Document of The World Bank FOR OFFICIAL USE ONLY Report No: 78270 EMERGENCY PROJECT PAPER ON A PROPOSED ARTF GRANT IN THE AMOUNT OF US$85.5 MILLION TO THE ISLAMIC REPUBLIC OF AFGHANISTAN FOR A JUSTICE SERVICE DELIVERY PROJECT 31st May 2012 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective June 17, 2012) Currency Unit = AFN 50.90 = US$1 US$0.6580050000 = SDR 1 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS AGO Attorney General’s Office of Afghanistan NPLJA National Program for Law and Justice for All AIBA Afghanistan Independent Bar Association NPP National Priority Program AJSRP Afghanistan Justice Sector Reform Project ORAF Operational Risk Assessment Framework ANDS Afghanistan National Development Strategy P&G Pay and Grading ARTF Afghanistan Reconstruction Trust Fund PAR Public Administration Reform ARDS- Afghanistan Reconstruction and Development PC Project Coordinators PU Services - Procurement Unit PFM Public Financial Management CBR Capacity Building for Results Facility PEFA Public Expenditure and Financial CIP Capital Investment Plan Accountability DA Designated Account PRR Priority Reform and Restructuring program DAB Da Afghanistan Bank (Central Bank) POC Project Oversight Committee ESMF Environmental and Safeguards Management PPOC Provincial Project Oversight Committee Framework RIMU Reform Implementation Management Unit FM Financial Management PSU Project Support Unit FMA Financial Management Agent PU Project Unit GoA Government of Afghanistan SDU Special Disbursement Unit HRM Human Resource Management SF Stakeholder Forums IBRD International Bank for Reconstruction and SPRGRD Support for Programmatic Resource Development Growth Corridor Development project ICT Information and Communication Technology SOE Statement of Expenses IDA International Development Association (or SC Supreme Court of Afghanistan the Association) TA Technical Assistance ILAB Independent Legal Aid Board UNAMA United Nations Assistance Mission in ILF-A International Legal Foundation – Afghanistan Afghanistan JI Justice Institutions UNDP United Nations Development Program JSDP Justice Service Delivery Project UNODC UN Office on Drugs and Crime LAD Legal Aid Department USAID United States Agency for International M&E Monitoring and Evaluation Development MoJ Ministry of Justice of Afghanistan WDR World Development Report NGO Non-Governmental Organizations MoE Ministry of Economy of Afghanistan MoF Ministry of Finance Vice President: Isabel Guerrero Country Director: Robert J. Saum Sector Manager: Tony Verheijen Task Team Leader: Lubomira Z. Beardsley ISLAMIC REPUBLIC OF AFGHANISTAN Justice Service Delivery Project CONTENTS Page A. Introduction ......................................................................................................................... 1 B. Emergency Challenge ......................................................................................................... 1 C. Bank Response: The Project ............................................................................................... 8 D. Appraisal of Project Activities .......................................................................................... 17 E. Implementation Arrangements and Financing Plan .......................................................... 18 F. Key Risks and Mitigating Measures ................................................................................. 23 G. Terms and Conditions for Project Financing .................................................................... 25 Annex 1: Detailed Description of Project Components ................................................................ 26 Annex 2: Results Framework and Monitoring.............................................................................. 41 Annex 3: Summary of Estimated Project Costs ............................................................................ 47 Annex 4: Operational Risk Assessment Framework (ORAF) ...................................................... 50 Annex 5: Financial Management Arrangements .......................................................................... 58 Annex 6: Procurement Arrangements ........................................................................................... 71 Annex 7: Implementation Arrangements ...................................................................................... 79 Annex 8: Project Preparation and Appraisal Team Members ...................................................... 83 Annex 9: Environmental and Social Safeguards Framework ....................................................... 85 Annex 10: Economic, Financial and Accountability Analysis ..................................................... 90 Annex 11: Documents in Project Files ......................................................................................... 98 Annex 12: Country at a Glance ..................................................................................................... 99 Annex 13: Maps .......................................................................................................................... 101 ISLAMIC REPUBLIC OF AFGHANISTAN JUSTICE SERVICE DELIVERY PROJECT PROJECT PAPER SOUTH ASIA REGION Basic Information Country Director : Robert J. Saum Sectors: Justice (PG) Sector Manager: Antonius Verheijen Themes: Access to law and justice (60%), Team Leader: Lubomira Z.Beardsley Legal institutions for market economy Project ID: P118028 (30%), administrative and civil service Expected Effectiveness Date: May 31, 2012 reform (10%) Lending Instrument: Specific Investment Environmental category: B Grant Expected Closing Date: May 31st, 2017 Joint IFC: Joint Level: Project Financing Data [ ] Loan [ ] Credit [ x] Grant [ ] Guarantee [ ] Other: Proposed terms: Financing Plan (US$m) Source Total Amount (US $m) Afghanistan Reconstruction Trust Fund 85. 5 Client Information Recipient: Islamic Republic of Afghanistan Responsible Agency: Ministry of Finance Contact Person: Adris Walli Telephone No.: Fax No.: Email: adris.walli@budgetmof.gov.af Estimated disbursements (Bank FY/US$m) FY 2012 2013 2014 2015 2016 2017 Annual 0.5 11 17 19 19 19 Cumulative 0.5 11.5 28.5 47.5 66.5 85.5 Project Development Objective and Description Project development objective: The Development Objective is to increase the access to and use of legal services. The project seeks to: to implement the Government’s National Priority Program, mitigate the impact of the Transition; put the system on a sustainable path for long term results; and improve service delivery. Project description: The project consists of four interrelated components: (a) Partnership for Justice; (b) Legal Empowerment (composed of two subcomponents: Legal Aid and Legal Outreach); (c) Organization and Capacity of Justice Institutions (composed of two subcomponents: Effective Organizational Design and Strengthening Capacity of State Justice Institutions); and (d) Implementation Capacity. Safeguard and Exception to Policies Safeguard policies triggered: Environmental Assessment (OP/BP 4.01) [x]Yes [ ] No Natural Habitats (OP/BP 4.04) [ ]Yes [x] No Forests (OP/BP 4.36) [ ]Yes [x] No Pest Management (OP 4.09) [ ]Yes [x] No Physical Cultural Resources (OP/BP 4.11) [ ]Yes [x] No Indigenous Peoples (OP/BP 4.10) [ ]Yes [x] No Involuntary Resettlement (OP/BP 4.12) [x]Yes [ ] No Safety of Dams (OP/BP 4.37) [ ]Yes [x] No Projects on International Waterways (OP/BP 7.50) [ ]Yes [x] No Projects in Disputed Areas (OP/BP 7.60) [ ]Yes [x] No Does the project require any exceptions from Bank policies? [ ]Yes [x] No Have these been approved by Bank management? [ ]Yes [x] No Conditions and Legal Covenants: Financing Agreement Reference Description of Date Due Condition/Covenant A. Introduction 1. This Project Paper seeks the approval of the ARTF Management Committee for a grant in an amount of US$85.5 million, with an allocation of a first tranche of US$ 40 million to the Government of the Islamic Republic of Afghanistan (GoA) for a Justice Service Delivery Project (JSDP). 2. The proposed project will assist the GoA to implement the Government’s National Priority Program (NPP) in the justice sector, the ‘National Program for Law and Justice for All’ (NPLJA), whose objective is “to restore the faith of Afghans in the ability of the law to protect and defend their best interests as individuals and as a nation�. The project seeks to: mitigate the impact of the Transition; put the system on a sustainable path for long term results; and improve service delivery. The Development Objective is to increase the access to and use of legal services. The proposed project will finance the costs associated with: (a) building capacity of front line legal service providers to deliver key legal services; (b) increasing scope and quality of legal aid; (c) improving access of the people to legal information and civil legal education; (d) improving management and provision of legal services by central justice institutions; and (e) building project management capacity. The key outcome indicators for this project include: (a) scope and quality of legal services increased; (b) productivity of legal service providers improved; and (c) accountability of legal service providers enhanced. The implementing agencies are the Supreme Court (SC), the Ministry of Justice (MoJ) and the Attorney General's Office (AGO). 3. JSDP will be funded by the Afghanistan Reconstruction Trust Fund (ARTF). Several donors, including European Union, UK, Canada, Italy, Norway, Ireland and the United States of America (USA) have expressed their intend to support the Project. B. Emergency Challenge Country Context 4. Afghanistan continues to struggle to overcome almost three decades of war and civil strife. Its political context remains complex and dominated by the cross-border Taliban insurgency, narcotics production, and weak governance and rule of law. After nine years of state building, Afghanistan remains a fragile state. The delivery of basic government services has not met the expectations of citizens, while mechanisms to hold the government accountable for delivery of such services have been undermined by corruption and lack of capacity. 5. It is critical that Afghanistan develops an effective justice system with the capacity to respond to users’ demands in order for the state to provide a stable and secure environment in which citizens can pursue their goals. It must provide an effective accountability mechanism through which citizens can pursue peaceful resolution of grievances, and hold the executive responsible for its actions. As the World Development Report of 2011 on “Conflict, Security and Development� (the WDR) demonstrated, access to effective justice mechanisms is key to increasing state legitimacy, something the current Government lacks and which continues to feed the insurgency. However, as the WDR further demonstrated, investments in building such a 1 system are long term in nature and expectations of results must reflect this. A fifteen year time horizon is the minimum time frame for results, even in favorable conditions. 6. While recognizing that outcomes from investments in the justice sector are long term in nature, the GoA will also face increasing pressure to show rapid progress. The Transition process, encompassing the transfer of responsibility for security from international forces to Afghans, is ongoing and due to be completed by 2014. Transition presents a particular challenge for the justice sector, given the low level of its development to date. Effective justice services are crucial to the establishment of stable conditions necessary for peace, economic growth and poverty reduction. However, the expansion of services will have to be undertaken within the context of decreasing external resources for investment in all areas: from infrastructure, to equipment, to personnel and operating and maintenance (O&M) capacity. An emphasis on increased productivity and efficiency gains wherever possible throughout the justice service network is therefore critical. The project seeks to mitigate the impact of the Transition and put the system on a sustainable path for long term results. Sector Context 7. In Afghanistan there are a multitude of complementary, competing and conflicting spaces for rule setting and conflict resolution, all with varying degrees of legitimacy and with blurred and shifting divisions between the spaces. All justice institutions (JI) can and do enforce state law, Sharia law and/or customary rules. While a plural legal system is simply a fact in many countries, some crucial pieces of the legal architecture are missing in Afghanistan that would otherwise allow for such a system to function effectively. Most crucially, there is no mechanism to preclude parties from recycling disputes through different forums (usually referred to as res judicata). This compounds the uncertainty of the legal system in all substantive areas of law, allows for forum shopping and enables conflicting decisions. More generally, this uncertainty constrains the peaceful contestation of grievances (particularly over land) and the development of transactions outside of family networks that would form the basis for more robust private sector growth. 8. Locally, community organizations (mostly shuras or jirgas, maliks and mullahs) are the primary sources of societal order. These institutions are powerful players in resolving up to 80 percent of disputes at the community level; especially in the rural areas that make up 85 percent of Afghanistan. It is clear that community organizations will continue to play a significant role in delivering some form of justice for many years to come, even as state institutions’ presence, legitimacy and effectiveness increase. There is also evidence of growing collaboration between state, and community based resolution actors, which can be attributed to the increasing consolidation of the central government, the formalization and professionalization of certain elements within state administrative and judicial systems, and the willingness of state actors to engage with and respect the legitimacy of local processes. 9. The factors that motivate individuals to resolve their disputes through community institutions rather than state institutions must be better understood. There is a strong case to be made that many community organizations have more local legitimacy, and are faster and cheaper than state justice institutions. They are also more closely interwoven into the fabric of the rural communities and the type of justice that is dispensed – particularly in the area of criminal law – 2 tends (as with most rural societies), to be restorative rather than retributive in nature, thus contributing to local societal cohesion. 10. Poverty undoubtedly has a high impact upon the abilities of individuals to navigate the legal system, but the extent and nature of the impact needs to be better understood. High illiteracy rates exacerbate limitations in access to information; consequently, many are unaware of their rights. This is particularly the case for rural women, 85% of whom are illiterate. Poverty also precludes many from undertaking the often long journeys to access JI. 100 districts have no judges, and security and geographic factors make outreach activities in many areas very difficult. On the criminal justice side, a lack of appropriate forums for the police to take detainees to results in higher than needed pre-trial detention rates. These detention rates have damaging knock-on effects, including loss of earnings for families and a high and complex case load for the courts, prosecutors and public defenders. 11. GoA needs a better understanding of what strategies people employ to navigate the system, how they may have been successful, and where the key bottlenecks in the system are, in order to provide more targeted interventions. Linking community organizations with the formal institutions in a complementary mechanism will be fundamental for the GoA to leverage all the justice service resources at its potential disposal in order to be able to deliver an effective service for its citizens. 12. Surveys continually show that citizen perceptions of the JI are negative: a UNODC 2011 report found that both urban and rural respondents most frequently named prosecutors and judges as the officials that had demanded bribes. Bribes, misuse of funds, and undue influence remain common complaints, as does the inefficiency and inconsistency (and thus unpredictability) of state JI. 13. Rule of Law reforms since 2002 have focused on strengthening the formal sector mainly at the central level (predominantly through capacity building), with the assumption that these reforms will automatically benefit the people. The reforms have made modest progress, and remain a government priority, but have not yet yielded tangible results in the form of more accessible or better legal services. De facto, the state justice system still is a network of rather loosely connected national and local organizations without fully constituted nationwide functions and jurisdictions, policies or legal and business practices which are aligned with people’s actual needs for service. 14. The main recovery strategies as documented by the GoA have revolved around three key documents: (i) The Justice for All Needs Analysis of 2005; (ii) The Afghanistan National Development Strategy 2008-2013 (ANDS); and (iii) The 2012 NPLJA. 15. The NPLJA identified (a) Institutional Strengthening ; (b) Increasing Access; (c) Reaching out to traditional justice systems; and (d) Supporting other key Government programs such as counter-narcotics, anti-corruption and land tenure issues – as being of the most immediate need and priority. Similarly the ANDS identified (a) Improved Institutional Capacity to Deliver Sustainable Justice Services; (b) Improved Coordination and Integration within the justice system and with other state institutions; and (c) Improved Quality of Justice – as its main goals. Finally, the NPP identifies the following as key components of its strategy: (a) Increasing Access 3 to Justice; (b) Improved Efficiency of Judicial System (especially the Courts) for Better Service Delivery; (c) Improving the Technical Capacity of Judicial Staff; (d) Law Reform & Legislative Effectiveness; and (e) Institutional Strengthening. 16. While the overall direction of the Government’s strategy has therefore been consistent, and there has been substantial discussion from the international community regarding the importance of improving the rule of law in Afghanistan, thus far a Government-led, coordinated and sequenced approach to reform has been lacking. 17. Critically the JI have been unable to deliver on one of their core set of functions – that of ensuring accountability. At the highest level, the prosecutors and judiciary have been unable to hold the executive accountable for its actions. This is due to a number of reasons, including a lack of will and capacity on the part of the courts and the offices of public prosecution, corruption and a lack of space for the demand from citizens for such accountability to manifest itself in the courts. Similarly, the courts have been unable to hold individuals accountable to each other – either in civil law or criminal law through the AGO - in an objective and transparent manner, thus undermining the legitimacy of their institution. Finally, the SC and AGO have been unable to make judges within the system accountable for their actions. Without a stronger sense of accountability, and mechanisms to enforce it both internally and externally (while balancing against the important notion of judicial independence), the JI will continue to lack legitimacy. 18. The institutions themselves continue to suffer from internal problems that undermine their capacity to function effectively. In the courts, this is exemplified by the fact that almost 100% of cases are appealed up to the SC level. This has the consequence that nine SC judges (out of a total of 1,519 judges in the whole system), have the responsibility for issuing a final decision on almost 80 percent of all cases. The fact that so many appeals are allowed to the highest court further undermines the legitimacy and effectiveness of all the lower courts. The appeal system is also not quick, nor is case management transparent, leaving numerous grievances languishing in the system and citizens uncertain both how and when their case will be decided. The capacity of many judges has increased in recent years and could play a more active role in a functioning system. However, the conflicting nature of laws in Afghanistan, the general lack of independence and the absence of functional, administrative and managerial support for judges, continue to undermine the ability of judges to operate effectively. 19. In the court system itself, there has been little systematic attempt to develop a data set which the SC, MoJ and AGO could use to determine priorities for development. For example, no reliable court statistics are generally available or published that might indicate the workload of judges, such as volumes, types or distribution of civil disputes or prosecutions filed with the courts. There remains very little knowledge or transparency about the levels of court workloads and productivity or the levels of state resources that sustain the court system. The number and distribution of operational judicial panels is poorly monitored, other than for purposes of administering judicial payrolls. It is not possible to relate judge numbers to caseload trends even if caseload information were available. Although there has been a large amount of investment in some provinces and by various agencies in infrastructure, modern systems for administration of courts, such as usable court buildings, landline telephones, electricity supplies and office equipment are available to only a minority of judges. Even in the SC in Kabul there is very little use of computerized office equipment. The dominant office technology remains pen and paper. 4 20. The MoJ undertakes a range of functions for the Government including: subsidized legal defense and civic legal education (the Legal Aid Offices), registration of court civil disputes, civil legal aid, mediation of disputes and enforcement of judgments (the Hoqooq); drafting and publication of legislation (the Taqnin); legal protection of government assets (the Government Cases Department) and licensing of real estate businesses; and overseeing the Juvenile Rehabilitation Department. It is also responsible for providing legal advice to the government; registering political parties and social organizations; and licensing real estate agents. Despite improvements in terms of overall capacity at the MoJ over the last few years, it has suffered from a lack of support and coordination on the part of other institutions (such as the courts and police in terms of recognizing and facilitating the work of public defenders). Additionally, as with all ministries, it has been unable to pay salaries commensurate with the market to attract individuals of sufficient quality to undertake many of the technical tasks required at the MoJ; notably public defense and legal drafting. It also does not have a mechanism to be able to respond to surges of demand in the system, for example through contracting private attorneys. 21. The GoA has also struggled to develop a system of legal services that aids people in accessing institutions and helps them find appropriate remedies for breaches of their rights. While there is a Government system of legal aid for those being tried for criminal offences, the situation is more complex for civil cases. The institution of the Hoqooq, on the face of it, appears to present a novel approach to assisting litigants with navigating the civil justice system (for example drafting relevant court documents, assisting in mediating rather than litigating disputes, and enforcing the decisions of the court). However, the degree of access to the Hoqooq, the level of control it has over deciding how cases progress and whose interests it represents, the uncertainty as to how individual offices are actually functioning and the lack of an overall strategy for development of civil legal aid, currently militate against the institution being utilized more effectively. Given the large number of possible claims and the evolving nature of the legal framework in Afghanistan, it is likely that a centralized state run system will not be able to provide all of the civil and public law and justice needs of citizens. As such, the state will have to determine, through policy prioritizing and being strategic with regards to resources, which areas it is going to support and which areas it will encourage and allow space for the private sector to provide such services (from private lawyers, to Non-Governmental Organizations (NGOs), charities and religious organizations). Working in partnership with the private sector will allow greater access to justice and also increase the overall quality of the justice, as compared with what can be achieved via a single delivery mechanism of a state institution. 22. The ability of the AGO to investigate and prosecute crimes has been notoriously compromised, which has greatly contributed to the atmosphere of impunity and the perception that public attorneys are an instrument of the interest groups. Limited success with most systemic reforms caused donors to retreat to more selective and limited interventions, which in many cases circumvented regular institutions. Though perhaps necessary, this approach has created a number of tensions. There is a general consensus that very few results have been produced so far. 23. The lack of coordination of civil and military interventions and priorities has also hampered effectiveness. These interventions have often been focused on providing short term provincial and regional fixes aimed at promoting “stability�, while not necessarily contributing to the creation of a nationally durable system. Indeed, incorporating the results of many of these ad hoc localized interventions will present particular challenges for the GoA: from increased 5 maintenance costs for infrastructure and staff, to regularizing and incorporating new systems developed to deal with specific problems that may fade over time or move geographically. 24. Overall, the lack of appropriately resourced, predictable and accessible legal services is the greatest constraint to establishing a justice system that can promote legitimacy and stability of the state. Lessons Learned and Reflected in Project Design 25. The low level of success of rule of law reforms in Afghanistan at the level of rural communities has been linked to the fact that state building demands have not typically included offers of service that might have made social and governance changes palatable to rural inhabitants. In response to this challenge the project concentrates on service delivery. 26. The performance of the three JI was uneven under the Phase 1 AJSRP: the MoJ was the strongest and the AGO the weakest performer. The project seeks to involve all three JI, albeit to varying extents, in recognition of the added value of bringing the three institutions together under one program. The flexible ARTF design allows conditioning the release of resources upon the achievement of the specific performance targets. In this way, the ARTF mechanism clearly connects the three institutions together, and to the project outcomes, in a more coherent and incentivized manner. 27. The uneven performance of the JI suggests there is therefore a requirement for a “custom designed approach� to future reforms. This approach considers the institutions’ individual absorptive capacity. 28. The organizational structure (roles, responsibilities, structures, information flows, deliberative processes, management practices) of the JI reflect the influence of different regimes and do not correspond to current needs. In order to sustain and increase the impact of the capacity building effort, future reforms need to include structural and organizational changes of the legal institutions. Capacity building activities are clustered with and conditioned by reforms of organizational designs of the JI. 29. HR reform has been slow across government, and the Justice Sector has been no exception. A lack of commitment to certain reforms, e.g. HR reform, has been influenced by less than optimal communication about the benefits of reforms, an uncoordinated approach by donors involved, and a lack of incentives to implement reforms. The project has been designed in consultation with JI. The SC has shown particular leadership in implementing HR reforms. This will have an impact on AGO. Performance triggers target HR reform and provide additional incentives to implement them. The timing of such reforms is also appropriate, with MoJ seeking CBR support, and a cross-governmental vision emerging for improved HR management in line with a broader strategy for civil service reforms. 30. JI have been more receptive to assistance from countries with an Islamic legal culture. Cooperation between the MoJ of Egypt and the SC has been tested under the project with excellent results. The project will support cooperation of JI with their partners in such countries as Egypt, Turkey and India. 6 31. A functioning implementation structure is critical to the success of the project. A more decentralized project implementation structure with strong units within the JI encourages project ownership, and is required for a more complex program of activities. The coordination of the cross-sector activities can be addressed through a specific joint management structure. Under the JSDP the PSU maintains more of an oversight and coordinating role, with greater authority over financial management and procurement handed to the JI PU, in order to encourage ownership and improve disbursement rates. The second phase benefits from the continued presence of the Phase 1 PSU and PUs, with some critical changes to improve its functioning: The proposed implementation structure is more robust than that of the Phase 1 Afghanistan Justice Sector Reform Project (AJSRP). 32. Effective Monitoring and Evaluation (M&E) has been a challenge in the justice sector. To date, M&E in the sector has suffered from a lack of technical capacity at the implementation level and limited conceptual capacity at the policy-making level. The lack of an M&E strategy, including baseline data, to provide information has prevented the GoA from assessing properly the achievements and changes associated with Phase 1 AJSRP. The Phase 2 project will aim to provide quantitative and qualitative data collection tools and methods to ensure that project results are properly assessed within a clear M&E framework and strategy. The project emphasizes the importance of an effective M&E system: Starting with the collection of baseline data in the initial months of the project, and extending to training, the presence of dedicated staff in the PSU, and the hiring of a firm for additional support. 33. Finally, it is important to note that ARTF funding has been shown to encourage programmatic, cross-sector approaches to reform and promotes cooperation (as opposed to competition, mainly over resources) among JI. Channeling resources through the budget increases the JI’s ownership of reforms. However, the original 2-year timetable for Phase 1 AJSRP was unrealistic and a longer timeframe is needed to see tangible results. (See Para 5). Rationale for Proposed Bank Emergency Project 34. This is the second (Phase 2) ARTF funded operation supporting justice sector reforms. Phase 1 AJSRP sought to strengthen the centralized state justice system in Afghanistan and to increase access to justice for the Afghan people. It aimed to do so by enhancing the capacity of Afghan JI to deliver legal services. Investment and technical assistance (TA) were intended to strengthen human capital and physical infrastructure management, augment the skills of justice sector professionals, and enhance physical infrastructure. The project also sought to empower the Afghan people through legal aid and education on legal rights and obligations. The scope of activities in Phase 1 AJSRP was deliberately limited, in view of the need to establish the implementation structure, to build procurement capacity in the institutions, to assemble baseline data and to operate in an uncertain security environment. It was also intended to overcome the issue of lack of coordination amongst various actors up to that point. 35. At the Kabul International Conference (July 2010), the GoA articulated a plan for stabilizing and developing Afghanistan, and international partners renewed their commitment to support the Government. Both reaffirmed the goals of strong Afghan leadership, and more effective international partnership. This included channeling at least 50 percent of development 7 aid through the GoA’s core budget and aligning 80 percent of aid with the new plan within two years subject to the creation of a strong financial management system. 36. Many exogenous factors to the JI themselves, notably the decrease in the overall level of security, have slowed the pace of implementation of these critical reforms. Moreover, as security has worsened, the likelihood of rural communities being drawn towards using “insurgent justice� has increased. The GoA, however, remains committed to leveraging all the potential resources at its disposal to develop an effective justice system that can deliver core services that are in demand by its citizens in order to promote stability, increase legitimacy, and provide the space for economic development. Additionally, the GoA has reaffirmed its commitment to supporting a pooled financing mechanism with long term aims and objectives to support the development of the justice sector. 37. As with other sectors, the work is of increasing significance in light of the challenges of Transition. If Transition is to be successful, citizens must have confidence that the rule of law can provide physical security for them and their property, together with appropriate means to realize their rights and enforce remedies peacefully. This matters not just for the small scale entrepreneur, but will also become increasingly pressing as mining operations begin to scale up and resource corridors are developed to promote the infrastructure needed to support them and take advantage of their economic spill-over effects. 38. Phase 2 activities will address complex challenges. While JSDP continues many of the aspirations of Phase 1 and builds on its work, it has to confront (a) the lessons learned from Phase 1 and (b) the developments, political processes and the current realities of Afghanistan. This Project, therefore, takes as its approach a more holistic view of the justice sector by taking into account: effects of legal diversity; crucial role of legal services in future development of the country; people’s contemporary needs and preferences for a particular form of legal service vis- a-vis the potential of JI to respond to people’s needs. Using this approach, the principal goal will be to improve the capacity of JI to provide access to legal services in ways that will empower individuals to resolve their disputes satisfactorily and at minimal costs to them or the state. This incremental approach is intended to enable the swift delivery of tangible benefits that will work to build trust and confidence in the GoA and the JI, and capitalize on the political momentum, both domestically and internationally, for justice sector reform. 39. The proposed project interventions fully reflect the lessons learned in Afghanistan. Above all, the project seeks to provide stability and continuity during the time of transition in order to support the development of an effective justice system. In particular, significant operational lessons have been learned in relation to the implementation capacities of the JI from Phase 1 and these have been incorporated in order to ensure more efficient implementation of more complex reforms. C. Bank Response: The Project 40. The JSDP is a 5-year, ARTF funded operation. The estimated cost of the project is US$ 85.5 million. 8 41. The project will support the NPLJA namely: (a) Access to Justice: to expand the quality and the quantity of judicial service delivery to Afghans; (b) Improved Services: to raise the quantitative and qualitative technical capacities of the institutional service providers; (c) Improved Technical Capacity: to raise the quantitative and qualitative technical capacities of the institutional service providers; and (d) Institutional Strengthening: to build the capacity of the JI through comprehensive, management-oriented organizational development. 42. The project will also align with two other ARTF funded projects: the Afghanistan Capacity Building for Results Facility (CBR) and the Support for Programmatic Resource Growth Corridor Development project (SPRGRD). The CBR project is intended to increase the capacity of government to deliver essential services and implement national priority programs, while addressing the over-reliance on external technical assistance. CBR will offer support in the form of TA, training, and the financing of higher than Pay & Grading salaries for staff in key posts. This will be contingent upon and linked to agreed service delivery and reform targets. The JSDP will aim to leverage the resources available through CBR to both incentivize and augment the impact of MoJ reform plans, and sequencing of reforms to departments, personnel management, human capacity and organizational management will be synchronized with the ministry’s anticipated CBR proposal. To this end, the JSDP will finance TA to assist in the MoJ with its application for Tier 2 (which MoJ aims to achieve by mid 2013) and Tier 1 support (which MoJ aims to achieve by 2016). 43. Reforms at the SC and the AGO will similarly have at their core a focus on sustainability and fiscal responsibility while maximizing service delivery. They, however, will not formally be attached to the CBR. SPRGRD is intended to support the creation of a resource corridor anchored around Aynak and later Hajigak, through analytical work and catalytic investments into private sector and community development. In order to avoid any potential overlap and to ensure that all resources are leveraged effectively, the project will complement ongoing interventions in the justice sector such as those of USAID, UNDP, US State Department and others. 44. In response to the ‘lessons learned’ under Phase 1 AJSRP, the project design has been tailored to reflect the implementation capacities of the JI. Funding allocations, in contrast to the previous project, are differentiated based upon the capacity of JI to disburse funds and manage project implementation activities. Consequently, MoJ is allocated the largest sum of funding, approximately US$31 million, primarily to fund the development and expansion of critical Legal Aid services under Component 2, and also for the construction of a new HQ building under Component 3. The SC is allocated approximately US$21 million for its activities and works, and the AGO US$11.3 million. A further US$21 million is allocated for activities executed jointly across the JI. Incentives for stronger performance have also been built into the project design, with US$15 million of funding being contingent upon results. This is designed to create a clear and measurable link between effective achievement of critical outputs at mid-term, and the allocation of subsequent tranches of funding to those institutions. These interim results are detailed in the Project Outcomes section below. Project Development Objectives 45. The project seeks to: mitigate the impact of the Transition; put the system on a sustainable path for long term results; and improve service delivery. The Project Development Objective 9 (PDO) is to increase access to and use of legal services. The following three key project outcome indicators will be used to track progress toward achieving the PDO: (a) scope and quality of legal services increased; (b) productivity of legal service providers improved; and (c) accountability of legal service providers enhanced. 46. The project development objectives will be achieved by balancing demand for and supply of core legal services and increasing productivity of legal service providers through: (a) encouraging specialization and close collaboration among various service providers; (b) aligning structure, organization, processes and capacities of JI to contemporary needs of users; and (c) easing access to legal information by legal professionals, JI and broader public. The project intends to benefit the Afghan citizens and users of the legal system, with efforts to provide additional support to the indigent population, women and the private sector (particularly in resource corridors) in addition to central JI and front-line justice service providers. Summary of Project Components 47. The project consists of four interrelated components: (a) Partnership for Justice; (b) Legal Empowerment; (c) Organization and Capacity of Justice Institutions; and (d) Implementation Capacity. Further details are in Annex 1. Component 1: Partnership for Justice (US$ 13.05 million) 48. The objective of this component is to increase the scope and quality of legal services (mainly but not exclusively, dispute resolution, deed registration, and legal information) in selected provinces and districts. The ultimate goal of the component is to support business environment and investment climate. Therefore the project will concentrate on geographical areas with promising economic activities such as Kabul, Herat, Bamiyan and Logar, and legal services demanded by small and medium enterprises (mainly land disputes and registrations) or by the communities impacted by major developmental projects. 49. The goal and objective will be achieved by: (a) improving the collaboration and strengthening capacity of local JI and; (b) engaging local JI and other legal service providers, including community organizations and leaders, in community justice partnerships. The courts and Hoqooqs will be the main focus of the capacity building effort. Based upon the results of the province-specific demand surveys undertaken under Component 3 and functional reviews of institutions’ performance, the project will assist JI in developing and implementing a 3-4 year provincial justice reform strategy, which will include a road map for establishing community justice partnership. The component will finance technical assistance and investments to: (a) prepare the strategy; (b) build capacity of state JI to respond to local needs; (c) create a community justice partnership; and (d) promote users’ involvement with legal institutions through information centers and new practices (e.g. publishing court decisions, organizing public hearings, opening telephone legal consultation services and complaint lines). The community partnership will be based on the commitment of the service providers to mutually beneficial community outcomes, in particular for restoring and maintaining safety, security and prosperity. It will comprise joint regular meetings, shared record keeping, data exchange regarding cases, and, if feasible, task automation. 10 50. The key beneficiaries of these reforms will be: the people of a given province who will receive more and better legal service and will be better equipped to take advantage of legal systems; and local JI and other service providers whose capacity will be strengthened and better aligned to peoples’ contemporary needs. At the end of the project, the residents of these provinces and/or districts will have access to a higher volume and better quality of legal services; and they will be better informed about service providers and prepared to monitor their performance. The courts (mainly civil and commercial departments and land registries) and Hoqooqs will have stronger capacity and competence to serve their citizens) and together with other legal service providers and community organization will work in an environment which is more conducive to service delivery (clearer division of responsibilities and jurisdiction; access to shared information; more collaborative and transparent procedures, better working conditions, and improved performance incentives). This component supports section 1 (Increased Access to Justice) and section 2 (Improved Efficiency of Justice System) of NPLJA. Component 2: Legal Empowerment (US$ 17.55 million) 51. This component has two subcomponents: (a) Legal Aid; and (b) Legal Awareness. The overall objective of the component is to increase people’s ability to participate in the public (state) redress or dispute resolution system. a) Legal Aid (US$13.8 million) 52. The component will continue the efforts of the AJSRP (Phase 1) to strengthen and expand a state legal aid system. The objective of this component is to enlarge the existing state legal aid system while enhancing its effectiveness, efficiency and sustainability. The objective will be achieved through: consolidating existing legal aid sub-systems which are composed of two distinct models based on in-house lawyers and subcontracting an NGO (International Legal Foundation- Afghanistan, ILF-A); and (b) building the critical base (policies, procedures and capacities augmented by TA and automation) for an effective, fiscally sustainable, nationally coordinated state system of legal aid. The “National Legal Aid Strategy� and “National Legal Awareness Strategy�, both of 2011, will be a starting point and basis for policy and regulatory developments under the project. These strategies highlight the importance of a gender sensitive approach, and the project activities will incorporate this in their implementation. 53. The project will finance TA and investment to the MoJ (Legal Aid and Hoqooq Department) and an Independent Legal Aid Board (ILAB) to: (a) provide legal aid and expand the number of legal aid offices by at least five; (b) develop and/or revise a Legal Aid Strategy, current policies and regulations (for both criminal and civil legal aid) mainly with regard to the sustainability and affordability of publically funded legal aid; (c) design and implement a detailed business plan for the consolidation of the state legal aid system; (d) strengthen management capacity of the MoJ to plan, finance and manage legal aid with enhanced automation and information systems; (e) develop and implement models of cooperation with enforcement agencies; and (f) test and roll out low cost culturally sensitive ways of delivering legal aid. 54. The key beneficiaries of these reforms will be the people of Afghanistan who at the end of the project will receive more and better legal aid. The MoJ, ILAB and legal aid providers will 11 also benefit from this component. The MoJ together with the ILAB will have stronger capacity to plan, finance and manage legal aid. The number of legal aid providers will increase; they will have better skill sets and work in better working conditions (better offices, procedures, management and incentives) and hence will provide both a higher volume and higher quality of advice and representation. The sustainability of the system based on in-house lawyers will be pursued through the creation of a legal aid professional cadre, included in the tashkeel under the MoJ’s proposed Capacity Building for Results Program (CBRP), which MoJ aims to undertake by 2016, and contingency plans will also be developed for sustainability without a CBRP. This subcomponent supports section 1 (Increased Access to Justice) and section 5 (Institutional Strengthening) of NPLJA. b) Legal Outreach (US$3.75 million) 55. The Component also continues the efforts of AJSRP Phase 1. It seeks to help the Afghan people: (a) to acquire and incorporate legal knowledge into their choices and interactions with the Government and private actors; (b) to improve their ability to monitor and influence legal service providers; and (c) to secure their support for the proposed reforms. This will be achieved through strengthening capacities of the MoJ, SC and AGO to plan, finance and manage legal awareness activities and through the implementation of specific legal awareness activities. The project will finance TA to the SC and AGO to strengthen their capacity to manage their relationship with the public and to develop and implement legal awareness programs. The project will also support the Legal Outreach Office of the MoJ, the GoA’s focal point for civil legal education and awareness. This support will include mainly: the replication, dissemination and broadcasting of print-media materials and broadcast media materials and radio, such as TV shows developed under the AJSRP; development and dissemination of new materials and shows; and support for up to ten provincial awareness units. The key beneficiaries of this project will be the people of Afghanistan, who at the end of the project will have easier access to information about their rights and obligations, and a greater ability to defend their rights and apply legal remedies. The JI will benefit from the project through the development of a stronger system for state organized legal awareness activities. This subcomponent supports section 1 (Increased Access to Justice) and section 5 (Institutional Strengthening) of NPLJA. Component 3: Organization and Capacity of Justice Institutions (US$ 47.4 million) 56. The objective of this component is to improve the capacity of the state JI to manage and deliver legal services. The Component has two subcomponents: (a) Effective Organizational Design; (b) Strengthening Capacity of State Justice Institutions. a) Effective Organizational Design (US$ 4.5 million) 57. The Effective Organizational Design subcomponent aims to determine and encourage the sector’s structural reforms. These reforms will help establish the balance between development of services, delivery of those services, and the fiscal sustainability of delivery over the short, medium and long term. This objective will be achieved through policies which will: adjust courts’ and prosecutorial offices’ functions, jurisdictions, size and territorial organization to current needs; incorporate the independence and accountability safeguards into the organizational design, operations and processes of courts and offices of public prosecution; and 12 streamline procedural designs. The project will finance TA related to analytical work, periodic surveys (in the first, third and final year of the project) of users, consultations with stakeholders, and policy and law development. The component will focus on courts and public prosecutorial offices. If successful, this component will improve the organization of the legal sector and, by making it more open and evidence based, it will improve the sector’s policy and regulatory processes. The key beneficiaries of the reforms will be courts and offices of prosecutors who, by the end of the project, will have road maps for the reforms which will lead to more affordable, sustainable and effective institutions. Over time, the people will benefit from these institutions as they become better organized, hence more capable of delivering improved legal services. 58. In the MoJ the subcomponent will support the development of a Strategic Plan. Since a valid strategic plan is also a pre-requisite for participation in Tier 2 of CBR, this will also contribute to accessing CBR support. The Strategic Plan will clarify the mandate and vision of the MoJ, and establish the strategy for achieving its goals over the next 5 years. 59. The key beneficiaries of these reforms will be Afghan policy makers who will be better informed about the implications of their decisions, and stakeholders who will be allowed to participate in and influence policy decision-making. The ultimate beneficiaries should be legal service providers and citizens of Afghanistan who, if the reforms are implemented, should receive better legal services. This subcomponent supports all elements of NPLJA. b) Strengthening Capacity of Justice Institutions (US$ 42.9 million) 60. This subcomponent seeks to improve the capacity of the state JI to plan, finance, and manage their resources in order to deliver better justice services. The subcomponent is divided into the following clusters of activities for the three JI: (a) Human Capital; (b) Case Management (c) Physical Infrastructure.  Human Capital aims to further strengthen human capacity in the JI. This component will: (a) finance TA for the completion of Pay and Grading reforms in SC and AGO, (b) assist with preparation and implementation of human resource (HR) strategy for prosecutors and judges, (c) finance critical HR reforms including process, information and performance management for all three JI, (d) finance complimentary support to the HR department in MoJ to ensure it has adequate capacity to implement the reforms and recruitments required by CBR participation. This subcomponent will also support the development of legal libraries, training courses and programs, and professional gatherings of judges, prosecutors, and their support staff.  Case Management will finance the development of an automated court case management system for the SC. The system will also be piloted in the primary and appellate courts in Kabul under Component 1 Partnership for Justice. This activity will build on the case filing reforms implemented nationwide by the SC with the support of USAID.  Physical Infrastructure activities seek to strengthen JI’s infrastructure management capacity and enhance the physical infrastructure used to deliver services. This will be achieved through the hiring of additional staff; improving the skills of professionals (mainly skills related to planning, financing and managing construction projects and 13 facilities); developing a Capital Investment Plan (CIP) and additional infrastructure Design Standards for the MoJ and AGO offices; and constructing courts and offices. Equipment, implementation services, and technical and user staff development will be included to improve information management systems in the JI. JI and their employees will be the beneficiaries of the Physical Infrastructure activities. The people of Afghanistan will also benefit from buildings which are, by their design, more conducive to the better performance of JI and sensitive to factors such as gender. 61. The key beneficiaries of the activities to be implemented under this subcomponent will be employees of JI who will, by the end of the project, benefit from merit based hiring; more predictable career opportunities; possession of stronger professional backgrounds, transparent and competent HR services and better access to laws and legal materials. Some of them will benefit from improved working conditions. The productivity of the SC will be enhanced by an automated case management. The MoJ, with the help of this project, will be able to take advantage of the CBR including through more qualified and better paid staff. The ultimate beneficiaries will be Afghan citizens who will receive better services. This subcomponent will support sections 1 (Increased Access to Justice), 2 (Improved Efficiency of Justice System), 3 (Improved Capacity of Justice Sector Employees) and 5 (Institutional Strengthening) of NPLJA. 62. The objective of this component is to further strengthen implementation capacity within the JI so that they will, in time, be able to implement reforms and other activities without significant additional assistance. The immediate objective of this component is to facilitate implementation of the project. (See also Section E). 63. The key beneficiaries of this component are the JI which, as a result of this component, will be able to absorb more aid and support of international development partners. The component supports section 5 (Institutional Strengthening) of NPLJA. Consistency with Country Interim Strategy Note 64. The proposed JSDP is fully aligned with the Bank’s Interim Strategy Note FY12-14 (ISN) for Afghanistan, supporting all the pillars of the ISN. This specifically includes support for the pillar related to equitable service delivery, where intervention in the justice sector is highlighted. Expected Outcomes 65. The project will focus on three results: increased scope and quality of selected legal service; improved productivity of legal service providers; and enhanced accountability of legal service providers. The project activities under each component are designed to work towards generating the above outcomes and, in so doing, will ultimately move the project closer towards achieving the development objective set forth in the project: namely, to increase access to and use of legal services. 66. The project is expected to produce the following key outputs which would lead to the above outcomes. These include: (a) improved of capacity of front line service providers to deliver key legal services; (b) increased scope and quality of legal aid; (c) improved citizen 14 access to legal information and civil legal education; (d) increased citizen participation in monitoring the performance of service providers; (e) improved management and provision of legal services by central legal institutions and; (f) improved project management capacity. Each of these outputs, while seeking to strengthen a particular theme or focus area identified by the project as heretofore either weak or non-existent, will also work to reinforce other project outputs thereby improving the likelihood of the project achieving its desired outcomes. Annex 2 lays out the Project’s Results Framework. PDO Project Intermediate Outcome Proposed Target (2017) Outcome Indicators Baseline (2012 Indicators or Latest Estimate) Increase Scope and quality of legal services increased Provincial reform strategy access to based on community and use of partnership of justice prepared legal services Legal aid regulatory framework includes sustainable targeting and funding mechanisms Number of legal outreach units increased by 4 Productivity of legal service providers Number of cases in primary improved pilot courts increased by 30% Review of JI map for optimal scale and specialization completed Case management reform in the SC completed Accountability of legal service providers Number of information centers enhanced and/citizen complaints system operational Information about legal aid framework and providers available in local JI and in information centers Effective performance management system for judges and prosecutors operational 67. Project progress will be assessed at mid-term on the basis of established key outputs/interim results agreed upon with the JI. Each of these key outputs/interim results 15 corresponds to discrete activities that link directly to sectoral reform and are, therefore, considered critical to the project. 68. The objective of having these criteria in place is to offer the Bank and the JI an opportunity to conduct a thorough consultative review of project implementation at mid-term, with particular attention to the attainment of/delivery on the expected key outputs. This list of expected key outputs/mid-term results is intended to provide clarity for all parties on how the project will be evaluated. 69. The project funds are separated into three amounts: Tranche 1 funds (US$ 40 million, Tranche 2 funds (US$ 30.5 million) and Mid-Term-Review (MTR) Conditional funds (US$15 million). Conditional funds will be included in the request for the second tranche (so that a total of US$ 45.5 million is requested) only if mid-term review targets have been met. These funds are earmarked for activities that would be included in the project only if progress on the more critical areas of the project is apparent, as indicated by the completion of certain critical outputs. While the activities funded through the conditional allocation contribute to the better achievement of the PDO, the PDO is not contingent upon their completion. Therefore, they are intentionally designed to be activities that could be omitted without substantively impacting the achievement of the PDO. If these targets are met, the allocation to the project requested at the mid-term ARTF MC will be correspondingly increased to US$ 45.5 million. 70. Drawing on the inherent flexibility of ARTF funding, this performance review would also inform any adjustments to project design or reprogramming of funds, where this is considered necessary to better achieve the project objectives. The project could be scaled up or down in size depending on the demonstrated capacities of the JI to meet these critical targets. Institution MTR Targets Conditional Conditional Activities Funds in (US$ Millions) Tranche 2 MOJ Strategic Plan Approved US $5.8 million Vehicles and equipment Regulatory Framework for Legal (0.5) Aid Agreed Upon Training (0.5) Capital Investment Plan Completed Legal Outreach (1) Legal Fund (0.8) Legal Aid (2) Construction (1) SC Facility Design Standards US $4.7 million Construction (3) Completed Training (1) HRM Strategy Completed Professional Gathering (0.2) Judicial Map Review Completed Commentaries (0.5) AGO Facility Design Standards US $4.5 million Construction (3.5) Completed Internet Networking (0.5) HRM Strategy Completed Professional Gathering (0.2) Capital Investment Plan Completed Training (0.3) TOTAL US $15 million 16 D. Appraisal of Project Activities Government Ownership 71. The proposed operation supports the NPLJA prepared in a process led by the GoA. Its approach to reform has been discussed and endorsed by the key sector actors. The Project design has benefited from lessons learned from previous reforms implemented by other development partners and the AJSRP, as well as from extensive consultations with the SC, MoJ, AGO, ILEB, Afghanistan Independent Bar Association, concerned donors, implementing agencies, and NGOs. It is safe to say that the project and its implementing arrangements reflect the demands of the GoA and JI, and the project enjoys GoA’s ownership and support. Environmental and Social 72. OP/BP 4.01 and OP/BP 4.12 are triggered due to rehabilitation and construction activities and potential land acquisition requirements for the construction of justice institution facilities. However, the impacts are envisaged to be limited in duration and spatial extent, and the project has therefore been assigned Category B status. The project will apply the Environmental and Social Management Framework (ESMF) developed for the proposed operation, and the Environmental and Social Management Plans developed for each site. The ESMF provides guidance on the approach to be taken during implementation for the selection and design of subprojects/proposed investments and the planning of mitigation measures, guidelines and codes of practice for an environmental mitigation measures to be incorporated in the design, contracting and monitoring of sub-projects. Consultation, disclosure and due diligence guidelines are also considered. Impacts from construction works are expected to be minor, and the project is expected to have a positive impact due to the benefits of increased access to JI, and improved quality of infrastructure. Financial, Economic and Governance 73. The project is expected to have a positive economic impact. The project activities are designed to generate cost savings, improve productivity and reduce opportunities for corruption. Annex 10 provides a detailed analysis of the financial and economic impact of the project. The project will identify and implement improved business processes in the JI, as well as organizational arrangements that improve the cost effectiveness of the justice systems. Improved collaboration with the local service providers other than JI, including community organizations, is anticipated to increase the availability and effectiveness of informal and low cost dispute resolution mechanisms for citizens, and correspondingly reduce the burden of cases for formal institutions. These reforms are also expected to reduce the opportunities for corruption in the system, through process simplification, greater transparency and improved access to information for citizens. Facilitating improved organizational processes, corruption reduction measures and improved information is expected to impact positively upon the overall investment climate, which relies upon predictable law enforcement. The focus upon pilot provinces is expected to facilitate the investments in these areas and enable local communities to harness the correlative opportunities of these investments. In the context of transition, in which aid flows are expected 17 to fall dramatically over the next decade, the project will contribute to the fiscal sustainability of the system. E. Implementation Arrangements and Financing Plan Implementation Arrangement 74. The project will be implemented by the JI the SC, the MoJ, and the AGO and will follow the Bank policies and guidelines. The Bank will be responsible for the supervision of the project. The project implementation structure builds on and expands the structure established under the Phase 1 AJSRP. A detailed description of the implementation structure and operational procedures will be included in the project Operations Manual to be issued within four months from the date of project effectiveness. The implementation structure includes: (a) a Project Oversight Committee (POC); (b) Stakeholders Forums (SF); (c) a Project Support Unit (PSU); (d) Project Units (PU) in the implementing institutions – the SC, the MoJ and the AGO; (e) the Provincial Project Oversight Committees (PPOC) and their secretariats.  The POC is responsible for the overall policy, strategic planning and management oversight of the project. It is composed of the Afghan Chief Justice, Minister of Justice, Attorney General, and the Minister of Finance. The GoA may appoint additional members of the POC. The POC members select a chairman who serves as the POC’s Executive Director. The POC meets at least once every two months. It works closely with the SF.  The SF affects project implementation through its feedback to the project documents and reports. It is a consultative forum composed of representatives of legal professions, academia, civil society and NGOs, the business community, religious leaders, local government and other interest groups. The regular SF will be created to partner with the POC and the PPOCs; the POC will organize at least one, and the PPOC at least two, meetings with the SF per year.  The PSU serves as the POC’s secretariat. Its responsibilities include: day to day project management (mainly financial management, procurement and M&E); and operating a project website. The PSU includes a director who reports to the POC and staff which reports to the project director. The PSU staff includes a group of approximately ten senior local and/or international and regional experts in fields such as M&E, Information and Communication Technology (ICT), and project management (including financial and procurement management). The PSU will be supported by two or three assistants and an interpreter. The project director, regional procurement specialist, ICT expert, financial management specialist and two assistants have already been selected under the AJSRP. Other staff will be hired on a competitive basis by the POC, in accordance with Bank guidelines. The PSU works closely with the PUs established in the SC, MoJ, and the AGO.  The PUs are responsible for day to day management of project activities of the SC, MoJ, and AGO. A PU is led by a deputy principal of a justice organization supported by a PU Director. The PU Director is charged with leading a team of local and international experts who will: (a) coordinate specific reforms such as HRM, training, legal aid, legal awareness and ICT reform efforts; and (b) manage the project (mainly procurement, FM, contract 18 management and M&E of project activities). The PU Director reports to the Deputy Principal. The team members report to the project coordinator. The PU Directors and some experts were selected under the AJSRP. The remaining staff will be selected on a competitive basis. The PUs work closely with the departments leading a particular reform. The specific responsibilities of each PU include developing concept notes and terms of reference for project activities; organizing procurement; securing inputs from departments; overseeing the work of consultants; and monitoring and reporting on project progress.  The Provincial Project Oversight Committees supported by their small secretariats will oversee and implement the Partnership for Justice Program in pilot provinces. The PPOC is the provincial equivalent of the POC. The PPOCs will report to the POC. 75. Monitoring will take place through continuous and timely reviews of project implementation to assess delivery, identify challenges and bottlenecks, and explore practical solutions. M&E will primarily be the responsibility of the PSU which in turn will work with the staff in the PUs of the three JI to coordinate all activities on M&E. The PSU and PUs will periodically monitor progress against agreed indicators, as described in the Results Framework and against key outputs/interim results. As part of M&E, the project will generate regular quarterly reports and a report for funds tranche release, whichever is earlier. Other key reports will also include those that report on financials as well as reports providing periodic updates on implementation progress with all activities; the format and template will be in the project’s financial, procurement and Operations Manual. 76. Building on the lessons of Phase 1 AJSRP, the project will focus from the outset on having dedicated M&E staff in the JI for periodic monitoring. Lessons learned from M&E implementation in Phase 1 indicate a need for investment in capacity building for M&E staff. This effort will foster the institutionalization of M&E culture within the JI and ultimately be an investment in the longer-term capacity of JI staff beyond the life of the project. 77. Data Collection: The Justice Sector suffers from a general absence of robust and reliable data and a lack of credible baselines. The project will work closely with the PSU and JI to improve data collection practices. With a view to further strengthening the evidence base, the project will also commission a baseline survey within the first year of project effectiveness to take stock of baseline data, which will be periodically updated. Overall, the project will reinforce the message of the need for better data collection procedures to be adopted by staff, particularly as data collection takes place largely at the sub-national level, with M&E data flowing bottom-up for consolidation and reporting at the central level. Financing Plan Project Cost by Component US$ million 1 Partnership for Justice 13.05 2 Legal Empowerment 17.55 A Legal Aid 13.8 B Legal Outreach 3.75 19 3 Organizational Design and Capacity of JI 47.4 A Effective Organizational Design 4.5 B Capacity of JI 42.9 4 Project Implementation 7.5 TOTAL 85.5 Financial Management, Disbursement and Audit Arrangements 78. A Public Financial Management (PFM) performance rating system has been recently developed for Afghanistan by the Public Expenditure and Financial Accountability (PEFA) multi-agency partnership program, which includes the Bank, International Monetary Fund, European Commission, and other agencies. Afghanistan’s ratings against the PFM performance indicators portray a public sector where financial resources are, by and large, being used for their intended purposes as authorized by a budget that is processed with transparency and has contributed to aggregate fiscal discipline. 79. At the central level, financial management and audit functions for the proposed project will be undertaken through agents contracted under the IDA-financed Public Financial Management Reform Project II. This is the primary instrument for continuing to strengthen the fiduciary measures put in place for ensuring transparency and accountability of funds provided by the Bank and other donors. Under these contracts, two advisers - Financial Management and Audit - are responsible for working with the government and line ministries to carry out these core functions. The former, the Financial Management Agent (FMA) is responsible for helping MoF maintain the accounts for all public expenditures, including IDA-financed projects and for building capacity within the government offices for these functions. The latter, the Audit Agent is responsible for providing technical assistance to the Control and Audit office in the performance of annual audits. 80. At the project level, the PSU already established under the AJSRP will be responsible for the overall financial management for the project and will perform the overall key FM functions for the project. The PSU will be staffed with a financial management specialist and a finance officer, who will be supported by the financial management specialist of the PU in each of the JI. The PU's finance staff will work closely with the finance staff of the JI to carry out the day to day FM activities for the project. The PSU and PUs will utilize an Excel based accounting system to maintain relevant books of records and generate required periodic reports on the project activities. 81. Consolidated Quarterly Interim Financial Reports (IFRs) will be prepared by the PSU, and submitted to the Bank within 45 days from the end of the quarter. Consolidated project reports will be prepared, reviewed, and approved by the MoF, supported by the FMA. 82. A Designated Account (DA) will be opened at Da Afghanistan Bank (DAB, the Central Bank) on terms and conditions satisfactory to IDA. The DA will be maintained by the MoF. Withdrawal applications for new advances and expenditure reports will be submitted monthly. Fund Flows 20 83. Fund management for the project will follow existing procedures. As with all public expenditure, all payments under the project will be routed through MoF. The FMA will assist the MoF in executing and recording project payments. In keeping with current practices for other projects in Afghanistan, the DA will be operated by the Special Disbursement Unit (SDU) in the Treasury Department, MoF. Requests for payments from DA funds will be made to the SDU by PSU and the 3 PUs. In addition to payments from DA funds, the PSU/PUs can also request the SDU to make direct payments to consultants, consulting firms or suppliers, and special commitments for contracts covered by letters of credit. Such requests will follow Bank procedures. All withdrawal applications to IDA, including replenishment, reimbursement, and direct payment applications, will be prepared and submitted by MoF. Accounting and Reporting 84. The PSU and the PUs will maintain essential project transaction records using an Excel based accounting system and generate required monthly, quarterly, and annual reports. 85. The AJSRP FM Manual1, to be updated by the PSU, and to be approved by the Bank by July 31, 2012, will include: (a) financial management arrangements for the proposed project; (b) roles and responsibilities of PSU/PUs staff and the linkages with the JI finance departments; (c) documentation and approval procedures for payments; (d) project reporting requirements; and (e) quality assurance measures to help ensure that adequate internal controls and procedures are in place and are being followed. 86. The FM Manual will also establish project financial management in accordance with standard Afghan government policies and procedures including use of the government Chart of Accounts to record project expenditures. Overall project accounts will be maintained centrally in SDU, which will be ultimately responsible for recording of all project expenditures and receipts in the Government’s accounting system. Reconciliation of project expenditure records with MoF records will be carried out monthly primarily by the PSU, supported by the PUs. Disbursement Method 87. Disbursements from the grant will be transaction-based, with replenishment, reimbursement, direct payment, and payments under Special Commitments including full documentation or against statements of expenditures, as appropriate. Audit of Project Funds 88. The Auditor General, supported by the Audit Agent, is responsible for auditing the accounts of all IDA-financed projects; it will also be responsible for this project’s audit. Annual audited project financial statements will be submitted within six months of the close of GoA’s fiscal year. 89. The Bank-funded project already implemented or currently being implemented by MoJ, SC and AGO (Phase 1 AJSRP) have no overdue audit reports, ineligible expenditures or overdue 1 The FM manual will be a part of Operations manual. 21 interim financial reports. Key issues raised in the audit reports have been resolved up to Solar Year 1388. The issues raised in the solar year 1389 audit report have been communicated to MoJ, and responses are awaited. 90. The responsible entities for the audit report are MoJ, SC and AGO. 91. Detailed financial management arrangements for the project can be found in Annex 5. Procurement 92. Procurement for the Project will be administrated in accordance with the Bank’s “Guidelines: Procurement of Goods, Works, and Non-Consulting Services� dated January 2011. “Guidelines: Selection and Employment of Consultants� dated January 2011 and the provisions stipulated in the Financing Agreement. In addition, the Bank’s “Guidelines on Preventing and Combating Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants� dated October 15, 2006 has been shared with the recipient. The Bank’s Standard Bidding Documents, Requests for Proposals, and Forms of Consultant Contract will be used. Civil works and goods following National Competitive Bidding (NCB) procedures shall be procured using the agreed Standard Bidding Documents (SBDs) for Afghanistan. In case of conflict/contradiction between the Bank’s procurement procedures and any national rules and regulations, the Bank’s procurement procedures will take precedence as per the Article 4(2) of the Procurement Law July 2008 (Amendments in January 2009 incorporated) of the GOA, the IDA Procurement/Consultant Guidelines shall prevail. The general description of various procurements under different expenditure categories are described in Annex 6: Procurement Arrangements. A detailed procurement plan is being prepared for the Project as part of the Procurement arrangement (See Annex 6). 93. With donor assistance, Afghanistan has made considerable efforts to establish the Legal and Regulatory Framework for public procurement over the last five years. A Procurement Law, reflecting international best practice in public procurement was enacted in November 2005 replacing the earlier procurement regulations. While the law provides a very modern legal system for procurement, effective implementation of the law may encounter difficulties in the current weak institutional structure and capacity of the Government. A Procurement Policy Unit (PPU) has now been established under MoF to ensure implementation through the creation of secondary legislation, standard bidding documents, provision of advice, creation of the necessary information systems for advertising and data collection. “Rules of Procedure for Public Procurement,� which details the better implementation of the Procurement Law, has been issued by MoF as circular number PPU/C005/1386 dated April 12, 2007. The Procurement Appeal and Review mechanism is in place and the Manual of Procedures for “Procurement Appeal and Review� has been issued by MoF as circular number PPU/N001/1385 on March 18, 2007. The Procurement Law was revised in July 2008 and amended in January 2009 and issued as a new Law by the Ministry of Justice and was published in the Official Gazette Number 957, 29.10.1387 (18 January 2009). The revised “Rules of Procedures for Public Procurement� has also been issued as circular PPU/C027/1387 of November 18, 2009. 22 94. The Special Procurement Commission (SPC) comprising the MoJ and Ministry of Economy (MoE), under the chairmanship of MoF, approves high-value contracts. These approvals will be done according to Article 91 of the Afghan Public Procurement Law. 95. In the absence of adequate capacity to manage procurement activities effectively, some interim arrangements have been put in place to improve Afghanistan’s procurement management. Specifically, a central procurement facilitation service, the ARDS Procurement Unit, has been established under the supervision of MoE. 96. SC, MoJ, and AGO are the implementing agencies and will be responsible for all procurement to be carried out for the project. However, it has been assessed that the capacity of these implementing agencies to handle procurement under Bank Guidelines needs to be strengthened. For all large value procurements, ARDS and PSU will assist MoJ, SC and AGO to ensure procurement compliance, as and when required. In addition, the Procurement Policy Unit (PPU) embeds procurement specialists in the line ministries to provide technical assistance, oversight, capacity building and assistance for complex procurements. Moreover, the PSU will be strengthened by hiring the services of one International Procurement Consultant financed for the duration of at minimum two years. A general description of various procurements under different expenditure categories can be found in Annex 6. A detailed procurement plan has been prepared for the project. 97. Project procurement involves the following:  Consultancy services (firms or individuals);  Works contract for infrastructure development of MoJ, SC and AGO; and  Procurement of goods, IT equipment and non-consultant services for the project. F. Key Risks and Mitigating Measures 98. The project risks and mitigation measures and process are detailed in the Operational Risk Assessment Framework (ORAF) in Annex 4, and summarized below. 99. The overall risk to achieving the PDO is assessed to be “High�. The risk to successful implementation of the project is also “High�. Besides the general country level risks (such as security, political instability, changes in leadership of selected ministries, slower than anticipated implementation of correlated reforms) which are beyond the project’s control, key risks include:  Project Stakeholder Risks: Legal pluralism and forum shopping is deeply entrenched with local community power structures and allegiances and very difficult to change; accountability structures may be inadequate while incentives may take time to actualize; weak commitment to reforms in JI exacerbated by uneven engagement across institutions; transition and the anticipation of decrease of funds may encourage: (i) unhealthy competition for funds; and (ii) distort the choice of reform; volatile political context may result in frequent changes in leadership; judicial institutions are highly conservative in nature and 23 often resist change based on arguments of judicial independence; and limited access for citizens to project information due to high illiteracy rates.  Implementing Agency Risks: The increased amount of responsibilities to be delegated to the JI will place a strain on capacity; weak FM capacity may slow project implementation; overall capacity in the JI for complex tasks is limited; different levels of capacity exist between the JI but throughout all of them, decision making and business processes remain ad hoc and not well formalized; decision making processes across all JI remain centralized with little engagement of provincial and district level authorities  Governance and Project Monitoring: These include environmental and social risks due to construction and rehabilitation works; weak implementation capacity in JI; weak governance in JI for transparency and accountability; and weak supervision and monitoring mechanisms for implementation. 100. Key mitigation measures include: Triggers and tranches financing mechanism and focus on results; leveraging of numerous interest groups (businesses, local communities) combined with a participatory approach (for example in relation to the development of sector-wide strategic plans) should provide space for consensus building to overcome competitiveness for resources as well as increase pressure on leaders to implement reforms; linking with other priority Afghan Government projects (for example the CBR project) will ensure longer term sustainability of the investments and reforms; implementation of pay and grading reforms throughout the JI will improve the opportunities for career progression and improve HR management, thereby reducing incentives for nepotism and corruption in the system; use of an Environmental and Social Management Framework; strong implementation structure with decentralized project units in JI and centralized coordination unit; emphasis on transparency in relation to all procurement processes; and clear M&E framework and development of M&E capacity. 101. For project success the JI will have to work cooperatively together at the macro level. The POC will provide relevant oversight and guidance in this regard. However, on a day to day basis, the JI will have to coordinate closely with the central PSU to ensure timeliness and accuracy in relation to all procurement and implementation functions. The project will provide the necessary support for capacity to the PSU to be able to deliver the services required to the JI to enable them to undertake all project activities – including monitoring and supervision – effectively. Close and constant World Bank supervision will also be required to ensure that this project remains well coordinate and on track. Donors can also reinforce the need for on-going government commitment during project implementation. 102. Reform of the justice sector represents a challenge in any environment – not just a fragile and conflict affected one. The Bank, however, now has substantial experience and numerous good practice lessons which can be applied to this project in order to ensure that effective results are achieved. Additionally, the risk of not engaging in the justice sector – particularly at the time of transition - is even more significant, since without an effective justice system that citizens have faith in and which is providing services that meet the broad demands of communities, other development activities (such as the provision of effective health, education and infrastructure services) may be jeopardized in the medium to long term. While recognizing that political conditions in Afghanistan remain highly fluid, the relatively long term commitment of this 24 project, together with the focus on results, should provide a relatively stable platform for the reform and continued effective delivery of basic justice services on a nationwide basis. G. Terms and Conditions for Project Financing 103. The Project will be US$85.5 million “results-based� grant over a five year period, supporting the National Priority Program for Rule of Law for All. A first tranche of US$40 million will be requested at the start of the project. At mid-term, an evaluation of the project will be undertaken according to the mid-term outputs/interim results. Of the second tranche of US$45.5 million, US$15 million is conditional upon the achievement of agreed mid-term outcomes, and US$30.5 million is non-conditional. If all targets are achieved, then the total request for tranche two will be US$45.5. If all targets are not met, then the request for further allocation to the Project will be reduced accordingly. This is to ensure that there is sufficient progress in areas critical to the overall project objectives. 25 Annex 1: Detailed Description of Project Components AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT 104. The project has four components. First, Partnership for Justice (US$ 13.05 million), second, Legal Empowerment (US$ 17.55 million), third, Organization and Capacity of Justice Institutions (US$47.4 million) and fourth, Implementation Capacity (US$7.5 million). Component 1: Partnership for Justice (US$ 13.05 million) 105. The immediate objective of this component is to increase the scope and quality of legal services in selected provinces and districts. Its ultimate goal is to help justice institutions (JI) and community organizations to play their role in improving the business environment and enhancing economic growth. The goal and objective will be achieved by: (a) improving collaboration among local JI; (b) strengthening capacity of courts and Hoqooqs; and (c) engaging other local legal service providers such as community organizations and leaders in community justice partnerships with state JI. 106. One of the key strategies for ensuring long term growth in Afghanistan is centered on the development of “resource corridors� (developed infrastructure zones linked to urban areas which will be driven by the development of extractive industries). The subcomponent will support this strategy in two ways. First, it will focus on enforcement of property rights and enforcement of contracts (mainly on the disputes related to land ownership and land registrations) and legal services to the communities impacted by these developments (for example, ensuring that citizens have a means for redress in relation to contractual provisions contained in mining contracts, such as development of services and infrastructure for citizens, or revenue allocation). Second, it will focus on geographical locations with more dynamic business communities and/or significant developmental projects and plans. 107. The Government of Islamic Republic of Afghanistan (GoA) has tentatively selected four pilot provinces, Kabul, Herat, Bamiyan and Logar, as the component pilot sites. A pilot site will include the provincial but also district institutions in two districts in each province. Pilot districts will be selected against agreed upon criteria, cooperatively by the central and relevant local justice and administrative institutions in consultations with the Office of Governor and Municipalities. 108. The component will target the following legal services and providers: dispute mediation and arbitration (provided mainly by jirgas, Hoqooqs and courts); publically funded civil legal advice (provided mainly by Hoqooqs); issuance and registration of land titles (provided by primary courts and makhzans); and provision of legal information and civic legal education (provided mainly by Hoqooqs). 109. To ensure desired results, the component will harness the considerable potential of non- state legal service providers including community based organizations to mediate disputes and build upon their fast expanding collaboration with the Afghan state dispute resolution actors. Rather than attempt to reform and strengthen informal institutions the project will seek to: forge sustainable consensus-based community justice partnerships between JI and other service providers while strengthening performance of provincial and district courts, Hoqooqs, and if 26 needed, offices of public prosecution and legal aid offices. Improved performance should increase the competitiveness of state sub-national justice institutions and facilitate their quest to be the chosen forum for dispute resolution. 110. The community partnership among local organizations will be voluntary and “custom made�. It will be based on mutually beneficial goals and should lead to such results as: improved communication and collaboration among institutions; clearer understanding of and consensus on division of roles and jurisdictions among local institutions (in accordance to Afghan law); streamlined and uniformly applied processes governing interagency relationships (from the first application to the execution of a decision); shared record-keeping systems and information exchange (on individual cases and decisions); and citizen involvement in evaluation and monitoring of service providers (e.g., through the carrying out of public hearings and trials, the publishing of decisions, and the increased availability of complaint boxes, hotlines for legal consultations, and related tools). The reforms of provincial and district institutions will be closely aligned with the vertical reforms implemented by the central JI (See also: Components 2. Legal Empowerment and 3. Organization and Capacity of Justice Institutions). 111. The component will finance technical assistance (TA) and investment to the local state institutions – mainly courts and Hoqooqs. Limited support in the form of TA will be provided to non-state service providers and stakeholders, mainly to increase their access to information or involve them in data sharing, and to improve their knowledge about legal framework and state systems. 112. First, assistance will be provided to prepare a three to four year action plan (the Plan) based upon an assessment of legal needs and an efficiency review of local JI which will be prepared under Component 3 a) Effective Organizational Design. The plan will be undertaken by the provincial and district JI in consultation with all local stakeholders under the leadership of a Provincial Project Oversight Committee (PPOC). Initially, the Plan will propose only a basic cooperation framework and a set of prioritized, sequenced, and costed specific reforms. The Plan will evolve based on the results of additional analytical work, consultations with stakeholders, and on-going implementation results. The Plan will include a road map for establishing the community justice partnership and a strategy for involving stakeholders (e.g. the business community) and the broader public in pursuing the above mentioned social goals. The reform plans will be carried out in consultation with the relevant central institutions and coordinated with those institutions’ reform plans. 113. Next, the Project will finance the implementation of this Plan. This will include support for: (a) developing compatible systems for record keeping, case processing and information exchange; (b) establishing and operating community information points that can offer readily available information on service providers and “first aid� consultation and advice; (c) developing phone based services and complaint systems; (d) consultations and conventional outreach programs. The majority of resources will be spent to enhance the capacity of courts and Hoqooqs. These investments will involve minor updates to physical infrastructure (the updates should not exceed US$ 0.05 million in budget and one year of implementation); reengineering and streamlining business operations; helping to develop appropriate skills of staff; improving management practices; and introducing incentives for a more service-oriented culture among providers. In Kabul the project will assist in developing and testing simple automated case 27 management and case tracking systems in the offices of Hoqooq and primary and appellate courts, and a digital records management system for Property Deeds Registries in all piloted courts. The objectives of automation include modest but sustainable improvements in staff efficiency, records management, public information, and performance data for management decision-making and M&E. If successful, and subject to the availability of resources, these pilot systems will be rolled out to other offices and courts. 114. The cooperation among service providers will likely reduce competition among dispute resolution forums and reduce forum shopping by users. It will result in the specialization of providers, and consistency and predictability of commonly applied justice processes and their outcomes. The greater capacity of local JI will allow service providers to process cases quickly and at lesser cost. Publically available information about rights and service providers will reduce the information gap between legal professionals and citizens, which in turn will help people to make wiser choices in their navigation of the legal system. All of the above will make the system more transparent and will allow for greater accountability of service providers. The key results indicators for measuring whether or not there have been improvements in the right direction will include: an agreed upon and tested model of collaboration among local JI for dispute resolution established and number of information centers and complaints systems operational. 115. The PPOC will steer the preparation and implementation of the provincial programs and coordinate implementation of the district programs. The PPOC will be composed of the principals of the relevant local JI, the provincial governor and at least two representatives of non- state institutions (if the proposed reforms involve these institutions). A chief justice will chair the PPOC unless members decide otherwise. The PPOC will report to the Project Oversight Committee (the POC). The PPOC will be supported by a small secretariat responsible for day to day management of the projects. The Project Support Unit (PSU) and Project Units (PUs) in the Supreme Court (SC), Ministry of Justice (MoJ) and the Attorney General’s Office (AGO), will work closely with the secretariats. They will advise them (along the lines of their responsibilities) on project management issues; in particular, they will assist with drafting project documents and advise on procurement and financial management matters. Component 2: Legal Empowerment (US$ 17.55 million) 116. The objective of this component is to increase people’s ability to participate in public (state) redress or a dispute resolution system. The objective will be achieved through the supply of a larger volume and better quality of publically funded legal defense lawyers against criminal charges (legal aid); through outlining more effective policies for civil legal aid; and through legal outreach and civic education. If successful as a Capacity Building for Results (CBR) ministry, the MoJ will leverage CBR assistance in order to institutionalize legal aid providers. The component has two subcomponents: (a) Legal Aid (US$13.8 million) and (b) Legal Awareness (US$3.75 million). a) Legal Aid (US$ 13.8 million) 117. The reform under this subcomponent seeks to enlarge the existing state legal aid while also enhancing its effectiveness and sustainability. The existing state legal aid system comprises 66 28 lawyers employed by the MoJ in 16 provinces - Badakhshan, Baghlan, Balkh, Farah, Faryab, Ghazni, Herat, Jawzjan, Kabul, Kandahar, Kapisa, Kunduz, Nangarhar, Paktia, Parwan, Takhar and 35 “Legal Aid Providers� in 8 provinces (Baghlan, Balkh, Bamiyan, Herat, Kabul, Kunduz, Nangarhar and Paktika), funded by the Phase 1 Afghanistan Justice Sector Reform Project (AJSRP). 118. The legal defense system subsidized by the state will expand mainly by opening a few new legal aid offices, adding legal aid providers and by integrating the International Legal Foundation-Afghanistan (ILF-A) with 13 offices and 73 lawyers into the state network. The effectiveness and efficiency of the system will be increased by reforms targeting capacity, management practices, and performance incentives for the whole system and individual providers. These reforms will include the cooperation of providers with police and courts to ensure that the role of defense counsel is properly recognized. The expansion and overall sustainability of the publically funded legal service will be secured mainly through reforms of funding mechanisms; better calibration of the system to the needs of the people but also available funds; efficiency gains; and through the proposed creation of a technical cadre of legal aid providers with the status of civil servants through Capacity Building for Results Facility (CBR). 119. Civil legal aid, which is provided mainly by the Hoqooq, will be directly supported under the project only in a limited capacity. The organization, performance and fiscal sustainability of providing civil legal aid is a key but unknown challenge for the GoA at present. No coherent Government policy currently exists in this regard. Under this component, an assessment of needs and potential of Hoqooqs, private sector and other mechanisms to deliver legal service and civil legal aid would be conducted (within the first year of the project). Thereafter TA will be provided to implement the recommendations. It is expected that the analytics which the project will finance coupled with the efficiency gains and increased demand from the citizenry for more effective institutions, will result in resources being allocated internally more efficiently to meet the demand for civil legal aid. 120. Under this sub-component the project will finance TA and investment to the Legal Aid Department (LAD),Hoqooq Department, and Independent Legal Aid Board (ILAB) in support of the following activities:  Regulatory framework for legal aid: This will include two activities: (a) operational support for the ILAB; and (b) revision of a current policy and regulatory framework for legal aid. The former will seek to enable functioning of ILAB through funding of its day to day operations. The latter will seek to enable ILAB to perform its main responsibility, which is to manage the legal aid system as a whole. The project will support research, consultations and policy, regulation and law drafting in the field of legal service and legal aid. The work will be concerned with: the market for civil legal aid (from both a demand and supply side perspective); the cost and price of legal services; the fiscal sustainability of legal aid (funding alternatives and eligibility criteria will be explored); effective governance and management of legal aid; and developing options for sustainable civil legal aid.  Consolidation and expansion of the state legal aid system: This will mean: (a) a continuation of funding operation and maintenance costs of the legal aid offices and personnel supported under Phase 1 AJSRP; (b) development of a detailed consolidation plan 29 for a smooth integration of ILF-A and its unification with the LAD; and (c) creation of additional legal aid offices. The consolidation plan will provide a step by step guide for integration, an assessment of capacity needs for a unified legal aid system, and development of a legal aid related strategy for transitioning the MoJ to Tier 2 and 1 under the CBR (See Component 1 Partnership for Justice) or in other parts of the country). It will also propose alternative solutions for the sustainability of Legal Aid, should MoJ be unable to enter Tier 1.  Enhancement of legal aid capacity: Under this activity the project will support mainly: (a) reorganization of LAD; (b) strengthening its human resource management system (HRM); (c) development of a basic automated case tracking system to support Legal-Aid staff, professionals and management in up to 30 provincial offices; and (d) introduction of an integrated management information system connecting provincial offices to MoJ HQ. The project will also provide for necessary technology to support the above changes. The HRM reform will include a reorganization of personnel, the development of a career path and grading functions within the LAD and legal aid offices (including the development of necessary technical and administrative positions to support lawyers, and the setting of new standards both in terms of individuals’ qualifications and abilities and in the expected output of numbers and types of cases) and developing a simple performance management system. The purpose here is to ensure consistency between all lawyers employed at the LAD and the smooth transition of the key staff into the LAD’s tashkeel should the MoJ successfully enter Tier 1 of CBR. It is expected that the integration of the ILF-A lawyers into the LAD will allow for a continued increase in capacity and the internalization of abilities and skills more broadly as the ILF-A lawyers and management train relevant counterparts. Therefore, for instance, all training needs and associated costs for the LAD will be internalized during this stage. Similarly, initial information, case and performance management equipment will be obtained from the ILF-A. The physical assets (including IT equipment) of the ILF-A will also be fully integrated and absorbed into the functions of the Ministry in line with the needs of the new business plan and legal aid policies. Thereafter, additional equipment to fill any gaps (both geographically and technologically) will be funded by the project.  A Legal Aid Fund will be created to test and roll out innovative and cost effective methods of delivering legal aid. Three schemes to be piloted include: a) The expansion of the “sub-contracting private lawyers delivery model�, which was piloted on “cases in absentia� during the first phase of the project. Under this activity the project will finance: (a) costs associated with strengthening the capacity of the LAD in order to improve selection of the best providers; to negotiate and agree on contracts; to make sure that services are, in fact supplied and that providers are paid based on their performance; and to manage good relationships with both clients and service providers; (b) costs of services; and (c) at the end of the project, an assessment of this program, which will include a cost benefit analysis of this delivery model. b) The provision of “on duty� lawyers to assist those arrested at police stations, both virtually and in person; and in provincial courts to assist those who have not yet been introduced to a lawyer but are at court for a hearing This will ensure that individuals get access to a legal representative as swiftly as possible at low costs. 30 c) User reporting system: A direct reporting system will be developed to allow users and recipients of legal aid services to report on their satisfaction with regard to the services received. Reporting will be a part of performance M&E system. The pilot schemes will be first placed in the “pilot regions� and later be rolled out to other provinces. The pilot schemes will be closely aligned with investments and reforms undertaken as part of Component 1 Partnership for Justice. 121. The consolidation of the state legal aid system should result in an economy of scale and specialization which will have a positive impact on the volume of service. Subcontracting of private lawyers should invigorate the private market and lead to less dependence on legal aid. The capacity building activities will increase the transparency and productivity of the system. These activities include incentives for front line providers to perform at more efficient and effective levels. Testing the most cost effective methods for service delivery should have a similar effect. In addition, reporting by users will likely increase the accountability of service providers. The proposed policy reforms and underlining research are intended to reverse current ineffective policies (such as a cap of seven cases per month per provider). Policy reforms prioritize more accurate targeting, financing of legal aid and effectiveness and efficacy of providers. 122. The key results indicators for measuring whether there have been constructive improvements will include: Legal aid framework includes realistic targeting and funding mechanism and productivity incentives and collaboration frameworks between legal aid providers (MoJ and legal aid offices, Afghanistan Independent Bar Association (AIBA), Non- Governmental Organizations (NGOs) and enforcement agencies (courts, public prosecution, police) are operational. 123. The MoJ will be in charge of implementing the majority of the reforms of the state legal aid system, while the ILAB will be responsible for implementing the projects under its aegis. The ILAB and MoJ will work closely to ensure a smooth flow of information with regard to the policies developed by the ILAB and the implementation capacities of the MoJ. This process will therefore map the intended new policy and regulatory setting functions of the ILAB and MoJ. b) Legal Outreach (US$ 3.75 million) 124. The objectives of this subcomponent are threefold: (a) to help the Afghan people internalize an awareness of their rights, entitlements, obligations and responsibilities into their choices and interactions with the government administration and private actors; (b) to improve the ability of the users of the justice system to monitor and influence legal service providers; and (c) to secure the proposed reforms for the stakeholders. The program will therefore work along three strands: (a) increasing knowledge of citizens’ rights; (b) increasing awareness and dispelling misconceptions with regard to the operations of state JI; and (c) empowering citizens by giving them greater knowledge with regard to their options. 125. The proposed reform is a follow up to the legal awareness program implemented under the Phase 1 AJSRP, which financed predominantly knowledge based empowerment activities loosely coupled with legal aid. Project activities under the Phase 1 AJSRP have been limited to a media unit of the Hoqooq Department in the MoJ (previously responsible for state legal outreach 31 programs) and three legal outreach units in Balkh, Kunduz and Nangarhar. The Justice Service Delivery Project (JSDP) will build on this experience and expand the previous program in terms of JI involvement, range of activities and geographical outreach. All three JI will be engaged in this endeavor, thus leveraging the opportunities to promote awareness of rights and obligations. However, the MoJ will continue to be the lead implementer. The program will spread out to at least 5 new provinces, four of which will be the pilot sites under Component 1 Partnership for Justice. The program is aligned with the National Legal Awareness Strategy passed by the Government in 2011. 126. Under this component the project will finance TA and goods to: (a) the MoJ (the LAD, which recently took over responsibility for legal outreach from the Hoqooq Department) and the Publication Department; (b) the MoJ’s provincial units in charge of legal outreach; (c) the SC (the Publication Department); and (d) the AGO (the Publication Department) in support of the following activities:  Developing communication strategies: which will help the JI to identify communication methods and processes to understand and engage key audiences in support of achieving JI reform objectives.  Materials and Operational Cost Support: This support will include: a) Funding operating costs of the existing provincial units and the costs associated with the expansion of the units to at least five new provinces, including the provision of necessary Information and Communication Technology (ICT) equipment; b) Developing, disseminating and broadcasting legal awareness materials including: production of print-media materials (e.g. pamphlets, posters, newspapers, books); production of broadcast media (radio and TV shows); and c) Supporting a range of capacity building activities such as strategic advice and various forms of trainings. 127. The component will contribute to two project result areas: increased scope and quality of legal services, and improved accountability of service providers. The scope of services will be increased indirectly through the strengthened capacity of the MoJ and other JI to manage and coordinate awareness activities. Increasing the volume of awareness activities (through engaging all JI, adding new provincial offices and staff and raising the range of activities) provides the direct contribution of the project to this result area. Legal knowledge will empower people in two ways: it will allow them to navigate the legal system more effectively and will help to keep legal service providers accountable for their behavior. 128. The key results indicator for measuring whether there have been improvements in the above direction will be: 4 legal outreach units created. Component 3: Organization and Capacity of Justice Institutions (US$47.4 million) 129. The objective of this component is to improve the capacity of the JI to manage and deliver legal services. This will be achieved by: (a) reforming JI’s organizational designs (functions, 32 jurisdictions, organizations, structures, and procedures); and (b) strengthening the JI’s critical capacities (focusing on human capital and physical infrastructure). 130. The component has two subcomponents: (a) Effective Organizational Design (US$4.5 million); and (b) Strengthening Capacity of State Justice Institutions (US$42.9 million). a) Effective Organizational Design (US$ 4.5 million) 131. The subcomponent seeks to align the mandate, functions, and structure of JI to the current societal needs and people’s demands. The subcomponent will finance TA for data collection and analytical work; consultations with stakeholders; and policy reforms that are concerned with the asymmetry between demand and supply of legal services and a lack of fiscal sustainability of their delivery over the short, medium and long term. This work should increase the knowledge of Afghan decision makers, legal professionals, and the broader public regarding the key obstacles to access to legal services and potential solutions and their impacts. In the longer run, it will help to develop an adequate, evidence based approach to policy response to the problems Afghanistan face. 132. The project will support the following activities:  Diagnostic and baseline analysis will involve the initial assessment of the paths to justice that people and businesses have to “travel� in order to resolve their non-trivial legal problems and disputes. The assessment will be concerned with: (a) needs and demand for legal services; (b) people’s response strategies to problems that might have a resolution via legal means; and (c) comparison of the results across jurisdictions and institutions. The purpose of the assessments is threefold: (a) to diagnose local legal practices and preferences and inform reform designs; (b) to lay a foundation for the provincial reform plans under Component 1 Partnership for Justice; and (c) to provide baseline data for measuring improvements achieved by the project. This work will be closely related to the implementation of the activities under Component 1 Partnership for Justice; For example, in year 1, the survey will be started in the four pilot provinces (Logar, Bamiyan, Herat, Kabul) with the results being subject to immediate analysis to inform the activities under Component 1, while the survey is completed on a broader scale nationwide. The initial assessment will be followed by at least two follow up assessments designed to measure the project progress.  Analysis of institutional response to this demand: This research will be concerned with the factors which influence JI’s performance, such as costs, capacity, incentives, confidence and culture. It will include: a) Organizational preconditions for effective service delivery: This sub-activity will analyze issues of: functions and jurisdiction (to explain cost and benefits of such practices as “unlimited appeals�; excessive forum shopping; de novo processes at the appellate or SC level; and concentration of decision making in the SC); independence and accountability safeguards (to explain the impact of internal institutional dependence and a lack of due process or reasoned decisions); and the flexibility of the system to match demand and supply for services. This will attempt to answer the questions about the numbers, size and location of courts and other offices. This information will help explain 33 whether courts operate at optimal scale and specialization vis-a-vis current requests for massive investment in physical assets and human capacity. The analysis will be based in large part upon the nationwide demand survey conducted above. b) Analysis of procedures for contract enforcement: This analysis will focus on the efficiency and effectiveness of commercial and selected civil procedures. The objective is to identify opportunities for reducing costs, time and procedural formalism while improving the protection of litigants.  MoJ’s 5-year Strategic Plan: The Strategic Plan should set out the ministry’s vision, and thus guide the ministry’s activities. A valid strategic plan is also likely to be a pre-requisite for participation in CBR, due to its central role in guiding any reform process. The strategic plan will need to clarify the mandate and goals of the MoJ, and establish the strategy for achieving its goals over the next 5 years. The subcomponent will finance the costs of TA to assess ministerial resource needs, including an assessment of donor activities; assist the ministry to assess and prioritize its strategic objectives; support an assessment of ministry organizational structures, with scope for de-concentration of activities and responsibility to sub-national institutions; and enable the development of a costed and prioritized timetable to implement the Strategic Plan. 133. Related research, consultations and policy discussions will be carried out for publically subsidized legal aid under Component 2. (a) Legal Aid. Local surveys of demand for legal services will be carried out in coordination with Component 1, Partnership for Justice. 134. The relevant JI will be responsible for conducting research and organizing consultations and policy dialogues. In the SC, the Chief Justice with the High Judicial Council will be responsible for the implementation of this component. Within four months from the beginning of the project, the SC and AGO will develop and submit to the Project Oversight Committee (POC) a research plan, which will provide a list of and timetable for research projects, consultations and policy dialogues. 135. The contribution to the project results here will be: increased knowledge and understanding by decision makers and stakeholders of factors that influence the performance of JI, subject to the will of decision makers to implement often complicated reforms. The key result indicator to assess whether progress has been achieved will be: Organizational map for courts, public defenders offices and Hoqooqs completed. b) Strengthening Capacity of State Justice Institutions (US$ 42.9 million) 136. The objective of this component is to enable JI to manage its critical resources: people and physical assets, for the goal of improved service delivery. This will be achieved by strengthening management and service delivery practices in the central JI and their sub national branches. The project activities will to a large extent build on, complement, and/or expand reforms implemented under the Phase 1 AJSRP (2008-2011), as well as ongoing government and donor activities. 34 137. HRM reform is particularly critical, because the performance of JI and their service delivery depends above all upon people’s inputs. In Afghanistan to date, people’s input has been almost a sole source of JI productivity. HR reforms in MoJ through both JSDP and CBR will strengthen the link between the additional capacity and resources coming into the ministry, and the performance results it demonstrates. The additional salaries and support available through CBR will increase the MoJ’s chances of retaining the best professionals, and improve capacity to hold staff accountable for outcomes and hence sustain the results of the most important reforms such as reform of legal aid. MoJ will seek CBR Tier 2 support by mid 2013, and Tier 1 approval by 2016. 138. Other HR reforms (e.g. performance management reform) will target work force productivity and accountability. Asset management reform and ICT support are designed to improve the working environment of legal professionals and increase their productivity and transparency, hence accountability. The key results indicators against which the progress in achieving the above results will be measured include: Pay and Grading reform (P&G) completed; performance system for judges in place; five year training plan developed; number of buildings constructed; and Capital Investment Plan prepared. 139. The subcomponent includes three clusters of activities: (a) Human Capital (US$ 15.1 million); (b) Case Management Reform (US$1.75 million); and (c) Reform of Physical Infrastructure (US$ 26.05 million). 140. The reforms under this subcomponent seek to: increase alignment of human resource management (HRM) functions, capacity, and processes with justice sector business needs; encourage professional affiliations and exchange of information and views on relevant legal subjects; and intensify learning and training of the workforce in state JI. 141. Under this cluster the project will finance TA to the SC, and AGO and/or MoJ for following activities:  Support to Reform Implementation Management Unit (RIMU) units for reform implementation: Completion of the pay and grading reform (P&G) of civil servants: This reform will be concerned with the re-grading of positions, re-structuring of the tashkeel, and recruitment of staff through competitive, merit based P&G processes in the SC and AGO for all civil servant positions. In AGO, this process is still at the initial stages, and it is expected that implementation of P&G reform will take up to 2 years. SC will be assisted to continue its recruitment under P&G reform as required. It is estimated that the SC will need an additional year to complete the reform. The project will bear the costs associated with operating a Reform Implementation Management Unit (RIMU) created under the Phase 1 AJSRP. Additional assistance (in the form of consultant services, training and equipment) may be necessary to synchronize this reform with the HRM reform for judges and prosecutors.  Developing and implementing HRM strategies for courts and prosecutorial offices: The HRM Strategy should be concerned with matching human resources to medium and longer term business needs as defined through functions and jurisdictions, existing and forecasted 35 workload, procedures and operations and broader planning documents. It will be guided by two principles: sustainability and affordability. As such it will promote effective use of human resources while, recognizing, in case of courts, that judicial independence drives court philosophy, structure, and decisions. The strategy should also be responsive to the particular issues the current systems face, such as: the challenge of coordinating two tracks of HRM systems; an aging labor force; younger judges, prosecutors or other employees with different backgrounds, values and expectations; the need for more women and ethnic minorities to be represented; safety and security. The call for increased accountability should be of particular concern for the strategy. The development of the strategy should be followed by broad consultations and practical reforms, some of which the project may support depending on their impact and availability of resources. Subsequent activities may include the installation of HRM software if required. The preparation of the HR Strategy for courts and public prosecutors has to be closely coordinated with the ongoing P&G reform for support staff and should include suggestions for how the two HRM systems should be coordinated in the future.  MoJ’s analysis and proposal for professional cadres under CBR: To complement the MoJ’s efforts to draw upon CBR to build capacity for service delivery, an assessment of ministerial needs would be undertaken. This would include identification of professional groups, phasing in of staff over time, proposed pay-scales for these cadres, fiscal implication analysis, and plan for reduced dependency upon externally financed staff. In particular, the HRM reform for professional cadres will target the Legal Aid Department but will include other potential professionals groups such as legislative drafters, litigating officers and so on. This activity will be closely aligned with the activities of Component 2 a) Legal Aid. In addition to the Strategy, this activity intends to support reforms of selection and appointment and performance monitoring systems, including technology based solutions such as acquisition of improved HRM software. This activity will complement ongoing reforms supported by USAID (mainly in the SC) that focus on developing HR management tools and the introduction of a new profession of court administrators. These interventions will be targeted to reduce operating costs, improve staff performance, increase accountability of legal professionals, and in the case of MoJ to prepare for CBR recruitment should the ministry enter Tier One. Legal Aid HR reforms in the MoJ will be supported by Component 2 Legal Empowerment.  Training and management capacity: This activity will be concerned with improving the capacity of the JI to develop, organize and coordinate education, learning and training programs. This activity will be concerned with improving job related skills and the competence of sitting and new professionals. The project will finance trainings under S-S initiative arrangements (e.g. training prepared in cooperation with partners from Egypt, Turkey and India) as well as other forms of training. It will also support the Training Department (TD) for, inter alia: training associated with developing the competence of the TD staff and the current core trainers from JI; a comprehensive training needs assessment and 5-year training plan; and developing a system of reviews of skills and competence of new professionals, including developing individual training plans for their future development. Specialized training and management capacity for relevant departments – e.g. IT or Infrastructure Departments– will also be provided. 36  Expanding and operating legal libraries: This activity will be concerned with improving access of legal professionals and the broader public to legal books and materials. The project will finance the operation of the existing 25 provincial libraries created under the Phase 1 AJSRP (and the establishment of new mid-size libraries in courts and offices of public prosecutors (around 20 in total) with the objective of having at least one library per province. This subcomponent will also finance printing and disseminating laws and legal materials to judges, prosecutors and other legal professionals.  Drafting commentaries to the critical laws: This activity will be concerned with encouraging more uniform application of state laws by providing judges, prosecutors and other legal professionals with guidance materials in the form of commentaries. The project will financially support working groups which include local and international legal professionals (mostly from Egypt and Turkey) and broad consultations with stakeholders. The work will be implemented under the leadership of the SC and will include civil and criminal codes and criminal procedural codes.  Encouraging professional affiliations: This will be concerned with promoting the commitment of judges to the rule of law and with improving their work ethic and morale. The project will support the professional associations of judges and prosecutors and their meetings and conferences. The support will include nationwide annual conferences of judges and prosecutors which have been organized with great success under the Phase 1 AJSRP. 142. If successful, this subcomponent will result in the improved capacity of the JI to use their human resources effectively. More effective management should have a positive effect on scope and quality of services provided by courts and offices of public prosecution. Case Management Reform (US$ 1.75 million) 143. Under this activity the project will finance development and implementation of an automated court case management system for the SC. The system will also be piloted in the primary and appellate courts in Kabul under Component 1 Partnership for Justice. This activity will build on and extend the case filing reforms implemented nationwide by the SC with the support of USAID. Under the reform the SC and most of the provincial courts have improved their paper-based filing system for all active court cases by use of color-coded file folders with case summaries and tracking cards. The SC plans to expand this reform to an automated court case management system by which cases are entered into the court system, classified, prioritized, calendared and processed. As a result of the reform: electronic case status information will be available to judges and court staff at a new SC Justice Information Center (constructed in the second half of 2012 under this project), and will improve the transparency of court operations. Automation will increase the technical competency of staff, provide tools to carry out their tasks more efficiently, and result in an increase in judicial productivity and quality of court services provided to the citizens. More reliable court performance statistics may be readily obtained from the automated case record database. Statistics will describe changes in judicial workload over time to suggest appropriate resource allocation and provide analyses to support M&E of reform efforts. 37 144. Post-transition sustainability of the automated court case management system poses some risks. Maintenance of the software and the underlying hardware infrastructure will require a technical support capacity within the SC significantly greater than that demonstrated to date. Moreover, executive management at the SC is not accustomed to managing the allocation of court resources on the basis of prospective analyses of caseload and performance trends, since the requisite data on which to base objective decisions has not been historically available. It is anticipated, however, that these conditions will be improved in the near term (pre-transition) through continued technical assistance provided by USAID and other donors. A simple, more maintainable design of the system will also contribute to its sustainability. 145. With the investment and technical assistance provided under this activity, the JI will: (a) strengthen their capacity to plan, finance and manage construction projects and assets; and (b) prepare and implement the construction and repair of court and office facilities and equip new and existing courts and offices. Specific activities to be implemented include the following:  Developing a 5 year Capital Investment Plan (CIP) for all JI: The CIP will be based on an assessment of the current condition of the facilities and will produce an inventory of necessary new projects, criteria for prioritizing these projects and an estimate of their costs. The CIP with Design Facility Standards will create a planning framework for the management of assets.  Developing Design Facility Standards (DFS) for the MoJ and AGO facilities: DFS are a set of guideline design documents, technical specifications, and detailed drawings to be used by architects, consultants, and contractors in the design and construction of new buildings. They should guarantee that the buildings meet international standards from the point of view of security, safety and human rights.  Hiring additional professional staff: These staff would be responsible for planning, financing and managing construction projects and assets, in addition to the JI staff. 146. Preparing and implementing construction and rehabilitation projects of court and office facilities. Some of the construction projects will start immediately after project implementation. These are mainly projects designed in Phase 1 AJSRP, including the construction of two AGO buildings (Logar Province), two court buildings (Kabul and Baghrami), the renovation of the Logar Justice Department office, as well as the preparatory work for the construction of the MoJ HQs. The rest of the projects will be selected on the basis of the prioritized outcomes of the CIP, and are expected to cover an estimated 7 building projects in prioritized locations. Construction work for the MoJ HQ and AGO HQ will also be financed from year two of the project. Purchasing of office equipment (including plotters, printers, copiers, fax machines) and furniture for current and to-be-constructed facilities will be included.  ICT infrastructure: including updates to telephone systems at MoJ headquarters, and support for network infrastructure at the new AGO headquarters, will also be financed under this component. 38 147. The results will be measured by the following key results indicators: HR reform strategy for SC, AGO and MoJ prepared; 250 judges, and 200 prosecutors and other professionals trained; Case management system in the SC installed. Component 4: Implementation Capacity (US$ 7.5 million) 148. The objective of this component is to build implementation capacity within the JI so that they will, in time, be able to implement reforms and other activities without significant additional assistance. The immediate objective of the component is to facilitate effective implementation of the project. This component will finance the operation of the implementation structure partially established under the Phase 1 AJSRP. This will include funds to cover incremental operating costs, PSU, PUs and PPOC secretariat staff costs, M&E of project activities, and compliance with Bank fiduciary and safeguard requirements. 149. Establishing an implementation structure with acceptable levels of capacity has been one of the critical challenges of the Phase 1 AJSRP. Project implementation has suffered from slow staffing and lack of ownership and leadership. As of today, most of the staffing issues have already been addressed. Assuming an expansion of project activities, the current implementation framework will require further strengthening and design changes. The JI do not intend to change the basic structure which includes, in addition to the POC, the PSU, a Project Unit in each JI, and Stakeholders Forums (SF). The issue of ownership will be addressed through entrusting more responsibilities to the units inside of the institutions led by the heads of administration. The units will be in charge of management of particular programs or their sub-parts (e.g. Legal Aid, Legal Awareness). They will have oversight functions and hence also the core subject matter technical expertise necessary for the implementation of project activities. The issue of capacity will be addressed through establishing a sufficient project management team for each major program (e.g. legal aid program, legal outreach program, legal libraries program) and through strengthening procurement and financial management capacity. The project teams will work mostly under a specific justice institution. The PU of the MoJ will work closely with the PSUs of MoF and the Independent Administrative Reform and Civil Service Commission under the CBR. Component 1. Partnership for Justice will, in addition, establish Provincial Project Oversight Committees (PPOC) which will be supported by small secretariats. 150. The PSU will continue to perform coordinating responsibilities and will be in charge of procurement and financial management as well as broader M&E functions. Additional capacity will be necessary for administrative functions, M&E, procurement, financial management, and the new activities planned under the JSDP. The PSU will also continue serving as a secretariat for the POC. 151. If successful, the implementation structure will facilitate timely and effective implementation of the project according to the World Bank Policies and Guidelines. The success of the project will be measured against the following key results indicators: Project units fully operational and POC and SF meet regularly at least once per year. (See also Section E. on Implementation Structure and Financing of the main document and Annex 4). Staffing Table Position SC MoJ AGO PSU PPOC TOTAL 39 Director 1 1 1 1 4 8 Procurement 1 2 1 2 0 6 Specialist FM Specialist & 1 1 1 3 0 6 Internal Auditor M&E Specialist 1 1 1 1 0 4 Contract Management 0 0 0 1 0 1 Specialist Court Management 1 0 0 0 0 1 Specialist Assistant 0 0 0 1 4 5 Interpreter/translator 1 1 1 1 0 4 TOTAL 6 6 5 10 8 35 40 Annex 2: Results Framework and Monitoring AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT Results Framework PDO Project Outcome Indicators Use of Project Outcome Information Increase access to and use of Scope and quality of legal To monitor progress towards legal services services increased achieving the project development objectives Productivity of legal service providers improved Accountability of legal service providers enhanced Intermediate Outcomes Intermediate Outcome Use of Intermediate Indicators Outcome Monitoring Component 1: Partnership for Justice Cooperation among JI An agreed upon provincial To monitor implementation improved and their structured reform strategy & community potential and efficacy of dialogue with community justice partnership approved collaborative model for organizations and/or other dispute resolution service providers ongoing Citizens’ participation in legal Number of information To monitor level of outreach process increased centers operational Component 2: Legal Empowerment Subcomponent a. Legal Aid Policies on legal aid are Legal aid framework includes To monitor quality of policy realistic sustainable and easy practical targeting and funding and regulatory framework to understand mechanism Access to legal aid improved Collaboration frameworks To monitor degree between legal aid providers productivity of legal aid and enforcement agencies providers (courts, public prosecution, police) operational 41 Subcomponent b. Legal Outreach Availability of information Four legal outreach units To monitor extent and effects about obtainable rights and created of increased legal outreach legal service providers increased Component 3: Organization and Capacity of State Justice Institutions Subcomponent a. Organizational Design Organizational design of state Reviews of JI’s map for To monitor overall alignment institutions more conducive to optimal scale (size & location) of organizational structure effective and efficient delivery and specialization of the and management with needs of dispute resolution system completed and demand for service Subcomponent b. Strengthening Capacity of State Justice Institutions Capacity of state institutions HR Reform for judges, To monitor progress in to manage and deliver legal prosecutors, legal aid implementation of HRM service improved. providers and Hoqooq officers reform approved At least 250 judges and court To monitor capacity of service staff, 200 prosecutors and staff providers and quality of and Hoqooq staff trained service Case management system To monitor productivity of installed in the SC judges in SC Component 4: Implementation Capacity Build stronger capacity within Project units fully operational Implementation by JI and JI for effective project coordination between PSU implementation and JI Improve general preparedness POC meets with SF once per To monitor cooperation of JI of JI to take on more complex year and SF implementation in medium to long-term 42 Arrangements for Results Monitoring Target Values Data Collection and Reporting Project Outcome Baseline YR1 YR2 YR3 YR4 YR5 Frequency Data Responsibility Indicators and Reports Collection for Data Instruments Collection Scope and quality User of legal services survey/data TBD 2013 - - - - - Annual JI increased collection and analysis User Productivity of survey/data TBD 2013 - - - - - Annual JI legal service collection and providers improved analysis User Accountability of survey/data TBD 2013 - - - - - Annual JI legal service collection and providers enhanced analysis Intermediate Data Responsibility Frequency Outcome Baseline YR1 YR2 YR3 YR4 YR5 Collection for Data and Reports Indicators Instruments Collection Component 1: Partnership for Justice Provincial Survey of An agreed upon Legal provincial reform professionals strategy and 0 2 2 4 4 4 Annual and users of JI community justice legal services partnership conducted as approved part of survey under 43 Component 3 Number of information centers 0 1 2 4 4 4 Annual Reports JI/PSU operational Target Values Data Collection and Reporting Intermediate Data Responsibility Frequency Outcome Baseline YR1 YR2 YR3 YR4 YR5 Collection for Data and Reports Indicators Instruments Collection Component 2: Legal Empowerment Subcomponent a: Legal Aid Legal aid framework includes prepared Progress practical targeting 0 - - and - - Annual MoJ Reports and funding approved mechanism Collaboration frameworks between legal aid providers and enforcement 0 25% 50% 60% 75% 100% Annual Reports JI agencies ( courts, public prosecution, police) operational Subcomponent b: Legal Outreach Number of legal 3 - 5 5 6 7 Annual Reports MoJ outreach units increased 44 Target Values Data Collection and Reporting Intermediate Data Responsibility Frequency Outcome Baseline YR1 YR2 YR3 YR4 YR5 Collection for Data and Reports Indicators Instruments Collection Component 3: Organization and Capacity of State Justice Institutions Subcomponent a: Organizational Design Reviews of JI’s map for optimal scale (size and location) Prepared and specialization of 0- - - and - -- Annual Reports JI the system approved completed Subcomponent b: Strengthening Capacity of State Justice Institutions HR Reform for judges, prosecutors, Prepared legal aid providers 0 and Annual Reports SC and AGO and Hoqooq officers approved approved At least 250 judges Annual JI and court staff, 200 prosecutors and 0 100 300 600 800 950 Reports staff and Hoqooq staff trained Case management SC Reports & system installed in 30% - 50% 20% 100% 100% Annual Statistics the SC 45 Component 4: Implementation Capacity Project units fully operational 0 50% 100% - - - Annual Reports JI POC meets with SF 0% 80% 100% 100% 100% 100% Annual Reports PSU once per year 46 Annex 3: Summary of Estimated Project Costs AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT Amount in US$ Project Cost by Component million 1 Partnership for Justice 13.05 2 Legal Empowerment 17.55 a Legal Aid 13.8 b Legal Outreach 3.75 3 Organizational Design and Capacity of JI 47.4 a Effective Organizational Design 4.5 b Capacity of JI 42.9 4 Project Implementation 7.5 TOTAL 85.5 Detailed Component Costing Break Down Component Amount in US$ million 1 Component 1: Partnership for Justice 13.05 a Diagnostic Analysis 0.5 Functional Reviews 0.5 b Forming Partnership 3.5 Implementation Plan, Consultations 1.5 Outreach and Information Centers 1.0 Establishing Shared Record & Info. Systems 1.0 c Institutional Capacity of Local Institutions 9.05 Modernization of Courts and Land Registries 5.25 Modernization of Legal Aid 2.50 Modernization of Public Prosecution 1.3 2 Component 2: Legal Empowerment 17.55 a Legal Aid 13.8 Consolidation of State Legal Aid 8.4 TA Support for LAD 2.5 Legal Fund 1.6 Regulatory Framework 1.3 b Legal Outreach 3.75 Communication department and legal outreach in AGO and SC 1 47 Support for LA Units 1.1 Expansion of LA Units 0.15 Development and dissemination of outreach materials 1.5 Component 3: Organization & Capacity of JI 47.4 a Effective Organizational Design 4.5 Demand Surveys 2.2 Mapping 1.2 Safeguards for Accountability and Independence Review 0.3 Procedural Analysis 0.3 MoJ's Strategic Plan 0.5 b Capacity of State JI 42.9 i Reform of Human Capital 15.1 HRM Strategy 1.5 HR Reform 2 Training Management 1.5 Support for RIMUs 0.6 Legal Libraries & Publications 2 Commentaries to Critical Laws 2.5 Professional Gatherings 1 SC Training 2 AGO Training 1 MoJ Training 1 ii Case Management in SC 1.75 iii Support for Physical Infrastructure 26.05 Design, Construction or Rehabilitation 6.1 SC 5.0 AGO 1.1 Operating Investment Fund 0.30 Buildings SC 0.10 Buildings MoJ 0.10 Buildings AGO 0.10 Design and Construction in Kabul 12.95 Design and Construction of AGO Building 3.75 Construction of MoJ Headquarters 8.00 Construction of SC 1.20 Investment Plan and Facility Standards 2.30 Staff and support cost 1.25 Design standards AGO & MoJ 0.40 Capital Investment Plan 0.65 Equipment and Furniture 1.3 Equipment SC 0.5 Equipment MoJ 0.5 Equipment AGO 0.5 Vehicles 1.8 48 Vehicles SC 0.8 Vehicles MoJ 0.4 Vehicles AGO 0.6 ICT Technology 0.7 SC 0.1 MoJ 0.3 AGO 0.7 4 Component 4: Implementation Capacity 7.5 POC 0.5 PSU 1.8 PU SC 1.2 PU MoJ 1.4 PU AGO 1 PPOC (including secretariats) 1.6 PROJECT TOTAL 85.5 49 Annex 4: Operational Risk Assessment Framework (ORAF) AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT Stage: Appraisal 1. Project Stakeholder Risks Rating: High Description : Risk Management: 1. Legal pluralism and forum shopping is deeply 1. The reforms at sub-national level will focus on business environment (land issues entrenched in culture and hence difficult to and contract enforcement). They will build on already existing cooperation among reverse. critical institution. Legal outreach activities and consultations should also mitigate this risk. 2. Local leaders may benefit from status quo and not 2. The business community – one of the beneficiaries of the program, should be able be interested in reforms. There may also be to influence leaders in favor of reforms. Outreach, consultation and consensus limited will for increased engagement with the building activities will be undertaken as part of the process of arriving at the state institutions. Component 1 Plans. 3. Leadership of state institutions has little incentive 3. The triggers and tranches (T&T) arrangement should provide leverage for the to support reforms which produce long terms and implementation of more difficult reforms. The design also calls for participatory uncertain benefits. reform processes which should provide space for consensus building and pressure on the leaders to implement reforms. 4. Transition and the anticipation of a decrease in 4. This risk will be addressed through the project design and supervision, as well as funds may: (i) encourage unhealthy competition through continuous and active donor coordination. Asset management planning is for funds; and (ii) distort the choice of reform part of the project, and MOF is now becoming more closely involved in monitoring (toward those which in the future will not be the O&M implications of infrastructure budgets to ensure reasonable decisions are affordable or sufficient to generate desired made. A further ARTF project is also expected to strengthen O&M management results, such as construction projects). capacity. 5. Volatile political context may result in frequent 5. The risk will be mitigated through building support at the mid-level of changes in leadership which slows and/or management, across a range of departments, as well as through the development of redirects reforms. a strong PU/PSU. Furthermore, the tranching mechanism offers a means to reduce 50 risks to the project funds in the event of mis-direction of reforms. 6. Due in large part to the high levels of poverty and 6. Demand side accountability will be improved though increased dissemination of illiteracy, there is limited access for citizens to information to citizens on rights and entitlements under the law (legal outreach project information, and accountability program and partnership for justice). Project information will be made available on mechanisms are limited. the internet and communities will be engaged in outreach at the provincial and district levels, particularly through the PPSUs. Resp: Government Stage: Continuous Due Date : N/A Status: In implementation team place supported by WB advisory support 2. Implementing Agency Risks (including fiduciary) 2.1. Capacity Rating: Moderate Description : Risk Management : 1. The previous project created basic 1. Under the previous project, the project coordinators have been trained on the job. implementation capacities. The key challenge As of today they have a proven record of excellent performance. All of them have of this project will be the implementing received full or partial training on project management, procurement and FM. They capacity of JI (through the PUs), as more will be supported by a team of professionals who will assist in managing individual responsibilities will be delegated to them. projects and programs. 2. FM capacity in the JI faces limitations that 2. a) An FM specialist for the PSU was recruited under Phase 1, and has shown the can slow project implementation down. This capacity to manage FM processes in compliance with WB requirements. Under risk becomes particularly acute since Phase 2 Phase 2, the FM capacity of the JI will be strengthened through the hiring of FM seeks to delegate more responsibilities to the specialists for each JI to work in coordination with the PSU: the process for these JI themselves. recruitments is already underway. b) Training will be provided to FM staff by the Bank, and the Operations/FM Manual will be updated to ensure complete guidance is available. c) A parallel World Bank Project, CBR, also aims to strengthen FM process management through the provision of high capacity FM managers in selected posts in line ministries, including MOJ, at managerial levels. It is hoped that this CBR position will be in place by the end of 2012, thereby providing a strong counterpart within the Ministry for project staff. 51 3. Capacity for complex tasks such as 3. Firms will be hired to support the Project Units and JI with these tasks. The project development of strategic plans, the Capital will capitalize on the ARTF third party monitoring program. The M&E framework Investment Plan and Monitoring and will be prepared for each major project activity/program. The sub-frameworks will Evaluation through the life of the project is support the result framework of the EPP. Baseline data have been already gathered weak. for court performance and legal aid. This work will continue through first phase of the project. Component 1 builds capacity of users to oversee/monitor service providers. Resp: Stage: completed Due Date: N/A Status: Justice institutions completed 2.2. Governance Rating: High Description : Risk Management : 1. Overall, JI governance remains weak, but varies, 1. The project aims to improve management of key resources (HR, asset, case with MoJ being the strongest and the AGO the management) which includes decision-making. Component 3 directly targets the weakest among them. Decision making and decision-making of courts in civil/commercial matters. MoJ has as its objective to business processes remain ad hoc and not well be a first tier ministry in the Capacity Building for Results Facility, which requires formalized, posing risks over transparency; they an overhaul of its management system. A strong political commitment to this are concentrated in hands of a few and not based objective has been made. Peer pressure among institutions may push the other on solid evidence. justice institutions to follow suit. The combined impact of this project and CBR could have a positive impact in terms of risk reduction. 2. Decision processes remain centralized, with little 2. Component 1 will establish provincial focal points in the 4 pilot provinces, and engagement of provincial and district level enable establishment of mechanisms for coordination. Better engagement of authorities. provincial and district level JI is at the heart of this component, and a Provincial PSU will also be in place in order to facilitate this. The development of the Plans will be managed so as to encourage adequate consultation and engagement with the provincial and district levels, and should inform a more needs and capacity based approach. Links between centre and provinces will also be encouraged through professional gatherings and trainings. 52 Resp: Justice Stage: first year of Due Date : N/A Status: planned Institutions operation of the project Fraud & Corruption (sub-category of Governance risk) Risk Management : 1. a) The project will aim to improve both accountability and independence of JI. Both are at the heart of addressing corruption and the proposed reforms will take steps to mitigate the problem. However, it is noteworthy that no evidence of corruption in the implementation structure has come to light during the implementation of the JSRP. b) The project also assists JI to streamline procedures and increase their transparency, hence reduce opportunities for corruption. 2. a) Legal awareness programs should increase people’s willingness and potential to interact with JI and keep them accountable. b) Support for implementation of P&G reforms in SC and AGO will increase the use of merit based recruitment practices, and HR reforms in all three JI should improve the opportunities for career progression and improve HR management, thereby reducing incentives for nepotism and corruption in the system. c) Monitoring and evaluations will be undertaken for project staff and regular audits will apply to procurement and FM undertaken by the project to minimize risks. d) Regular communication with PSU, provision of adequate WB support for supervision will also act as a safeguard against fraud and corruption within the project. 3. a) Transparency: Public bid openings will be used and a complaints mechanism will be maintained. Procurement of services will be adequately advertised and records maintained of procurement processes. Regular audits will be conducted, as well as performance reviews of project staff. Clear Guidelines and Procedures: For 53 work, goods and services financed through the project, Bank procurement guidelines will be applicable. Operations/Procurement Manual will be provided to ensure that professional standards and transparent criteria are maintained. Staffing: The PSU teams are now experienced in meeting World Bank requirements for such processes, and will have responsibilities for undertaking regular M&E of project activities. Additional training will also be provided by the International Procurement Specialist (already in place) and the Bank team as required. Additional assistance will be provided by the ARDS in the Ministry of Economy. b) WB has worked closely with JI to ensure packages are well designed. WB will continue to work with the JI on packaging to maximize competition and participation by capable contractors. Resp: Leaders of Stage: throughout Due Date: N/A Status: legal justice institutions project operation awareness work Third party ongoing and to be stakeholders deepened during project implementation 2.3 Procurement Rating: High Description: Risk Management: PDO may be jeopardized by weak procurement It should be noted that a number of procurement packages are already being processed, capacity in the JI For large value contracts, timely therefore the risk of delaying the project is less pronounced. completion of these procurement packages is The risk mitigation activities include the hiring of an international procurement particularly critical for achieving the PDO. consultant (for first two years of project implementation) for the PSU and procurement specialists for each JI. Procurement under the project will also be assisted by ARDS in the Ministry of Economy. As part of capacity building, international training on public procurement will be offered to the procurement staff as well as for the senior management. It should be noted that 90% of staff hired under the Phase 1 JSRP have already received some form of procurement training. Resp: PSU Stage: immediate Due Date : upon Status: ongoing project effectiveness 54 3. Project Risks 3.1. Design Rating: High Description : Risk Management : The success of the project will depend on full This risk was mitigated through participatory preparation and will be further mitigated ownership and commitment to reforms such as through the design of the reform process. Reform processes will be open and inclusive, organizational reform, legal aid related reforms to so results will be based on broad consensus. Reforms will also be based on empirical HRM. In some instances, the ownership and research. This combination will make reforms less dependent on the decisions of a commitment may not be strong enough, and the few. Further to this, the project is designed to build incentives to complete difficult reform process risks being controlled by just a few reforms before MTR, with some financing conditional upon their completion. This powerful figures, or blocked by stakeholders with builds a strong incentive into the project to move forward in these critical areas. The vested interests. tranches of the ARTF also provide a mechanism to ensure that the project’s subsequent funding allocations are based upon adequate performance on meeting project objectives. Resp: Leadership of Stage: Due Date: starting Status: planned JI in collaboration implementation from effectiveness with World Bank team 3.2. Social & Environmental Rating: Moderate Description : Risk Management : The project has been assigned category B due to the The risk will be mitigated through an environmental safeguards management construction and rehabilitation work undertaken for framework (ESMF) which will apply to all works and rehabilitation projects JI. OP/BP 4.01 and 4.12 are triggered. undertaken through the project. The ESMF provides the principles for preparing the environmental and social mitigation plans (EMP/RAP etc) which will apply (wherever relevant) to all works and rehabilitation projects undertaken under this project. The Mitigation plans will be monitored during implementation phase and consultants are in place in the PSU and PUs to ensure compliance Engineers are in place in the PSU and PUs to ensure compliance and additional in house training will be provided to them through the project. Status: Resp: PSU Stage: complete Due Date: N/A complete 3.3. Program & Donor Rating: Moderate Description : Risk Management : 1. Program success is contingent upon donor funding 1. This risk is relatively small. Sufficient resources have been committed by donors 55 and coordination. A number of donors have already thus far and performance of the project will draw the needed remaining resources. expressed their commitment to contribute to the program. 2. The project should support the NPP for Rule of 2. The GoA and donors will continue working to finalize the NPP and this is required Law. So far, donors and the GoA have not been able to be completed by the Tokyo Conference in July 2012. Consultations with government to agree on the program. A continuing lack of such throughout the development of the project should ensure coherence of objectives. agreement may undermine project implementation. Resp: Leaders of JI together with DP Stage: continuous Due Date: N/A Status: ongoing representatives 3.4. Delivery Monitoring & Sustainability Rating: High Description: 1. Weak Monitoring has been endemic Risk Management : to the justice sector with limited capacity, inadequate 1. Strengthening M&E capacity of JI will be undertaken early on with a focus on ownership and poor data quality having the potential training/capacity building, and hiring a firm with responsibilities to strengthen overall of impacting service delivery measurements. data collection and periodic monitoring. The project will also leverage the capabilities and knowledge of the ARTF third party monitoring agent.  The centralised PSU will receive regular reports, maintain a close oversight function and report regularly to the Project Oversight Committee on implementation progress.  The Stakeholder Forums will be a key mechanism for oversight and transparency. These forums will also be a source of feedback from civil society organisations, business community, religious and professional representatives among others.  Provincial and District Project Oversight Committees will provide regular inputs to the project. The UNAMA and key ARTF Donors will meet with the POC to ensure that progress is sufficient, review use of ARTF funds and review the efficacy of M&E mechanisms.  Triggers and tranches approach will link disbursement to achievement of project outcomes. 2. For project activities relying heavily on inter-JI 2. The Project will be implemented through three decentralised units in the justice synergies to generate final output(s)/outcome(s) at institutions, and in collaboration with provincial and district level institutions. On more the district level, limited inter-institutional complex activities requiring inter-JI collaboration and synergies, the project will aim to 56 coordination and working practices with local justice more closely monitor processes and outputs institutions could lead to weak monitoring of results. 3. Sustainability will depend on JI commitment to 3. Demonstration of strong support from the highest authorities in the justice sector improving implementation relative to the earlier and widespread ownership and sound understanding of project objectives among operation, Also important is the inherent inclination project staff is key. Extensive consultations have shown that there is leadership in the JI and ability of the JI to move away from the status and will to move the project forward. The project will work to create sustainable quo and work consistently towards bringing about mechanisms that can be managed by JI through their own capacity, while also boosting credible sectoral reform for the long term. capacity and learning on M&E systems through the involvement of the M&E firm. Resp: Leaders of Stage: Due Date: firm to be Status: planned Justice Institutions and implementation hired shortly after PSU effectiveness 57 Annex 5: Financial Management Arrangements AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT Country Context 152. The Bank has gained substantial experience and understanding of the financial management environment in Afghanistan through the large number of projects carried out over the past four years. The Public Financial Management Reform Project II (PFMRP II) is the primary instrument to continue and enhance the fiduciary measures put in place during the past years to help ensure transparency and accountability for the funding provided by the Bank and other donors. 153. A PFM performance rating system using 28 high-level indicators was developed by the Public Expenditure and Financial Accountability (PEFA) multi-agency partnership program and was applied in Afghanistan in June 2005. PEFA is comprised of the World Bank, IMF, EC, and several other agencies. The system is structured around six core dimensions of PFM performance: i) budget credibility, ii) comprehensiveness and transparency, iii) policy-based budgeting, iv) predictability and control in budget execution, v) accounting, recording, and reporting, and vi) external scrutiny and audit. Afghanistan’s ratings against the PFM performance indicators generally portray a public sector where financial resources are, by and large, being used for their intended purposes. This has been accomplished with very high levels of support from international firms; this assistance will continue to be needed over the medium term if these ratings are to be maintained. There is also much room for improvement. 154. In spite of undeniable gains made in reconstruction since the end of 2001, the challenges facing Afghanistan remain immense; not least because of the tenuous security situation in the region and continued prevalence of a large illegal and illicit economy. The policy framework benchmarks have not yet been fully estimated, so various priorities are funded through the annual budgeting process. The rising costs of the security sector constitute the major constraint on attainment of fiscal sustainability. With regard to executive oversight, the national assembly will play an increasingly active role. All in all, the new national strategy has created high expectations of the executive which could prove to be quite difficult to meet. 155. The public sector, in spite of considerable efforts to reform its core functions, remains extremely weak outside of Kabul. The lack of qualified staff in the civil service and the absence of qualified counterparts in the government after 30 years of war and conflicts is a binding constraint. Delays in reforming the pay structure and grading of civil servants have severely crippled the public administration of the country. Domestic revenues lag behind expenditures by a factor of ten to one. Large-scale corruption could emerge to undermine the government’s efforts to enhance aid flows through national accounts. Capacities to track expenditures and monitor expenditure outcomes have improved, but they need rapid and substantial strengthening if progress toward the attainment of national development targets is to be monitored. Currently, 75% of external revenues bypass government appropriation systems. 156. The World Bank is financing a Financial Management Advisor to assist the Ministry of Finance, an Audit Advisor to assist the Control and Audit Office, and a Procurement Advisor to 58 assist in Procurement-related activities. Also an Internal Audit function is being developed within the Ministry of Finance with World Bank financing. USAID, and earlier the Indian Aid Assistance Program, is financing a team of consultants and advisors to assist the Da Afghanistan Bank in local as well as foreign currency operations. The activities carried out under the existing Public Financial Management Reform projects have helped the Government to ensure that appropriate fiduciary standards are maintained for public expenditures, including those supported by the Bank and the donor community. 157. Progress has been slower than expected in shifting from operations support provided by the three Advisors to capacity development and knowledge transfer to the civil servants. Given that, it is expected that the Advisors will continue to be required for the medium term. Challenges still remain in attaining the agreed upon fiduciary standards and also to further enhance them. And to make matters more complex, the regulatory environment in Afghanistan has advanced significantly in the past three years. Unfortunately, even mastery of basic skills in the early environment does not fully qualify the civil servants to work effectively in the new emerging environment. Risk Assessment and Mitigation 158. The table below identifies the key risks that the project may face and indicates how these risks are to be addressed. The overall FM risk rating is high, while the residual risk rating after application of the mitigating measures is substantial. Risk Risk Rating Risk Mitigation Measures Residual Condition of Risk negotiations, Board or Effectiveness (Y/N) Inherent Risk Country Inherent M Source - PFM study M N Risk Project Financial H Ensure Designated Account is not S N Management Risk excessive and remains active with regular expenditure reporting. Key financial management functions to be performed by PSU and PUs finance staff. Perceived H Government commitment, internal controls S N Corruption and internal audit will help to reduce the high level of perceived corruption. Strengthening the FM capacity through staffing of PSU and PUs will also help to reduce the high level of perceived corruption Overall Inherent H S Risk 59 Control Risk 1.Weak S Project will be supported by the PSU to be M N Implementing staffed with international and national Entity consultants. PSU will be responsible for overall control and coordination with the three implementing entities. POC will be responsible for the overall policy, strategic planning and management oversight of the project. The PSU will act as the Secretariat to the POC. 2. Funds Flow S Payments will be made to contractors, M N consultants, and suppliers from the DA by SDU-MoF. In addition to payments out of DA funds, the implementing entities can also request the SDU to make (i) direct payments from the Grant Account to contractors, consultants or consulting firms, and (ii) special commitments for contracts covered by letters of credit. These payments would only be made by SDU after due processes and proper authorization from the respective component implementing entities. 3. Budgeting S Ensure that project funds are allocated in M N the annual Government Development Budget. Ensure approved carried forward budget is used at the beginning of the new year, and that disbursements are made while waiting for the Parliament’s approval of the new year’s budget. The JI with assistance from the PUs and PSU are responsible for the preparation of annual work plans and the derivation of annual budget there from for the project. The PUs and the PSU will coordinate with MoF to facilitate this process. The PSU will help maintain the consolidated budget for the project. A Project Budget Committee comprising of representatives from MoJ, SC, AGO, PSU and the PUs will coordinate the budget process, and shall report to the 60 POC. 4.Accounting S Project will follow international accounting M N Policies and standards. Project accounting procedures Procedures and details of the FM arrangements will be documented and incorporated in the Operations/FM Manual to be updated by the PSU and to be approved by the Bank 5. Internal Audit H The internal audit units of the 3 JI have S N been assessed and found to be of weak capacity and incapable of performing the internal audit for the project. Further, the Internal Audit Directorate of MoF is not covering donor funded projects currently. So as an interim measure, the internal audit will be facilitated through the hiring of an internal auditor under the project 6. External Audit H Will be audited by CAO with support from S N Audit Advisor 7. Reporting and H Strengthening the SDU is a priority under S N Monitoring the FM Advisor contract, to provide information that will comply with agreed format of financial reports. This will be facilitated by the excel-based accounting system that will be utilized by the PSU/PUs to maintain records and generate required reports. Overall Control Risk H S Detection Risk S Adequate accounting, recording, and M N oversight will be provided in project procedures. Accounting/Recording/oversight by SDU – MoF of all advances/M-16 supported by Financial Management Advisor. Overall FM Risk H S Rating Risk rating: H=high risk; S=substantial risk; M=modest risk; L-low risk Strengths and Weaknesses Strengths 159. The Government provides assurance to the Bank and other donors that the measures in place to ensure appropriate utilization of funds will not be circumvented. The Government strongly supports reforms through the Public Financial Management Reform Projects to enhance financial management in Treasury operations, public procurement, internal audit in the public sector, and external audit by the Auditor General. 61 160. The justice institutions, MoJ, AGO and SC, have implemented another Bank funded project, so the agencies have experience in carrying out Bank projects and following Bank procedures. The JI will also be supported by the Project Support Unit that will be staffed by international and national consultants; and the PUs. Weaknesses and Action Plan 161. The main weakness in this project, as in many others in Afghanistan, is the ability to attract suitably qualified and experienced counterpart staff especially for financial management. The existence of the PSU, and the staffing of the PSU and the PUs with consultants to be funded by the project, is expected to strengthen the fiduciary arrangements in the justice institutions. Action Plan – To be reviewed at ‘Initial Supervision’ Significant Action Responsable Completion Weaknesses Agent Date Shortage of Presence of PSU financial management PSU/JI Exists qualified and specialist and utilization of JI finance experienced FM departments staff Hiring of national financial management PSU/ JI July 31, 2012 specialist in each of the three PUs Project internal FM Manual to be updated PSU/JI July 31, 2012 controls and procedures need to be defined Weak internal Hiring of national internal auditor PSU December audit arrangements 31, 2012 Interim reports Un-audited interim financial report formats IDA/JI/ Before need to include for the project to be confirmed PSU negotiations required information Implementing Entities 162. The project will be implemented by three justice institutions: the Supreme Court (SC), the Ministry of Justice (MoJ), and the Attorney General office (AGO). The Project Support Unit (PSU) that has already been established under the previous project will coordinate and supervise the implementation of the project and perform the overall key financial management functions. Project Unit (PU) has also been established in each of the three implementing entities; the PSU and 3 PUs will work closely together to carry out the project activities. The respective PUs will coordinate with the relevant departments within the justice institutions to facilitate the day-to-day operations between the PSU and the JI. There will be secretariats supporting Provincial Project Oversight Committee set up in each of the 4 pilot provinces that will work closely with the PSU and the PUs. 62 163. The PSU is already staffed with a national financial management specialist (FMS) to carry out day-to-day financial management operations of the project. He will be supported by a finance officer in the PSU and financial management specialist in each of the PUs that will be recruited. The financial management activities will include preparation of: M-16 forms (payment orders), project coding sheets, and B27 allotment forms as well as overall contract and project management. The PU finance staff will be primarily responsible for performing the FM activities for transactions that originate in the JI, and the PSU finance staff will be primarily responsible for transactions that originate in the PSU. Until the time PUs finance staff are hired, the PSU FMS will perform all the FM activities for the project. Detailed working relationships between the PSU/ PUs/ JI finance departments, FM reporting requirements, staffing, systems, internal control procedures, and other financial management arrangements will be included in the updated FM Manual. Project oversight 164. The Project Oversight Committee (POC) is responsible for the overall policy, strategic planning and management oversight of the project. It is composed of the Afghan Chief Justice, Minister of Justice, Attorney General, and the Minister of Finance. The POC will meet at least every two months. The PSU will act as the secretariat of the POC. Project coordination and monitoring 165. The PSU has the responsibility for overall project implementation, coordination, and monitoring. The PSU will work closely with the PUs in the 3 justice institutions and the PPSUs in the 4 pilot provinces to facilitate this function. The PSU will report to the Project Oversight Committee on the consolidated progress of the project. The PSU is also responsible for: (a) assuring steady progress of execution in accordance to an implementation schedule reviewed and approved by the World Bank; (b) reporting regularly to the POC; and (c) ensuring that transparency and high ethical standards are maintained throughout the process. Budgeting 166. The project budget committee that is already established under the earlier project will coordinate preparation of the annual work plan and the derivation of the annual budget. This committee will be made of representatives from the PSU, PUs and the justice institutions, and shall report to the POC. The Budget Committee shall also coordinate quarterly budget reviews to ensure adequate budget discipline and control. The committee will be responsible for ensuring that project expenditures for each fiscal year are captured in the Governmental Development budget of that fiscal year. Project should also ensure that approved carried forward budgets are used at the beginning of the New Year, and that disbursements are made while waiting for Parliament approval of the New Year’s budget. 167. The budgeting process and the key role of Budget Committee on periodic budget reviews will be detailed in the Operations/FM Manual. Annual work plans and annual budgets will be submitted to the Bank for review and approval, not later than three months before the end of the fiscal year. 63 Funds Flow 168. The standard funds flow mechanism in Afghanistan, similar to other ongoing projects, will be followed in this project. Project funds will be advanced in the Designated Account (DA) to be opened and maintained at the Da Afghanistan Bank (DAB) and operated by the Special Disbursement Unit (SDU) in the Treasury Department of MoF. Requests for payments from the DA will be made to the SDU by the project when needed. 169. In addition to payments out of the designated accounts, the project can also request the SDU to make (a) direct payments from the Grant Account to consultants, consulting firms or suppliers; and (b) special commitments for contracts covered by letters of credit. These payments will follow World Bank procedures. All project payments will be made to either international firms or local firms that have bank accounts in DAB, a local commercial bank, or an overseas bank. All payments will be made either through bank transfers into the account of such firms or by check. Expenditures for each component will be paid after relevant approvals from the component implementing entity and in accordance with the approval mechanisms documented in the project’s Operations/FM Manual. 64 Funds Flow Chart World Bank / IDA Provides SOEs with supporting documentation, reconciliations, IDA & requests replenishment Replenishes Designated Direct transfers to Designated Accounts payments Account, OR requests Direct Payments Designated Consultants/ suppliers/ SDU (MoF) Accounts contractors etc JIs Finance departments Invoices PSU/PUs Legal requirements for authorized signature 170. The Ministry of Finance has authorization to approve disbursement from the Grant. Specimen signatures of authorized signatories in MoF are on file with the Bank. Accounting 171. The SDU will maintain a proper accounting system of all expenditures incurred along with supporting documents to enable IDA to verify these expenditures. The FM staff of the PSU and PUs will: (i) supervise preparation of supporting documents for expenditures; (ii) prepare payment orders (Form M16); (iii) obtain approval for M16s from the relevant authority depending on the payment amount; and (iv) submit them to the Treasury Department in MoF for verification and payment. Whilst original copies of required supporting documents are attached to the Form M16, the project is required to keep photocopies of these documents for records retention purposes. The FM Advisor in the MoF/SDU will use the government's computerized 65 accounting system, AFMIS, for reporting, generating relevant financial statements, and exercising controls. 172. The PSU and PUs FM staff will maintain essential project transaction records using Excel spreadsheets and generate required monthly, quarterly, and annual reports. 173. The Operations/FM Manual, to be updated by the PSU by July 31, 2012, and to be approved by the Bank, will include: (a) financial management arrangements for the proposed project; (b) roles and responsibilities of PSU/PUs FM staff and the linkages with the JI finance departments; (c) documentation and approval procedures for payments, (d) project reporting requirements, and (e) quality assurance measures to help ensure that adequate internal controls and procedures are in place and are being followed. 174. The Operations/FM Manual will also establish project financial management in accordance with standard Afghan government policies and procedures including use of the government Chart of Accounts to record project expenditures. The use of these procedures will enable adequate and timely recording and reporting of project expenditures. Overall project accounts will be maintained centrally in SDU, which will be ultimately responsible for recording all project expenditures and receipts in the Government’s accounting system. Reconciliation of project expenditure records with MoF records will be carried out monthly primarily by the PSU, supported by the PUs. Internal Control & Internal Auditing 175. The PSU and the PUs will be responsible for coordinating FM activities for the project with the SDU. Project–specific internal control procedures for requests and approval of funds will be described in the Operations/FM Manual including segregation of duties, documentation reviews, physical asset control, asset verification, and cash handling and management. 176. Annual project financial statements will be prepared by SDU/MoF detailing activities pertaining to the project as separate line items with adequate details to reflect the details of expenditures within each component. 177. The project financial management systems will be subject to review by the internal audit departments of the three implementing entities and the Internal Audit Directorate of MoF. However, due to the weak capacity in the internal audit departments within the JI and the non- coverage of donor funded projects by MoF IAD currently, an internal auditor will be hired under this project to perform the project internal audit. This internal auditor will be housed in the PSU. Internal Audit TOR will be reviewed and approved by the Bank. The Internal Audit departments of the JI have been assessed, and have been found incapable of meeting the needs of this project; hence the interim mitigating measure of hiring an internal auditor has been adopted. 178. The frequency of the internal audit exercise should be at least every six months. A copy (English version) of each internal audit report should be provided to the World Bank once completed. 179. The Bank also reserves the right to conduct an external review of the project activities and financial flows. 66 External Audit 180. The project accounts will be audited by the Auditor General, with the support of the Audit Advisor, with terms of reference satisfactory to the Association. The audit of the project accounts will include an assessment of the: (a) adequacy of the accounting and internal control systems; (b) ability to maintain adequate documentation for transactions; and (c) eligibility of incurred expenditures for Association financing. The audited annual project financial statements will be submitted within six months of the close of fiscal year. All agencies involved in implementation and maintaining records of expenditures would need to retain these as per the IDA records retention policy. 181. The following audit reports will be monitored each year in the Audit Reports Compliance System: Responsible Agency Audit Auditors Date MoJ/ SC/ AGO SOE, Project Accounts and Auditor General June 20 Designated Account 182. The Bank-funded/administered projects already implemented or currently being implemented by MOJ, AGO and SC (Afghanistan Judicial Reform Project) have no overdue audit reports, ineligible expenditures or overdue interim financial reports. Key issues raised in the audit reports have been resolved up to Solar Year 1388. The issues raised in the solar year 1389 audit report have been communicated to the JI, and responses are awaited. Financial Reporting 183. Financial Statements and Project Reports will be used for project monitoring and supervision. Based upon the financial management arrangements of this project, consolidated financial statements and project reports will be prepared monthly, quarterly, and annually by the PSU. These reports will be produced based on records from three sources: (i) PSU’s and PUs’ accounting system; (ii) expenditure statements from SDU (as recorded in AFMIS) and reconciled with the PSU/PU records, and iii) bank statements from DAB. 184. The consolidated quarterly Project Interim Financial Reports will show: (a) sources and uses of funds by project components; and (b) expenditures consolidated and compared to governmental budget heads of accounts. The project will forward the relevant details to SDU/DBER with a copy to IDA within 45 days of the end of each quarter. The government and IDA have agreed on a pro forma report format for all Bank projects; a final customized format for JSDP will be provided before project negotiations. 185. The annual project accounts to be prepared by SDU from AFMIS after due reconciliation to records maintained at the PSU, will form part of the consolidated Afghanistan Government Accounts for all development projects. This is done centrally in the MoF Treasury Department, supported by the Financial Management Advisor. 67 Disbursement Arrangements 186. The project will be financed 100% by the ARTF Grant inclusive of taxes. Disbursements procedures will follow the World Bank procedures described in the World Bank Disbursement Guidelines and the Disbursement Handbook for World Bank Clients (May 2006). Table 1 shows the allocation of ARTF proceeds in a single, simplified expenditure category. The single category for "goods, works, consultancy services, training, and operating costs" is defined in the financing agreement. Project funds will be disbursed over 60 months. The closing date of the project will be May 31, 2017 with a final disbursement deadline six months after the closing date. 187. During this additional 6-month grace period, project-related expenditures incurred prior to the closing date are eligible for disbursement or documentation against advances to the designated account. Disbursement will follow the World Bank procedures described in the World Bank Disbursement Guidelines and the Disbursement Handbook for World Bank Clients (May 2006). Table 1: ARTF Financing by Category of Expenditure (US$ 85.5 million) Amount of the Financing Expenditure Category Grant Percentage Allocations (1) Goods, works, consultants’ services, training, and US$ 85.5 M 100 % Incremental Operating Costs2 Total US$ 85.5 M - Summary Reports 188. Summary reports in the form of Statements of Expenditure will be used for expenditures against contracts for: (a) works valued at less than US$500,000 equivalent per contract; (b) goods valued at less than US$200,000 equivalent per contract; (c) consulting firm valued at less than US$100,000 equivalent per contract; and (d) individual consultants valued at less than US$50,000 equivalent per contract, all training programs and incremental operating costs. Supporting documents will be required for expenditures against contracts above the above mentioned thresholds. Designated Account 189. One segregated Designated Account (DA), to be managed by the Special Disbursement Unit of the Treasury Department of the Ministry of Finance, will be established at the Da Afghanistan Bank (central bank of Afghanistan) in USD for the project, with a ceiling of 2 Incremental Operating Costs refers to project-related incremental expenses incurred on account of project implementation support and management including the rental of office space; the operation, maintenance, rental and insurance of vehicles; fuel; communications supplies and charges; advertisements; books and periodicals; office administration and maintenance costs; bank transaction charges; utility charges; domestic travel and per diem but excluding salaries of officials and staff of the Recipient's civil service. 68 advance up to four (4) months’ worth of expenditures to be paid out of the DA. The SDU will manage payments from and new advances/ replenishment to the DAs. Petty cash advances for small day to day operating expenditures may be taken from the Designated Account, and held and managed by PSU, PUs and/or the PPSUs in the 4 pilot provinces. Each of these units will have a focal finance (PSU and PUs) and admin (PPSUs) staff who will be responsible for management and custody of the petty cash, and will report to the head of the respective units. The overall responsibility and accountability will rest with the PSU. New cash advances will only be made when all other prior cash advances have been justified through submission of SOEs to the SDU. Monthly expenditure reporting for payments made from the designated accounts is required. Direct Payments. 190. Third-party payments (direct) and Special Commitments will be permitted for amounts exceeding 20% of advances to the designated accounts. All such payments require supporting documentation in the form of records (copies of invoices, bills, purchase orders, etc.). Issuance of SCs is unlikely. Preparation of Withdrawal Applications 191. PSU will prepare Summary Reports (Statement of Expenditures or Summary sheets) and forward those reports to the SDU for further processing as a replenishment application. The SDU will review withdrawal applications for quality and conformity to Treasury procedures, and then obtain signature. Selected PSU, PU and SDU finance staff will be registered as users of the World Bank Web-based Client Connection system, and take an active hand in managing the flow of disbursements. Financial Management Covenants  MoF shall submit audited financial statements for the project within six months of the end of each fiscal year. The Project’s audit report will cover the financial statements, the Designated Account, and SOEs, in accordance with terms of reference agreed with the Association.  Consolidated project interim financial reports will be submitted by PSU on a quarterly basis to the World Bank and a copy to SDU-MoF within 45 days after the end of each quarter. Special Financial Management Covenant  The justice institutions will ensure that key FM staff of the PSU and the PUs are retained throughout the duration of the project in order to ensure smooth project implementation. Regular Supervision Plan 192. During project implementation, the Bank will supervise the project’s financial management arrangements. The team will: 69  Review the project’s quarterly interim financial reports, internal audit reports as well as the project’s annual audited financial statements and auditor’s management letter.  Review the project’s financial management and disbursement arrangements (including a review of a sample of SOEs and movements on the Designated Account and bank reconciliations) to ensure compliance with the Bank's minimum requirements.  Review PSU’s, PUs’ and JI’ performance in managing project funds to ensure that it is timely, accurate, and accountable. Particular supervision emphasis will be placed on asset management and supplies.  Review of financial management risk rating, compliance with all covenants, and follow up on the action plan. Conclusion 193. The FM arrangements, including the systems, processes, procedures, and staffing are adequate to support this project- subject to implementation of the action plan. 70 Annex 6: Procurement Arrangements AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT Country Context 194. The World Bank (the Bank) has gained substantial experience and understanding of the procurement environment in Afghanistan through its involvement in the interim procurement arrangements put in place under the Emergency Public Administration Project (2002) and through working with the institutions currently responsible for procurement functions, including the Afghanistan Reconstruction and Development Services. As part of the broader review of Afghanistan’s Public Finance Management (PFM) system, the Bank carried out two assessments, in June 2005 and September 2007, of the procurement environment in the country based on baseline and performance indicators developed by a group of institutions led by the Bank and OECD/DAC. 195. The first key issue identified through the procurement assessments was a lack of ownership and the lack of a procurement champion in the Government of Afghanistan (GoA), which is a serious impediment to reform and to inter-ministerial dialogue. A second, related issue is the lack of capacity in the line ministries, as evidenced by their inability to define and communicate effectively their desired functional specifications/terms of reference in their procurements. The lack of capacity is also evident in the local private sector while the number of bids is reasonably high; there is a lack of understanding about how to apply public procurement rules. Government Reforms 196. A new Procurement Law (PL) was adopted in November 2005 that radically transforms the legal and regulatory framework. In accordance with the law, GOA established a Procurement Policy Unit (PPU) under the Ministry of Finance to provide oversight for the PL’s implementation. PPU has issued several circulars regarding implementation of the PL including “Rules of Procedures for Public Procurement� (Circular: PPU/C005/1386 of April 12, 2007) and “Procurement Appeal and Review Mechanism� (Circular: PPU/N001/1385 of March 18, 2007). PPU and MOF have developed several standard bidding documents (SBDs), standard requests for proposal (SRFPs), standard requests for quotation (RFQs) for national and international procurement of goods/works and consulting services following national procedures as per the PL’s Glossary of Procurement Terms in English and Dari. MOF has now mandated the use of: (i) SBDs for Goods and Works (Circular PPU/C024/1388 of June 10, 2009); (ii) SRFQs (Circular PP/C026/1388); and (iii) SRFPs (Circular PPU/C029/1388 of January 13, 2010). A Procurement Management Information System (PMIS) has been developed and is being piloted in three line ministries. In addition, a PPU website will facilitate publication of procurement notices and contract awards in addition to similar action being done under the ARDS-website and the websites of the line ministries, as applicable. 197. In the absence of adequate capacity to manage procurement activities effectively, a central procurement facilitation unit (ARDS–PU) has been established under the Ministry of Economy to support line ministries and project implementing agencies. The GoA has agreed on a program for country-wide procurement reform and capacity building, leading to the transition from 71 centralized to decentralized procurement services. The above was implemented by an international consultant under the supervision of PPU/MOF and financed under the Public Administration Capacity Building Project (PACBP) and the Public Finance Management Reform Project (PFMRP). The consultant has conducted several basic, intermediate, and advanced level training programs. The implementation of the procurement reform component of the PACBP/PFMRP should be considered with due priority to ensure that fiduciary standards are further enhanced and that capacity is developed in the Government to maintain these standards. 198. The Procurement Law has been revised in July 2008 and amended in January 2009 and issued as a new Law by the Ministry of Justice and was published in the Official Gazette Number 957, 29.10.1387 (18 January 2009). The revised “Rules of Procedures for Public Procurement� have been issued as circular PPU/C027/1387 of November 18, 2009. General Procurement for JSDP 199. Procurement for the project will be administered in accordance with the World Bank’s Guidelines: Procurement under IBRD Loans and IDA Credits dated January 2011 Guidelines: Selection and Employment of Consultants by World Bank Borrowers dated January 2011, and the provisions stipulated in the Financing Agreement. In addition, the World Bank’s Guidelines on Preventing and Combating Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants dated October 15, 2006 and revised January 2011 has been shared with the recipient. The World Bank’s Standard Bidding Documents, Requests for Proposals, and Forms of Consultant Contract will be used. Goods following National Competitive Bidding (NCB) procedures shall be procured using the agreed Standard Bidding Documents (SBDs) for Afghanistan. It has been agreed by both parties that in the event of a conflict between IDA Procurement/Consultant Guidelines, as per Article 4 (2) of the Procurement Law July 2008 (Amendments in January 2009 incorporated) of the GOA, the IDA Procurement/Consultant Guidelines shall prevail. Procurement of Works 200. Procurement of Works is estimated to be US$10 million for the first 18 months. The total allocation for infrastructure is US$26.05 million, out of which procurement of works is estimated to be US$ 21 million. The major works contracts are site work and construction of an MOJ HQ Building, two AGO buildings, construction of Administrative and Information Building in the SC HQ, and construction of a primary court in Bagrami, Kabul. Minor updates to physical infrastructure are planned under Component 1 in the four pilot provinces. A few contracts will be awarded for small renovations to physical infrastructure for Legal Awareness units for Legal Outreach under Component 2. 201. Procurement of the works will be done using Bank’s SBD for Works for all contracts following International Competitive Bidding (ICB) procedures. National SBDs agreed with IDA, or satisfactory to IDA, will be used for the procurement of works following National Competitive Bidding (NCB) procedures. Shopping shall be in accordance with paragraph 3.5 of the Bank’s Guidelines. Any contract estimated costing more than US$5,000,000 shall be procured following ICB procedures. Any contract estimated to cost more than US$50,000 equivalent and less than US$5,000,000 may be procured following NCB procedures. Any 72 contract estimated to cost less than US$50,000 equivalent shall be procured following shopping procedures. Works that meet the requirements of paragraph 3.7 (a) and (e) of the World Bank Procurement Guidelines may be procured following direct contracting procedures with prior agreement with IDA. The Procurement Plan shall set forth the specific procurement method and the requirement of prior review by the Bank depending upon the circumstances, procurement method used and the threshold. Selection of Consultants 202. The proposed grant would finance several consultancy assignments for both firms and individuals. 203. Firms: The following major consultancy assignments are foreseen under the project: Consultancy to develop business consolidation plan for Legal Aid (Component 2 a), Demand Supply Survey and Functional Reviews (Component 3a), Institutional Mapping for all JI (Component 3a). 204. Individual consultants: A substantial number of individual consultants will be hired under the project. A number of individual consultants are already in place under Project Preparation Grant (PPG) facility. Those individuals will be hired on single source basis on the justification that tasks are continuation of previous work that the consultant has carried out and for which the consultant was selected competitively, and subject to a performance review. For individual contracts that are to be competitively awarded, the PSU shall facilitate all individual selection processes in coordination with other JI, while the appropriate implementing agency shall be responsible for developing the TOR and contract signing. MoJ shall sign the contracts for all individual consultants hired for the PSU. 205. Short lists of consultants for services estimated to cost less than US$300,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. The selection methods and processes applicable for consultants are QCBS, QBS, CQS, LCS, FBS, and SSS for firms; and for individuals as per Section V of the Bank’s Guidelines. The threshold for CQS will be less than US$200,000 equivalent per contract. Bank shall review all TORs for Firm and Individual Consultant services. The Procurement Plan shall set forth the specific procurement method and the requirement of prior review by the Bank depending upon the circumstances, procurement method used and the threshold. Procurement of Goods and Non Consulting Services 206. The Project will finance procurement of goods and non-consulting services. This will include computer equipment, IT software, furniture, vehicles and other printing materials for all JI. 207. Procurement of the goods will be done using the Bank’s SBD for Goods for all contracts following International Competitive Bidding (ICB) procedures. National SBDs agreed with IDA, or satisfactory to IDA, will be used for the procurement of goods following National Competitive Bidding (NCB) procedures. Shopping shall be in accordance with paragraph 3.5 of the Bank’s Guidelines. Any contract estimated costing more than US$200,000 shall be procured 73 following ICB procedures. Any contract estimated to cost more than US$50,000 equivalent and less than US$200,000 shall be procured following NCB procedures. Any contract estimated to cost less than US$50,000 equivalent shall be procured following shopping procedures. Goods that meet the requirements of paragraph 3.6 of the World Bank Procurement Guidelines may be procured following direct contracting procedures with prior agreement with IDA. The Procurement Plan shall set forth the specific procurement method and the requirement of prior review by the Bank depending upon the circumstances, procurement method used and the threshold. Operating Costs 208. The operating costs financed by the project will be procured using the implementing agency’s administrative procedures, which will be reviewed by the Bank to determine if they are acceptable. The operating costs will include operations and maintenance of equipment and vehicles, hiring of vehicles, office rent, costs of consumable, fuel, office utilities and supplies, Bank charges, and advertising expenses, training fees for individuals with prior agreement with the World Bank for professional development. Assessment of the Agency’s Capacity to Implement Procurement 209. MoJ, AGO and SC will have the responsibility for procurement under the project. An assessment of the capacity of MoJ, AGO and SC in the context of implementing procurement actions for the project has been carried out. The assessment reviewed the organizational structure of the implementation of the project. 210. The preliminary procurement capacity assessment reveals that although some capacity has been developed within these implementing agencies, the capacity may not be sufficient to handle procurement under the project. Therefore, the procurement risk is “High�. 211. To mitigate the risk the following measures have been taken. MoJ has already contracted the services of a competent international procurement consultant from market (having hands-on experience of public procurement rules as well as procurement rules of the donor agencies). Also for large value contracts, ARDS will assist MoF to ensure procurement compliance, as and when required. In addition, the following procurement practices will apply for the duration of the project: (a) implementing agencies’ officials / staff to be alerted about any fraud and corruption issues; (b) bidders to be alerted against adopting fraud and corruption practices; (c) award contracts within the initial bid validity period, and closely monitor the timing; (d) take action against any corrupt bidder in accordance with law of the Government of Afghanistan; (e) preserve records and all documents regarding public procurement, in accordance with the PL provisions; (g) publish contract award information through UNDB online, ARDS’s website and agencies’ websites within two weeks of contract award; (h) ensure timely payments to the suppliers/contractors/consultants and impose liquidated damages for delayed completion and, (i) enforce a procurement filing system. Procurement Capacity Development 74 212. In consideration of the capacity development in the Line Ministries and Provinces already being undertaken through the Public Financial Management Reform Project II (PFMRII) under MoF, close co-ordination between MoJ and MoF is envisaged during the project implementation. It is expected that by the end of the project, the MoJ will have enough capacity to carry out its own procurement without reliance on external assistance. A comprehensive procurement capacity development plan will be developed, leading to the Procurement Accreditation of MoJ by the Procurement Policy Unit of MoF. The capacity development plan shall take into consideration the training and procurement assistance provided by PFMRII. 213. Procurement Training: Through PFMRII, Afghanistan Civil Service Institute (ACSI) is conducting 3 levels of training (Basic, Intermediate and Advanced) on public procurement. During the project, the procurement staff of the MoJ shall gradually complete all the three levels of training. Staff who successfully complete the Basic and Intermediate training will be eligible for appropriate international training on Procurement. However before any international training, the staff shall also be required to complete English language training. 214. Staffing: Appropriate staffing plan shall be developed along with a Capacity Development Plan. The PSU will carry out the training program to assist the procurement departments of JI. Procurement plan 215. The Borrower, at appraisal, developed a Procurement Plan for Project implementation that provides the basis for the procurement methods. This plan has been agreed between the client and the Bank Task Team on April 4, 2012 and is available at the MoF offices. It will also be available in the Project’s database and on the Bank’s external website. The Procurement Plan will be updated in agreement with the Project Team annually or as required to reflect the actual Project implementation needs and improvements in institutional capacity. 216. The procurement plan has outlined the contract packages of goods, consultants (individual/firm), and non-consulting services. Other individuals (operation staff) who are not consultants will not be part of the procurement plan. Those individuals will be hired in line with the Operations Manual which will be developed by the project and be agreed by the Bank. All contracts not prior reviewed by the Bank will be subject to Post Review as per the provisions of the Procurement and Consultant Guidelines of the Bank. Frequency of Procurement Supervision 217. In addition to the prior review, supervision shall be carried out from Bank offices. There will be two Implementation Support Missions per annum. 218. Procurement Audit. In addition to prior review, Bank staff or Bank appointed consultant shall carry out post procurement audit once per annum. Procurement Plan 75 General Project Information:  Country/Borrower: Islamic Republic of Afghanistan  Project Name: Justice Service Delivery Project  Implementing Agency: Ministry of Justice, Attorney General’s Office, Supreme Court  Grant No: TF 012533  Bank’s approval Date of the Procurement Plan [Original:] April 4, 2012  Date of General Procurement Notice: Published 26th April 2012  Period covered by this procurement plan: 18 months  A. Goods and Works and Non-Consulting Services a) List of contract Packages that will be procured following ICB, NCB and direct contracting: Procurement Method and Threshold Procurement Method Threshold for Methods Comment (US$) 1. ICB (Goods) 200,000 Equivalent or more 2. NCB (Goods) 200,000 Equivalent or less 3. Shopping (Goods ) 50,000 Equivalent or less 4. ICB (Non-Consultant Services) 200,000 Equivalent or more Procurement Method Threshold for Methods Comment (US$) 1. ICB (Works) 5,000,000 Equivalent or more 2. NCB (Works) 5,000,000 Less than 3. Shopping (Works) 50,000 Equivalent or less Selection Method Threshold for Methods Comment (US$) 1. QCBS 200,000 Equivalent or more 2. QBS 200,000 Equivalent or more 3. FBS, LCS, CQS 200,000 Less than Prior Review Threshold: Procurement Decisions subject to Prior Review by the Bank as stated in Appendix 1 to the Guidelines for Procurement: 76 Procurement & Consultant Prior Review Threshold Comments Selection Method in US$ 1. ICB (Goods, Works and non All Contracts consulting services) 2. NCB – Goods First contract only First contract NCB – Works and Non consultancy Above 500,000 regardless of value and all other Equivalent or more than US$ 200,000 per contract will be prior reviewed. 3. Shopping (Goods and Non First contract only consultancy) 4. Direct Contracting (Goods) All regardless of value 5. QCBS, QBS and Single Source All contracts regardless of Selection value. 6. FBS, LCS, CQS Only the TOR shall be reviewed by the Bank. Reference to any Operations/Procurement Manual: The Project will develop an Operations Manual where the Procurement Manual will be part of the Operations Manual. 77 Procurement Plan (Goods, Works and Services) Summary JSI Goods Services Works Total Number of Funds Number of Funds Number of Funds Number of Funds Procurement Required Procurement Required Procurement Required Procurement Required Packages (US$) Packages (US$) Packages (US$) Packages (US$) MOJ 7 36 1 44 1,215,063 11,464,360 7,900,000 20,579,423 AGO 4 24 1 29 650,000 2,349,460 370,000 3,369,460 SC 7 21 1 29 1,571,500 5,427,760 1,590,350 8,589,610 PSU 9 18 -- 27 410,000 2,583,900 -- 2,993,900 Total 27 99 3 129 3,846,563 21,825,480 9,860,350 35,532,393 78 Annex 7: Implementation Arrangements AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT 219. The project will be implemented by the Justice Institutions (JI) -the Supreme Court (SC), the Ministry of Justice (MoJ), and the Attorney General’s Office (AGO) and will follow World Bank (the Bank) policies and guidelines. The Bank will be responsible for the supervision of the project. The project implementation structure builds on and expands the structure established under the previous Phase 1 Afghanistan Justice Sector Reform Project (AJSRP.) A detailed description of the implementation structure and operational procedures will be included in the project Operations Manual to be issued within four months of project effectiveness. 220. The implementation structure includes: (a) a Project Oversight Committee (POC); (b) Stakeholder Forums (SF); (c) a Project Support Unit (PSU); (d) a Project Unit (PU) in the implementing institutions – the SC, the MoJ and the AGO; (e) the Provincial Project Oversight Committees (PPOC) and their secretariats. 221. The POC is responsible for the overall policy, strategic planning and management oversight of the project. It is composed of the Afghan Chief Justice, Minister of Justice, Attorney General, and the Minister of Finance. The Government of Islamic Republic of Afghanistan (GoA) may appoint additional members of the POC. The POC members select a chairman who serves as the POC’s Executive Director. The POC meets at least once every two months. It works closely with the SF. 222. The SF affects project implementation through its feedback to the project documents and reports. It is a consultative forum composed of representatives of legal professions, academia, civic society and Non-Governmental Organizations (NGO), the business community, religious leaders, local government and other interest groups. Two types of regular SFs will operate under the project. The first SF will partner with the POC. The POC will organize at least one meeting with the SF per year to discuss project progress or more specific matters. The second type of SF will partner with the PPOC; the PPOC will organize at least two meetings with the SF per year. 223. The PSU serves as the POC’s secretariat. Its responsibilities include: day to day project management (mainly financial management, procurement and monitoring and evaluation [M&E]); and operating a project website. The PSU includes a director who reports to the POC and staff which report to the project director. The PSU staff includes a group of approximately ten senior local and/or international and regional experts in fields such as public relations, M&E, Information and Communication Technology (ICT), project management (including financial and procurement management), and public relations. The PSU will be supported by two or three assistants and an interpreter. The project director, regional procurement specialist, ICT expert, financial management specialist and two assistants have already been selected under the Phase 1 AJSRP. Other staff will be hired on a competitive basis by the POC, in accordance with Bank guidelines. The PSU works closely with the PUs established in the SC, MoJ, and the AGO. 224. The PUs are responsible for day to day management of project activities of the SC, MoJ, and AGO. A PU is led by a deputy principal of a justice organization supported by a project coordinator. The project coordinator is charged with leading a team of local and international 79 experts who will: (a) coordinate specific reforms such as HRM, training, legal aid, legal awareness and ICT experts; (b) manage the project (mainly procurement, FM, contract management and M&E of project activities); and c) manage junior support staff. The project coordinator reports to the Deputy Principal. The team members report to the project coordinator. The project coordinators and some experts were selected under the AJSRP. The remaining staff will be selected on a competitive basis. The PUs work closely with the departments leading a particular reform. The specific responsibilities of each PU include developing concept notes and terms of reference for project activities; organizing procurement; securing inputs from departments; overseeing work of consultants; and monitoring and reporting on project progress. The Provincial Project Oversight Committees supported by a small secretariat composed of two consultants will oversee and implement the Partnership for Justice Program in pilot provinces and districts. The PPOC is a provincial equivalent to the POC. The PPOCs will report to the POC. Monitoring 225. Monitoring will take place through continuous and timely reviews of project implementation to assess delivery, identify challenges and bottlenecks, and explore practical solutions. M&E will primarily be the responsibility of the PSU which in turn will work with the staff in the PUs of the three JI to coordinate all activities on M&E. The PSU and PUs will periodically monitor progress against agreed indicators, as described in the Results Framework. As part of M&E, the project will generate regular quarterly reports and a report for funds tranche release, whichever is earlier. Other key reports will also include those that report on financials as well as reports providing periodic updates on implementation progress with all activities; the format and template will be in the project financial, procurement and Operations Manual. 226. Building on the lessons of Phase 1 AJSRP, the project will focus from the outset on having dedicated M&E staff in the JI for periodic monitoring. Lessons learned from M&E implementation in Phase 1 indicate a need for investment in capacity building for M&E staff. This effort will foster the institutionalization of M&E culture within the JI and ultimately be an investment in the longer-term capacity of JI staff beyond the life of the project. 227. Data Collection: The justice sector suffers from a general absence of robust and reliable data and a lack of credible baselines. The project will work closely with the PSU and JI to improve data collection practices. With a view to further strengthening the evidence base, the project will also commission a baseline survey within the first year of project effectiveness to take stock of baseline data. Other special targeted user surveys will also be commissioned during the course of project implementation to gauge level of satisfaction with legal services. Overall, the project will reinforce the message of the need for better data collection procedures to be adopted by staff, particularly as data collection takes place largely at the sub-national level, with M&E data flowing bottom-up for consolidation and reporting at the central level. 228. The Project will close on May 31, 2017. Implementation Arrangement: Central Level 80 SC MOJ AGO MoF Project Oversight Committee supervision of WB reporting implementation Project Support Unit secretariat for POC/project management – FM, procurement, M&E / coordination SC MoJ AGO supervision PU SC PU MoJ PU AGO 81 Implementation Arrangement: Intra-agency Arrangement High Judicial Head of Court Admin. / Council/Advisory Committees Deputy Ministers Project Unit Department 1 Department 2 Department 3 Project Manager & Project Manager & Project Manager & Team Team Team 82 Annex 8: Project Preparation and Appraisal Team Members AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT NAME TITLE / FUNCTION Justice and Public Sector Lubomira Z. Beardsley Task Team Leader, Senior Counsel, LEGJR Richard Hogg Governance Adviser, SASGP Richard George Andrew Nash Counsel, LEGJR John Sherman Consultant (IT Specialist) Ravindra Cherukupalli Consultant (Monitoring and Results Specialist) Samina Bhatia Consultant (Governance) Hikaru Kitai Consultant (Infrastructure Specialist) Environmental and Safeguards Asta Oleson Senior Social Development Specialist, SASD Obaidullah Hidayat Environmental Specialist, SASD Abdul Mohammed Durrani Social Development Specialist, SASD Financial Management and disbursements Asha Narayan Financial Management Specialist, SARFM Chau-Ching Shen Senior Finance Officer, CTRLN Procurement Asif Ali Senior Procurement Specialist, SARPS Toufiq Ahmed Procurement Specialist, SARPS Rahimullah Wardak Procurement Specialist, SARPS Legal Hanneke Van Tilburg Senior Counsel, LEGMS Martin Serrano Senior Counsel, LEGMS External Relations Abdul Raouf Zia Senior Communications Officer (EXT) Team Support Edreess Sahak Team Assistant, SASGP, Kabul Parwana Nasiri Team Assistant, SASFP, Kabul Jyoti Sriram Team Assistant, SASGP, New Delhi Peer Reviewers Lisa Bhansali Adviser, LCSOC Christina Biebesheimer Chief Counsel, LEGJR Satyendra Prasad Senior Governance Specialist, SASGP Randi Ryterman Director, WDR 83 Scott Carlson US State Department Scott Guggenheim Consultant, SDV 84 Annex 9: Environmental and Social Safeguards Framework AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT 229. The JSDP will undertake a number of construction, rehabilitation and renovation activities over the 5 year period. Since the detailed designs of the multiple maintenance and construction activities will be developed only at the beginning of the project implementation period, a framework approach has been adopted for safeguards management. The Environmental and Social Management Framework (ESMF) provides general policies procedures for the management of environmental and social issues at each site and as such constitutes a set of guidelines for the development of site-specific Environmental and Social Management Plans (ESMP). The JSDP maintenance, rehabilitation and construction work does not anticipate significant and irreversible adverse impacts on the environment or community. The identified potential adverse impacts are localized in spatial extent and short in duration, and are manageable by implementing mitigation measures that will be detailed in site specific the Environmental and Social Management Plan (ESMP). The project is categorized as environmental category B in accordance with World Bank operational policy (OP) 4.01 (Environmental Assessment). General Principles 230. Recognizing the emergency nature of the proposed relief and reconstruction operation, and the related need for providing immediate assistance, while at the same time ensuring due diligence in managing potential environmental and social risks, this Framework is based on the following principles: 231. The project will support multiple maintenance and construction activities, the detailed designs of which may not be known at appraisal. To ensure the effective application of the World Bank’s safeguard policies, the Framework provides guidance on the approach to be taken during implementation for the selection and design of subprojects, and the planning of mitigation measures;  All proposed subprojects will be screened to ensure that the environmental and social risks can be adequately addressed through the application of standardized guidelines;  Employment opportunities within the projects will be available on an equal basis to all, on the basis of professional competence, irrespective of gender, or local minorities. Purpose of the Environmental and Social Management Framework 232. Social and environmental management in Afghanistan currently suffers from critical capacity constraints. Since there is potential for adverse environmental impacts, albeit limited, from the proposed activities under the JSDP, their mitigation and management is key to effective rehabilitation and development within the justice sector. Hence, keeping in view the existing management capacity, as well as the flexibility required with investments still to be finalized, a framework approach is adopted for JSDP. It allows for early identification of potential adverse impacts, without the requirement of rigorous analysis through quantification, and also provides general policies and broad guidance for their effective mitigation, along with codes of practice 85 and procedures to be integrated into project implementation. Consistent with existing national legislation, the objective of the Framework is to help ensure that activities under the proposed reconstruction operations will:  Protect human health;  Prevent or compensate any loss of livelihood;  Prevent environmental degradation as a result of either individual subprojects or their cumulative effects;  Enhance positive environmental and social outcomes; and,  Ensure compliance with World Bank safeguard policies. Safeguard Screening and Mitigation 233. The selection, design, contracting, monitoring and evaluation of subprojects will be consistent with the following guidelines, codes of practice and requirements:  A negative list of characteristics that would make a proposed subproject ineligible for support, as indicated in ESMF Attachment 1;  Guidelines for land and asset acquisition, entitlements and compensation, presented in ESMF Attachment 2 along with guidelines for Abbreviated Resettlement Framework (Attachment 3);  Relevant elements of the codes of practice for the mitigation of potential environmental and social impacts, presented in ESMF Attachment 4;  The requirement that confirmation is received through the Regional Mine Action Center that areas to be accessed during reconstruction and rehabilitation activities have been demined (see Guidelines in ESMF Attachment 5).  Environmental Guidelines for Contractors are presented in this document (see ESMF Attachment 6) 234. The ESMF stipulates that contractors hired in the project should:  Minimize negative impacts on local communities and the environment during construction.  Ensure appropriate restoration of areas affected by construction.  Prevent any long term environmental degradation and deal adequately with environmental, social, health and safety issues during rehabilitation works. 86 235. Contractors must declare themselves conversant of all relevant national environmental and social legislation and Bank regulations- as well as of their environmental and social obligations as stipulated in the ESMF. Further, the contractor shall ensure compliance with the World Bank/IFC’s General Environmental, Health and Safety Guidelines as applicable to mitigate construction related impacts. The Project Management team of the central PSU will monitor implementation of the ESMPs prepared for each site in accordance with the guidelines set out in the ESMF. Potential Impacts of Various Components 236. Activities under the project should not entail significant environmental and social impacts, provided they are designed and implemented with due consideration of environmental and social issues. Component 3b, Strengthening Capacity of State Justice Institutions will finance the maintenance and construction of courts and offices facilities. Construction activities may cause limited, temporary, and localized negative impacts due to depletion or degradation of natural resources such as stone, earth, water etc. used for Justice Institution (JI) construction if proper environmental management is not carried out at design, construction and operation stages. This will be mitigated through the implementation of an appropriate site specific Social and Environmental Management Plan (ESMP), including environmental checklist to monitor and plan the work. Capacity building of concerned departments of JI, including physical and institutional management, is likely to have a positive impact on social and physical environment. Additionally, water harvesting, energy efficient lighting and air ventilation facilities may be considered during design stage for new buildings as well as rehabilitation of existing buildings. 237. OP/BP 4.01 is triggered because of JI rehabilitation and construction activities. The project will apply the Environmental and Social Management Framework (ESMF) developed for the project. The ESMF provides guidance on the approach to be taken during implementation for the selection and design of subprojects/proposed investments and the planning of mitigation measures, guidelines and codes of practice for an environmental and social mitigation measures to be incorporated in the design, contracting and monitoring of sub-projects. Guidelines for consultation and disclosure requirements are also included, to ensure due diligence and facilitate consistent treatment of environmental and social issues by all participating development partners. 238. The adverse social impacts, as anticipated at appraisal, would largely result from land which may be required in connection with the construction activities and OP 4.12 on involuntary resettlement is therefore triggered. Wherever possible, the project will utilize land that is already public property, and avoid or minimize land acquisition. However, documentation is required that the land is free of encroachments, squatters or other encumbrances, and that the land has been transferred to the relevant authorities. In the rare cases that land acquisition is unavoidable, it will be undertaken in accordance with the provisions of Afghanistan’s current Law on Land Expropriation, enacted in 2009 and Law on Managing Land Affairs 2008 and according to WB OP/BP 4.12 on Involuntary Resettlement. Guidelines for Land and Asset Acquisition, Entitlements, and Compensation are attached (Attachment 2) as well as a framework for Abbreviated Resettlement Action Plan (Attachment 3). 87 239. In case of chance finds of cultural property (archaeological artefacts) during implementation of sub-projects involving civil works, these will be handled according to provisions in the “Law on Preservation of Afghanistan's Historical and Cultural Heritage (2004)� and be reported to the provincial or district governors, who then will inform the Archaeological Committee. 240. Compliance with the safeguard provisions and the negative list will be ensured through an environmental, social and risk screening procedure (check lists) required for sub-project proposals, and by internal input, process, and output monitoring, independent external monitoring by consultants, and by Bank supervision missions. Institutional Arrangement and Responsibilities for Safeguard Screening and Mitigation 241. The overall responsibility for project implementation rests with the SC, MoJ and AGO. A designated Safeguards Officer will be identified with specific responsibility for overseeing the implementation of the Environmental and Social Management Framework, Site specific Environmental and Social Management Plans and Abbreviated Resettlement Plan (if any) within the Project Team. Preparation of site specific ESMPs and abbreviated resettlement plan will be the responsibility of site engineers in close collaboration with project management team. Monitoring of ESMF Implementation 242. The Safeguards Officer, in collaboration with PSU director, will be responsible for monitoring the environment and social performance aspects supported by the JSDP. The Safeguards Officer will undertake random visits to monitor construction activities and will provide technical advice to site engineers on social and environment issues if needed. The Safeguard Officer will collaborate closely with the World Bank Safeguards team and will share quarterly progress report on safeguards issues in the Project. 243. The cost of implementing and monitoring the ESMF is included in the overall budget of the AJSDP. Capacity Building 244. The Safeguards Officer and relevant staff of JI and implementing agencies/Consultants and contractor will undergo trainings in the application of the ESMF. During supervision of the project, the World Bank will assess the implementation of the Framework directly or through third party, and if required, will recommend additional strengthening. Capacity Number Details Required building budget activities Training 3 Training sessions to staff on ESMF US$3000 sessions to implementation (organized by Safeguards AJSDP staff Officer) Training TBD Training sessions on site specific ESMP TBD 88 sessions to implementation contractors Public Complaints and Grievance Redress 245. All public complaints will be addressed, documented and investigated. All complaints and grievances should first be negotiated to reach an agreement at the local community/village level. Resolving complaints will at first be entrusted to the Safeguards Officer, in consultation with the PSU Director and relevant agencies representatives. Public complaints which cannot be resolved at the project level will be directed to a provincial committee composed of relevant local governmental agencies and relevant local CSO representatives for necessary action. The project will establish an easily accessible system for submission of complaints/grievances, with multiple intake options (verbal/written/electronic submission) and analysis and monitoring of grievance resolution. The project will also establish different options for public information/disclosure of information for communities and relevant stakeholders to be aware of processes to be followed to register complaints. Consultation and Disclosure 246. This Environmental and Social Management Framework was developed for the project on the basis of an overall Framework for World Bank-funded reconstruction operations which was prepared in consultation with the principal NGOs and development partners participating in reconstruction activities in Afghanistan. Prior to approval of the project by the World Bank, it will be disclosed by the Government in Dari and Pashto, as well as English, and it will also be made available at the World Bank Infoshop. When sub-projects are identified, information will be disclosed by provincial Justice Department. 89 Annex 10: Economic, Financial and Accountability Analysis AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT Objective 247. The objective of the Economic, Financial and Accountability Analysis is to a) provide an overview of the main economic, corruption and governance issues in the sector; b) identify the main economic and governance benefits of the project for the sector; and c) identify project specific governance risks and set out mitigation measures. The mitigating measures will be incorporated into the Operations Manual for the project and implemented through the project management structures as well as partner organizations. 248. The basis for analysis in this section is composed of a range of inputs including, but not limited to: outputs and lessons learned of the Phase 1 AJSRP; the World Bank’s analytics and report on “Transition�; the US Interagency Planning and Implementation Team’s “Courts Baseline Assessment and Plan�; Supreme Court of Afghanistan Human Resource Department’s Analysis and Training Plan; USAID “Assessment of Afghanistan Rule of Law Project�; UNAMA “Quantitative Assessment of Legal Aid�, UNDP and World Bank “Vulnerabilities to Corruption Assessments�. Background Main Economic and Financial Issues Related to the Justice Sector 249. Functioning justice institutions play a critical role in economic development: To date, however, the justice institutions have played little part in providing a pillar to support the private sector. Inconsistency and unpredictability in interpretation of laws, crime, theft, disorder, corruption, lack of access to land, and dysfunctional court system are among the key constraints to investment climate and private sector development in Afghanistan. Consequently, many businesses remain small enterprises in the informal sector where they cannot contribute to tax revenues and opportunities for expansion are limited. 250. One of the key current economic strategies for ensuring future growth in Afghanistan is centered on the development of “resource corridors� (essentially, developed infrastructure zones linked to urban areas which will be driven by the development of extractive industries). The justice institutions (JI) will need to play a supportive role in these developments by providing relevant services within their purview directly to the business community: for example land registration procedures, contract enforcement (not only between private sector operators but also between the private sector and the Government both at central and decentralized level,) and so forth, but also to the communities impacted by these developments (for example ensuring that citizens have a means for redress in relation to contractual provisions contained in mining contracts such as development of services and infrastructure for citizens (schools, recreational areas, markets etc.) or revenue allocation. In essence the JI will have to play a key role in ensuring and supporting the equitable development and allocation of revenues from these areas. 90 251. Improving the business environment remains a critical challenge in Afghanistan. According to a recent World Bank/IFC report on Doing Business, Afghanistan ranks 160 out of 183 economies assessed for ease of doing business: a 6-point deterioration from the previous year. While business registration processes have been improved by removing the system from the remit of commercial courts, and establishing a separate agency for this, dealing with legal disputes once a business is established remains costly, time consuming and high risk. The study estimates that going to court to enforce a contract through the courts requires 47 procedures, and takes 1642 business days. It was found to be amongst the hardest places to register property, ranking 172 globally, with the formal process estimated to take 250 days. The challenge during Transition will be to improve these processes and reduce costs in the context of declining resources, but the decline in funding is also an important reason why these reforms must be prioritized to ensure a more sustainable system. 252. The state justice sector remains highly dependent upon external resources: As is the case for most sectors in Afghanistan, 90 percent of development activities in the justice sector are financed through donor funding. However, as Transition progresses, a rapid decline in these resources can be expected. Compounding this, growth, even under reasonably optimistic scenarios, is projected to fall from a ten year average of over nine percent to between five and six percent in 2011-18. This will result in an increasingly constrained budget envelope from which to deliver services to citizens. In addition, a decrease in Non-Government Organizations’ (NGO) activities can also be expected, and there may be increased pressure on government to take ownership of projects and services that were previously delivered outside of the government systems, thereby increasing further the fiscal burden upon government. The effects of reduced NGO activity may be particularly acute in the legal aid sector, where NGOs provide at least 60 percent of legal aid for criminal cases. All the NGOs in this area are reliant for their continued operational existence on external financing from donors and have not managed to generate a sustainable business model. In addition, through subsidies, NGOs have raised the price of legal representation to unaffordable levels and thus distorted private market for legal services. As such, a key challenge for the state sector will be how to fill this service void and vacuum if the services by NGOs retract during the Transition. The inherent danger of not filling the vacuum is that more individuals choose to utilize insurgent justice forums instead. 253. State justice systems in Afghanistan are highly inefficient and cost-ineffective: Reliable data about the workloads and processes of Supreme Court (SC), Ministry of Justice (MoJ) and Attorney General’s Office (AGO) staff is still very limited. There is little transparency about case numbers or productivity of support staff in courts. The Afghan local JI are currently too small to generate benefits of scale or specialization. Infrastructure and technology remain weak across these institutions. The Kabul SC office has very little computer equipment, meaning most processes are managed by paper handwritten documents. This contributes to lengthy and unpredictable processing times for cases, with numerous opportunities for rent seeking and misuse of funds during case processing. This in turn reduces the number of cases that can be processed by the given staffing levels, and reduces the quantity and quality of services delivered. In legal aid, weak criteria for eligibility for assistance place an unmanageable and unpredictable burden on limited service capacity, with no means through which to prioritize cases. Pre-trial detention rates are high which again contributes to high costs of managing the system, and has significant spillover effects for the broader socio-economic condition of numerous families throughout Afghanistan. Escalation of all cases through repeated appeals causes further direct 91 costs, while the indirect costs in terms of a reduction in the legitimacy of verdicts delivered – and thereby the ongoing uncertainty with regards to substantive legal issues throughout Afghanistan – are also substantial. 254. There has been little emphasis on efficiency gains to date: Previous investments in the sector have not been able to noticeably improve the quantity and quality of justice services provided. The government has sought to scale up the system by expanding its network of courts and staff numbers, but this has not been informed by reliable needs assessments in order to maximize impact. The state and NGOs remain the major providers of legal aid. Therefore the next five to ten years will pose a clear challenge in terms of improving service delivery scope and quality, in the context of declining resources. The focus of the Justice Delivery Project is therefore to improve the productivity of key elements of the justice system, prioritizing critical frontline services. Corruption 255. Establishing good governance in Afghanistan is proving to be extremely difficult – While there have been some encouraging developments such as the passing of the anti-corruption law, the ratification of the United Nations Convention Against Corruption (UNCAC) and the establishment of the High Office of Oversight (HOO) for Anti-Corruption, the overall progress in improving governance and fighting corruption has been limited. Corruption in Afghanistan has become more widespread and systemic over the course of the last few years. In 2005, Afghanistan ranked 117 out of 159 countries covered in Transparency International’s Corruption Perception Index; by 2009 its rank had dropped to 179 out of 180 countries, while by 2010 its rank had risen to 176 out of 178 countries3. Available survey evidence and other information show that a majority of Afghans view the payment of bribes to be a necessity in order to obtain services from the government4. Corruption is commonly perceived to have become more organized and entrenched, involving networks at all levels with those at the top reaping large rewards. 256. The broader institutional context remains weak and political economy pressures upon public officials are significant. Nepotism and patronage widely affect civil service recruitment. Compounding this is the continued practice of recruitment of large numbers of national technical advisers who carry out routine civil service functions, with weak lines of accountability to the Government. This diverse system is further complicated by the variety of donor approaches to capacity building and capacity substitution in administrative structures. A World Bank commissioned study notes that ‘elite’ attachment to the rules of administration remained weak and uneven. The institutionalization of the rules of public administration faces many barriers. The state lacks a clear sense of demarcation between political and administrative staff, with the civil service lacking its own independent top-tier of leadership. Although the Government has examined various options to clarify the rules, clear policy decisions have not been taken to demarcate responsibilities and functions. The guardian of civil service ethics and rules, the Independent Administrative Reform and Civil Service Commission (IARCSC), is in need of strengthening. Major attempts to reform these systems have to some degree been prompted by 3 Transparency International: http://www.transparency.org/policy_research/surveys_indices/cpi/2010 4 See “Fighting Corruption in Afghanistan – Summaries of Vulnerabilities to Corruption Assessment,� World Bank, June 2009 92 international initiatives, such as the London and Kabul conferences and also the introduction of a formal Civil Service Code to provide a stronger benchmarking of formal rules. 257. In a functioning state system, the justice sector - and in particular administrative courts – acts as a key safeguard in ensuring the accountability to individual citizens of executive action. Ensuring access to such courts and tribunals is therefore a key pillar in ensuring the accountability of the executive and its services to users and can be a forum for predictable enforcement of the broader aims of the social accountability agenda. 258. An independent judiciary, with appropriate accountability mechanisms, can play a critical part in reducing corrupt practices in the justice system. Afghanistan, however, does not have a very long history or experience of a truly independent judiciary free from executive interference. It was not until the Constitution of 1964 that it could be stated that the judiciary of Afghanistan was in any way truly independent but this independence itself was short lived. The Constitution of 1973 abolished the SC and transferred the powers of the Chief Justice to the MoJ. Under the Revolutionary Council of 1977, the powers of the SC were transferred to a Supreme Judicial Council under the Minister of Justice before the communist Constitution of 1980 re-established the SC, nominally as independent, but required it to report regularly to the Revolutionary Council. The SC regained full independence in 1987 but following the collapse of the Communist system, the civil war of the 1990s and the imposition of a radical Islamic system of Government by the 1990s, it was never able to exercise such independence again until the current Constitution of 2004. 259. At the individual judicial level there is little sense of accountability towards the internal judicial power and authority structures. While a High Judicial Council to govern the judiciary’s administrative affairs (including appointments) has been established in Afghanistan, it is perceived as being non-transparent in terms of decision making and thus in important ways undermines efforts to improve accountability among the judiciary. The lack of collegiality and inclusiveness amongst the judiciary continues to encourage practices of primary loyalty to tribe, family and community by judges which leads to the corrupt dispensation of justice. 260. Numerous studies show that citizens perceive corruption in justice institutions to be among the worst of all state institutions. A 2010 UNODC survey shows that in 2009, judicial and criminal justice officials were those most frequently reported to have taken a bribe. This applied equally to both urban and rural respondents. The 2010 Integrity Watch Afghanistan (IWA) survey reached a similar conclusion: The survey indicates that Afghans perceive the main institutions responsible for security and justice as among the most corrupt. In total 50 percent of respondents named either the courts or the MoJ as the most corrupt public institution (each respondent could name up to 3 institutions). Moreover, households paid the highest numbers of bribes for the provision of security and justice by the police and the courts. As such, it is clear that corruption in these institutions has a daily and damaging impact upon the lives of citizens. 261. The high number of cases being tried in the absence of defendants in criminal courts is further cause for concern and is indicative of wide spread corruption throughout the justice institutions and police. Over the past two years, the courts have been processing ever increasing number of these types of case. The reasons for the absence of the defendant are not always clear but are commonly referred to as being related to (a) bribes paid for the release of the defendant to 93 the detention authorities; (b) bribes paid to “switch files� between defendants/prisoners; (c) a lack of effort by the police to find the defendant and serve notice of the hearing date on them; and (d) collusion by the prosecution and the judge to process the case quickly. The incentives for defendants to bribe their way from court are also very high since in Afghanistan sentencing may also take place in the absence of the defendant but the time to be served for that sentence commences immediately, rather than when they are caught (the rationale being that life as a fugitive is just as bad as being in prison). All these factors combine to delegitimize the system as a whole and encourage further bribe paying. 262. Some of the most pressing sectoral issues related to corruption in the justice sector are set out below. These all tend to reinforce the negative dimensions of one another and therefore, in order to address them, a holistic, multi-pronged and sector wide approach is required: 263. Lack of Accountability. High ranking officials from the justice sector are hardly ever sanctioned for corruption, demonstrating limited accountability within the sector. Specific mechanisms for corruption in the justice sector can include delays in processing a case, or passing a judgment, until a bribe is paid. Case management is weak; there is little accountability for processing times, little transparency of process and weak information systems to mitigate these issues. Additionally the issues of legal pluralism, recycling of disputes, forum shopping all lead to an increased reliance upon judge’s discretion, unpredictability of justice systems outcomes (jurisprudence), opportunities for corruption and undermining of legitimacy. 264. “Justice� is often for sale to the highest bidder and captured by vested interests. This is a problem with both internal and external dimensions. While the external dimension has been well documented (as noted above in relation to the perception surveys), the internal dimensions have not been well captured. Internal sale of justice usually involves the process of judges “bidding� for the allocation of particularly “valuable� (value can take a number of forms) cases to be allocated to them for hearing. This process is of course further swayed by the vested interests that are able to manipulate such a weak system for their own needs. This form of sale and capture usually involves active participation by both administrative courts staff as well as the judiciary and is particularly corrosive to the smooth functioning of the system. Little research has been undertaken to assess how this operates in the Afghan context, although all the outward indicators (high cost of access, lengthy case processing times, lack of trust in the system, high number of cases in absentia in the criminal courts) suggest the practice is rampant. 265. Beneficiaries are vulnerable. The weak and vulnerable position of those seeking to engage with Justice Institutions exacerbates the opportunities for rent seeking. There are large information asymmetries about the law in Afghanistan and traditional mitigating features of a functioning system (lawyers and other repeat users of the system such as insurance companies) do not exist to a sufficient degree or are also captured within the network of corruption. As with any system the poverty and high illiteracy rate of the population makes formulating and understanding a claim and decision without assistance nearly impossible. Moreover, the physical barriers to access make any decision to undertake a court case a highly risky, expensive and uncertain one for the majority of the population. The vulnerable are especially at risk in the criminal justice system, where those who cannot pay may become the “victim� of a switched file. The high pre-trial detention rates (27 percent of total prison population when last recorded) 94 also have a significant socio-economic impact on the livelihoods of numerous families who may lose an important source of income for an uncertain amount of time. 266. In addition to these factors undermining the very legitimacy and effectiveness of the state system, they also contribute to “pushing� many individuals into the arms of “insurgent justice� institutions. Such process, however, is not entirely due to the weakness of the state system. It is of particular note that enforcing “justice� and “law and order� (although not necessarily the rule of law) is one of the first acts that the insurgents typically carry out (often presiding over dispute mechanisms that are in breach of Afghanistan’s constitution as well as numerous treaties to which it is signatory.) Nevertheless, the “insurgent justice� forums also exhibit a number of factors that exert a strong “pull� for individuals. Notably, they are perceived as being free from corruption, they are quick, they exist and are available and they are seen by many to be deeply rooted in traditional Islamic beliefs and jurisprudence. 267. Despite the high number of judges versed in Sharia law operating within the courts, the Afghan justice system has been unable to leverage this apparent expertise into providing a greater legitimacy for the courts – in terms of having the population see that the laws that are being enforced are part of their Islamic heritage. Indeed, until recently, there was active promotion from the Government –assisted and encouraged by the donor community – to move the system away from being too closely aligned with Islamic jurisprudence and principles. This has been mainly due to the conflation of “Sharia� with only negative aspects of the jurisprudence and in particular with its implementation by fundamentalist Islamic groups around the world. There are, however, numerous positives which could be gained from providing a greater degree of synergies between the justice systems and Sharia values (those that are of course compatible with the Constitution of Afghanistan, the international conventions to which it is signatory and so forth). 268. The Judiciary in Afghanistan has started to take tentative steps towards a more transparent and accountable system. A number of judges have recently been removed from their positions. More has to be done and the project will assist in this regard. Since there is a rich tradition in Islamic heritage of high moral standards, ethics, values and norms of behavior, which govern personal, professional and business life and these values promote commercial fairness and ethical business as basic standards of economic activities, providing the space for such positive values to take root within the courts as part of the reform efforts under the project, will be key in increasing the legitimacy of the courts and combating corruption. Economic, Financial and Governance Benefits of the Project 269. Due to the nature of the project (including lack of data on the justice system, the long term nature of seeing results arise from investment in the justice sector and so forth), it is difficult to carry out a complete and quantified ‘Cost-Benefit Analysis’ and estimate the internal rate of return of the investment being made. Some limited assessments can be made regarding the economic and financial benefits of the project, and in particular the “sector benefits� (which are closely aligned with the expected governance improvements) and “cost-effectiveness� of the investments under the project can be captured. Set out below are the main examples of the “sector benefit� the project is expected to have: 95 a) Efficiency of Formal Justice Systems increases thereby reducing cost and increasing productivity. b) By developing a mechanism for improved collaboration between formal and informal institutions, resulting in better case management, data exchange, record sharing, and thereby a reduced caseload for formal institutions as recycled cases are not entertained and cases which can be more appropriately dealt with away from the formal system are diverted, costs will be saved and will also become more predictable. The predictability of caseload and costs will allow for systems of performance based budgeting to be introduced. c) Core /common function business process of the JI will be reviewed and augmented as part of effort to promote internal efficiency gains. Financing business process improvements in JI (e.g. case management, HRM, procurement) are intended to create improvements in productivity through process simplification and formalization, but also to reduce opportunities for corruption through greater transparency of process and reduced transactions. Trainings will be provided to build the capacity of key justice officials, including trainings and exchanges that build professional values and ethical awareness. d) Additionally, interventions will be made from the demand side to in order to provide mechanisms that adequately and predictably meet the demands of citizens. Filters on criteria and eligibility to reduce the burden on the legal aid budget will be introduced while at the same time the incorporation of the ILF-A will allow for an increase in productivity, efficiency and resultant service delivery. e) Finally, the pilot areas (Logar, Bamiyan, Herat, Kabul) are centers of commercial activity, including large scale mining. It is therefore expected that these interventions will improve and support the business environment, and facilitate economic activities. HR Processes 270. Since the project seeks to improve the quality of service delivery outcomes in the Justice sector, the human capital available to implement this within the JI is of central importance. The project would be at risk of HR processes being biased towards preferred candidates, in particular since nepotism is a widely acknowledged practice in the sector. 271. The HR departments will be a focus of key reforms, with the project supporting the development of performance evaluation processes, the roll out of Pay and Grading reform and merit based recruitment, and restructuring of departments and clarification of job descriptions to improve accountability and oversight. Improved recruitment processes should result in reduced instances of nepotism in JI. Independence and Accountability 272. While the independence of the judiciary is guaranteed by the constitution (as it is in most countries) it is still not effectively secured in Afghanistan. One of the primary reasons for this is the lack of accountability that judges have to respond to, thereby decreasing any need for 96 transparency and increasing the incentives for taking bribes as noted earlier. While the SC as an institution has secured a degree of independence from other public organs, judges within the institution regularly face pressures that prevent them acting with impartiality. Additionally, the fact that the SC entertains 100 percent of appeals to it, delegitimizes any decisions taken prior to the SC. The proposed reforms – particularly in the area of human resource reform and financial management – will have a catalytic effect on improving the independence and accountability of the formal justice as a whole. 273. Demand side accountability will be improved though increased dissemination of information to citizens on rights and entitlements under the law (Legal Awareness program and Partnership for Justice). The legal outreach program will also specifically focus upon strengthening capacity of communication departments of the three JI. Forum Shopping and Recycling of Disputes 274. The ‘Partnership for Justice’ component aims to build a workable model for collaboration between formal and informal dispute resolution mechanisms, with information sharing in order to reduce duplication of cases. It will work with local and state institutions to increase the efficiency and effectiveness of legal service delivery, thereby reducing the incentives for forum shopping and improving the predictability of outcomes. Improved access to information should improve demand for more predictable systems and more efficient delivery of services. At the local level this will ensure that limited community resources are not wasted in continually pursuing cases and allow such resources to be directed towards more efficient means. Regulatory Frameworks 275. Missing pieces of the key regulatory framework will be introduced, combined with clearer policy guidelines and improved lines of accountability and independence of judges/ prosecutors, improved reporting structures. This will allow for the predictable development on a holistic and sector-wide basis the development of true access for justice services for the citizenry. The predictability brought about by the new regulatory framework will also provide the space and opportunity for the private legal market to develop. User Complaints Mechanism 276. These will be developed directly through the project and will provide a forum for the users to provide directly their complaints on the justice system where they feel they have been treated unfairly. The performance management processes to be introduced will allow for such criticisms to be actually acted upon where merited. 97 Annex 11: Documents in Project Files AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT PCN Review Package 04/03/2012 Minutes of the Project Concept Note Review Meeting 04/14/2012 Peer Review Comments and Responses 04/14/2012 ESMF 04/25/2012 ISDS 04/25/2012 Disbursement Letter 06/31/2012 98 Annex 12: Country at a Glance AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT 99 100 Annex 13: Maps AFGHANISTAN: JUSTICE SERVICE DELIVERY PROJECT 101