Document of The World Bank FOR OFFICIAL USE ONLY Report No: PAD827 PROJECT PAPER ON A PROPOSED RESTRUCTURING AND ADDITIONAL CREDIT IN THE AMOUNT OF SDR 19.5 MILLION (US$30.0 MILLION EQUIVALENT) TO THE REPUBLIC OF BENIN FOR THE DECENTRALIZED COMMUNITY DRIVEN SERVICES PROJECT JANUARY 31, 2014 Social Protection (West) Country Department AFCF2 Africa Region This document is being made publicly available prior to Board consideration. This does not imply a presumed outcome. This document may be updated following Board consideration and the updated document will be made publicly available in accordance with the Bank's policy on Access to Information. CURRENCY EQUIVALENTS (Exchange Rate Effective December 31, 2013) Currency Unit = CFA Franc CFA Franc 479 = US$1 US$ 1 = SDR 0.649 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS ADV Association de Développement Villageoise APDC Agents Porteurs de Développement Communautaire APL Adaptable Program Loan AGETIP Agence d'Exécution des Travaux d'Intérêt Public AGETUR Agence d'Exécution des Travaux Urbains ANCB Association Nationale des Communes du Bénin BCEAO Banque Centrale des États de l'Afrique de l'Ouest CAA Caisse Autonome d'Amortissement CAS Country Assistance Strategy CCS Comités Communaux de Suivi CDD Community Driven Development CDPR Comités Départementaux des Pistes Rurales CGC Comité de Gestion Communautaire CONAFIL Commission Nationale des Finances Locales CPS Centres de Promotion Sociale CTNPR Conseil Technique National des Pistes Rurales DAT Délégation à l'Amenagement du Territoire DGAE Direction Générale de l'Administration de l'Etat DGB Direction Générale du Budget DGDGL Direction Générale de la Décentralisation et de la Gouvernance Locale DP Direct payment DPP Direction de la Programmation et de la Prospective EFA/FTI Education for All / Fast Track Initiative ESMF Environmental and Social Management Framework EU European Union FADeC Fonds d'Appui au Développement des Communes FCFA Franc de la Communauté Financière Africaine FM Financial Management FY Fiscal Year GDP Gross Domestic Product GIZ Deutsche Gesellschaftfir Internationale Zusammenarbeit (GIZ) GMT Grassroots Management Training ICB International Competitive Bidding IDA International Development Association IFR Interim Financial Report INSAE Institut National de la Statistique et de l'Analyse Economique IGAA Inspection Gindrale des Affaires Administratives IGF Inspection gindrale des finances ISP Implementation Support Plan KfW Kreditanstaltflir Wiederaubau M&E Monitoring and Evaluation MDG Millennium Development Goals MDGLAAT Ministry of Decentralization, Local Government, and Administration and Development of the Territory MEMP Ministry of Maternal and Primary Education NCB National Competitive Bidding NGO Non-governmental organization ORAF Operational Risk Assessment Framework PAD Project Appraisal Document PDC Plan de Dveloppement Communal PDO Project Development Objectives PIM Project Implementation Manual PIU Project Implementation Unit PNDCC Projet National d'appui au Dveloppement Conduit par les Communautes PSDCC Projet de Services D&entralisis Conduits par les Communautis (Decentralized Community Driven Services Project) PONADEC Politique Nationale de Dcentralisation et de Dconcentration RPF Resettlement Policy Framework ROSC Reports on the Observance of Standards and Codes SCRP-3 Stratigie de Croissance pour la Rduction de la Pauvretd SSDCC Secrtariat aux services d&entralisis conduits par les communautis (Secretariat for Decentralized Community Driven Services) SYSCOHADA Systeme Comptable de l'Organisation pour l'Harmonisation en Afrique du Droit des Affaires UNICEF United Nations Children's Fund WA Withdrawal Application Vice President Makhtar Diop Country Director Ousmane Diagana Country Manager Olivier Fremond Sector Manager Stefano Paternostro Task Leader John Van Dyck REPUBLIC OF BENIN DECENTRALIZED COMMUNITY DRIVEN SERVICES PROJECT ADDITIONAL FINANCING CONTENTS Project Paper Data Sheet........... ...................... ................1 I. Introduction ......................................................... 6 II. Background and Rationale for Additional Financing in the amount of US$30.0 million ......... 6 III. Proposed Changes .................................................... 9 Annex 1: Results Framework.............................................. 14 Annex 2: Operational Risk Assessment Framework (ORAF) ........................ 21 Annex 3: Detailed Description of New Project Activities ...................... 27 Annex 4: Disbursements ......................................... ........ 30 ADDITIONAL FINANCING DATA SHEET Benin Benin Decentralized Community Driven Services Project - Addl Financing (P146597) AFRICA AFTSW Basic Information - Parent Parent Project ID: P117764 Original EA Category: B - Partial Assessment Current Closing Date: 30-Jun-2016 Basic Information - Additional Financing (AF) Project ID: P146597 Additional Financing Scale Up Type (from AUS): Regional Vice President: Makhtar Diop Proposed EA Category: B - Partial Assessment Country Director: Ousmane Diagana Expected Effectiveness 30-Jun-2014 Date: Sector Director: Tawhid Nawaz Expected Closing Date: 31-Dec-2017 Sector Manager: Stefano Paternostro Report No: PAD827 Team Leader: John Van Dyck I Borrower Organization Name Contact Title Telephone Email Republic of Benin Project Financing Data - Parent (Decentralized Community Driven Services Project- P117764) Key Dates Project Ln/Cr/TF Status Approval Signing Date Effectiveness Original Revised Date Date Closing Date Closing Date P117764 IDA-51110 Effective 03-May-2012 27-Jun-2012 24-Jan-2013 30-Jun-2016 31-Dec-2017 Disbursements Cancelle Disburse Undisbur % Project Ln/Cr/TF Status Currency Original Revised Disburse I d d sed d P117764 IDA-51110 Effective XDR 29.60 29.60 0.00 12.96 16.64 43.79 1 Project Financing Data - Additional Financing Benin Decentralized Community Driven Services Project - Addl. Financing ( P146597) [ ] Loan [ ] Grant [ ] IDA Grant [X] Credit [ ] Guarantee [ ] Other Total Project Cost: 30.00 Total Bank Financing: 30.00 Financing Gap: 0.00 Financing Source - Additional Financing (AF) Amount BORROWER/RECIPIENT 0.00 International Development Association (IDA) 30.00 Total 30.00 Policy Waivers Does the project depart from the CAS in content or in other significant No respects? Explanation Does the project require any policy waiver(s)? No Explanation Team Composition Bank Staff Name Title Specialization Unit Josiane M. S. Luchmun Program Assistant Program Assistant AFTSW Serge Theunynck Consultant Consultant AFTEW John Van Dyck Sr Social Protection Team Lead AFTSW Specialist Isabella Micali Drossos Senior Counsel Senior Counsel LEGAM Christophe Ribes Ros Consultant Consultant EASHD Aissatou Diallo Senior Finance Officer Senior Finance Officer CTRLA Africa Eshogba Olojoba Senior Environmental Senior Environmental MNSEE Specialist Specialist Sylvie Charlotte Ida do Program Assistant Program Assistant AFMBJ Rego Paivi Koskinen-Lewis Social Development Social Development AFTCS Specialist Specialist Alain Hinkati Sr Financial Sr Financial AFTMW Management Specialist Management Specialist 2 Gbetoho Joachim Boko E T Consultant Social Protection AFTSW Specialist Mathias Gogohounga Procurement Specialist Procurement Specialist AFTPW Faly Diallo Finance Officer Finance Officer CTRLA Non Bank Staff Name Title Office Phone City Locations Country First Administrative Location Planned Actual Comments Division Benin Departement du Departement du Zou X Zou Benin Departement de l' Departement de l' X Oueme Oueme Benin Departement du Departement du X Mono Mono Benin Departement du Departement du X Borgou Borgou Benin Departement de l' Departement de l' X Atlantique Atlantique Benin Departement de l' Departement de l' X Atakora Atakora Benin Departement de l' Departement de l' X Alibori Alibori Benin Departement du Departement du X Collines Collines Benin Departement du Departement du X Couffo Couffo Benin Departement de la Departement de la X Donga Donga Benin Departement du Departement du X Littoral Littoral Benin Departement du Departement du X Plateau Plateau 3 Institutional Data Parent ( Decentralized Community Driven Services Proj ect-P117764) Sector Board Social Protection Sectors / Climate Change Sector (Maximum 5 and total % must equal 100) Major Sector Sector % Adaptation Mitigation Co- Co-benefits % benefits % Public Administration, Law, and Sub-national 30 Justice government administration Health and other social services Other social services 30 Education Primary education 30 Health and other social services Health 5 Water, sanitation and flood protection Water supply 5 Total 100 Themes Theme (Maximum 5 and total % must equal 100) Major theme Theme % Public sector governance Decentralization 29 Rural development Rural services and infrastructure 28 Social protection and risk management Social safety nets 11 Urban development Urban services and housing for the poor 10 Social dev/gender/inclusion Participation and civic engagement 22 Total 100 4 Additional Financing Benin Decentralized Community Driven Services Project - Addl Financing (P146597) Sector Board Social Protection Sectors / Climate Change Sector (Maximum 5 and total % must equal 100) Major Sector Sector % Adaptation Mitigation Co- Co-benefits % benefits % Public Administration, Law, and Sub-national 40 Justice government administration Education Primary education 40 Health and other social services Health 10 Water, sanitation and flood protection Water supply 10 Total 100 MI certify that there is no Adaptation and Mitigation Climate Change Co-benefits information applicable to this project. Themes Theme (Maximum 5 and total % must equal 100) Major theme Theme % Public sector governance Decentralization 32 Rural development Rural services and infrastructure 31 Social dev/gender/inclusion Participation and civic engagement 25 Urban development Urban services and housing for the poor 12 Total 100 5 I. Introduction 1. This Project Paper seeks the approval of the Executive Directors to provide an additional credit in the amount of US$30 million for the Benin Decentralized Community Driven Services Project (PSDCC) (P117764). 2. The proposed additional credit (Cr. 5380-BJ) would allow the scaling-up of the project to enhance access to decentralized basic social services in Benin. The resources would scale-up the existing support under PSDCC for the "Service Delivery Grants to the Communes" component, which supports basic infrastructure sub-projects in education, health, water, and commerce (public markets) at community and commune levels. The additional financing would also supplement the "Technical Assistance and Capacity Building" component to support training and capacity building, and support project management activities associated with the scaling-up. The project would be restructured in order to revise outcome indicator targets, extend the closing date to accommodate the scale up, and create a fourth component for project management in order to separate these costs from project activities in the area of training and capacity building. II. Background and Rationale for Additional Financing in the amount of US$30.0 million 3. Country background. The Republic of Benin on the West African coast covers an estimated land surface area of 112,622 square km with, according to the 2013 census, a population of 9.9 million growing at about 3 percent a year. Poverty remains a concern with a poverty headcount of 36.2 percent in 2011, according to the latest Household Living Conditions Survey (EMICoV 2011). The incidence of extreme poverty is estimated to be 14.6, despite relatively strong economic growth. GDP growth reached 5.6 percent in 2012, one of the highest in West Africa. It is estimated that Benin will achieve the Millennium Development Goals in several areas, including access to safe drinking water, but maternal and infant mortality remain of concern, despite important recent progress. Access to education improved, but not for the poorest wealth quintile in urban areas. The same holds for access to drinking water which increased on average but not for the poorest wealth quintiles in rural and urban areas. Access to health services deteriorated across the board but mostly for the poorest wealth quintile. 4. Sector background. Decentralization of the responsibility for delivery of basic services is at the heart of Benin's poverty reduction strategy for 2011-2015, the Stratigie de Croissance pour la Riduction de la Pauvretd (SCRP-3). The SCRP-3 specifies that any given development intervention should be undertaken by the lowest-level actor that can effectively carry it out (the principle of subsidiarity). Along these lines, Benin's 77 communes have the responsibility for delivery of key basic services including primary education, health, and water management' Furthermore, the SCRP encourages communes to delegate the implementation of small-scale, low complexity development activities to communities through the Community Driven 1 Responsibilities of communes specifically include the following activities as per law 97-029 (some of which are shared with the central level): planning, infrastructure (building /maintenance of roads, street lighting), environment, hygiene and sanitation (drinking water and waste management), literacy, early childhood and primary education (building, equipment and maintenance of schools), health and social education (building, equipment and maintenance of public health centers), economic services and investments (building, equipment and maintenance of markets and abattoirs). 6 Development approach. Under this approach, poor communities identify their local needs, receive training on project management, receive funds, plan and implement the projects chosen, and monitor the provision of services that result from those projects. For the Government, the delegation of service delivery to the lowest possible level has the benefit of increasing the participation of citizens at the grass-roots level, lowering costs, and improving the rate of implementation of development projects2 5. Project background. The $46 million IDA credit for PSDCC was approved on May 3, 2012, became effective on January 24, 2013, and is expected to close on June 30, 2016. To date, the credit is 44% disbursed. The PSDCC aims to improve access to decentralized basic social services and to mainstream the community driven development approach for such services. The original project had three components. 1. Service Delivery Grants to Communes (US$36 million). * Subcomponent 1.1: Communal Grants * Subcomponent 1.2: Community Grants 2. Pilot Social Safety Nets Program (US$5 million). 3. Technical Assistance and Capacity Building (US$5 million). * Subcomponent 3.1: Technical assistance and capacity building for the Ministry of Decentralization and other key Ministries * Subcomponent 3.2: Technical assistance and capacity building for the Communes * Subcomponent 3.3: Grassroots management training (GMT) for Communities * Subcomponent 3.4: Social accountability, monitoring and evaluation. 6. Current project performance. Project performance is currently rated Satisfactory for likelihood of meeting development objectives and Satisfactory for implementation progress. The project is 44% disbursed. Key achievements to date include: Overall * The Government's National Commission for Local Finance (Commission Nationale des Finances Locales - CONAFIL) has signed sub-grant agreements with all 77 communes detailing each commune's role and responsibilities in executing activities under Component 1 (commune and community sub-projects) and Component 2 (safety net sub- projects). Component 1 * The project made the first transfer of funds to communes through the Commune Development Fund (Fonds d'Appui au Developpement des Communes - FADeC), Benin's intergovernmental fiscal transfer system, at the end of September 2013. * An evaluation of procurement capacity in each commune has been undertaken. Communes meeting minimum criteria have been given the green light to begin 2 As discussed in the ICR for the Benin National CDD Project (Report number ICR2385, October 25, 2012), the CDD approach in Benin has delivered results faster, with similar quality, and at a lower cost than conventional methods. 7 procurement for project-funded activities; funds for other communes will remain blocked in their accounts until such communes satisfy the minimum criteria for procurement capacity, with capacity building support provided by the project. * Geographical targeting for community infrastructure and safety nets sub-projects by communal councils in collaboration with the national statistics institute (Institut National de la Statistique et de l'Analyse Economique - INSAE) has been completed. This entailed the creation of a national database ranking all 3,789 villages in all communes of Benin by their degree of access to basic social infrastructure. Commune councils approved the final lists of targeted communities based on the INSAE ranking, with some latitude given for councils to substitute other communities if the decision was made in a public meeting and approved by the Ministry of Decentralization. Component 2 * The first transfers are expected to be carried out in the first wave of communes in early 2014. Geographical targeting of beneficiary communes and communities is completed. A common national targeting methodology has been agreed and validated by the Government's National Social Protection Platform Committee, a multi-sectoral body representing ministries implementing social protection programs. Component 3 * Implementation of the largest activity under component 3, Grassroots Management Training, has advanced with the hiring and training of 12 senior trainers and 77 Community Development Agents (Agents de D6veloppement Communautaire - ADC). In addition, village level Community Development Facilitators (Agents Porteurs de D6veloppement Communautaire - APDC) trained under the previous PNDCC project have been re-mobilized and given refresher training to enable them to start working with communities. 7. Rationale for the Additional Financing (AF). This request is aligned with the Government's third Growth and Poverty Reduction Strategy (SCRP-3) (2011-2015), which emphasizes: (i) accelerating sustainable growth and transforming the economy; (ii) development of infrastructure; (iii) reinforcement of human capital; (iv) improving the quality of governance; and (v) promoting equitable and sustainable national development. The SCRP-3 also states that "the Community Driven Development (CDD) approach, which promotes participatory local development, will be used for the implementation of projects at local level." The additional financing is also consistent with the FY13-17 Country Partnership Strategy (CPS) for Benin, the second pillar of which aims to improve service delivery and social inclusion. The PSDCC is a key operation supporting this pillar. 8. Safeguards. The proposed AF is classified as environmental category B (partial assessment), same as the parent project, in recognition of the fact that the potential negative environmental impacts are expected to be limited and manageable. The AF triggers the same safeguards policies as the parent project; OP 4.01 on Environmental Assessment, OP 4.12 on Involuntary Resettlement and OP 7.50 on Projects on International Waterways. The AF will continue to apply the safeguards instruments; Environmental and Social Management Framework and Resettlement Policy Framework, which were prepared, consulted upon and disclosed in-country and at the InfoShop for the parent project and which have been re-disclosed on October 24 and November 6, 2013 for the AF. 8 III. Proposed Changes 9. The PDO, which aims to improve access to decentralized basic social services and to mainstream the community driven development (CDD) approach for such services, will remain unchanged. A summary of the main proposed changes is presented in the table below. Summary of Proposed Changes The proposed additional credit would finance the scaling up of the PSDCC to enhance access to decentralized basic social services in Benin by (a) providing financing to scale up the existing support under the PSDCC for the "Service Delivery Grant to the Communes" component which supports basic infrastructure sub-projects at commune and community levels, (b) increasing resources allocated to training and building capacities of communities, local government, and the central government; and (c) supporting the costs of project management to manage the scaled-up activities. This Project Paper also seeks approval for restructuring the PSDCC in order to revise outcome indicator targets, extend the closing date to accommodate the scale up, and create a fourth component for project management in order to separate these costs from project activities in the area of training and capacity building. Change in Implementing Agency Yes[ ] No[ X] Change in Project's Development Objectives Yes [ ] No [X] Change in Results Framework Yes [ X ] No[ ] Change in Safeguard Policies Triggered Yes [ ] No [X] Change of EA category Yes [ ] No [X] Other Changes to Safeguards Yes [ ] No [X] Change in Legal Covenants Yes [ ] No [X] Change in Loan Closing Date(s) Yes [ X ] No[ ] Cancellations Proposed Yes [ ] No [X] Change in Disbursement Arrangements Yes [ ] No [X] Reallocation between Disbursement Categories Yes [ ] No [X] Change in Disbursement Estimates Yes [ X ] No [ ] Change to Components and Cost Yes [ X ] No [ ] Change in Institutional Arrangements Yes [ ] No [X] Change in Financial Management Yes [ ] No [X] Change in Procurement Yes [ ] No [X] Change in Implementation Schedule Yes [ X ] No[ ] Other Change(s) Yes [ X ] No[ ] 9 Development Objective/Results Project's Development Objectives Original PDO To improve access to decentralized basic social services and to mainstream the Community Driven Development (CDD) approach for such services. Change in Results Framework Explanation: No new indicators will be added and all existing indicators will be retained. The target value for the outcome indicator on the number of project beneficiaries will be reduced from 429,200 to 270,000. The number of project beneficiaries is defined as the sum of direct beneficiaries of schools, health posts, and water systems (Comp. 1), safety net beneficiaries (Comp. 2), and people receiving Grassroots Management Training (GMT) (Comp. 3.3). This is because the project will no longer support GMT in all villages in the country, as originally planned in the parent project PAD. The Government and Bank have reassessed this idea and agreed that resources could be put to better use by supporting GMT only in villages that will receive financing for sub-projects. Also, there is a concern that providing GMT in villages that will not receive financing for sub-projects could cause confusion and disappointment in communities. This change will reduce the number of communities receiving GMT from 3447 to 1000, and the estimated number of beneficiaries of GMT from 344,700 to 100,000. The decrease in the target number of GMT beneficiaries is partially offset by additional beneficiaries of beneficiaries of schools, health posts, and water infrastructure funded by the additional financing. Other outcome and intermediate indicators will be adjusted in light of the scaled-up financing. Outcome indicators to be updated with new targets would include the number of students enrolled in the schools constructed / rehabilitated under the project, and the number of people in rural areas with access to an improved water source constructed / rehabilitated under the project, among others (see Annex 1). Compliance Covenants - Additional Financing (Benin Decentralized Community Driven Services Project - Addl Financing - P146597) Source of Finance Description of Funds Agreement CovenantsDate Due Recurrent Frequency Action Reference Finance Loan Closing Date - Additional Financing (Benin Decentralized Community Driven Services Project - Addl Financing - P146597) Source of Funds Proposed Additional Financing Loan Closing Date International Development Association (IDA) 31-Dec-2017 10 Loan Closing Date(s) - Parent (Decentralized Community Driven Services Project - P117764 ) Explanation: The closing date will be extended by one year to allow for completion of the scaled up activities. Ln/Cr/TF Status Original Closing Current Closing Proposed Closing Date Date Date IDA-51110 Effective 30-Jun-2016 30-Jun-2016 31-Dec-2017 Change in Disbursement Estimates (including all sources of Financing) Explanation: The disbursement estimates will be revised to take into account the additional resources. Expected Disbursements (in USD Million) Fiscal Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 Annual 5.70 20.00 20.00 20.00 17.30 3.00 0.00 0.00 0.00 Cumulative 5.70 25.70 45.70 65.70 73.00 76.00 0.00 0.00 0.00 Allocations - Additional Financing (Benin Decentralized Community Driven Services Project - Addl Financing - P146597) Disbursement % (Type Source of Category of Allocation Total) Fund CurnyExpenditure Proposed Proposed IDA XDR GD/WK/NCS/CS/TRG 3.80 100.00 for SUB -PRJ PT A.1I IDA XDR GD3WK/NCS/CS/TRG 15.20 100.00 for SUB-PRJ PT A.2 GD/WK/NCS/CS/TRG for SUB-PRJ PT B.1, C, 11.00 100.00 IDA XDR and D Total: 30.00 Components Change to Components and Cost Explanation: Two components will receive additional resources. Component 1 (Service Delivery Grants to Communes) will be scaled up by $19 million to a total of $55 million. This increase will allow the scale up of activities under this component to at least 300 additional communities and will provide increased resources to all 77 communes for additional commune-level investments. The increased resources will also allow increased capacity building at community, commune, prefecture, and central government levels under Component 3 (Technical Assistance and Capacity Building), which will increase to $10 million. 11 In addition, in order to delineate more clearly the division between project activities and project management, a fourth component for project management will be created to separate the administrative costs of project management from the costs of the project activities related to capacity building and technical assistance in Component 3. Component 4 will have an allocation of $6 million. Current Component Proposed Component Current Cost Proposed Action Name Name (US$M) Cost (US$M) Service Delivery Grants Service Delivery Grants 36.00 55.00 Revised to Communes to Communes Pilot Social Safety Net Pilot Social Safety Net 5.00 5.00 Program Program Technical Assistance and Technical Assistance and 5.00 10.00 Revised Capacity Building Capacity Building Project Management 0.00 6.00 New Total: 46.00 76.00 Other Change(s) Change in Implementation Schedule Explanation: In order to allow sufficient time for the implementation of the scaled up activities and for the implementation of the pilot cash transfer component, the closing date of the project will be extended to December 31, 2017. Other Change(s) Explanation: In order to reduce the complexity of the pilot safety net component and devote more attention to ensuring the quality of implementation of the pilot, the impact evaluation mentioned in the original PAD would be dropped and replaced with a process evaluation and a targeting assessment of this component. The impact evaluation had been expected to provide data for the intermediate results indicator on the proportion of transfers benefitting the poorest two quintiles of the population. This information would now be provided by the targeting assessment instead. Appraisal Summary Economic and Financial Analysis Explanation: The economic and financial analysis of the original project still applies as the additional financing will support the same activities at the same unit costs as in the original project. While the community subprojects are of a social nature and do not easily lend themselves to economic analysis, there is a strong economic rationale for the project-it will build needed basic social infrastructure in a cost effective manner. The cost-effectiveness of the project's community-driven approach was demonstrated by its predecessor project, the National Community Driven Development Project (PNDCC), which was able to build primary schools 25 and 28 % cheaper than the other two major actors building schools, with similar 12 quality. The project's approach also supports greater allocative efficiency in public expenditure. Like PNDCC and the original project, the additional financing will empower communities to allocate scarce resources across sectors through the promotion of participatory decision making at the local level (the participatory community planning process), thereby ensuring that such resources are applied most efficiently in response to local priorities. Broad-based participation creates local ownership which, combined with other complementary activities that the project provides (such as capacity building, etc.), makes the subprojects sustainable and extends the life of the investment's benefits. Technical Analysis Explanation: No change Social Analysis Explanation: No new social safeguard policies are expected to be triggered by the additional financing and safeguards arrangements will remain unchanged. The Resettlement Policy Framework for the PSDCC has been re- disclosed in country and in the Infoshop. Environmental Analysis Explanation: No new environmental safeguard policies are expected to be triggered by the additional financing and safeguards arrangements will remain unchanged. The Environmental and Social Management Framework (ESMF) has been re-disclosed in country and in the Infoshop. Risk Explanation: The level of implementation risk is attenuated by the satisfactory results produced by the current arrangements so far. Staff in the implementing agencies is familiar with Bank procedures and has shown reasonable technical competence. Still, substantial country level risks and risk of fraud and corruption remain. Given the risks described above, overall risk is rated substantial (the same level as the parent project). 13 Annex 1: Results Framework Project Benin Decentralized Community Driven Services Project - Project Additional Financing Status: DRAFT Name: Addl Financing (P146597) Stage: Team Requesting Leade: John Van Dyck uit: AFCF2 Created by: John Van Dyck on 22-Oct-2013 Leader: Unit: Line: IBRD/IDA U nit: AFTSW Modified by: John Van Dyck on 03-Feb-2014 Lmne: Unit: Country: Benin Approval FY: 2014 Region: AFRICA Lending Instrument: Investment Project Financing Parent Prect I P117764 Parent Project Name: Decentralized Community Driven Services Project (P117764) Project ID: Project Development Objectives Original Project Development Objective - Parent: To improve access to decentralized basic social services and to mainstream the CDD approach for such services. Proposed Project Development Objective - Additional Financing (AF): Results Core sector indicators are considered: Yes Results reporting level: Project Level Project Development Objective Indicators Status Indicator Name Core Unit of Measure Baseline Actual(Current) End Target Revised Direct project beneficiaries Number Value 0.00 0.00 270000.00 Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 Comment Defined as the sum of direct beneficiaries of schools, health posts, and water systems (Comp. 1), safety net 14 beneficiaries (Comp. 2), and people receiving Grassroots Management Training (GMT) (Comp. 3.3). No Change Female beneficiaries / Percentage Value 0.00 0.00 40.00 Sub Type Supplemental Revised Resources transferred through E Percentage Value 0.00 0.00 15.00 FADeC that are executed by Date 3 1-Dec-201 1 22-Mar-2013 30-Jun-2017 communities for basic social infrastructure through delegation Comment Target date adjusted to of responsibility from communes match new closing date. Revised Timeliness of FADeC transfers to E Days Value 16.00 0.00 15.00 communes (average number of day s a.o roe ublishedDate 3 1-Dec-201 1 22-Mar-2013 30-Jun-2017 days' vaniation from the published transfer schedule) Comment Target date adjusted to match new closing date. Revised Students enrolled in schools Number Value 0.00 0.00 90000.00 constructed/rehabilitated under Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 the project Comment Increased due to scale up of project activities Revised Number of people in rural areas X Number Value 0.00 0.00 18000.00 provided with access to Improved Date 3 1-Dec-201 1 22-Mar-2013 30-Jun-2017 Water Sources under the project Comment Increased due to scale up of project activities Revised Temporary employment created E Days Value 0.00 0.00 1296000.00 in labor intensive public works Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 sub-projects (number of person- days) Comment Target date adjusted to match new closing date. 15 Intermediate Results Indicators Status Indicator Name Core Unit of Measure Baseline Actual(Current) End Target Revised Community subprojects for E Number Value 0.00 0.00 1000.00 basic infrastructure completed Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 Comment Increased due to scale up of project activities Revised Communes having executed at E:] Percentage Value 0.00 0.00 100.00 least one multi-village Date 3 1-Dec-201 1 22-Mar-2013 30-Jun-2017 subproject Comment Target date adjusted to match new closing date. Revised Number of additional X Number Value 0.00 0.00 1800.00 classrooms built or Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 rehabilitated at the primary level resulting from project Comment Increased due to scale interventions. up of project activities Revised Health facilities constructed, Number Value 0.00 0.00 100.00 renovated, and/or equipped Date 3 1-Dec-201 1 22-Mar-2013 30-Jun-2017 (number) Comment Increased due to scale up of project activities Revised Improved community water X Number Value 0.00 0.00 72.00 points constructed or Date 3 1-Dec-201 1 22-Mar-2013 30-Jun-2017 rehabilitated under the project Comment Increased due to scale up of project activities Revised Beneficiaries of Safety Nets Number Value 0.00 0.00 12000.00 programs (number) Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 Comment Target date adjusted to match new closing date. 16 No Change Beneficiaries of Safety Nets Number Value 0.00 0.00 6000.00 programs - Female (number) Sub Type Date Breakdown Comment No Change Beneficiaries of Safety Nets X Number Value 0.00 0.00 12000.00 programs - Unconditional cash Sub Type Date transfers (number) Sub_Type_Date Breakdown Comment No Change Beneficiaries of Safety Nets X Number Value 0.00 0.00 10800.00 programs - Cash-for-work, Sub Type Date food-for-work and public Sub_Type_Date works (number) Breakdown Comment Revised Communities implementing E:] Number Value 0.00 0.00 120.00 safety nets program Date 31-Dec-20 11 22-Mar-2013 30-Jun-2017 Comment Target date adjusted to match new closing date. Revised Public works schemes Percentage Value 0.00 0.00 90.00 completed with satisfactory Date 31 -Dec-2016 22-Mar-2013 30-Jun-2017 technical quality Comment Target date adjusted to match new closing date. Revised Proportion of total cost of E Percentage Value 0.00 0.00 70.00 public works subprojects Date 3 1-Dec-20 11 22-Mar-2013 30-Jun-2017 allocated to wages Comment Target date adjusted to match new closing date. Revised Transfer payments made within E Percentage Value 0.00 0.00 80.00 5 days of when they are due, Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 according to the annual payment calendar Comment Target date adjusted to match new closing date. 17 Revised Proportion of total safety nets E:] Percentage Value 0.00 0.00 70.00 transfers received by Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 households in the bottom two Targe_dateadjused _t quintiles on the national Comment Target date adjusted to consumption distribution match new closing date. Revised Communes with up to date E Percentage Value 0.00 0.00 90.00 financial audits with published Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 action plans to correct any Target_date_adjusted _t revealed deficiencies Comment Target date adjusted to match new closing date. Revised Communes with second E Percentage Value 79.00 0.00 90.00 generation Community Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 D e v e l o p m e n t P l a n s ( P D C s ) T a r g e _ d a t e a dj u s e d _t which were prepared in a Comment Target date adjusted to participatory process match new closing date. Revised Communities that have E Number Value 0.00 0.00 1000.00 received Grassroots Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 M a n a g e m e n t T r a i n i n g T h e _ t a r g e _n u m b e r _o (refresher or full GMT) Comment The target number of communities is reduced from 3447 to 1000. Originally, the idea was to support GMT in all villages in the country. But the Government and Bank have reassessed this idea and agreed that resources could be put to better use by supporting GMT only in villages that will receive financing for sub- projects. Also, there is a concern that providing GMT in villages that will not receive 18 financing for sub- projects could cause confusion and disappointment. Revised Beneficiaries of Grassroots - E Number Value 0.00 0.00 100000.00 Management Training Date 3 1-Dec-20 11 22-Mar-2013 30-Jun-2017 Comment See indicator above. The target number of beneficiaries of GMT is reduced from 344,7 00 to 100,000. No change Of which women [j Percentage Value 0.00 0.00 40.00 Sub Type Supplemental Revised Communities having produced Number Value 0.00 0.00 360.00 service delivery scorecards Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 Comment Target date adjusted to match new closing date. Revised Percent of total cost of E Percentage Value 0.00 0.00 0.00 transferred competencies Date 3 1-Dec-20 11 22-Mar-2013 30-Jun-2017 transferred by Government to communes through the FADeC Comment APL trigger. Target and baseline to be established based on study underway with support of GiZ. Revised Percent of domestic revenues E Percentage Value 3.30 0.00 3.40 transferred by Government to commnesthrogh he FDeCDate 31-Dec-2011 22-Mar-2013 30-Jun-2017 communes through the FADeC Comment APL trigger. Target date adjusted to match new closing date. 19 Revised Resources transferred through E:] Percentage Value 0.00 0.00 15.00 FADeC that are executed by Fo e a a c.b Date 3 1-Dec-201 1 22-Mar-2013 30-Jun-2017 communities for basic social infrastructure through Comment APL trigger. Target date delegation of responsibility adjusted to match new from communities closing date. Revised Students enrolled in schools E Number Value 0.00 0.00 90000.00 constructed/rehabilitated under cotr ucterie d Date 31-Dec-20 11 22-Mar-2013 30-Jun-2017 the APL series____________ Comment APL trigger. Increased due to scale up of project activities. Target date adjusted to match new closing date. Revised Communes with scalable Percentage Value 0.00 0.00 12.00 decentralized safety net decraizoedsatonet Date 31-Dec-2011 22-Mar-2013 30-Jun-2017 program in operation __________ Comment APL trigger. Target date adjusted to match new closing date. 20 Annex 2: Operational Risk Assessment Framework (ORAF) Benin: Decentralized Community Driven Services Project - Addl Financing (P146597) Stakeholder Risk Rating Moderate Risk Description: Risk Management: The original project's APL triggers will include the Government's adherence to Government's support to local service delivery may be maintaining funding above an agreed percentage of revenues. threatened by a fiscal crisis or reprioritization of expenditures, which could translate into Government not Resp: Status: Stage: Recurrent: Due Date: Frequency: maintain its funding for local service delivery through Client Not Yet Due Implementation FaDEC at sufficient levels. Risk Management: Donor partners and local officials may see the The design of the project itself seeks to debunk the idea that CDD and decentralization mainstreaming of CDD as a threat to the prerogatives of are incompatible. The project team will consult closely with commune associations communes, leading some local government officials and such as the Association Nationale des Communes du Benin (ANCB) and the technical donor partners to oppose the CDD approach. Indeed, some and financial partners, whose feedback and experiences will be incorporated in communes have expressed concern in the past about not preparation and implementation. The team will seek to develop a MoU with donors prior being sufficiently involved in or in control of CDD to approval. implementation. Resp: Status: Stage: Recurrent: Due Date: Frequency: Client Completed Preparation Capacity Rating Substantial Risk Description: Risk Management: Training/mentoring by World Bank FM, procurement and disbursement staff, and/or the PrGor is gainin expeAAThaneowth IDina . possibility of hiring new personnel with previous experience with IDA projects. Prior to PSDCC, MDGLAAT had not recently implemented Bank operations, and it needed to become Resp: Status: Stage: Recurrent: Due Date: Frequency: accustomed to Bank processes and understand rules and Bank Completed Implementation 21 principles governing project implementation. This has Risk Management: been accomplished through capacity building of Recruitment of experienced and qualified FM consultants at central and decentralized MDGLAAT and the establishment of the Secretariat for level and update of the FADEC manual of procedures in order to include IDA project Decentralized Community Driven Services (SSDCC) requirements and fiduciary procedures at community level. The Project includes staffed with professionals experienced in the institutional strengthening subcomponents for central ministries, communes, and implementation of Bank projects. communities. MDGLAAT could contract consultants with experience working with the AtBank to support the FM/procurement process. The project will also support four (4) Atocthemdeentalid level,c thneren wekcaliy FM, Finance Controllers who will support Public Treasury agents located at communes level procurement, and contract management capacity. In absence of appropriate mitigation, low capacity in these by ensuring compliance with agreed delays for funds transfers, adequate budget executing and expenditures recording. Tapping the expertise of PNDCC 1 project staff, are uentato leither by hiring them as consultants to MDGLAAT or otherwise, could be a way to mitigate the risk of lack of technical capacity on CDD. Capacity for monitoring use of FaDEC funds also needs to Resp: Status: Stage: Recurrent: Due Date: Frequency: be strengthened to ensure they are spent efficiently and Client Completed Preparation effectively. CONAFIL, the body charged with administering FaDEC is understaffed and requires institutional capacity building support to build its ability to The performance of CONAFIL and FADeC will be closely monitored. Assistance for monitor use of FaDEC funds. institutional capacity building of CONAFIL will be provided in coordination with donor partners. The technical quality and staffmg levels of deconcentrated Resp: Status: Stage: Recurrent: Due Date: Frequency: sectoral staff are not sufficient in many communes to assure technical quality of projects. Whereas under B PNDCC the technical quality of sub-projects was Risk Management: backstopped by engineers of the Fiduciary Agent, this Train local government staff on simple and efficient methods to monitor quality. Issue project will rely on commune-level staff to assure the black list of poor performing contractors and controllers. Support hiring of engineers in quality of the work of the contractor and technical. supior. Ie ntificatin of e c aactyo and c i o, t departments to control quality of technical supervision in communes. supervisor. Identification of capacity gaps and actions to strengthen capacity has already made significant progress. Resp: Status: Stage: Recurrent: Due Date: Frequency: Client In Progress Implementation 22 Governance Rating Substantial Risk Description: Risk Management: Support to Prefectures, who are responsible to monitor the respect of law and national There is a risk of capture, as communes, entrepreneurs or commitments by local governments. Team will ensure that relevant communes other actors may try to gain control of sub-projects understand what is at stake and that they will be held accountable for results. resulting in disempowerment of communities. Communes may also resist social accountability measures and Resp: Status: Stage: Recurrent: Due Date: Frequency: participatory planning. Client In Progress Implementation Risk Management: Work closely with other donors supporting decentralization to help the government keep momentum. Resp: Status: Stage: Recurrent: Due Date: Frequency: Bank In Progress Implementation Risk Management: The Project includes institutional strengthening subcomponents for central ministries, communes, and communities. The project will also support social accountability measures designed to boost citizens' demand for good governance. Resp: Status: Stage: Recurrent: Due Date: Frequency: Client In Progress Implementation Risk Management: Frequent audits will verify financial and technical compliance. Remedies including suspension of disbursement can be applied if necessary. Resp: Status: Stage: Recurrent: Due Date: Frequency: Bank Not Yet Due Implementation 23 Design Rating Moderate Risk Description: Risk Management: The Additional Financing supports an existing project and Close integration of safety net pilot procedures with existing CDD model. Minimization therefore design risk is low. Delivery of social safety nets of additional steps required for safety net implementation. Hiring of safety net expert in through CDD has not been attempted and is a new concept SSDCC. in the country. The safety net pilot is a new concept for Resp: Status: Stage: Recurrent: Due Date: Frequency: Benin and its implementation design will need to be grafted onto existing Grassroots Management Training Client Completed Implementation and CDD procedures. Social and Environmental Rating Moderate Risk Description: Risk Management: SubprojectsEnvironental and Social Management Framework (ESMF) with: (i) an environental include c ts to be spp oe u er co pn ent O e wll and social screening process for subprojects; (ii) guidance for the operation of w ater supply systems, latrines, rural roads, and market management structures; (iii) Environmental and Social Management Plan (EMP) for the suppysyst emls as, Tiehs,al proads andimaket woproposed project; and (iv) a medical waste management plan. A Resettlement Planning stall/harriedounga Themphysica projet laces wber Framework should be applied if sub-projects require land and/or have negative impacts carried out in all communes and a large number of local livelihoods. communities in Benin. The sub-projects could trigger small-scale and site specific environmental impacts typical Resp: Status: Stage: Recurrent: Due Date: Frequency: of category B projects. The menu of eligible public works Client Completed Preparation 18-Jan-2012 under Component Two will likely include public goods Risk Management: such as road rehabilitation, small-scale irrigation, reforestation, and other environmental management type An Environmental and Social audit will be carried out to determine the respect of sub-projects. Other expected activities under Component procedures and performance in implementing safeguards policies. Three, such as capacity building and technical assistance, Resp: Status: Stage: Recurrent: Due Date: Frequency: are not expected to have any environmental impacts. Client Not Yet Due Implementation Potential environmental impacts are site-specific, reversible in nature, and mitigating measures can be readily designed. As projects supported are small in scale, potential impacts are likely to be on the same scale. 24 Potential impacts, in the absence of mitigation, include dust, soil and water pollution, soil erosion, loss of vegetation and land acquisition have been identified as possible impacts that could arise from implementation of sub-projects. Program and Donor Rating Substantial Risk Description: Risk Management: The project benefits from donor support for the The Bank team and government will engage donors in dialogue on decentralization and Government's decentralization program, including support CDD (through the Technical Working Group on Decentralization) and will seek to for FADEC. If this support were to be reduced, the develop a MoU with donors prior to approval. project may suffer. Donors have indicated strong commet toy su ppDorng adeetai in cludied stro ng Resp: Status: Stage: Recurrent: Due Date: Frequency: commitment to supporting decentralization, including Bn nPors rprto FADEC, but have displayed mixed support for CDD. Bank In Progress Preparation UNICEF will provide coordinated support to build safety net capacity in the Ministry of Social Affairs. Delivery Monitoring and Sustainability Rating Substantial Risk Description: Risk Management: Proer oniorig ad ealutio isimprtat t esablshThe project will support the strengthening of CONAFIL's monitoring and evaluation Proper monitoring and evaluation is important to establish adequatecapacity. The team will also work with CONAFIL toward a better understanding on the adhequate tats teomeasur thje c ess CONF I hearjeti necessity of maintaining funding for projects. The project will monitor the recurrent achieving its development objective. CONAFIL has currently only limited M&E capacity. There are also risks budget of communes compared to resource needs for ongoing operation and maintenance of their infrastructure endowment. Furthermore, as in the PNDCC, related to the sustainability of investments and of policy communities will be trained in maintenance of projects. reforms. With respect to investments, arrangements for operations and maintenance of investments may not be Resp: Status: Stage: Recurrent: Due Date: Frequency: adequately respected or resourced. Regarding policy Bank In Progress Implementation reforms, policies relating to decentralization and CDD emwwan may not be maintained after the project closes.cs ofement: The original project's APL structure allows for sustained support by IDA over a longer- term, which will encourage the policies to take deep root. 25 Resp: Status: Stage: Recurrent: Due Date: Frequency: Bank In Progress Both Other (Optional) Rating Risk Description: Risk Management: Resp: Status: Stage: Recurrent: Due Date: Frequency: D Other (Optional) Rating Risk Description: Risk Management: Resp: Status: Stage: Recurrent: Due Date: Frequency: D Overall Implementation Risk: Rating Substantial Risk Description: The CDD approach is well established in Benin, but channeling donor resources to local governments through the Government's fiscal transfer system has only been done on a small scale. While the project design has put in place numerous measures to mitigate the risks involved in aligning Bank support with country systems, there still remain risks of implementation delays and potential misuse of funds if control mechanisms are not well implemented. 26 Annex 3: Detailed Description of New Project Activities Component 1: Service Delivery Grants to Communes 1. This component will strengthen the delivery of basic services at the decentralized level in line with the objectives of Benin's SCRP-3 and PONADEC through the provision of grants to communes to finance commune-level and community-level subprojects in their commune development plans, or plans de ddveloppement communal (PDC). Sectors covered are basic education, health, water and sanitation, markets and roads. Eligible expenditures will include investment projects in the areas of education, health, water, and commerce (public markets). The project resources would be transferred to communes periodically during the year through the Fonds d'Appui au Diveloppement des Communes (FADeC) fiscal transfer system. 2. Community sub-projects. As in the original financing, the additional financing will allocate eighty percent of the resources under this component to fund community-level investments that are consistent with PDCs in the areas of education, health, water, and market infrastructure. For these relatively simple community-level investments, the responsibility for implementation would be delegated by the communes to communities through the CDD approach. Resources would be transferred to communes through an earmarked window of the FADeC controlled by the Ministry of Decentralization, Local Government, and Administration and Development of the Territory (MDGLAAT), and would only be made available once an agreement has been signed between a commune and community to delegate responsibility for implementation of an eligible subproject. 3. Targeting of communities to receive resources for infrastructure sub-projects would be carried out in the same manner as under the initial financing. The first step will be the allocation of resources among the 77 communes on the basis of each commune's contribution to extreme poverty in Benin, i.e. the number of extremely poor people in each commune divided by the overall number of extremely poor people in Benin. Second, within communes, the targeting would then be based on communities' access to basic infrastructure as measured by an Index of Access to Basic Infrastructure (Indice Synthtique dAccessibilit des mnages aux Infrastructures de Base - ISAIB) that has been be prepared for the PSDCC by the Institut National de la Statistique et de I'Analyse Economique (INSAE). Within each commune, selection of beneficiary communities will be made by communal councils on the basis of the INSAE index, with any deviations from the index requiring a justification from the communal council to MDGLAAT. 4. The community sub-projects will continue to be capped at US$40,000 per sub-project. As such an additional 300 communities could be targeted under the additional financing. 5. Commune sub-projects. For more complex investments that deal with multiple villages, communes would retain responsibility for implementation. Twenty percent of the additional financing resources for component one will support commune-level infrastructure investment. These resources would be transferred to communes through the guichet non-affectd investissement (non-earmarked investment window) of the FADeC, and as such they would follow the procedures for allocation, transfer, management, and reporting for this window. 27 Specifically, this means that allocation among communes would be made on the basis of the FADeC allocation formula administered by CONAFIL, which incorporates population, poverty, and performance. Transfers would occur periodically throughout the year in line with the FADeC schedule for transfers. World Bank resources would be linked to specific investments in the PDCs, enabling traceability. Supported expenditures would need to be limited to certain types of activities (education, health, water, and public markets) to ensure compliance with World Bank environmental and social safeguards requirements. 6. As in the original project, all 77 communes in Benin will receive support for commune and community subprojects under the additional financing. Component 2: Pilot Social Safety Net Program 7. No changes are proposed to this component. Component 3: Technical Assistance and Capacity Building 8. The additional financing will ensure adequate funding for a program of institutional capacity building and technical assistance aimed to strengthen the capacity for decentralized service delivery and mainstream the CDD approach. Component 3 has four sub-components: 9. Subcomponent 3.1: Technical assistance and capacity building for the Ministry of Decentralization and other key Ministries. This sub-component will aim to strengthen the performance of the FADeC and to ensure the necessary capacity is in place to supervise and mainstream the CDD approach. Capacity building will be provided for CONAFIL to strengthen administration of the FADeC (for example, by improving the transparency of the calculation of allocations, fiduciary controls, and monitoring and evaluation). Technical assistance will be given to prefectures to strengthen their technical and financial capacity to ensure the quality of decentralized investments. Assistance will also be given to key sectoral and cross-cutting Ministries to implement decentralization and deconcentration while incorporating and streamlining the CDD approach into their regular operations. 10. Subcomponent 3.2: Technical assistance and capacity building for the Communes. This subcomponent aims to strengthen communes' capacity to (i) improve participatory preparation of PDCs, (ii) implement poverty targeting; (iii) adopt the CDD approach for the implementation of small-scale community-level investment projects; and (iv) implement social protection projects (safety nets). 11. Subcomponent 3.3: Grassroots management training (GMT) for Communities. This sub- component will provide capacity building to communities to take on the responsibility for implementing development projects and to participate in the commune's development planning process. GMT will be provided in at least 1,000 communities receiving funds for infrastructure and/or safety nets projects. 12. Subcomponent 3.4: Social accountability. This sub-component will support the roll-out of community scorecards in communities in Benin as part of the GMT. Through focus groups 28 and facilitated meetings, the scorecard process will engage communities in discussions with service providers on their performance, and on actions that can be taken to address performance shortcomings. The community scorecards component is expected to be implemented by the SSDCC together with a non-governmental organization (NGO) to be contracted by MDGLAAT. Component 4: Project Management 13. The costs of project management, previously included in component 3, will now make up a new Component 4 of the project, which will permit a clearer delineation between administrative costs and programmatic costs. Expenses under Component 4 will include expenses related to the functioning of the Executive Secretariat in Cotonou, project coordination, monitoring and evaluation, communication, and project audits. 29 Annex 4: Disbursements 1. The project will continue to use the report-based disbursement procedures. The existing Designated Account (DA) at BCEAO Cotonou will also be used for the additional financing. The designated accounts will receive an initial advance equivalent to the forecast for two quarters as shown in the quarterly Interim Financial Report upon project effectiveness. In addition to advances to the designated account, other disbursement methods will be available for use under the project, such as the direct payment, reimbursement, and special commitment methods. Further instructions on the withdrawal of proceeds will be outlined in the disbursement letter. Details of the disbursement arrangement will be in the Disbursement Letter. 2. The disbursement schedule will be as follows: Category Amount of the Credit Percentage of Allocated Expenditures to be Financed (inclusive of Taxes) (1) Goods, works, non SDR 2.4 million 100% of amounts consulting services, (equivalent to USD 3.8 disbursed under consultants' services and million) Communal Grants Training for Subprojects under Part A.1 of the Project (2) Goods, works, non SDR 10.0 million 100% of amounts consulting services, (equivalent to USD 15.2 disbursed under consultants' services and million) Community Grants Training for Subprojects under Part A.2 of the Project (3) Goods, works, non SDR 7.1 million 100% consulting services, (equivalent to USD 11 consultants' services, million) Operating Costs and Training for Parts B.1, C, and D of the Project TOTAL AMOUNT SDR 19.5 million (equivalent to USD 30.0 million) 30