World Bank Documentdocuments.worldbank.org/curated/en/... · Progress towards achievement of PDO...

The World Bank Implementation Status & Results ReportPublic Financial Management Reform Program Phase I (P147343)

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Public Disclosure Copy


Public Financial Management Reform Program Phase I (P147343)

AFRICA | Zambia | Governance Global Practice | Recipient Executed Activities | Investment Project Financing | FY 2014 | Seq No: 6 | ARCHIVED on 16-Jun-2017 | ISR28661 |

Implementing Agencies: Government of Republic of Zambia, Ministry Of Finance

Key Dates

Key Project Dates

Bank Approval Date:06-May-2014 Effectiveness Date:17-Jul-2014

Planned Mid Term Review Date:24-May-2016 Actual Mid-Term Review Date:24-May-2016

Original Closing Date:31-Dec-2017 Revised Closing Date:31-Dec-2017

Project Development Objectives

Project Development Objective (from Project Appraisal Document)The project development objective (PDO) is to contribute to improving the efficiency and accountability of public resources.

Has the Project Development Objective been changed since Board Approval of the Project Objective? No

PHRPDODEL

Name Previous Rating Current Rating

Progress towards achievement of PDO Moderately Satisfactory Satisfactory

Components

NameIntegrated Planning and Budgeting:(Cost $1.87 M)

IFMIS and Cash Management:(Cost $7.64 M)

Public Procurement:(Cost $4.06 M)

Enhanced Internal Audit and Control:(Cost $1.70 M)

Revenue Administration:(Cost $10.08 M)

Tax Policy Formulation:(Cost $0.58 M)

Program Management:(Cost $1.52 M)

Other PFM Interventions (Oversight Improvement etc.):(Cost $2.55 M)

Overall Ratings

Pub

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Overall Implementation Progress (IP) Moderately Satisfactory Satisfactory

Overall Risk Rating Substantial Substantial

Implementation Status and Key Decisions

The progress towards the achievement of the Project Development Objectives and the overall implementation progress are rated as “ Satisfactory”. Four of the eight components had improved ratings when compared to the previous ISR and other four retained their ratings (which are either Satisfactory or Moderately Satisfactory). With the availability of the PEFA scores (Joint Government World Bank PEFA exercise was conducted in 2016-17), the direction of progress towards PDO is well established as recorded in the Results Framework and Monitoring.Five most significant key results achieved so far are as follows:1. Planning and Budget bill and amended Public Finance bill are prepared and awaiting tabling in the national assembly. These would significantly strengthen the PFM legal framework in the country.2. The Integrated Financial Management Information System (IFMIS) has been rolled out to 48 of the targeted 55 Ministries, Provinces and Spending Agencies enabling better budget execution and timely decision-making. 3. Treasury Single Account has been established and already rolled out in MPSAs making way for consolidation of Government cash balances and savings on interest costs.4. Zambia Revenue Authority introduced the Minerals Value Chain Monitoring Project, the first of its kind in Africa, to effectively monitor mining resources and thereby contribute to increased revenue mobilization.5. E-Government Procurement system, ‘end-to-end’ automation of procurement processes has been developed and the roll out is in progress heralding a new era of transparency and efficiency in procurement processes in Zambia. Government has requested the World Bank to extend the project end date to 31 December 2018 (one year extension) to enable completion of the planned activities. A final decision on the extension will be made jointly by the Government and World Bank in consultation with MDTF Donors.


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Risks

Systematic Operations Risk-rating Tool

Risk Category Rating at Approval Previous Rating Current Rating

Political and Governance -- Moderate Moderate

Macroeconomic -- Moderate Moderate

Sector Strategies and Policies -- Substantial Substantial

Technical Design of Project or Program -- Substantial SubstantialInstitutional Capacity for Implementation and Sustainability -- Substantial Substantial

Fiduciary -- Moderate Moderate

Environment and Social -- Low Low

Stakeholders -- Substantial Substantial

Other -- -- --

Overall -- Substantial Substantial

Results

Project Development Objective IndicatorsPHINDPDOTBL

Improved fiscal discipline (Budget Credibility) - PI 2 (Text, Custom)

Baseline Actual (Previous) Actual (Current) End Target

Value D+ D+ C+ C

Date 31-Dec-2012 31-Dec-2014 30-Sep-2016 31-Dec-2017


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PHINDPDOTBL

Improved transparency in public finance (Budget Reporting) - PI 24 (Text, Custom)


Value C C D+ B+


PHINDPDOTBL

Increased transparency in procurement - PI 19 (Text, Custom)


Value D+ D+ C B


PHINDPDOTBL

Enhanced internal control and internal audit - PI 20 (Text, Custom)


Value C+ C+ C+ B


PHINDPDOTBL

Effectiveness in collection of taxes - PI 15 (Text, Custom)


Value Not Rated D+ D+ B


PHINDPDOTBL

Aggregate expenditure outturn compared to original approved budget (PI 1) (Text, Custom)


Value D D B C


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Overall CommentsThe draft PEFA results available till date indicate a broad trend of improved PEFA scores as on 30 September 2016.

Intermediate Results IndicatorsPHINDIRITBL

The Planning and Budgeting Policy Bill issued (Text, Custom)


Value Draft Policy issued

New Planning and Budgeting Policy has been issued by the Government. Draft Bill is developed and consultative workshops are conducted. Government reiterated its commitment to table in parliament for legislation during the upcoming session.

New Planning and Budgeting Policy has been issued by the Government. Draft Bill is developed and consultative workshops are conducted. Government reiterated its commitment to table in parliament for legislation during the upcoming session.The legislative version of the Planning and Budgeting Bill had been drafted by Ministry of Justice and was awaiting submission to Parliament later this year

7th NDP formulated using processes consistent with Planning and Budgeting Act.

Date 19-Nov-2013 20-Feb-2017 13-Jun-2017 30-Dec-2017

CommentsIt is envisaged that the Planning and Budgeting Bill would be submitted to Parliament during the June, 2017 sitting. While the work towards coming up with the Planning and Budgeting legislation commenced a few years ago, progress towards enactment of the Planning and Budgeting Bill slowed mainly due to the need to allow for the enactment of the new Constitution so that subsequently, the provisions of the Planning and Budgeting Bill are not at variance with the provisions in the Constitution.


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PHINDIRITBL

Budget circular to be consistent with IFMIS chart of Account (Text, Custom)


Value Budget circular not as per IFMIS chart of Accounts

Unified Chart of Account has been implemented and confirmed by the Government. There are no reported inconsistencies during parallel run of budget through IFMIS.

Unified Chart of Account has been implemented and confirmed by the Government. There are no reported inconsistencies during parallel run of budget through IFMIS.

Revised BFP finalized

Date 03-Apr-2014 20-Feb-2017 20-Feb-2017 30-Dec-2017

PHINDIRITBL

Program Based Budget Manual and Program Classification implemented (Text, Custom)


Value Program classification diluted

Successful completion of the review of pilots and roadmap for further rollouts done

Critical review of OBB pilot in Education with IMF support was done in 2016 and plans are underway to roll out the OBB to five (5) institutions: Ministry of Health; Ministry of Agriculture; Ministry of Livestock; Ministry of Community Development and Social Services and Zambia Police. Training workshop has been held with the above institutions where the OBB concept was introduced. 2018 Budget for these institutions expected to be in OBB. With regard to the development of Budget Manuals, this is still work in progress.

Program based budgeting rolled out to 10 MPSAs

Date 03-Apr-2014 20-Feb-2017 13-Jun-2017 30-Dec-2017


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PHINDIRITBL

Number of planning and budget officials trained in the use of the new planning and budgeting manual (Number, Custom)


Value 0.00 0.00 0.00 200.00


CommentsSince the law is not yet passed, progress on this activity is not expected.

PHINDIRITBL

IFMIS activities guided by strategic roadmap (Text, Custom)


Value No strategic roadmap for IFMIS

Draft roadmap completed by consultants and now under consideration of the Government.

The consultancy firm Ernst and Young (EY) who had been engaged to undertake this assignment had submitted a final copy of the Roadmap to GRZ, awaiting final approval by GRZ..

IFMIS roadmap adapted by Government and all IFMIS activities are guided by strategic roadmap

Date 23-Nov-2015 20-Feb-2017 13-Jun-2017 31-Dec-2017

PHINDIRITBL

IFMIS rolled out in all MPSAs (Number, Custom)


Value 36.00 44.00 48.00 50.00

Date 03-Apr-2014 20-Feb-2017 31-May-2017 30-Dec-2017


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PHINDIRITBL

IFMIS planning and budgeting module fully operational, including uploading of appropriated funds and authorized budget reallocations and amendments (Text, Custom)


Value Planning and budgeting module not operational.

Budget paralled run through IFMIS is done. Government plans to use IFMIS as the primary system for budget preparation for the Budget of FY 2018

Budget paralled run through IFMIS is done. Government plans to use IFMIS as the primary system for budget preparation for the Budget of FY 2018

2018 budget preparation using IFMIS budget module


PHINDIRITBL

Cash Management Module fully operational (Text, Custom)


Value MoF using the module

Cash Management Manual developed and workshops conducted to supplementation. The manual is being further fine-tuned based on feedback.

Cash Management Manual developed and workshops conducted to supplementation. The manual is being further fine-tuned based on feedback.

Quarterly and monthly cash forecasts prepared and used for releases in all MPSAs


PHINDIRITBL

Budget execution consolidated reports issued quarterly within thirty days after end of quarter (Text, Custom)


Value Consolidation done with considerable delays

Budget Execution Reports are being posted on the MoF portal, with signficant delays.

Budget Execution Reports are being posted on the MoF portal, within the stipulated target dates, every end of quarter without significant delays.

Reports issued quarterly within thirty days after end of quarter



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PHINDIRITBL

Treasury Single Account (TSA) implementation plan developed and agreed by Secretary Treasury to establish a comprehensive TSA (Text, Custom)


Value Initiated TSA is implemented in 10 MPSAs

TSA is implemented in 23 MPSAs

Completed and functional


PHINDIRITBL

Reduction in month end bank balances (Text, Custom Breakdown)


Value Huge balances

32 Accounts closed in Bank of Zambia and 4 accounts closed at commercial banks, leading to reduction in balances.

33 Bank accounts are closed.

Government faced challenges with identification of the cash balance reduction due to netting out issues. These technical issues will be revisited in the next mission and appropriate action taken.

Month end balances reduced as % of total cash balance in BoZ versus commercial banks


PHINDIRITBL

Service level Agreement with Banks (Text, Custom Breakdown)


Value No service level agreement with Banks

SLAs with 10 commercial banks were signed

SLAs with 14 commercial banks were signed

SLA finalized and signed with banks using competitive procuement process



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PHINDIRITBL

No TSA implementation (Text, Custom Breakdown)


Value No accurate inventory of all government accounts

TSA implemented in 10 ministries

TSA implemented in 23 MPSAs.

Inventory of all government accounts complete and 70% of bank accounts either linked with TSA or inactivated as per legal provisions

Date 03-Apr-2014 01-Sep-2016 31-May-2017 31-Dec-2017

PHINDIRITBL

Public Procurement Training (Number, Custom)


Value 0.00 259.00 330.00 240.00

Date 08-Apr-2014 20-Feb-2017 31-Dec-2016 30-Dec-2017

PHINDIRITBL

Procurement Staffs in MPSAs trained in public procurement (Number, Custom Breakdown)


Value 0.00 100.00 100.00 200.00

Date 08-Apr-2014 02-Sep-2015 02-Sep-2015 30-Dec-2017

PHINDIRITBL

Private sector staffs trained in bidding under public procurement (Number, Custom Breakdown)


Value 0.00 154.00 154.00 40.00



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PHINDIRITBL

System to compare reference prices to support a competitive procedure for pricing based on market information and government wage policies and ceilings (Text, Custom)


Value None Final system established.

Final system established.

Final system established


PHINDIRITBL

User friendly Procurement Guidelines or Manual issued (Text, Custom)


Value Manual needs updatingDraft manuals prepared and are under review

Draft manuals prepared, reviewed and revised.

Updated Manual produced


PHINDIRITBL

E-procurement pilots on a phased approach (Number, Custom)


Value 0.00 2.00 6.00 7.00


PHINDIRITBL

Internal Audit related Training (Text, Custom)


Value TNA being revisedTNA has been revised and trainings are underway

TNA has been revised and trainings are underway

Training completed as per the TNA



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PHINDIRITBL

Internal auditors trained and apply IIA standards (Text, Custom Breakdown)


Value Curriculum needs updating263 Internal Auditors trained in International Standards

263 Internal Auditors trained in International Standards

curriculum developed and 100% auditors trained

Date 08-Apr-2014 05-Apr-2016 16-Jun-2017 31-Dec-2017

PHINDIRITBL

Internal auditors trained and sensitized in quality control as per TNA (Text, Custom Breakdown)


Value TNA being updated

20 auditors were trained on the Quality control manual developed.

20 auditors were trained on the Quality control manual developed.

100% trained and refresher training also completed for allMPSAs

Date 08-Apr-2014 24-Mar-2016 16-Jun-2017 30-Dec-2017

PHINDIRITBL

Improve Internal Audit quality assurance and performance improvement standards (Percentage, Custom)


Value 30.00 50.00 50.00 90.00

Date 08-Apr-2014 24-Mar-2016 16-Jun-2017 30-Dec-2017

PHINDIRITBL

Audit Committees meeting regularly on a quarterly basis (Text, Custom)


Value Irregular or no meetings

Audit committees meetings indicate inconsistent trends across Ministries. While in some Ministries they meet regularly, they do in others. With the planned launch of Audit Committees manual in March 2017, the internal Audit team intends periodic follow up of the progress

All MPSAs have Audit committees. 85% of these Audit Committees are now meeting whilst 15% are still facing challenges in having meetings. To ensure consistency across Ministries, a sub-committee has been formed under the Office of the Secretary to Treasury to begin receiving reports from all

At least 85% of the IA and OAG recommendations are followed up every year


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made on Audit Committees.

Audit Committees and deal with any hurdles in getting the Audit Committees functioning effectively.

Date 08-Apr-2014 20-Feb-2017 30-Apr-2017 30-Dec-2017

PHINDIRITBL

Revenue targets for ZRA collections (Text, Custom)


Value Target exceeded by 1.3% in 2013

Unaudited preliminary numbers indicate that Revenue for 2016 fell marginally short of the target 2016 as per the information provided by ZRA

Unaudited preliminary numbers indicate that Revenue for 2016 fell marginally short of the target 2016 as per the information provided by ZRA. The target for the first quarter of 2017 was met.

Annual revenue target to be achieved annually

Date 31-Mar-2014 27-Feb-2017 16-Jun-2017 30-Dec-2017

PHINDIRITBL

Implementation of Mining Value Chain monitoring mechanism (Text, Custom)


Value No systems in place

Pilot of production module completed and rolled out in Phase I. Export permit module has been developed and piloted on 8 Mineral exporters

Pilot of production module completed and rolled out in Phase I. Export permit module has been developed and piloted on 8 Mineral exporters.

Systems fully in place and operational (for copper and cobalt)



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PHINDIRITBL

System for monitoring balance of payments in place (S155) (Text, Custom)


Value No system in place

Successfully completed and handed over to Bank of Zambia for implementation.

Successfully completed and handed over to Bank of Zambia for implementation.

ASYCUDA World enhanced with this capability.

Date 08-Apr-2014 20-Feb-2017 31-Mar-2017 31-Dec-2017

PHINDIRITBL

Cargo Transit tracking system in place (Text, Custom)


Value No system in place Rollouts are successfully piloted.

Pilot completed and full phased rollouts are planned as soon as Multi-purpose seals are delivered.

Transit tracking system fully operational (on all routes and for all types of traffic)

Date 08-Apr-2014 20-Feb-2017 30-Apr-2017 31-Dec-2017

PHINDIRITBL

Capacity building program for MTO staff particularly in audit and debt management skills, procedures and policies, including preparation of audit sector notes and training of staff in their use (Text, Custom)


ValueStaff skills need enhancing and policies need updating.

Sector notes procurement in process. Training of Debt Management staff completed.

Sector audit notes on wholesale, construction and retail developed and 20 staff trained in their use.Study tour undertaken by Debt management staff for skills enhancement.

100% staff trained in audit and debt management.

Date 08-Apr-2014 20-Feb-2017 31-Dec-2016 31-Dec-2017


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PHINDIRITBL

Use of specialist equipment for investigation and internal affairs staff (Text, Custom)


ValueLimited equipment available (affecting operations adversely)

Equipment for forensic lab installed. 40% of vehicles have radios installed.

Equipment for forensic lab installed. 40% of vehicles have radios installed.

100% equipment procured and in use

Date 08-Apr-2014 02-Jun-2015 02-Jun-2015 31-Dec-2017

PHINDIRITBL

Bulk intelligence data analysis capability (Text, Custom)


Value No capability

Feasibility study conducted based on diluted focus in Phase I of the project.

Feasibility study conducted based on diluted focus in Phase I of the project.

Feasibility study and business case established.


PHINDIRITBL

Electronic records management System (Text, Custom)


Value No system in place User acceptance test has been conducted

User acceptance test has been conducted

Scanning system operational at all locations


PHINDIRITBL

Tax policy analysis strengthend (Text, Custom)


ValueTax policy research studies needed in many areas

Studies planned for April - May 2017

Delays in studies planned. Consultants identified by the World Bank. Terms of reference for the METR study developed. TORs for tax gap analysis and tax expenditure analysis in-process. Studies to be undertaken in the second quarter of 2017..

Total of 10 studies undertaken


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Date 08-Apr-2014 24-Mar-2016 30-Apr-2017 30-Dec-2017

PHINDIRITBL

Tax policy staff capacity enhanced (Text, Custom)


Value capacity needs improvement

2 Activities took place (against 9 planned)

Tax Unit staff have undertaken Tax Policy Analysis and Revenue Forecasting courses.

All training completed as per sub indicators

Date 08-Apr-2014 31-May-2016 30-Apr-2017 30-Dec-2017

PHINDIRITBL

International tax conference or workshop attended (Text, Custom Breakdown)


Value 0.00 7.00 7.00Attendance at 4 conferences per year


PHINDIRITBL

ATI or similar courses attended by staff (Text, Custom Breakdown)


Value 0.00 0.00 3.00

4 persons per year attending ATI or similar courses

Date 08-Apr-2014 24-Mar-2016 31-Mar-2017 30-Dec-2017


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PHINDIRITBL

One training and mentoring activity held in country (Text, Custom Breakdown)


Value 0.00 0.00 1.00 3 total


PHINDIRITBL

Improved access to information to aid tax policy (Text, Custom)


Value Limited access Limited access

Training room for easy access to information established. Internet provided via Government LAN connections.

Access improved as per sub indicators


PHINDIRITBL

Subscriptions to international tax data (Text, Custom Breakdown)


Value Limited data availabilityComplementary subscription received and is in place

Complementary subscription received and is in place

Subscriptions in place


PHINDIRITBL

Equipment and processes in place to download information (Text, Custom Breakdown)


Value Limited data avaliability Equipment procured and are put to use

Equipment procured and are put to use

Equipement and process in place to download data from BoZ, ZRA etc. databases



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PHINDIRITBL

Program management and monitoring (Text, Custom)


Value Nil

JGDC meetings are held regulary. Seven TC meetings held in 2016

JGDC meetings are held regularly. In 2017, TC meetings are now held regularly with meeting plans in place.

Meetings as per sub indicators


PHINDIRITBL

Joint Government Donor Committee meetings (Text, Custom Breakdown)


Value Nil All four required JGDC meetings are held

All four required JGDC meetings are held

4 per every year


PHINDIRITBL

Technical Committee meetings (Text, Custom Breakdown)


Value Nil 7 TC meetings are held in 2016

7 TC meetings are held in 2016

12 per every year


PHINDIRITBL

New Zambia Chartered Accountant professional qualificaiton to be launched (Text, Custom)


Value Draft curriculum for the new qualification prepared

Curriculum for new CA qualification developed. Development of training material in progress.

Curriculum for new CA qualification developed. Development of training material in progress.

New Zambia Chartered Accountant course ware development and qualification launched

Date 06-Feb-2016 20-Feb-2017 20-Feb-2017 31-Dec-2017


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PHINDIRITBL

Office of Auditor General strategic plan to be approved (Text, Custom)


Value Strategic Plan 2017-2020 not initiated

INTOSAI SAI-PMF framework Assessment is underway. Strategic plan under development

Consultancy is in progress conducting assessments using the INTOSAI SAI-PMF framework.

Strategic Plan 2017-2020 approved

Date 06-Feb-2016 20-Feb-2017 31-May-2017 31-Dec-2017

CommentsOverall CommentsOverall, the pace of implementation during the period January to May 2017 has been steady and on the upswing as most components have endeavored to implement the activities whose processes date back to 2016 as well as kick started the activities in the 2017 Work Plan and Budget. The initiation of procurement activities across all components picked momentum at an early start than had been the case previously owing to the presence of the Programme Procurement Specialist. This is a positive milestone on programme delivery given that this is the last year of the programme. Moving on all components have to sustain a fast paced implementation plan and work towards accomplishing their work plans and achieving the set targets in the remaining timeframe.

Overall Comments

Data on Financial Performance

Disbursements (by loan)

Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed

P147343 TF-17118 Effective USD 17.00 17.00 0.00 15.03 1.97 88%

Key Dates (by loan)

Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date

P147343 TF-17118 Effective 06-Jun-2014 06-Jun-2014 17-Jul-2014 31-Dec-2017 31-Dec-2017

Cumulative Disbursements


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Restructuring History

There has been no restructuring to date.

Related Project(s)

There are no related projects.

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