Contracts subject to Prior Review.

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(e) Summary Statement of PSRP Holding Account Expenditures not subject to Prior Review.

(0 Projected cash requirements for the next two quarter reporting periods.

199. All documents supporting the reported expenditures, such as invoices, statements, and bills of lading, should be maintained by the implementing entities and made available for review by auditors as set out in the Financing Agreement.

200. Submission of Withdrawal Applications to IDA: PO-PSM should submit the initial withdrawal application after the project has become effective and the PSRP Holding Account has been opened at Bank of Tanzania. The Borrower should submit withdrawal applications to the Loan Department, together with two copies of the project expenditure forecast for the first fiscal year. For subsequent withdrawals, PO-PSM should submit withdrawal applications to the Loan Department, along with the IFRs for the period ended, the PRAP Holding Account Activity Statement, and the summary PRAP basket fund holding account Statements of Expenditures for contracts subject to prior review and expenditures not subject to prior review.

201. Due date for submission of the above report: The Bank must receive al l disbursement reports and bank statements, together with the IFRs, within 60 days of the end of each semi- annual reporting period.

202. Procurement arrangements: The Procurement Specialist has assessed the procurement arrangements for the project. The specific procurement issues that affect financial management are described under Annex 8.

203. Supervision arrangements: There will be an annual review by both GOT and DPs. In addition, there will be regular FM supervision reviews by the World Bank Financial Management Specialist. The inherent risk of project funds not being used in an efficient, economical way and exclusively for the intended purpose will continue to be addressed through PFMRP currently under implementation. Additionally and as currently done, this risk will be reviewed and monitored during the annual PEFAR. Additional program monitoring will include the following:

(i) Management oversight o f MDAs audit committees and PMC sub-committee.

(ii) Annual external audit that includes both financial and procurement audit.

204. The World Bank Financial Management Specialist will also carry out regular reviews of semi-annual IFRs and annual financial statements, audit reports, and follow up on any issues and recommendations. As part of the FM supervision, the Bank, jointly with other DPs will also examine the audit reports of each one of the MDAs participating in the PRAP. The report i s issued by the NAO normally within 9 months after the end of the fiscal year. Transactions and control reviews will be carried out at the ministry’s internal audit unit and their report would be submitted to the respective MDA Audit Committee for further follow- UP*

Financial Management Effectiveness and Disbursement Conditions 205. There are no financial management conditions for credit effectiveness.

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Financial Covenants

206. other DPs:

Standard financial covenants include the submission o f the following to IDA and

(i) Audited PRAP basket fund holding account and annual financial statements within six months after the year-end o f the financial year.

(ii) Agreed IFRs within 60 days after each financial year quarter, and shall cover such financial quarters.

(iii) Other related information as required by the PSRP - DG. (iv) Annual performance and procurement audits.

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Annex 8: Procurement Arrangements

TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

A. General

207. Procurement of the PRAP will be carried out in accordance with the World Bank's "Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004, Revised October 2006; and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004, Revised October 2006; and the provisions stipulated in the Financing Agreement. In particular, procurement of contracts through ICB procedures for goods, works; and selection of consultants for large contracts; the World Bank's "Guidelines" will be adhered to at a l l times. Procurement of non ICB contracts for goods, works; and selection of small consultant contracts (less than US$lOO,OOO equivalent per contract) will be carried out in accordance with Public Procurement Act (PPA) of 2004 and associated regulations. The various items under different expenditure categories are described in general below. For each contract to be financed by the Credit, the different procurement methods or consultant selection methods, the need for pre-qualification, estimated costs, prior review requirements, and time frame are agreed between the Borrower, the Bank and other DPs in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity.

208. Procurement of Works: Works procured under this program for the first 18 months would include: construction of proposed NRC by PO-PSM. Other works contracts would be identified during implementation when other MDAs would be on board. Procurement will be done using the Bank's Standard Bidding Documents (SBD) and Standard Bid Evaluation Forms for a l l ICB contracts. The Government has already prepared Standard Bidding Documents for National Competitive Bidding (NCB) procedures for procurement of works, which have been found acceptable to the Bank. The Government may use these documents when carrying out procurement of works through NCB procedures. Civil works estimated to cost more than US$500,000 equivalent per contract would be procured through ICB. Civil works estimated to cost less than US$500,000 equivalent per contract would be procured through NCB. Minor works contracts estimated to cost less than US$50,000 per contract would be procured using Shopping method. Direct contracting may be used when it can be justified that a competitive method i s not advantageous and meets the requirements under paragraph 3.6 of the Procurement Guidelines and after consultation with the Bank. The prior review threshold for works contracts would be US$500,000 equivalent per contract.

209. Procurement of Goods: Goods procured under PRAP for the first 18 months would include: motor vehicles, office and ICT equipment (desktop computers, laptop computers, photocopiers, fax machines, etc.), and maintenance of office and ICT equipment. Other goods contracts would be identified during implementation when other MDAs are on board. Procurement will be done using the Bank's SBD and Standard Bid Evaluation Forms for al l ICB contracts. Since the Government has prepared SBDs for NCB procedures for procurement of goods, which have been found acceptable to the Bank, procurement of goods through NCB procedures may be carried out using these documents. Goods estimated to cost more than US$250,000 equivalent per contract would be procured through ICB procedures. Goods estimated to cost less than US$250,000 equivalent per contract would be procured through NCB procedures. Goods contracts estimated to cost less than US$50,000 equivalent per contract would be procured using Shopping method. Direct contracting may be used

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when it can be justified that a competitive method i s not advantageous and meets the requirements under paragraph 3 -6 o f the Procurement Guidelines and after consultation with the Bank. The prior review threshold for goods contracts would be US$250,000 equivalent per contract.

2 10. Procurement of non-consulting services: Non-consulting services to be procured under the program include: venues for workshops, training, etc., which wi l l be selected on the basis o f at least three quotations.

2 1 1. Selection of Consultants: Main consulting services to be procured through Quality and Cost Based Selection (QCBS) procedures and financed by the program for the first 18 months include: (i) consulting services for supervision o f the proposed construction o f NRC; (ii) consulting services to develop and implement e-Government portal; (iii) consulting services to develop management standards, inspection routines, and manuals; (iv) consulting services to support the review o f the EA operational framework process; (v) consulting services to review and analyze studies undertaken to support the Presidential Commission’s findings on Pay; (vi) consulting services to review MTPP and MTPS; (vii) consulting services to study options for an appropriate incentives and reward scheme to be adopted by the public service; (viii) consulting services to develop IEC guidelines for MDAs; (ix) consulting services to develop a management accountability framework; (x) consulting services to review OPRAs experience in 67 MDAs; (xi) consulting services to develop payroll inspection routine and tools; (xii) consulting services to review and restructure offices responsible for administration and personnel in MDAs, RSs and LGAs, (xiii) consulting services to develop the assessment center project document, (xiv) consulting services to develop a framework to manage the consortium for delivering top level leadership program, (xv) consulting services to develop training programs to bridge competency gaps at top leadership level; (xvi) consulting services to develop strategic contemporary programs and training materials for top leaders; (xvii) consulting services to conduct awareness campaign for 400 parliamentarians on public sector reforms; (xviii) consulting services to conduct fora for PO-PSM to listen to citizens; (xix) consulting services to undertake PRAP social marketing campaign; (xx) consulting services to establish the RCU; (xxi) consulting services to undertake periodic evaluation, impact assessments and studies. In future procurement plans, the appropriate method o f consultant selection wi l l be determined for each assignment or package o f assignment in the course o f preparing the procurement plan on the basis o f the nature o f the assignment and the provisions o f the Consultant Guidelines. Consulting f i rms for services estimated to cost less than US$200,000 equivalent per contract would be selected using Consultants’ Qualifications (CQS). Consulting f i rms for carrying out standard or routine nature assignments such as audits would be selected through Least Cost (LCS). Consulting firms for services, which meet the requirements under paragraph 3.2 o f the Consultant Guidelines such as monitoring and evaluation would be selected through Quality Based Selection (QBS). Individual consultants would be selected on the basis o f their qualifications in accordance with Section V of the Consultant Guidelines. Single source may be used where it can be justified and after consultation with the Bank. Short l is ts o f consultants for services estimated to cost less than US$200,000 equivalent per contract may be composed entirely o f national consultants in accordance with the provisions o f paragraph 2.7 o f the Consultant Guidelines. Consultancy services estimated to cost above US$200,000 equivalent per contract for f i r m s and above US$ 1 00,000 equivalent per contract for individual consultants and single source selection o f consultants wi l l be subject to prior review by the Bank.

- 8 7 -

B. Assessment o f the agency’s capacity to implement procurement

212. Procurement activities will be carried out by the following entities: (i) PO-PSM and (ii) 67 MDAs. Besides conducting normal procurement of items under their jurisdiction, PO- PSM will also be responsible for clearance of contracts below prior review thresholds from MDAs, which have inadequate procurement capacity as one of the mitigation measures. In this case PO-PSM will prior review at least the first three NCB contracts from MDAs with inadequate capacity. PO-PSM will assess the capacity of an MDA after reviewing these three contracts to validate i ts capacity. In the event that PO-PSM determines that the capacity of a certain MDA has not improved, it will continue to clear procurement packages until such time that the capacity i s improved.

213. I t i s unlikely that MDAs will be able to access the program funds from first year of operation. However, from second year of operation, many MDAs, if not all would begin accessing funds. In this respect, PO-PSM’s Procurement Management Unit (PMU) will have the following roles in addition to the above function: (i) consolidate procurement plans of MDAs and submit to DPs for clearance; (ii) in collaboration with DPs, to carry out a joint procurement capacity assessment of MDAs, that will be able to access the funds, and revise the mitigation measures accordingly; (iii) consolidate procurement progress reports; (iv) in collaboration with the Public Procurement Regulatory Authority (PPRA), prepare a capacity building program for MDAs with inadequate capacity; and (v) liaise with PPRA to ensure that an annual procurement audit i s conducted on time and a report shared with the DPs or hire an independent consultant to carry out annual procurement audit. To carry out the above-mentioned responsibilities, the PMU must retain the same capacity in terms of number o f staff, experience and qualifications. Since procurement function in Tanzania i s decentralized, each MDA i s a procuring entity. The new PPA (2004) became effective May 2005. The above arrangement confirms that procurement activities will be mainstreamed within the existing structures of the Government.

214. PO-PSM has already established a PMU and the tender board in accordance with the Public Procurement Act (PPA) of 2004. Currently, PMU has sufficient number o f staff to carry out procurements of PRAP. It has six people out of which three are procurement experts (two are consultants and one i s an employee of PO-PSM - head of PMU), and three are supplies officers. Contracts of the two procurement experts expire on December 31, 2007. In this respect, PO-PSM must retain adequate capacity for procurement through outsourcing or other internal government arrangements. PMU has two sections. The first sections deals with procurement function and the second section deals with supplies and stores function including logistic function. The tender board meets regularly in accordance with PPA of 2004. There has been no delay in procurement processes related to tender board meetings.

215. An assessment of the capacity of PO-PSM to implement procurement actions for the program was carried out in May 2007 by Pascal Tegwa, Senior Procurement Specialist. The assessment reviewed the organizational structure of the PMU, its staffing, experience of the staff doing procurement, filing and record keeping system, and whether procurement i s done in accordance with the new PPA (2004) and its associated regulations. There would be 67 MDAs that would implement this program. MDAs would access funds on demand driven basis. The capacity assessment o f MDAs would be carried out once PO-PSM identifies them. This would entail revision of mitigation measures based on the capacities of MDAs. The

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Risk Factor

Inadequate skil ls in

current mitigation measures have been designed based on the findings from the assessment o f PO-PSM.

Action to mitigate risk Action by Deadline for

Prepare and conduct PO-PSM Before effectiveness completing Action

216. The key finding i s that PO-PSM has adequate capacity because o f previous experience in implementing PSRPI. In this respect, the prior review thresholds that were applicable to PSRPI would 'be retained (see paragraphs 124 and 125 above). The procurement post review (PPR) carried out recently (in June 2007) concluded that PO-PSM has a credible filing and record-keeping system, although minor improvements are required. However, it i s substantially enhanced compared to previous years. In addition, PO-PSM has introduced a framework contract arrangement for procurement o f items related to incremental operating costs that seems to provide value for money. The review noticed that under the framework contract arrangement unit costs o f items are lower than what i s paid by other projects, which are not practicing framework contracts. This i s good practice that must continue under PRAP. The packages that constituted framework contracts included: (i) supply o f stationeries; (ii) maintenance, repair, and services o f ICT equipment; (iii) maintenance, repair, and services o f office equipment; (iv) maintenance, repair, and services o f motor vehicles; (v) maintenance, repair, and services o f air conditioners and refrigerators; (vi) supply o f motor vehicles tyres, tubes, batteries, and related services; (vii) supply o f fuel; (viii) provision o f internet services; (ix) provision o f traveling services; and (x) provision o f hospitality and conference facilities.

217. Experience gained from Phase I shows that component leaders play a big role in contract management and administration during contract execution, particularly in consulting services contracts. Unfortunately, component leaders lack contract management ski l ls. To avoid unnecessary delays in contract execution, it i s important that component leaders have basic knowledge in contract management and administration. Therefore, it i s recommended that the PMU should prepare awareness training programs to train component leaders in preparation o f terms o f references, and contract management and administration during execution o f PRAP to ensure that there are no delays in contracts execution. Procurement capacity assessment o f the 67 MDAs wi l l be carried out before allowing them to access the program funds. PO-PSM wi l l be responsible for clearance o f non ICB contracts and small consulting services contracts (contracts less than US$lOO,OOO equivalent per contract) for MDAs with inadequate capacity.

218. The corrective measures, which have been proposed are for PO-PSM to: (i) retain the same prior review thresholds as per PSRPI, (ii) retain the same capacity o f the PMU; (iii) prepare and conduct awareness training programs for component leaders in areas such as preparation o f terms o f references, and contract management and administration during execution o f PRAP to ensure that there are no delays in contracts execution; (iv) carry out an annual procurement audit; (v) clear at least the first three non-ICB contracts and small value consulting services contracts from MDAs with inadequate capacity; (vi) prepare a procurement manual; and (vii) prepare a procurement plan covering the first 18 months o f the program.

219. mitigate the risk are summarized in the following table.

The overall program risk for procurement i s AVERAGE. Proposed actions to

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preparation of TORS, and contract management and administration by component leaders or MDAs with inadequate capacity Inadequate capacity amongst 67 MDAs that would access the PRAP funds

Likely turn-over of procurement staff at PO-PSM

Absence of a procurement plan Absence of a Procurement Manual

C. Procurement Plan

awareness training programs for PO-PSM component leaders and other MDAs with inadequate capacity

(a) Clear procurement documents of non ICB contracts and small-value consulting services contracts (b) Train procurement staff of these MDAs including respective members of their tender boards (c) Carry out annual procurement audit

(a) Retain the same staff in terms of numbers, qualifications, and experience

(b) Retain the same prior review thresholds as per PSRPI. Prepare a procurement plan of the first 18 months Prepare a Procurement Manual at least in a draft form

PO-PSM

PO-PSM PPRA World Bank

PO-PSM

PO-PSM ~

PO-PSM

PO-PSM

PO-PSM

220. The Borrower, at appraisal, developed a procurement

and during implementation

During implementation of PRAP

During implementation of PRAP

During implementation of PRAP Before effectiveness

During implementation of PRAP

Before negotiations

Before negotiations

plan for program implementation, which provided the basis for the procurement methods. This plan has been agreed between the Borrower and the Project Team during negotiations and i s available in the project files. I t will also be available in the program’s database and on the Bank’s external website. The Procurement Plan will be updated in agreement with the team annually or as required to reflect the actual project implementation needs and improvements in institutional capacity.

D. Frequency o f Procurement Supervision and Audit

221. In addition to the prior review supervision to be carried out from the Bank’s country office, the capacity assessment of the Implementing Agencies has recommended one supervision mission every six months to visit the field to carry out post review of procurement actions. Furthermore, the Borrower will engage an independent procurement auditor each year to review procurement of goods, works, and consultant’s services

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Selectio

Method P-Q

Contract Estimated Ref* No’ Description Cost

AOZDOl Construction 4,900,000 ICB of Proposed NRC

NCB G10C03 Maintenance of Office and 200,000 ICT equipment

undertaken the previous financial year, including reviewing o f procurement procedures and processes.

Expected

Opening Domestic Review by Bid Preference Bank (yeslno) (PriorlPost) Date

Comments

No Prior 9-NOV-OS

No Post 21-Jun-OS

E. Details o f the Procurement Arrangements Involving International Competition

Consultancy Services to develop Management

routines and manuals standards, inspection

1. Goods, Works, and Non Consulting Services

QCBS 200,000

Consultancy Services to support the review EA

process operational framework

(b) ICB contracts estimated to cost above US$250,000 equivalent per contract for goods; and US$500,000 equivalent per contract for works and all direct contracting wi l l be subject to prior review by the Bank.

QCB S 100,000

2. Consulting Services

(a) Li;

Ref. No.

A02DO 1

A03C03

A07S02

A08S02

o f consulting assignments with short-list o f ii

Estimated Selection I cost 1 Method Contract Description

Supervision o f Proposed Construction o f National Records Centre

QCBS 150,000

Consultancy Services to develop and implement e- Government Portal

QCBS 109,200

mational f

Review by Bank (PriorPost)

Post

Post

Prior

Post

bms. Expected Proposal Submission Date

9-May-08

1 8-JuI-08

2 -May -0 8

27-Jun-08

Comments

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Estimated cost

Review by Bank (PriorPost)

Expected Proposal Submission Date

Selection Method Ref. No, Contract Description Comments

Consultancy Services to review and analyze studies undertaken to support the Presidential Commission's findings on Pay

COlSOl QCBS Post 4-JuI-08 150,000

150,000

100,000

~~~

QCBS

QCB S

Post 12-Sep-08 Consultancy Services to review MTPP and MTPS CO 1 SO3

Consultancy Services to study on options for an appropriate incentives and reward scheme to be adopted by the Public Service

Consultancy Services to develop IEC guidelines for MDAs

C03S01 26-Sep-08 Post

D O l S O l QCBS Post 26-Sep-08 100.000

Consultancy Services to develop a management accountability framework

D03S01 QCB S

QCB S

QCB S

Prior 3-Oct-08

26-Sep-08

17-Oct-08

200,000

Consultancy Services to review OPRAs experience in 67 MDAs 124,000

100,000

EOlSOl

E03 SO 1

E07SO 1

F03C01

Post

Consultancy Services to develop Payroll inspection routine and tools

Consultancy Services to review and restructure offices responsible for Administration and Personnel in MDAs, RSs and LGAs

Consultancy Services to develop the Assessment center project document

Consultancy Services to develop framework to manage the consortium for delivering top level leadership programmes Consultancy Services to develop training programmes to bridge competency gaps at top leadership level

Post

QCBS Post 3-Oct-08 100,000

QCB S Prior 29-Aug-08 200,000

F06CO 1 QCBS Post 5-Dec-08 100,000

2 1 -Nov-O8 F07CO 1 QCBS Post 100,000

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Review by Bank [PriorPost)

3xpected Proposal Submission Date

Estimated cost

Selection Method Contract Description Comments Ref. No.

Consultancy Services to develop Strategic Contemporary programs and training materials for Top leaders Consultancy Services to support the design o f public sector reforms in Zanzibar Government

F08C01 Post 12-Dec-08 QCBS

QCB S

QCBS

100,000

200,000

200,000

GOlOCOl 29-Aug-08

20-Jun-08

29-Aug-OS

Prior

Prior Consultancy Services to establish Reform Coordination Unit

GO 1 SO4

Consultancy Services to conduct awareness campaigns for 400 parliamentarians on public sector reforms

Consultancy Services to conduct forums for PSRF’ to listen to citizen

QCBS Post G02S01

G07S01

GO8C03(i)

100,000

26-Sep-08 Post QCBS

QCBS

QCBS

100,000

200,000

Consultancy Services to undertake periodic evaluations, impact assessments and studies

11-Jul-08

25-JuI-08

7-NOV-07

Prior

Prior Consultancy services to undertake P U P Social Marketing campaign

G08S04 600,000

Change Management Advisor IC Prior 1 17,000

Short term AdvisorExpert on Pay Reform Post 12-Dec-07 G04C05(2 1) IC 96,000

Consultancy to Support to E- Government Dev. 2 1 -Nov-07 8 1,000 IC Post G04C05(22)

E01S02 Consultancy Services to customize HCMIS 22-0ct-08 CQ Post 60,000

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(b) Consultancy services estimated to cost above US$200,000 equivalent per contract for f i r m s and above US$lOO,OOO equivalent per contract for individual consultants and single source selection o f consultants (firms) for assignments wi l l be subjected to prior review by the Bank.

(c) Shortlists composed entirely o f national consultants: Shortlists o f consultants for services estimated to cost less than US $ 200,000 equivalent per contract may be composed entirely for national consultants in accordance with the provisions o f paragraph 2.7 o f the Consultant Guidelines.

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Annex 9: Economic and Financial Analysis

TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

222. public service. ultimately contribute to the achievement of the objectives of the MKUKUTA.

The project will have a positive economic impact through improving capacity of the This will result in efficient and effective use of public resources and

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Activity Training of 2 staff from PO- PSM in planning and implementing EIA EIA for NRC building Total

Annex 10: Safeguard Policy Issues TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

Particulars Cost estimates The two staff will be sponsored to attend a course on environmental impact assessment at a cost of ~ $ 2 , 5 0 0 each EIA US$5,000.00 US$5,000

US$5,000

uss1o.ooo

223. PRAP will finance civil works costs for a new building that will house the NRC in Dodoma. There are potential negative impacts that could arise before construction such as loss of vegetation during site clearing; pollution of land and water resources arising from waste disposal during and after construction, soil erosion may result from inadequacies in backfilling construction works and improper drainage of storm water. Potential social impacts that may arise include possible land acquisition and loss of livelihoods, negative effects on health due to air pollution and noise during construction; and blockage of access during construction and diseases associated with poor sanitation during use of the buildings. Another potential social impact may be increased pressure on existing water and other natural resources during construction and operation.

224. can be managed through the application of mitigation and monitoring measures.

The anticipated impacts will be short-term, site specific, confined and reversible and

Measures taken by the borrower to address safeguard policy issues

225. An environmental and social management framework (ESMF) and a resettlement policy framework (RPF) have been prepared by the GOT to guide the respective authorities to handle any of these issues in case they arise. The ESMF and RPF have been reviewed, commented upon and approved by the Bank and the GOT. These documents have been disclosed in country and at the World Bank Public Information Center.

226. A review of institutional capacities of the implementing institution, PO-PSM, revealed the lack o f capacity to plan and implement the ESMF. Training will be needed to establish such capacity. Two staff, one from the department of records and archives and another from the procurement unit will be trained in planning and implementing the ESMF. The costs of this training are estimated at US$2,500. In addition, an environmental impact assessment (EIA) will have to be included as part of the construction of the NRC, which i s estimated at US$5,000.

Key stakeholders and mechanisms for consultation and disclosure on safeguard policies

227. The key stakeholders include the National Environmental Management Council (NEMC), Department of Environment, PO-PSM and the communities in Dodoma where the building will be located.

228. The draft ESMF and RPF have been discussed by the government, NEMC and the World Bank. The latter has reviewed and commented on the two documents. The final reports have been approved by NEMC and have been disclosed in the relevant government

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ministries and departments. They have also been disclosed at PO-PSM, the Tanzania Public Information Center and at the project site in Dodoma.

229. The ESMF and the RPF set out the consultation processes that will be used before construction takes place. These are in line with the Tanzania national environmental impact assessment guidelines. Consultations with local communities and other interested parties will be carried out in undertaking an EIA. The implementing agency, PO-PSM, will provide al l relevant material and information related to the construction of the NRC in a timely manner prior to consultation, in a form and language that are understandable and accessible to the groups being consulted. Depending on the public interest in the potential impact o f the construction, a public hearing may be requested to better convey the concerns. Once the NRC project plan has been cleared by NEMC and the Department of Environment, the implementers will inform the public o f the results of the review.

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Annex 11: Project Preparation and Supervision TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

Planned Actual Project Concept Note (PCN) review Initial Project Information Document (PID) to Programme Implementation Committee (PIC) Initial Integrated Safeguards and Data Dec. 14,2006 Sheet (ISDS) to PIC Appraisal June 25,2007 June 25,2007 Negotiations August 16,2007 August 16,2007 Regional Vice President (RVP) approval Board approval October 11, 2007 Planned date o f effectiveness Planned date o f mid-term review Planned closing date

Dec. 5,2006 Dec. 12,2006

September 27, 2007

November 5,2007 August, 2010 December 3 1,20 12

September 6, 2007

Key institutions responsible for preparation o f the project:

President’s Office - Public Service Management in consultation with numerous stakeholders including the Ministry o f Finance, Ministry o f Planning and Empowerment, and sector ministries.

Bank staff, development partner staff and consultants who worked on the project included: Name Title Unit Denyse Morin Senior Public Sector Specialist AFTPR Denis Biseko Public Sector Specialist AFTPR Mercy Sabai Senior Financial Mgmt Specialist AFTFM Pascal Tegwa Senior Procurement Specialist AFTPC Edith Mwenda Senior Counsel LEGAF Modupe Adebowale Senior Finance Officer LOAFC Chau-Ching Shen Senior Finance Officer LOAFC Arleen Seed Senior Information Officer ISGEG Prasad Mohan Lead IEC Specialist AFTKL Charles Kinyeki Human Resources Mgmt Consultant Reynaldo Castro Operations Specialist Consultant Agripina Mosha Gender Specialist CIDA Anne-Lucie Lefebvre Governance Specialist CIDA Jean Touchette Senior Development Officer CIDA Jacob Winther First Secretary Embassy o f Denmark Ian Shapiro Senior Governance Advisor UK-DFID Wamuyu Gatheru Governance Advisor UK-DFID Tim Harris Statistics Advisor UK-DFID Robin Milton Social Development Advisor UK-DFID Zabdiel Kimambo Governance Advisor UK-DFID John Piper Economist UK-DFID Mwanaisha Kassanga Team Assistant AFCE 1 Marie Lolo Sow Extented Term TemDorarv AFTPR

- 98 -

Bank fimds expended to date on project preparation: 1. Bank resources: US$13 1,693 2. Trust finds: 3. Total: US$13 1,693

Estimated Approval and Supervision costs: 1. Remaining costs to approval: US$lO,OOO 2. Estimated annual supervision variable cost: US$40,000

- 99 -

Annex 12: Documents in the Project File TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

1. Service Reform Programme, PO-PSM, 2007.

Assessment o f the Performance o f the Records Management Component o f the Public

2. Task Force on Capacity Development in Africa, September 2005.

Building Effective States - Forging Engaged Societies, Report o f the World Bank

3. World Bank Support, 2005.

Capacity Building in Africa, Operations Evaluation Department (OED), Evaluation o f

4. Detailed Cost Table by Components/Sub-Components for the PSRP PRAP.

5 . Environmental and Social Management Framework for the Infrastructural Development Programme, President’s Office-Public Service Management, October 2005,

6. September 2006.

I.C.T. and the Implementation o f e-Government Initiatives in Tanzania, David Sawe,

7. Imperatives in the Formulation of PSRPII Strategy, Final Report, August 2006.

Kiragu, K., J. Rugumyamheto, P. Mazikana, Stakeholders’ Perspectives and

8. Approaches to Capacity Building, August 2005.

Kiragu, K., Tanzania: A Case Study in Comprehensive and Programmatic

9. Public Service Reform, Programme (Phase II), PO-PSM, 2007.

Medium-Term Strategy, Action Plan and Budget, 2007/08 - 2011112, (Volume I-IV),

10. Service Reform: The Tanzania Experience, Discussion Paper No 570, ECDMP, January 2007.

Morgan, P. and H. Baser, Analysis, Building the Capacity for Managing Public

1 1. Stakeholder Conference, October 2004

Reforming Tanzania’s Public Administration: Status and Challenges, Report o f a

12. President’s Office-Public Service Management, October 2005.

Resettlement Policy Framework for the Infrrastructure Development Programme,

13. Programme Independent Review, April 29th 2006.

Steedman, D., D.Poate, C. Barnett & C. Kinyeki, Tanzania Public Service Reform

14. in Ghana, Tanzania and Zambia, World Bank, 2003

Stevens, M. and S. Teggemann, Comparative Experience with Administrative Reform

15. Performance in Tanzania and Uganda: Public Servants Perspectives, Final Report, February 2007.

Therkildsen, 0. and P. Tiedeman, StaffManagement and Organisational

16. Thompson, M., The MDA-driven Approach, Report, April, 2007

- 100 -

Annex 13: Statement of Loans and Credits TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

Project ID FY Purpose

~

Difference between expected and actual

Original Amount in US$Millions disbursements

IBRD IDA SF GEF Cancel Undisb Orig Frm Rev’d

PO87256 PO82492

PO70736 PO85786 PO71014 PO74624 PO57234 PO78387 PO82335 PO83080 PO59073 PO67 I03

PO73397

PO02797 PO58706 PO47762 PO69982 PO49838 PO571 87 PO60833 PO47761 PO02789 PO46837 PO02770

2006 2006

2005 2005 2004 2004 2004 2004 2004 2004 2003 2003

2002

2002 2002 2002 2001 2000 2000 2000 1999 1998 I997 1994

TZ-PRSC 3 DPL (FY06) TZ-Marine & Coastal Env Mgmt SIL (FY06) TZ-LOC Govt Supt S I L (FYO5) TZ-Soc Action Fund 2 S IL (FY05) TZ-HIV/AIDS APL (FY04) TZ-Emergency Power Supply (FY04) TZ-GEF Eastern Arc Forests S I L (FY04) TZ-Central Transp Corridor Prj (FY04) TZ-Health Sec Dev 2 (FY04) TZ-Sec Edu Dev Prj (FY04) TZ-Dar Water Suply & Sanitation (FY03) TZ-Partic Agr Dev & E m p m n t SIL (FY03) TZ-Lower Kihansi Env Mgmt TAL (FY02) TZ-Songo Gas Dev & Power Gen (FY02) TZ-Forest Conserv & Mgmt S I L (FY02) TZ-Rural Water Sply (FY02) Regional Trade Fac. Proj. -Tanzania TZ-Privitization & Priv Sec Dev (FYOO) TZ-FIDP 2 (FYOO) TZ-Pub Sec Reform Prgm (FYOO) TZ-Tax Administration (FY99) TZ-Human Res Dev I (FY98) TZ-Lake Victoria Env (FY97) TZ-Roads 2 (FY94)

Total

0.00 150.00 0.00 51.00

0.00 52.00 0.00 129.00 0.00 0.00

0.00 43.80 0.00 0.00 0.00 122.00 0.00 40.00 0.00 123.60 0.00 61.50 0.00 56.58

0.00 6.30

0.00 183.00 0.00 31.10 0.00 26.00 0.00 15.00 0.00 45.90 0.00 27.50 0.00 41.20 0.00 40.00 0.00 20.90 0.00 10.10 0.00 170.20

0.00 0.00

0 00 0.00 0.00 0.00

0.00 0.00 0.00 0.00 0.00 0 00

0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00 0.00

0.00 0.00

0.00 0.00 0.00

0.00 7.00 0.00 0.00 0.00 0.00 0.00

0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00

0.00 0.00

0 00 0 00

0 00 0 00 0 00 0 00

0 00 0 00 0 00 0 00 0 00 0 00

0 00

0 00 0 00 0 00 0 00 0 00

0 00 0 00

0 00 0 00 0 00

63 53

153.77 49.68

50.63 137.39 66.65

0.00 7.00

106.72 28.56 97.62 42.34 49.27

2.95

98.67 29.76 22.05

8.84 27.32

9.59 12.23 10.70 0.46 1.85

13.44

0.00 0.00

10.56 -0.33 19.01

-30.40 3.33

5 1.08 29.94 -0.13

10.43 6.49

1.26

71.18 15.77 12.54 7.35

26.15 8.38

-30.66 6.31 0.55

-6.50 81.87

0.00 0.00

0.00 0.00 0.00 0.00 0.00

0.00

0.00 0.00 0.00 0.00

0.00

0.00 0.00 0.00 0.00

0.00 1.56 0.00

-0.54 0.00

1.26 36.28

000 1,44668 000 7 00 63 53 1,027.49 294 18 38.56

TANZANIA STATEMENT OF IFC’s

Held and Disbursed Portfolio In Millions o f U S Dollars

Committed Disbursed

IFC IFC

FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic.

I997 2001 1998 2005 2002 1996

AEF Aquva Ginner 0.68 0.00 0.00 0.00 0.68 0.00 0.00 0.00 AEF Boundary Hi1 0.20 0.00 0.00 0.00 0.20 0.00 0.00 0.00 AEF Maji Masafi 0.04 0.00 0.00 0.00 0.04 0.00 0.00 0.00 BEL 10.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

105 Exim Bank 0.00 0.00 3.00 0.00 0.00 0.00 0.00 0.00 IHP 0.12 0.00 0.00 0.00 0.12 0.00 0.00 0.00

- 101 -

2000 IOH 2 10 0 00 0 00 0 00 2 10 0 00 0 00 0 00 2000 NBC 0 00 1000 0 00 0 00 0 00 3 63 0 00 0 00

1993 TPS (Tanzania) 3 06 0 00 0 00 0 00 3 06 0 00 0 00 0 00 1991 TPS Zanzibar 0 18 0 00 0 00 0 00 0 18 0 00 0 00 0 00 1994 Tanzania Brewery 0 00 3 43 0 00 0 00 0 00 3 43 0 00 0 00

Total portfolio: 16.38 13.43 3.00 0.00 6.38 7.06 0.00 0.00

Approvals Pending Commitment

FY Approval Company Loan Equity Quasi Partic.

Total pending commitment: 0.00 0.00 0.00 0.00

- 102 - Annex 14: Country at a Glance

TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

Tanzania at a dance 0i19m

W V E R N and SOCIAL TlWiUIfd

38.3 330 12 a

2.0 2 2

33 24 4% 78 29 8.2

108 t Q8 104

ao

IS95 5.3

18.8 2Q7 49 4. t

-19.Q 1.6

1411 21 t

2904

8 7 4 7

-7.0

74 1 745 552

2.3 2.3

35

1 OD 29

4a

ea 95 99 87

2004

82.3 98.4

8.5

-32.2 0.4

m.0 5.O

dO.0 t 12.2

BWS

7.0

-l.D

87.8

a.0

5.0

i f e erpenancy 2353 5w

1,364

Gmsr GNl Per P"W capita whmlknt

t J 2 3

1

I Indebiledwss

STRUCTURE of the ECONOMY

(% of GDPJ Agriwltun Industry

Serrees Manufwunng

1985

Hausehdo ha1 coosumpimi @xpw.aditvre Gwieral gov? find oonsumptm expenditure Inywrts of goods and sewices

t995.35

2 9 -0 D -0 3 1 3

2 7 - 4 3 -3 D 3 8

1995 2004 2005

47 t 46.2 4 4 5 145 18.7 178 7 2 7 0 7 5

?A4 371 375

580 787 7198 115 128 13L 5 8 1 27.7 283

1195-0s

4 1 k 2 5 3 5 3

1 5 18.d 5 e 30

2004 MQ5

0.0 5 9 10.1 1 I a e a O D e o 6 7

-5.3 1 0 24.4 1 3 2 0 1 9 5 2 2 - 0 5

J

63 I

Note: 2005 baa are preiiminaw estrnates.

' -ne d iamds show four xrey ind mm tn the counnry (in bid? cmpiirrJ wlth its cncome-gmw average I dara ae missing. h e CE a n m d will be nmmoete

PRsCES arsd GOVERNMENT FINANCE

Domescia price6 1% dmPNn7el Consumer pcioes Implion GDP d e k t w

rnmenr iinancc of GDP, ~acitnfes cenrwtl grads)

Current revenue Cummi b u d w balance k a l l sur&st%ie&cli

TRADE

(US5 mifhnsl Total ezwm :fob)

Coffee COzton Manutactures

Tdai imports I; 71 Food Fuel and energy Capital wads

Exp& priw inaex IZCtW=fUOj Impon pr-ce index [2:3000=1001 T m s of irme @ X W = f ~ ~

SAIANCE of PAWENTS

(US$ m8Iim)

Impwas of geod5 and smices R m u m e balance Ne! n m r Ne! current trssskrs

Cuwenl account balance FIR;~~:IRQ iems ineij Chawe5 in net reserves Memo. Resowe5 tncludrrsg goo (US5 mJfwns) Conversion rate (DEC, Iscab'US%I

EXTERNAL DEBT and RESOURCE FLOWS

(US5 mtTh& Tdal debt onrfsrJnri'irtg and axsbvpsed

E x p m &goods am SeNW

IBRD IDA

IBRD IDA

Official orants OWloral creditors Pnvate creditois Furergn direct invesrrnent mer ~nRws) Po& o wuity (ne! infwwsi

World Bank prugrarn Cammimnts 0 sbwsernenrs P m o p J repayments Net n- Interest pawnests Net traders

T&al debt sews*

Composition .of net resource flows

$995

33 3

1985

25 7 $18 30 33

W6 e5

227 ,333

80 $02 76

tm

445 l .Df5 -5? 1

-9 3 i 45

426 53 1 -14

$5 17 5

1985

9,?55 208 588 1J4 40

7

3 7 E4 45 15 0

45 45 27 16 20 -1

1335

28 4 26 0

11 0 -2 3 4 2

W§5

593 143 120 109

1510 97

185 802

105 141 74

1935

1.DM 2"mQ 443 .I25

18

- 1 047 1093 4

270 574.a

I995

7,421 87

2.182

233 42 28

45 1 121

15 120

0

11 160 46

114 24 Bo

2004

0.0 a. r

21.8 -3.5 -6.5

2001

1.175 41 38 9.5

:.3A1 25' 46 t

105 133 81:

a n

zoo1 1,911 3.231

-1,320 -18

8

-t<380 1,620 -241

2,2M t ,059 3

2004

7,800 D

3.91u

1 16 3

4r

t.272 380 4

246 0

39 3 343

16 327

28 29?

1005

8.8 3 7

130 -4.4

-10 8

2005

1.457 e8 E@

% 20 2.826

203 zm

1,069

7 2 c $49 61

2005

2 . 7 ~ 4.212 -1.37

-53 6

-1.551 1.?63 -212

2005

3 3.861

0 Q3

275 62

213 31

a 82

c: 423 I

T h WwM Bank GWW This table was prepared by wunb-q unit staR Rgures nay differ frcrrn m t k r Weed Bank p&&w d a 41 1 3836

- 104 - Annex 15: Maps

TANZANIA: Tanzania Performance Results and Accountability Project - APL I1

MAP NO. IBRD 33494R

KilimanjaroKilimanjaro(5895 m)(5895 m)

Iwem

bere

Ste

ppe

MasaiMasaiSteppeSteppe

Nguru M

ts.

Mbeya Range

A R U S H AA R U S H A

M A R AM A R A

R U V U M AR U V U M A MTWARAMTWARA

I R I N G AI R I N G A

L I N D IL I N D I

D O D O M AD O D O M A

K I G O M AK I G O M A

M WA N Z AM WA N Z A

S H I N YA N G AS H I N YA N G A

R U K W AR U K W A

M B E Y AM B E Y AP WA N IP WA N I

TA B O R ATA B O R A

KAGERAKAGERA

SINGIDASINGIDATA N G ATA N G A

MOROGOROMOROGORO

Mbemkur

u

Matandu

Rufiji

Great Ruaha

Rungwa

Wam

iW

ami

Simiyu

Ruvuma

Mara

Kagera

Moyow

osi

Ugalla

Pangani

Kilo

mbe

ro

YalovaYalova

KaliuaKaliua

KasuluKasulu

BabatiBabati

KondoaKondoa

ManyoniManyoni

KibondoKibondoKahamaKahama

NzegaNzega

BuoenBuoen

NjombeNjombe

MpuiMpui

MpandaMpanda

TundumaTunduma

SameSame

TunduruTunduru

MasasiMasasi

UteteUtete

MbeyaMbeya

MoshiMoshi

SongeaSongea

IringaIringa

KibahaKibaha

DODOMADODOMA

TaboraTaboraKigomaKigoma

ArushaArusha

MwanzaMwanza

SingidaSingida

MorogoroMorogoro

ZanzibarZanzibar

ShinyangaShinyanga

Kipengere Range

K E N Y AK E N Y A

UGANDAUGANDA

ZAMBIAZAMBIA

MOZAMBIQUEMOZAMBIQUE

RWANDARWANDA

BURUNDIBURUNDI

DEM

. R

EP.

OF

CO

NG

OD

EM.

REP

. O

F C

ON

GO

To To NakuruNakuru

To To MalindiMalindi

To To KasamaKasama

To To KasamaKasama

To To KasunguKasungu

To To LichingaLichinga

To To MarrupaMarrupa

To To ChiúreChiúre

To To NakuruNakuru

To To TororoTororo

To To KampalaKampala

To To KampalaKampala

To Kama

To Kama

Yalova

Kaliua

Kasulu

Babati

Kondoa

Manyoni

KibondoKahama

Nzega

Buoen

Njombe

Mpui

Mpanda

Tunduma

Same

Tunduru

Masasi

Utete

KilwaKivinje

Wete

Lindi

Mbeya

Koani

Tanga

Moshi

Songea

Mtwara

Iringa

Kibaha

DODOMA

Mkoani

TaboraKigoma

Arusha

Mwanza

MusomaBukoba

Singida

Morogoro

Zanzibar

Mkokotoni

Shinyanga

Sumbawanga

Dar es Salaam

K E N Y A

UGANDA

ZAMBIA

MOZAMBIQUE

RWANDA

BURUNDI

DEM

. R

EP.

OF

CO

NG

O

A R U S H A

M A R A

R U V U M A MTWARA

KILIMANJARO

I R I N G A

L I N D I

D O D O M A

K I G O M A

M WA N Z A

S H I N YA N G A

R U K W A

M B E Y AP WA N I

TA B O R A ZANZIBARNORTH

PEMBANORTH

PEMBASOUTH

ZANZIBARSOUTH &CENTRALZANZIBARWEST

DAR ES SALAAM

KAGERA

SINGIDATA N G A

MOROGORO

Mbemkur

u

Matandu

Rufiji

Great Ruaha

Rungwa

Wam

i

Simiyu

Ruvuma

Mara

Kagera

Moyow

osi

Ugalla

Pangani

Kilo

mbe

ro INDIAN

OCEAN

Lake

Victor ia

LakeTanganyika

LakeMalawi

LakeRukwa

LakeNatron

LakeEyasi Lake

Manyara

To Nakuru

To Malindi

To Kasama

To Kasama

To Kasungu

To Lichinga

To Marrupa

To Chiúre

To Nakuru

To Tororo

To Kampala

To Kampala

To Kama

Iwem

bere

Ste

ppe

MasaiSteppe

Nguru M

ts.

Mbeya Range

Kipengere Range

Kilimanjaro(5895 m)

30°E

0°

2°S

8°S

10°S

0°

2°S

4°S

8°S

10°S

12°S

32°E 34°E 36°E

32°E 34°E 36°E 40°E

TANZANIA

This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other informationshown on this map do not imply, on the part of The World BankGroup, any judgment on the legal status of any territory, or anyendorsement or acceptance of such boundaries.

0 50 100 150

0 50 100 150 Miles

200 Kilometers

IBRD 33494R

JULY 2007

TANZANIAMAIN ROADS

RAILROADS

PROVINCE BOUNDARIES

INTERNATIONAL BOUNDARIES

SELECTED CITIES AND TOWNS

PROVINCE CAPITALS

NATIONAL CAPITAL

RIVERS