The World Bank Liberia: Public Sector Modernization Project (P143064) REPORT NO.: RES36078 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF LIBERIA: PUBLIC SECTOR MODERNIZATION PROJECT APPROVED ON FEBRUARY 10, 2014 TO REPUBLIC OF LIBERIA GOVERNANCE AFRICA Regional Vice President: Hafez M. H. Ghanem Country Director: Henry G. R. Kerali Senior Global Practice Director: Deborah L. Wetzel Practice Manager/Manager: Hisham Ahmed Waly Task Team Leader: Smile Kwawukume, Miki Matsuura The World Bank Liberia: Public Sector Modernization Project (P143064) I. BASIC DATA Product Information Project ID Financing Instrument P143064 Investment Project Financing Original EA Category Current EA Category Not Required (C) Not Required (C) Approval Date Current Closing Date 10-Feb-2014 30-Sep-2019 Organizations Borrower Responsible Agency Republic of Liberia Civil Service Agency Project Development Objective (PDO) Original PDO To improve pay and performance management in participating ministries, and strengthen payroll management in the Civil Service in Liberia. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-53590 10-Feb-2014 08-Apr-2014 08-Apr-2014 30-Sep-2019 2.00 1.92 .03 TF-A1263 19-Dec-2016 19-Dec-2016 19-Dec-2016 30-Mar-2019 4.33 3.63 .70 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES The World Bank Liberia: Public Sector Modernization Project (P143064) PROJECT STATUS 1. The Liberia Public Sector Modernization Project (PSMP) was approved by the Board on February 10, 2014. The project has overall allocation of US$10.71 million which consists of International Development Association (IDA) credit of SDR1.4 Million (US$2 million equivalent) and a Multi-Donor Trust Fund (MDTF) of US$8.71 million from the United States Agency for International Development (USAID) and the Government of Sweden. Based on the MDTF, a Grant Agreement of value US$4.3 Million was signed between the Government of Liberia and the Bank. 2. The project is supporting the Government of Liberia (GoL) through the combination of a Program based Investment Lending (PBIL) instrument and a Technical Assistance (TA). The PBIL is disbursing against the achievement of Disbursement Linked Indicators (DLIs), which are a combination of results and key steps on defined reform paths. The TA is supporting specific activities for technical support to GoL’s reform program on pay, payroll and performance. The project has been providing support through the following components: • Component 1: Improved Pay Management; • Component 2: Strengthened Payroll Management; • Component 3: Improved Performance; and • Component 4: Project and Program Management. 3. Due to the outbreak of the Ebola Virus Disease (EVD), the project effectiveness date was delayed for one year after Board approval. It thus became effective on February 4, 2015. 4. A mid-term review (MTR) on the PSMP was carried out in September 2017 and rated as Satisfactory. The review confirmed the relevance of the PDO, as well as the overall adequacy of the project’s institutional and implementation arrangements. The review noted progress made towards execution of project activities across components and achievement of agreed results, despite the outbreak of EVD and economic slowdown. The project implementation slowed down in the last two years, mainly due to the presidential elections in October and December 2017 and its resultant transitional activities. Subsequently, the recent implementation Status and Results Report (ISR, approved on February 13, 2019) rated both PDO and Implementation Progress as Moderately Satisfactory. 5. In terms of progress towards achieving project results, out of 9 DLIs, 1 DLI was fully achieved and disbursed, and 4 DLIs are claimed to be achieved and is currently going through verification by the M&E Unit of the CSA and will be verified by a third-party verification by mid-2019. As of now, out of the US$10.71 million net commitments amount, the project has disbursed US$5.55 million (51.8 percent), leaving an available balance of US$5.16 million (48.1 percent). The teams from the World Bank and the Borrower agreed to actions to be undertaken to complete the project successfully. There are no outstanding audit reports. CHANGES 6. The Government sent two official requests to restructure the project by extending the closing date by 24 months from the current closing date of September 30, 2019. In order to prepare and complete the restructuring process, it is required that the two Administrative Agreements (AA) with the two donors are amended. Whilst the donors have agreed in principle to extend the AAs, internal consultations within the donor agencies are taking time and the Bank team is yet to receive the formal communication to extend the AAs. Since the Grant Agreement is closing on March The World Bank Liberia: Public Sector Modernization Project (P143064) 30, 2019, the team was advised by LEGAM and WFACS to extend the closing date of the Grant Agreement by two months to May 31, 2019. This will provide enough time to undertake the full restructuring of the project as requested by the client. The team contacted Trust Fund Partner and Relations Department (DFPTF) to approve this exceptional request and the approval was provided to extend the closing date by to May 31, 2019. II. DETAILED CHANGES LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IDA-53590 Effective 30-Sep-2019 30-Sep-2019 30-Jan-2020 TF-A1263 Effective 30-Mar-2019 31-May-2019 31-Jul-2019