The World Bank Report No: ISR10116 Implementation Status & Results Sierra Leone Integrated Public Financial Management Reform (P108069) Public Disclosure Copy Operation Name: Integrated Public Financial Management Reform (P108069) Project Stage: Implementation Seq.No: 7 Status: ARCHIVED Archive Date: 23-May-2013 Country: Sierra Leone Approval FY: 2009 Product Line: IBRD/IDA Region: AFRICA Lending Instrument: Technical Assistance Loan Implementing Agency(ies): Key Dates Board Approval Date 04-Jun-2009 Original Closing Date 31-Jul-2013 Planned Mid Term Review Date 15-Jan-2013 Last Archived ISR Date 29-Aug-2012 Effectiveness Date 15-Dec-2009 Revised Closing Date 31-Jul-2013 Actual Mid Term Review Date 25-Mar-2013 Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective is to support Government of Sierra Leone in sustainably improving the credibility, control and transparency of fiscal and budget management. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Component 1 Strengthening Macrofiscal Coordination and Budget Management 2.15 Component 2 Reinforcing the Control System for Improved Service Delivery 3.04 Component 3 Strengthening Central Finance Functions 12.20 Component 4 Assisting Non-State Actors# Oversight 1.00 Component 5 Project Management 1.93 Public Disclosure Copy Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Moderately Satisfactory Overall Risk Rating Moderate Implementation Status Overview The Implementation Support Mission (ISM) overall rating of the project implementation status is moderately satisfactory based on the team’s assessment that modest progress has been achieved in the implementation of outstanding activities funded by the project during the last eight months. Most critical are the recurring delays in approving of the Government Page 1 of 9 The World Bank Report No: ISR10116 Budgeting and Accountability Act and subordinate fiscal rules and debt regulations, the commissioning of an IFMIS Audit by an independent reviewer, and the lacking of a MoFED IFMIS Strategy Plan inclusive of an ICT Security Policy. The Mission reiterates its recommendation that the GoSL agrees on a timetable to slate and complete those actions and gets the basics in place for PFM reform, including the adoption of a unified GFS classification system for budget formulation and execution and agree on a major strategy plan for establishing a treasury single account and enabling improved cash and debt management practices and financial internal controls within the central government over the next six Public Disclosure Copy months. Prolonged delays in procurement have affected the relationship between the project Management team and beneficiaries. The MoFED Senior Procurement Specialist was transferred in September 2012 to another MDA. Since then the IPFMRP’s procurement has been managed by a Procurement Assistant, without sufficient knowledge and experience in World Bank procurement regulations. This has resulted in prolonged delays in procurement matters and multiple revisions by the Bank procurement team of basic procurement packages. Locations No Location data has been entered Results Project Development Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target Percentage of MDA contracts in compliance Percentage Value 49.00 63.00 95.00 with provisions of the GoSL#s procurement Date 08-May-2009 25-Mar-2013 31-Jul-2013 legislation and regulations Comments Problem with data reliability. The indicator will be revised. Timely audited Public Accounts with no Text Value Disclaimer of opinion on Unclear - The indicators will Opinion on 2010 with no more material qualifications concerning basic control Accounts for 2002-06 be revised. than 1 material qualification system failures. Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Publication of financial and procurement Text Value Only budget documents, in- The 2013 National Budget is All financial and prourement documents (all six listed in PEFA indicator 10) year execution reports, and available at MoFED website documents (all six listed in through the Sierra Leone Gazette and resources available to primary PEFA indicator 10) now MoFED#s website in accordance with service providers are publised by on the relevant requirements of GBAA and PPA. published by due dates (total websites. 3) Date 08-May-2009 25-Mar-2013 31-Jul-2013 Public Disclosure Copy Comments Domestic expenditure arrears (total from all Percentage Value 9.40 15.00 8.00 years) as % of total expenditure for year Date 08-May-2009 25-Mar-2013 31-Jul-2013 (excluding interest and donor-financed project Comments Due to an exceptional expenditure) situation in 2012 and expected for 2013, the targets are higher in 2012 than the baseline. Page 2 of 9 The World Bank Report No: ISR10116 The share of actual to budgeted spending on Text Value Poverty actual/budget = % to budget on HIPC/PRSP % to budget on HIPC/PRSP pro-poor spending priorities compared to the 57.5% (148.9/258.9) Other priorities =134.3 % to budget priorities > % to budget on ratio of actual to budget expenditures for all actual/budget =69.0% on other expenditures = other expenditures other discretionary primary expenditures (110.5/160.1) 110.6% Public Disclosure Copy Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Variance in expenditure for the 20 largest Percentage Value 13.50 3.40 7.00 budget heads Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments The corresponding figure for The indicator will be revised. PI-2 is 3.28%. However, the The revised information was project indicator though monitored and is in the Aide related to PI-2 is the variance Memoire. in the 20 largestbudget heads. The indicator will be revised. Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Timely submission of audit reports Text Value N.A. Final External Audit Report not yet submitted Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Timely submission of financial reports Text Value N.A. Quarterly financial As required management reports Date 08-May-2009 25-Mar-2013 31-Dec-2012 Comments Non-State Actors (NSA) active in the area of Text Value Lack of capacity and a forum Open Budget Initiative/survey At least 10 NSA are able to PFM monitoring and oversight for an institutionalized and done. access funds through systematic approach Local firm was contracted to submission of acceptable manage sub-grant. 15 NGO technical proposals At least 6 Public Disclosure Copy selected. publications from NSAs uncompleted activities related 2013 citizen budget under to monitoring and oversight preparatiion. disseminated Two joint Forums organized with Government on PFM issues NSA produce analytic report on budget preparation process that highlights challenges and constraints Page 3 of 9 The World Bank Report No: ISR10116 Date 08-May-2009 25-Mar-2013 31-Dec-2012 Comments Salary Support for MOFED Civil Service Staff Text Value Development partners funding Project restructuring is Project provides salary Public Disclosure Copy consultants/LTAs performing cancelling this activity and support according to the key functions in MoFED reallocating resources to PFM policy and implementation core issues. plan on a declining basis; no consultants in line positions Date 08-May-2009 25-Mar-2013 31-Dec-2012 Comments No of trained PFM officers in MDAs and Text Value Insufficient trained PFM IPFMRP trains (IPAM) more At least 133 PFM officers in MoFED officers at technician or that 300 public officials from MDAs and MoFED professional levels (estimated the Central Government and 34 technicians and Local councils. professionals in December 2008) Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Timely publication of all MoFED statutory Text Value Lack of GoSL ICT policy; lack MoFED website fully All documents as per PDO publications in MoFED website of MoFED website; operational. objective 4 available on insufficient support for ICT website across government Date 08-May-2009 25-Mar-2013 31-Dec-2012 Comments Percentage of budgeted expenditures executed Text Value IFMIS online in AGD and 8 IFMIS online in 12 MDAs IFMIS online in AGD and to online through IFMIS rolled out ministries MDAs (62% of budgeted 16 MDAs (80% of budgeted expenditure) expenditure) Date 08-May-2009 25-Mar-2013 31-Dec-2012 Comments Backlog of Auditor-General reports cleared Text Value Delays in PAC review of audit 2010 AGR report was Completion of 2010 Auditor reports (Review of Auditor published. General#s Report Public Disclosure Copy General#s reports for 2003 # Recommendations made over 05) years still pending. Date 08-May-2009 25-Mar-2013 31-Dec-2012 Comments Annual PETS Report published within six Percentage Value 89.00 93.10 100.00 months of completion of survey; evidence of Date 08-May-2009 25-Mar-2013 31-Dec-2012 material response (service improvement) by Comments 2011 PETs report was not relevant agencies: Proportion of textbooks reaching primary schools published. Page 4 of 9 The World Bank Report No: ISR10116 Annual PETS Report published within six Percentage Value 85.00 90.90 93.00 months of completion of survey; evidence of Date 08-May-2009 25-Mar-2013 31-Dec-2012 material response (service improvement) by Comments 2011 PETs report was not relevant agencies: Proportion of teaching and Public Disclosure Copy learning materials reaching published. Annual PETS Report published within six Percentage Value 75.70 93.00 95.00 months of completion of survey; evidence of Date 08-May-2009 25-Mar-2013 31-Jul-2013 material response (service improvement) by Comments 2011 PETs report was not relevant agencies: Proportion of essential drugs reaching Public Health U published. Audit Committees functioning in 4 key MDAs Text Value Three audit committees 19 audit committes in MDAs Audit Committee functioning as evidenced by minutes of quarterly meetings (Defense, National Electoral and 7 in Local Councils in at least 4 key MDAs as containing review of internal audit reports Commission, Police) evidenced by minutes of established but not quarterly meetings held functioning effectively Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Internal Audit Units in at least 15 MDAs Text Value Only 7 effective internal audit 39 MDAs with internal audit Quarterly reports in at least functioning as evidenced through quarterly units in MDAs; reports not unit. 15 MDA#s reports copied to Director of Internal Audit effectively used by Vote MoFED, with evidence of follow-up Controllers Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Own-operated personnel management system Text Value All Personnel management Tearchers verification process Personnel Management under HCA established at 3 MDAs within under HCA operationally completed on October 2012 under HCA established at HRMO oversight framework following consolidated within HRMO and presented to the Minister three of Sierra Leone Police/ completion of verification exercise of Education March 27, 2013. Ministry of Defense/ Ministry of Education, Youths and Sports Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Public Disclosure Copy Timely publication of comprehensive annual Text Value Public Accounts omit Indicator will be revised. Submission of fiscal/monetary financial statements with reference to PEFA Subvented Agencies reconciliation of subvented standards expenditure (about 40% of agencies; (expenditure total expenditure captured); captured increase to 70%) incomplete fiscal/monetary reconciliation Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Page 5 of 9 The World Bank Report No: ISR10116 Procurement units in MDAs functional as per Text Value Estimated 20 % of MDAs Indicator achieved. It will be 65% of MDAs have dedicated PPA and Regulations have dedicated procurement revised. procurement officers officers Public Disclosure Copy Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments New LG Financial Administration Regulations Text Value No Financial Administration Not achieved yet Cabinet approval and and Accounting Manual Budgeting Guidelines Regulations in place to enactment of FAR Finalized adopted and disseminated support the LGA 2004. No Accounting Manual to be Accounting Manual in place widely circulated to all LCs for LCs Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Revised GBAA and FMR adopted and Text Value The 2005 Government Not achieve yet. Cabinet approval and disseminated at all levels Budgeting and Accountability enactment of Act; regulations Act and Regulations need reviewed updating for the new business processes arising from IFMIS rollout and new foreign aid and commitment control procedures Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Revised legal and institutional framework for Text Value Relevant laws scattered, Regulations and Manual to be A new act passed debt management adopted by Cabinet criteria and ceilings unclear, concluded by June. lack of integrated organization or systems, weak capacity Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments New/additional payment arrears (Outstanding Percentage Value 1.90 15.00 0.70 Commitments) during the year as a percentage Date 08-May-2009 25-Mar-2013 31-Jul-2013 of total primary expenditures (%) Public Disclosure Copy Comments Target for 2012 was 12%. Approved Commitments/MTEF/PETS form 2 Percentage Value 98.90 99.00 100.00 backed by payments (restricted to non-salary Date 08-May-2009 25-Mar-2013 31-Dec-2012 recurrent): Grants to LCs Comments Approved Commitments/MTEF/PETS form 2 Percentage Value 98.80 100.00 100.00 backed by payments (restricted to non-salary Date 08-May-2009 25-Mar-2013 31-Jul-2013 recurrent): Agriculture Comments No data Indicator is not clear and will be revised. Page 6 of 9 The World Bank Report No: ISR10116 Approved Commitments/MTEF/PETS form 2 Percentage Value 94.00 100.00 99.00 backed by payments (restricted to non-salary Date 08-May-2009 25-Mar-2013 31-Dec-2012 recurrent): Health Comments 0.7. reduced from 1.9% in Public Disclosure Copy 2011. Quarterly allocations backed by approved Percentage Value 95.30 200.50 100.00 commitments (restricted to non-salary Date 08-May-2009 25-Mar-2013 31-Jul-2013 recurrent): Grants to LCs Comments Quarterly allocations backed by approved Percentage Value 94.20 109.00 99.00 commitments (restricted to non-salary Date 08-May-2009 25-Mar-2013 31-Dec-2012 recurrent): Agriculture Comments Quarterly allocations backed by approved Percentage Value 85.50 200.50 96.00 commitments (restricted to non-salary Date 08-May-2009 25-Mar-2013 31-Jul-2013 recurrent): Health Comments No data Appropriations backed by quarterly allocations Percentage Value 78.90 97.00 97.00 (restricted to non-salary recurrent): Grants to Date 08-May-2009 25-Mar-2013 31-Dec-2012 LCs Comments Appropriations backed by quarterly allocations Percentage Value 100.30 114.90 100.00 (restricted to non-salary recurrent): Agriculture Date 08-May-2009 25-Mar-2013 31-Dec-2012 Comments Appropriations backed by quarterly allocations Percentage Value 84.30 81.00 100.00 (restricted to non-salary recurrent): Health Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Capture of aid flows in government financial Text Value Lack of agreed aid policy, Adequate date not provided. Database used to check reporting including donor reporting; indicator need to be revised comprehensiveness of budget database under development; and accounts Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Public Disclosure Copy Number of MDAs with acceptable strategic Number Value 3.00 12.00 6.00 plans developed within resource ceilings and Date 08-May-2009 25-Mar-2013 31-Dec-2012 reflected in budget bids Comments This indicator will be revised. Deviation in own source revenues Text Value 4% 16 < 2% shortfall Date 08-May-2009 25-Mar-2013 31-Jul-2013 Comments Data on Financial Performance (as of 02-Apr-2013) Page 7 of 9 The World Bank Report No: ISR10116 Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P108069 IDA-H4930 Effective 04-Jun-2009 19-Oct-2009 15-Dec-2009 31-Jul-2013 31-Jul-2013 Public Disclosure Copy P108069 TF-95389 Effective 19-Oct-2009 19-Oct-2009 15-Dec-2009 31-Jul-2013 31-Jul-2013 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P108069 IDA-H4930 Effective USD 4.00 4.00 0.00 2.72 1.41 68.00 P108069 TF-95389 Effective USD 12.89 12.88 0.00 11.76 1.13 91.00 Disbursement Graph Public Disclosure Copy Key Decisions Regarding Implementation While the project is well focused and has specific targeted outcomes of credibility, control and transparency in fiscal and budget management, special attention is recommended to better prioritize certain actions and reallocate the remaining resources to ensure that interventions and outcomes are likely to be sustained beyond project completion. As regard to intermediate outcome indicators, the ISR mission calls on the Government of Sierra Leone to make the necessary changes in the set of Intermediate Outcomes Indicators (Annex 5 of the Aide Memoire) in order to getting the Project achieve those priority actions. The Bank is advancing in the restructuring of the project to make the best use of the remaining available resources and extension of the closing date. As of March 31, 2013, the ISM mission observed that the level of disbursements has increased to about 90% and 64% respectively for the MDTF (TF-95389) IDA (H-4930) respectively. The main reason for this increased disbursement level is two payments to FreeBalance. Page 8 of 9 The World Bank Report No: ISR10116 Unfortunately, outstanding issues continue endangering fiscal discipline and seriously affecting the sustainability of PFM reform, insofar as critical legal and regulatory reforms and the IFMIS planning, implementation and auditing and ICT Security, respectively. Restructuring History Public Disclosure Copy There has been no restructuring to date. Related Projects There are no related projects. Public Disclosure Copy Page 9 of 9