Document of The World Bank Report No: ICR2244 IMPLEMENTATION COMPLETION AND RESULTS REPORT (IBRD-78090, IBRD-79720, IBRD-80970) ON A LOAN IN THE AMOUNT OF US$370.0 MILLION TO THE DOMINICAN REPUBLIC FOR A SERIES OF PROGRAMMATIC DEVELOPMENT POLICY LOANS ON PERFORMANCE AND ACCOUNTABILITY OF SOCIAL SECTORS (PASS) May 30, 2013 Human Development Sector Management Unit Caribbean Country Management Unit Latin America and the Caribbean Region CURRENCY EQUIVALENTS (Exchange Rate Effective March 7, 2013) Currency Unit = Dominican Peso (DOP) DOP 1.00 = US$0.025 US$1.00 = DOP 40.74 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS ADESS Administrator of Social Subsidies (Administradora de Subsidios Sociales) CCT Conditional Cash Transfer CMS Clinic Management System CPS Country Partnership Strategy DPL Development Policy Loan DR Dominican Republic GDP Gross Domestic Product GoDR Government of the Dominican Republic IBRD International Bank for Reconstruction and development ICR Implementation Completion Report ISR Implementation Status and Results Report IMF International Monetary Fund M&E Monitoring and Evaluation PASS Performance and Accountability of Social Sectors PIPS Social Protection Investment Project (Proyecto de Inversión en Protección Social) PDO Program Development Objectives SIL Specific Investment Loan SIUBEN Unique Beneficiary System (Sistema Único de Beneficiarios) Vice President: Hasan A. Tuluy Country Director: Francoise Clottes Sector Manager: Mansoora Rashid Task Team Leader: Carine Clert/Aline Coudouel ICR Team Leader: Aline Coudouel i DOMINICAN REPUBLIC Series of Development Policy Loans on Performance and Accountability of Social Sectors (PASS) CONTENTS Data Sheet A. Basic Information B. Key Dates C. Ratings Summary D. Sector and Theme Codes E. Bank Staff F. Results Framework Analysis G. Ratings of Program Performance in ISRs H. Restructuring 1. Program Context, Development Objectives and Design ............................................ 1 2. Key Factors Affecting Implementation and Outcomes .............................................. 7 3. Assessment of Outcomes .......................................................................................... 17 4. Assessment of Risk to Development Outcome ......................................................... 22 5. Assessment of Bank and Borrower Performance ..................................................... 23 6. Lessons Learned........................................................................................................ 24 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners........... 26 Annex 1. Evolution of the Policy Matrix ...................................................................... 27 Annex 2. Key Development Indicators ......................................................................... 30 Annex 3. Bank Lending and Implementation Support/Supervision Processes............. 33 Annex 4. Summary of Borrower's ICR and/or Comments on Draft ICR ..................... 37 Annex 5. Comments of Cofinanciers and Other Partners/Stakeholders ....................... 39 Annex 6. List of Supporting Documents ...................................................................... 40 MAP .............................................................................................................................. 41 Acknowledgements: This ICR was prepared by a team comprising of Jorge Barrientos (consultant and lead author), Patricia Orna (Program Assistant, LCSHD), Aline Coudouel (Lead Economist and TTL, LCSHS), Salvador Maturana and Lucia Solbes (Consultants, LCSHS). The authors are grateful to the Dominican authorities for their availability to discuss progress in implementation with the team, and to Carine Clert (Sector Leader, LCSHD) and Mansoora Rashid (Sector Manager, LCSHS) for their comments and suggestions. The team is also grateful to Dena Ringold (Lead Social Protection Specialist, AFTSW), Yasuhiko Matsuda (Sr. Public Sector Specialist, EASPW), and Cornelia Tesliuc (Senior Social Protection Specialist, AFTSE) for their comments as peer reviewers for this ICR. ii A. Basic Information Program 1 First Performance and Accountability of Country Dominican Republic Program Name Social Sectors Development Policy Loan Program ID P116972 L/C/TF Number(s) IBRD-78090 ICR Date 03/07/2013 ICR Type Core ICR GOVERNMENT OF Lending Instrument DPL Borrower DOMINICAN REPUBLIC Original Total USD 150.00M Disbursed Amount USD 150.00M Commitment Implementing Agencies Ministry of Finance Cofinanciers and Other External Partners Program 2 Second Performance and Accountability of Country Dominican Republic Program Name Social Sectors Development Policy Loan Program ID P121778 L/C/TF Number(s) IBRD-79720 ICR Date 03/07/2013 ICR Type Core ICR GOVERNMENT OF Lending Instrument DPL Borrower DOMINICAN REPUBLIC Original Total USD 150.00M Disbursed Amount USD 150.00M Commitment Implementing Agencies Ministry of Finance Cofinanciers and Other External Partners Program 3 DO-3rd Country Dominican Republic Program Name Perform.&Accbilty of SocSctrs DPL iii Program ID P125806 L/C/TF Number(s) IBRD-80970 ICR Date 03/07/2013 ICR Type Core ICR GOVERNMENT OF Lending Instrument DPL Borrower DOMINICAN REPUBLIC Original Total USD 70.00M Disbursed Amount USD 70.00M Commitment Implementing Agencies Ministry of Finance Cofinanciers and Other External Partners B. Key Dates First Performance and Accountability of Social Sectors Development Policy Loan - P116972 Revised / Actual Process Date Process Original Date Date(s) Concept Review: 06/23/2009 Effectiveness: 12/01/2009 Appraisal: 09/21/2009 Restructuring(s): Approval: 11/17/2009 Mid-term Review: Closing: 12/10/2010 12/10/2010 Second Performance and Accountability of Social Sectors Development Policy Loan - P121778 Revised / Actual Process Date Process Original Date Date(s) Concept Review: 08/11/2010 Effectiveness: 02/22/2011 12/21/2010 Appraisal: 09/30/2010 Restructuring(s): Approval: 11/23/2010 Mid-term Review: Closing: 11/01/2011 11/01/2011 DO-3rd Perform.&Accbilty of SocSctrs DPL - P125806 Revised / Actual Process Date Process Original Date Date(s) Concept Review: 06/22/2011 Effectiveness: 02/17/2012 02/08/2012 Appraisal: 09/27/2011 Restructuring(s): Approval: 11/17/2011 Mid-term Review: Closing: 11/30/2012 11/30/2012 iv C. Ratings Summary C.1 Performance Rating by ICR Overall Program Rating Outcomes Satisfactory Risk to Development Outcome Moderate Bank Performance Satisfactory Borrower Performance Satisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Overall Program Rating Bank Ratings Borrower Ratings Quality at Entry Satisfactory Government: Satisfactory Implementing Quality of Supervision: Satisfactory Satisfactory Agency/Agencies: Overall Bank Overall Borrower Satisfactory Satisfactory Performance Performance C.3 Quality at Entry and Implementation Performance Indicators First Performance and Accountability of Social Sectors Development Policy Loan - P116972 Implementation QAG Assessments Indicators Rating: Performance (if any) Potential Problem Quality at Entry Program at any time No None (QEA) (Yes/No): Problem Program at any Quality of No None time (Yes/No): Supervision (QSA) DO rating before Satisfactory Closing/Inactive status Second Performance and Accountability of Social Sectors Development Policy Loan - P121778 Implementation QAG Assessments Indicators Rating: Performance (if any) Potential Problem Quality at Entry Program at any time No None (QEA) (Yes/No): Problem Program at any Quality of No None time (Yes/No): Supervision (QSA) DO rating before Satisfactory Closing/Inactive status v DO-3rd Perform.&Accbilty of SocSctrs DPL - P125806 Implementation QAG Assessments Indicators Rating: Performance (if any) Potential Problem Quality at Entry Program at any time No None (QEA) (Yes/No): Problem Program at any Quality of No None time (Yes/No): Supervision (QSA) DO rating before Satisfactory Closing/Inactive status D. Sector and Theme Codes First Performance and Accountability of Social Sectors Development Policy Loan - P116972 Original Actual Sector Code (as % of total Bank financing) General education sector 28 28 Health 33 33 Other social services 39 39 Theme Code (as % of total Bank financing) Education for all 21 21 Health system performance 29 29 Other public sector governance 36 36 Social safety nets 14 14 Second Performance and Accountability of Social Sectors Development Policy Loan - P121778 Original Actual Sector Code (as % of total Bank financing) General education sector 28 28 Health 33 33 Other social services 39 39 Theme Code (as % of total Bank financing) Education for all 21 21 Health system performance 29 29 Social safety nets 50 50 vi DO-3rd Perform.&Accbilty of SocSctrs DPL - P125806 Original Actual Sector Code (as % of total Bank financing) General education sector 28 28 Health 33 33 Other social services 39 39 Theme Code (as % of total Bank financing) Education for all 21 21 Health system performance 29 29 Social safety nets 50 50 E. Bank Staff First Performance and Accountability of Social Sectors Development Policy Loan - P116972 Positions At ICR At Approval Vice President: Hasan A. Tuluy Pamela Cox Country Director: Francoise Clottes Yvonne M. Tsikata Sector Manager: Mansoora Rashid Helena G. Ribe Task Team Leader: Aline Coudouel Carine Clert ICR Team Leader: Aline Coudouel ICR Primary Author: Aline Coudouel Second Performance and Accountability of Social Sectors Development Policy Loan - P121778 Positions At ICR At Approval Vice President: Hasan A. Tuluy Pamela Cox Country Director: Francoise Clottes Yvonne M. Tsikata Sector Manager: Mansoora Rashid Helena G. Ribe Task Team Leader: Aline Coudouel Carine Clert ICR Team Leader: Aline Coudouel ICR Primary Author: Aline Coudouel vii DO-3rd Perform.&Accbilty of SocSctrs DPL - P125806 Positions At ICR At Approval Vice President: Hasan A. Tuluy Pamela Cox Country Director: Francoise Clottes Francoise Clottes Sector Manager: Mansoora Rashid Mansoora Rashid Task Team Leader: Aline Coudouel Aline Coudouel ICR Team Leader: Aline Coudouel ICR Primary Author: Aline Coudouel F. Results Framework Analysis Program Development Objectives (from Program Document) The PASS has four objectives: (i) to enhance the performance of social sectors to promote human capital (health, nutrition, education) for the poorest citizens, through a fundamental redesign of the Government’s Conditional Cash Transfers (CCT) program, Solidaridad, and its articulation with critical actions in health and education; (ii) to improve budget management to support the performance of these social sectors within the CCT program; (iii) to support the gradual introduction of Performance Agreements in social sectors; and (iv) to enhance transparency and accountability to users by strengthening the enabling environment for a better informed demand for improved public sector performance in the social domain. Revised Program Development Objectives (as approved by original approving authority) N/A (a) PDO Indicator(s) First Performance and Accountability of Social Sectors Development Policy Loan - P116972 Original Target Formally Actual Value Values (from Revised Achieved at Indicator Baseline Value approval Target Completion or documents) Values Target Years Share of CCT Solidaridad Transfers paid based on the timely verification of Indicator 1 : compliance with co-responsibilities (Starting Jan. 2011) Value (quantitative or N/A N/A 80.0 85.0 and 80.7 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2012 11/30/2012 No baseline/targets in first DPL, targets of 80% for 2011 and 90% for 2012 in Comments second DPL, revised to 65% and 80% in third DPL once baseline available. (incl. % Target met: 85% and 80.7% in health and education (data from recurrent audit achievement) of program). viii Share of beneficiary households receiving transfers that are registered at their Indicator 2 : designated Primary Care Unit (UNAP) and/or school or who received a letter of warning (Interim phase Sep-Dec 2010) Value (quantitative or 0.00 80.0 92.0 97.7 Qualitative) Date achieved 11/30/2009 11/11/2010 11/30/2011 11/30/2012 Comments The indicator increased to 97.7% by November 2012 (share of families with (incl. % information letters to signal registration in a primary health care unit, data from achievement) the program’s information system). Second Performance and Accountability of Social Sectors Development Policy Loan - P121778 Original Target Formally Actual Value Values (from Revised Achieved at Indicator Baseline Value approval Target Completion or documents) Values Target Years Share of CCT Solidaridad Transfers paid based on the timely verification of Indicator 1 : compliance with co-responsibilities (Starting Jan. 2011) Value (quantitative or N/A 80.0 65.0 85.0 and 80.7 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2011 11/30/2012 No baseline/targets in first DPL, targets of 80% for 2011 and 90% for 2012 in Comments second DPL, revised to 65% and 80% in third DPL once baseline available. (incl. % Target met: 85% and 80.7% in health and education (data from recurrent audit achievement) of program). Share of beneficiary households receiving transfers that are registered at their Indicator 2 : designated Primary Care Unit (UNAP) and/or school or who received a letter of warning (Interim phase Sep-Dec 2010) Value (quantitative or 0.00 90.0 93.0 97.7 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2011 11/30/2012 Comments The indicator increased to 97.7% by November 2012 (share of families with (incl. % information letters to signal registration in a primary health care unit, data from achievement) the program’s information system). ix DO-3rd Perform.&Accbilty of SocSctrs DPL - P125806 Original Target Formally Actual Value Values (from Revised Achieved at Indicator Baseline Value approval Target Completion or documents) Values Target Years Share of CCT Solidaridad Transfers paid based on the timely verification of Indicator 1 : compliance with co-responsibilities (Starting Jan. 2011) Value (quantitative or N/A 90.0 80.0 85.0 and 80.7 Qualitative) Date achieved 11/30/2009 11/30/2012 11/30/2011 11/30/2012 No baseline/targets in first DPL, targets of 80% for 2011 and 90% for 2012 in Comments second DPL, revised to 65% and 80% in third DPL once baseline available. (incl. % Target met: 85% and 80.7% in health and education (data from recurrent audit achievement) of program). Share of beneficiary households receiving transfers that are registered at their Indicator 2 : designated Primary Care Unit (UNAP) and/or school or who received a letter of warning (Interim phase Sep-Dec 2010) Value (quantitative or 0.00 95.0 97.7 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2012 Comments The indicator increased to 97.7% by November 2012 (share of families with (incl. % information letters to signal registration in a primary health care unit, data from achievement) the program’s information system). (b) Intermediate Outcome Indicator(s) First Performance and Accountability of Social Sectors Development Policy Loan - P116972 Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised approval Completion or Target Values documents) Target Years Share of students from Solidaridad households who are enrolled in secondary Indicator 1 : education Value (quantitative or 42.2 51.0 45.0 47.5 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2011 11/30/2012 Comments Enrolment: children enrolled / children aged 14-18. Denominator does not (incl. % exclude children who finished secondary or are still in primary education, achievement) likely underestimating real value. Attendance is 93.5%. x Share of children between 0 and 5 years old comply with the series of consults Indicator 2 : established by the national standards of comprehensive care for healthy children (growth and development check-ups) Value (quantitative or 0.00 30.0 55.0 65.3 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2011 11/30/2012 Comments Targets were adjusted once the baseline data became available in September (incl. % 2011, from 30, 50 and 90% for 2010, 2011 and 2012 to 55, 60, and 65% achievement) respectively. Targets were met by the end of the program. Share of children between 6 and 60 months receive micronutrient sprinkles Indicator 3 : (iron and zinc) Value (quantitative or 1.4 5.0 12.6 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2012 Comments Target for children not met, linked to delays in implementation of World Food (incl. % Program, though targets for pregnant/puerperal women almost met. achievement) Deviation between proposed budget to cover the supply gaps in health, Indicator 4 : nutrition, and education services and the overall national budget, in relative terms Value (quantitative or N/A 1.00 0.08 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2012 Comments Target exceeded. Deviation almost zero (1.6%) for supply programs versus (incl. % 19.6% for overall budget. Indicator is 0.08 (the best value possible would be achievement) zero). In 2012, 98% of planned budget allocations were disbursed. Deviation between Scheduled Quota and Actual Budget Proportion to cover Indicator 5 : the supply gaps in health, nutrition, and education services. Value (quantitative or N/A 0.50 0.98 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2012 Comments (incl. % In 2012, 98% of planned budget allocations were disbursed. achievement) Number of priority programs in health, nutrition and education related to the Indicator 6 : Solidaridad program, that have successfully developed the log-frame methodology. Value (quantitative or 0.00 2 7 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2012 Comments Five priority programs are covered by the Performance Agreements. In (incl. % addition, the nutrition program, and the child labor eradication program have achievement) developed their logical framework for results-based management. xi Number of registered users in the "Consulta Amigable" budget information Indicator 7 : portal Value (quantitative or 0.00 N/A 15287.00 Qualitative) Date achieved 11/30/2009 11/30/2010 11/30/2012 Comments During January-December 2012, the system registered a total of over 15,000 (incl. % visits (corresponding to 37,000 pages visited). achievement) Second Performance and Accountability of Social Sectors Development Policy Loan - P121778 Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised approval Completion or Target Values documents) Target Years Share of students from Solidaridad households who are enrolled in secondary Indicator 1 : education Value (quantitative or 42.2 57.0 48.0 47.5 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2011 11/30/2012 Comments Enrolment: children enrolled / children aged 14-18. Denominator does not (incl. % exclude children who finished secondary or are still in primary education, achievement) likely underestimating real value. Attendance is 93.5%. Share of children between 0 and 5 years old comply with the series of consults Indicator 2 : established by the national standards of comprehensive care for healthy children (growth and development check-ups) Value (quantitative or 54.4 50.0 60.0 65.3 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2011 11/30/2012 Comments Targets were adjusted once the baseline data became available in September (incl. % 2011, from 30, 50 and 90% for 2010, 2011 and 2012 to 55, 60, and 65% achievement) respectively. Targets were met by the end of the program. Share of children between 6 and 60 months receive micronutrient sprinkles Indicator 3 : (iron and zinc) Value (quantitative or 1.40 60.0 12.6 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2012 Comments Target for children not met, linked to delays in implementation of World Food (incl. % Program, though targets for pregnant/puerperal women almost met. achievement) xii Deviation between proposed budget to cover the supply gaps in health, Indicator 4 : nutrition, and education services and the overall national budget, in relative terms Value (quantitative or N/A 0.90 0.08 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2012 Comments Target exceeded. Deviation almost zero (1.6%) for supply programs versus (incl. % 19.6% for overall budget. Indicator is 0.08 (the best value possible would be achievement) zero). In 2012, 98% of planned budget allocations were disbursed. Deviation between Scheduled Quota and Actual Budget Proportion to cover Indicator 5 : the supply gaps in health, nutrition, and education services. Value (quantitative or N/A 0.65 0.98 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2012 Comments (incl. % In 2012, 98% of planned budget allocations were disbursed. achievement) Number of priority programs in health, nutrition and education related to the Indicator 6 : Solidaridad program, that have successfully developed the log-frame methodology. Value (quantitative or 0.00 4 7 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2012 Comments Five priority programs are covered by the Performance Agreements. In (incl. % addition, the nutrition program, and the child labor eradication program have achievement) developed their logical framework for results-based management. Number of registered users in the "Consulta Amigable" budget information Indicator 7 : portal Value (quantitative or N/A 50.00 15281.00 Qualitative) Date achieved 11/30/2009 11/30/2011 11/30/2012 Comments During January-December 2012, the system registered a total of over 15,000 (incl. % visits (corresponding to 37,000 pages visited). achievement) xiii DO-3rd Perform.&Accbilty of SocSctrs DPL - P125806 Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised approval Completion or Target Values documents) Target Years Share of children between 0 and 5 years old comply with the series of consults Indicator 1 : established by the national standards of comprehensive care for healthy children (growth and development check-ups) Value (quantitative or 54.40 90.00 65.00 65.3 Qualitative) Date achieved 11/30/2009 11/30/2012 11/30/2011 11/30/2012 Comments Targets were adjusted once the baseline data became available in September (incl. % 2011, from 30, 50 and 90% for 2010, 2011 and 2012 to 55, 60, and 65% achievement) respectively. Targets were met by the end of the program. Share of children between 6 and 60 months receive micronutrient sprinkles Indicator 2 : (iron and zinc) Value (quantitative or 1.40 80.0 12.6 Qualitative) Date achieved 11/30/2009 11/30/2012 11/30/2012 Comments Target for children not met, linked to delays in implementation of World Food (incl. % Program, though targets for pregnant/puerperal women almost met. achievement) Share of students from Solidaridad households who are enrolled in secondary Indicator 3 : education Value (quantitative or 42.20 63.0 55.0 47.5 Qualitative) Date achieved 11/30/2009 11/30/2012 11/30/2011 11/30/2012 Comments Enrolment: children enrolled / children aged 14-18. Denominator does not (incl. % exclude children who finished secondary or are still in primary education, achievement) likely underestimating real value. Attendance is 93.5%. Deviation between proposed budget to cover the supply gaps in health, Indicator 4 : nutrition, and education services and the overall national budget, in relative terms Value (quantitative or N/A 0.85 0.08 Qualitative) Date achieved 11/30/2009 11/30/2012 11/30/2012 Comments Target exceeded. Deviation almost zero (1.6%) for supply programs versus (incl. % 19.6% for overall budget. Indicator is 0.08 (the best value possible would be achievement) zero). In 2012, 98% of planned budget allocations were disbursed. xiv Number of priority programs in health, nutrition and education related to the Indicator 5 : Solidaridad program, that have successfully developed the log-frame methodology. Value (quantitative or 0.00 6 7 Qualitative) Date achieved 11/30/2009 11/30/2012 11/30/2012 Comments Five priority programs are covered by the Performance Agreements. In (incl. % addition, the nutrition program, and the child labor eradication program have achievement) developed their logical framework for results-based management. Number of registered users in the "Consulta Amigable" budget information Indicator 6 : portal Value (quantitative or N/A 1500.00 15281.00 Qualitative) Date achieved 11/30/2009 11/30/2012 11/30/2012 Comments During January-December 2012, the system registered a total of over 15,000 (incl. % visits (corresponding to 37,000 pages visited). achievement) Number of community scorecards completed by beneficiary committees, as a Indicator 7 : share of total number of scorecards distributed /Percentage Value (quantitative or 0.00 70.0 78.5 Qualitative) Date achieved 11/30/2009 11/30/2012 11/30/2012 Comments Note that the Government has decided to scale up the community scorecard (incl. % process to the entire territory, as a core element of its management processes. achievement) G. Ratings of Program Performance in ISRs First Performance and Accountability of Social Sectors Development Policy Loan - P116972 Actual Date ISR No. DO IP Disbursements Archived (USD millions) 1 02/26/2011 Satisfactory Satisfactory 149.63 Second Performance and Accountability of Social Sectors Development Policy Loan - P121778 Actual Date ISR No. DO IP Disbursements Archived (USD millions) 1 02/06/2011 Satisfactory Satisfactory 149.63 2 11/16/2011 Satisfactory Satisfactory 149.63 xv DO-3rd Perform.&Accbilty of SocSctrs DPL - P125806 Actual Date ISR No. DO IP Disbursements Archived (USD millions) 1 02/05/2012 Satisfactory Satisfactory 0.00 2 12/07/2012 Satisfactory Satisfactory 69.83 H. Restructuring (if any) N/A. xvi 1. Program Context, Development Objectives and Design 1.1 Context at Appraisal 1. In 2009, the Fernandez administration had a solid political base to undertake reforms. At the time the Development Policy Lending (DPL) series was launched in October 2009, the Dominican Republic (DR) stood as a middle income country relying on tourism, mining and light manufacturing as its main exports. For over a decade the DR had competitive elections and peaceful transitions of the party in power. President Fernandez had been reelected for a second consecutive term in May 2008 and his party held a majority in both Chambers of Congress. His government was well positioned to implement a reform agenda focusing on addressing the energy crisis, social protection, fighting corruption and building institutions, and improving competitiveness and the investment climate. He convened a National Summit to define a long-term national development strategy. He also created a consensus with all political parties to make some changes to the constitution, realigning the electoral calendar and eliminating presidential reelections. 2. High levels of poverty called for a new social agenda. Economic growth during the 1990s had brought improvements in the quality of life, despite the 2003-4 crises which has pushed 1.3 million people into poverty (poverty increasing from 28 percent in 2002 to 43 percent in 2004). By 2006, the situation had rebounded, with a GDP growth of 9 percent, fueled by tourism, construction and telecommunications. Since the crisis, despite stabilization and robust growth over several years, poverty had declined only slightly, aggravated by a high income inequality. By 2009, 36 percent of the population was poor and 13 percent extremely poor. Structural poverty had increased the vulnerability of poor households to external and internal shocks, establishing a clear need for improved social protection services. The Fernandez Government had articulated a new social sector policy, aimed not only at reducing poverty levels, but also to increase the capacity of the poor to move themselves out of poverty and integrate into the economy and society at large. DR’s social sector policy was structured around four pillars: social protection, social security, the provision of social services (mainly education and health) and labor market interventions. The Government’s social protection policy was based on building human capital and increasing risk management capacities of the poor, in order to reduce their vulnerability to shocks. In September 2005 the Government established a cash transfer program (Solidaridad) to replace two existing, institutionally weak, programs. After a few years, a consensus emerged that Solidaridad needed significant improvements to become a full-fledged conditional cash transfer (CCT) program. 3. The Government of the Dominican Republic (GoDR) was aiming at maintaining economic stability to minimize the impact of the international crisis. In the two years prior to the 2008 international crisis, the DR had a growth rate well above the regional average. Even for 2008, growth was about 5.3 percent. Internally, the government had implemented reforms to enhance fiscal sustainability. The manufacturing and service sectors –communication, commerce, and tourism – were growing strongly and external factors also showed strong growth with important foreign exchange inflows from tourism, remittances, and foreign direct investments. Although during 2005-2007, the DR had achieved positive results in terms of fiscal balances, debt and international reserve ratios, and inflation, the situation deteriorated due to the international crisis. For 2008, the overall deficit had reached 3.2 percent of GDP, mainly due to increased spending in the run-up to the Presidential elections and increased subsidies starting in early 2008. Inflation had declined from 51.5 percent in 2004 to 6.1 percent in 2007 and 10.6 percent in 2008. The IMF had agreed a program supporting a policy of gradual return to balanced fiscal accounts. Declining revenues, higher energy sector deficits, and reduction of financing sources had created a risky situation. By requesting the IMF support, the Government had managed to secure 1 sufficient additional financing and had signaled its commitment to macroeconomic stability. The evolution of some key economic indicators during the six-year period prior to launching the DPL series is shown in Table 1 below. Table 1: Key Economic Indicators for Dominican Republic, 2003-2008 (Percentage of GDP, unless otherwise indicated) Indicator 2003 2004 2005 2006 2007 2008 Real GDP growth (% change) -0.3 1.3 9.3 10.7 8.5 5.3 Inflation (%) (End of period) 27.4 51.5 4.2 7.6 7.4 10.6 Gross Domestic Investment 15.0 14.9 16.5 18.4 18.9 19.7 Gross Domestic Savings 19.3 18.9 13.4 14.0 11.4 11.0 Total Public Debt 40.5 47.4 34.5 36.4 33.4 34.0 Foreign Direct Investment 3.1 4.2 3.5 4.3 3.8 6.5 Remittances 10.3 10.3 7.2 7.7 7.3 7.3 4. By the time the first DPL of the series was appraised, the medium-term macroeconomic outlook was positive. Growth was expected to be moderate during the following few years, supported by an improved external environment, and implementation of fiscal countercyclical stimulus supported by an IMF program. It was anticipated that inflation would remain subdued and domestic and external factors would support the medium-term growth prospects. It was foreseen that while the external financing needs for future years were substantial, they could be attained with the assistance of the IMF and other international financial institutions. The medium-term sustainability depended on the IMF program support, including a policy of gradual return to balanced fiscal accounts, sustained growth, further improvements in the quality and control of public spending, and the implementation of a multi-year budget system. The main risks were associated with the possibility of declining revenues, energy sector deficits and lack of adequate financial resources. 5. The education sector had plenty of room for improvement. Despite almost universal coverage in basic education (94 percent), access to preschool and secondary school was limited (31 and 53 percent, respectively) and unequal. A substantial gap, equal to more than three years of schooling, existed between the poorest and richest families compounded by wide urban-rural differences, particularly for pre-school and secondary attendance. In addition, there were serious issues with student retention and completion rates with significant percentages of overage students and student drop-outs. These issues were contributing to low educational efficiency compounded by quite low levels of public expenditure on education, reaching barely about 2.1 percent of GDP. 6. Primary health services at the first level of care were in urgent need of strengthening. Significant obstacles remained in terms of access at the first level of care. The number of hospital births had reached levels over 95 percent for the poorest quintile but maternal mortality rates were stubbornly high, estimated for 2007 at 150 per 100,000 deliveries. Post-natal checks and children with full vaccination coverage were under fifty percent. Other countries in the region with comparable or lower levels of development and healthcare coverage were showing better health outcomes. The disparity between high levels of service coverage and high levels of mortality suggested substantial shortcomings in the quality of delivery for key primary health services, in particular at the first level of care. The poor results were partly a product of scarce public resources allocated to the health sector. Public expenditure in health was among the lowest in the region, barely averaging 1.4 percent of GDP. 7. High poverty levels called for protecting social expenditures. By 2005, the GoDR had estimated approximately 700,000 households were poor, of which about 112,000 extremely poor. In this 2 context, it was assumed that a decline in social public expenditures, triggered by the global crisis, would damage efforts to improve equitable access to quality education and health services, undermining the capacity of the social protection system to serve as a buffer for the poor. There was a consensus in the DR on three major social policy challenges. Firstly, it was urgent to preserve the human capital of the poor in the short term, especially through the protection of expenditures on social transfers, education and primary health care services. In particular, the Solidaridad program, although imperfect, had been playing a key role providing an income protection floor to maintain consumption levels. Secondly, an adequate supply-side response to the increased demands of beneficiaries required an expansion of health and education services. Lastly, the crisis presented an opportunity to improve the impact of public services in the social sectors over the medium term, through social and public sector policy reforms that could not be postponed due to the adverse macroeconomic context. This approach provided a solid base for designing the policy reform program for the DPL series. Rationale for Bank Assistance 8. The Bank and the Government had prepared, by mid-2009, a Country Partnership Strategy (CPS) that became timely for providing a strategic framework for the DPL program. The CPS gave special emphasis to protecting the poor while enhancing competitiveness and strengthening public institutions for performance accountability. These priority areas were expected to be addressed by implementing actions to achieve four strategic objectives: (i) strengthen social cohesion and improve access to and quality of social services, (ii) promote competitiveness in a sustainable and resilient economic environment, (iii) enhance quality of public expenditures and institutional development, and (iv) build capacity and constituencies for reform. The structure of the DPL program was in line with the new CPS. In particular, the reform of the safety net program, measures to improve budget management and a better informed demand for improved public sector performance in the social domain were well aligned with the stated objectives. It should be noted that the progress reports on the CPS dated December 2011, confirmed that the four broad objectives of the CPS remained consistent with the Government’s agenda and that progress had been good and had validated its targeted approach, remaining relevant for the remainder of the CPS period. The progress report also highlighted that the Government had undertaken several institutional reforms to improve the efficiency, effectiveness, and transparency of government operations. Further, it noted that although the Dominican Republic registered a slowdown during the global economic crisis, growth had quickly recovered and the country continued to be one of best performers in the region, that the overall economic outlook for the country remained positive, and continued structural reforms were still needed to close the large electricity sector deficit and improve the reliability of service. On the social front, poverty rates continued to remain high, the levels of social spending were modest by regional standards, but poverty and social indicators, however, would likely have been worse without the proactive decisions of Government to protect the levels of social spending and reform social service delivery. 9. The design of the DPL program complemented well the activities undertaken by other programs supported by the Bank. The Social Protection Investment Project (PIPS) was not providing finance to the Solidaridad program as such, but was assisting in providing poor undocumented Dominicans with national identity documents, which enable them to have access to social protection programs. The PIPS was also focused on improving the coverage and effectiveness of the targeting instrument and provided technical assistance and capacity-building for the reform of the Solidaridad program. Specifically, the DPL series was aimed at supporting the redesign of the program, setting up the instruments required for its implementation, aligning managerial and staff capacity to the new operational rules of the redesigned CCT, and supporting the development of a comprehensive monitoring and evaluation system. The DPL series also provided a good complement to the ongoing second phase of the Adaptable Program Loan for the support to the Health Sector Reform. Specifically, it was designed to 3 provide a framework for improving intersectoral coordination for human capital investment and an enhanced accountability framework for the social sector. Furthermore, the education actions supported by the DPL series complemented well the sector initiatives that were being addressed by the Early Childhood Education Project. Finally, there were strong complementarities between the DPL series and the Public Finance and Social Sector DPL, which was presented jointly to the Board. The Public Finance and Social Sector DPL supported measures aimed at improving the quality and efficiency of public spending, especially in sectors that matter for poverty reduction and human development, and strengthening overall fiscal sustainability. 10. The DPL series incorporated relevant lessons from recent interventions in the DR and elsewhere in the region. In particular, the 2004 Social Crisis Response Adjustment Loan showed an effective manner for achieving short-term crisis alleviation measures along with advances on medium- term policy actions. This was reflected on a careful selection of policy actions, reaching consensus with GoDR on these actions, and seeking a close inter-sectoral and donor coordination. The experience with Peru’s Programmatic DPL in social sectors, was also used, since it offered interesting lessons related to the need to fully involve social sector ministries in the implementation of performance-informed budgeting, and the value of supporting an enabling environment for a better informed demand. 1.2 Original Program Development Objectives (PDO) and Key Indicators 11. The PASS has four objectives: a. to enhance the performance of social sectors to promote human capital (health, nutrition, education) for the poorest citizens, through a fundamental redesign of the Government’s Conditional Cash Transfers (CCT) program, Solidaridad, and its articulation with critical actions in health and education; b. to improve budget management to support the performance of these social sectors within the CCT program; c. to support the gradual introduction of Performance Agreements in social sectors; and d. to enhance transparency and accountability to users by strengthening the enabling environment for a better informed demand for improved public sector performance in the social domain. 12. The social and public sector policy reforms supported by this DPL series were consistent with the Government’s long term goal of improving major human development indicators in education and health, especially for the poorest citizens. Long term results extending beyond the time span of the DPL series in education included an increase in the share of extremely poor children in early childhood development programs and in basic and secondary education. In health, key long term results included increased Government performance in the delivery of critical nutrition, child and prenatal health care services for the poorest citizens. 13. The Key Development Indicators defined to assess achievement of the program outcomes, in the four policy areas included in the DPL series, are listed in Table 2 below. 4 Table 2: Key Development Indicators Policy Area I – Enhancing the performance of social sector agencies  Share of CCT beneficiary households receiving transfers that are registered at their designated Primary Care Unit (UNAP) or school, or who received a letter warning of potential suspension due to incompliance with registrations  Share of CCT beneficiary transfers paid on the basis of the timely verification of compliance with co-responsibilities.  Share of students from CCT beneficiary households who are enrolled in and attending pre-primary, basic and secondary education.  Share of children between 0 and 5 years old who comply with the series of consults established by the national standards of comprehensive care for healthy children (growth and development check-ups).  Share of children between 6 and 60 months who receive micronutrient sprinkles (iron and zinc). Policy Area II – Improving Budget Management  Deviation between proposed budget to cover the supply gaps in health, nutrition and education services and the overall national budget, in relative term.  Deviation between scheduled quota and actual budget proportion to cover the supply gaps in health, education and nutrition. Policy Area III – Supporting the gradual introduction of Performance Agreements  Number of priority programs in health, nutrition and education related to the Solidaridad program, that have successfully developed the log-frame methodology. Policy Area IV – Improving transparency and oversight  Number of registered users in the consulta amigable budget information portal.  Number of community-scorecards completed by beneficiary committees, as a share of total number of community- scorecards distributed 1.3 Revised PDOs and Key Indicators, and Reasons/Justification 14. The PDOs were not revised. Slight adjustments were made to the original key indicators when designing the second operation. During appraisal for PASS2, it was proposed that two indicators, originally included under PASS1, would no longer be considered as key outcomes for policy area 1. These were related to improving maternal/child care and vaccination rates and to assessing beneficiary satisfaction. In both cases, it was considered that the effect of these two indicators was adequately reflected by other indicators already included in the results framework. The change was introduced when the second operation was presented for Board approval. Also, as baseline data became available when the results from the Social Protection Evaluation Study (the baseline for the rigorous impact evaluation of the program) were published in September 2011 (data from July 2010); targets were established and/or revised for a series of indicators related to Policy Area 1. 1.4 Original Policy Areas Supported by the Program 15. In line with its strategic vision and the Government’s program, the PASS had four inter-related objectives: (i) to enhance the performance of social sectors to promote human capital (health, nutrition, education) for the poorest citizens, through a fundamental redesign of the Government’s CCT program, Solidaridad, and its articulation with critical actions in health and education; (ii) to improve budget management to support the joint performance of social sector agencies within the CCT program, as part 5 of the interim measures to protect critical aspects of social spending and support the required improvements in the supply of health, nutrition and education services; (iii) to support the gradual introduction of performance agreements in the key social sector agencies; and (iv) to enhance transparency and oversight in social sectors. These policy areas remained the same for all three operations of the DPL series. The main policy areas supported by the PASS, main sectoral issues and linkages to the Government’s programs are discussed below. 16. Policy area 1: Enhancing the performance of social sector agencies to promote equitable access to human capital. This policy area supported the enhancement of the transfer program Solidaridad to a full-fledged CCT focused on the promotion of human capital related to critical actions in health and education, select actions to enhance the overall quality of service to beneficiaries, and the effectiveness of the targeting system. The key reforms of the CCT were aimed at: (i) focusing the CCT exclusively on cash transfers conditioned to the investment in health and education by poor families; (ii) establishing a clear division of responsibilities among, and shared accountability within, key agencies of the Social Cabinet; (iii) establishing a clear division of responsibilities among, and shared accountability between, the CCT program and the education and health ministries, to ensure the compliance of beneficiaries with co-responsibilities in health, nutrition and education and its verification at national and regional level; and (iv) establishing an integral system of monitoring and evaluation shared by all agencies within the Social Cabinet and with the education and health ministries. Additionally, specific actions were introduced in the health sector for improving primary health care services. In the education sector, actions were focused on enhancing the articulation between the redesigned CCT program (Solidaridad) and the supply of education services to verify the compliance of co-responsibilities and to monitor student learning outcomes. Another reform supported by the program was related to enhancing the quality of services to CCT beneficiaries by expanding the network of businesses that accept the debit card of the program. It also included actions to improve the information provided to beneficiaries on transfer amounts and balances. One last line of action was aimed at reducing errors of inclusion and exclusion by updating the targeting registry and giving the specialized agency (SIUBEN) full responsibility for maintaining and updating the registry of the CCT beneficiaries. 17. Policy area 2: Improving budget management to support the performance of the CCT program. This second policy area was intended to address the need to both increase budget allocations to meet the entitlements envisioned under the CCT program and other social programs, and to ensure that the budget for CCT is executed as programmed. Its main actions were focused on developing rolling multi-annual projections of supply gaps in health, nutrition and education, and the provision of adequate budget resources to cover the gaps. 18. Policy area 3: Supporting the gradual introduction of performance agreements in the social sectors. This policy area was focused on addressing the need to enhance the performance orientation of the budget and management processes. Budget management was largely focused on controlling financial and human inputs hindering the prioritization of the programs based on their outputs and outcomes. A very gradual movement toward a flexible performance-informed budgeting framework was conceived to support better decision making, including managerial flexibility, transparency and accountability for public spending. 19. Policy area 4: Improving transparency and oversight. This last policy area of reform addressed some of the most critical challenges hindering a more informed demand for improved public sector performance in social sectors. At budget level, the program aimed at introducing a full disclosure of budget information to improve public access and understanding of the budget through a web based tool. At the CCT program level, the reform promoted the public disclosure of all critical information and 6 the introduction of a social auditing scheme and a complaints system associated with the provision of services in schools and health facilities. 1.5 Revised Policy Areas 20. The Policy Areas were not revised. 2. Key Factors Affecting Implementation and Outcomes 2.1 Program Performance 21. Disbursements for the three operations were carried out quite close to the schedule established when the first operation was appraised and agreed with the Government. Table 3 summarizes the dates and amounts. Table 3: Disbursements for each operation Operation Amount Actual Release US$ millions Release Date PASS1 150 12/03/2009 Regular PASS2 150 12/22/2010 Regular PASS3 70 2/14/2012 Regular 22. Specific policy actions, to be met before Board approval, by the first operation (PASS1) in the four policy areas included in this programmatic DPL series are summarized in Table 4. The evolution of policy actions for the three operations under the PASS are shown in Annex 1. Table 4: Policy Actions for PASS1 Prior Actions Status I. Enhance Performance of Social Sectors 1.1 Revamp of the Solidaridad program 1. Presidential Decree establishing the legal and regulatory framework for the restructuring and Completed strengthening of the Borrower’s social protection system, organized as a non-conditional cash transfers and targeted subsidies 2. Resolutions reforming the institutional framework and operative rules of the Solidaridad program, Completed including the verification and with compliance of co-responsibilities, establishing indicators of management and impact, and approving appropriate operational manuals for the redesigned Solidaridad program. 1.2 Health policy measures None 1.3 Education policy measures 3. Resolution validating student evaluation standards for pre-primary education and the first cycle of Completed basic education. 1.4 Improved quality of service to beneficiaries 4. Resolution approving a plan to expand the network of shops affiliated to the Solidaridad program Completed in order to promote competition among affiliated shops and to expand the supply and types of products that can be purchased with the Solidaridad debit card, reducing transaction time and costs for beneficiaries. II. Improved Budget Management 5. Providing an assessment estimating the costs of supply-gaps linked to the redesigned CCT Completed 7 Prior Actions Status program, covering the provision of education and primary health care services and micronutrients for pregnant women and children under two years old. 6. Necessary measures are taken to ensure that sufficient funds will be included in the Borrower’s Completed 2010 Budget Law to cover the supply-gaps linked to the redesign of the Solidaridad Program, as well as special measures to ensure that those funds are disbursed in a timely fashion. III. Gradual Introduction of Performance Agreements 7. An institutional diagnostic has been completed to assess the preparedness and capacity building Completed needs for the introduction of Performance Agreements in the education and health sectors. 8. The Secretariat of Health has signed results-oriented internal management agreements with two Completed Regional Health Services. IV. Enhanced Transparency and Civil Society Oversight 9. The Solidaridad program has published electronically the list of beneficiaries and the assessment Completed quantifying and estimating the costs of supply gaps in health, education and nutrition. Overall Approach/Basic Management Agreements 10. A basic management agreement has been signed agreeing on the policy and institutional Completed strengthening actions needed to improve the performance and accountability of the Solidaridad program. 23. The second operation (PASS2) introduced some changes to the formulation of the prior actions previously drafted (at the time PASS1 was agreed). However, most prior actions under PASS2 remained consistent and on track with the original program. Of the 18 triggers originally envisaged for the second operation, only three were modified, as follows: (i) under Policy Area I, the sub-component on developing the baselines for the verification of compliance with co-responsibilities was postponed due to complexities for developing a full-fledged nationwide M&E system to cross-reference data across regions and sectoral programs on a regular basis; (ii) actions plans, in the health sector, to improve prenatal controls, quality of delivery services and improvements in vaccination rates would be replaced by additional protocols under PASS3; and (iii) under Policy Area IV, the development of the web-based tool (Consulta Amigable), was rescheduled to be completed by June 2011. 24. The review process in the Bank decided that PASS2 should be focused on fewer prior actions. An attempt was made to have fewer prior actions for PASS2, reducing them to ten instead of the original eighteen triggers. This reduction required selectivity, focusing attention on fewer critical measures that were needed for reaching the full potential of the PASS series PDOs. In this context, although some original policy actions had already been implemented, they were no longer considered as criteria for disbursement. These revisions are detailed in Table 5 below. Table 5: Policy Actions for PASS2 Prior Actions Comments Status I. Enhance Performance of Social Sectors Revisions were made to triggers initially 1.1 Revamp of the Solidaridad program proposed in PASS1 to reflect the urgent need 1. Resolution approving: (i) the regulations governing for the organizational restructuring of the Completed the functions of the CCT Interagency and Intersectoral Solidaridad program, delays in the committees; and (ii) the implementation, by development of the M&E system, and an November 2011, of the organizational development enhanced focus on the process for verification plan for Solidaridad. of co-responsibilities. Completed 2. The Intersectoral Committee agreed that, by New prior action. The verification of co- December 2010, 90 percent of beneficiary households responsibilities was recognized as a critical receiving transfers will be action for the success of the redesigned registered in a Primary Care Unit and/or school or Solidaridad program, meriting its own prior 8 Prior Actions Comments Status have received a letter warning of potential suspension action. due to incompliance; and (ii) defining the procedures and timeline for the systematic verification of co- responsibilities in education and health, with the objective of linking at least 80 percent of the transfers to the verification of co-responsibilities. 1.2 Health policy measures This was removed from the program, as None reforms to improve the quality of services are supported by other measures in the PASS, and by other Bank operations (PARSS2). 1.3 Education policy measures Consolidation. The two triggers on student Completed 3. Resolutions of the Ministry of Education: (i) learning outcome tests were consolidated into formalizing the introduction of the student learning a single prior action. The policy action on a outcome tests for the first cycle of basic education; pilot for new transfer structures was absorbed and (ii) validating the evaluation standards to be used by a trigger under PASS3. both in public and private schools for students in the second cycle of basic education. 1.4 Improved quality of service to beneficiaries Unchanged (minor detailed additions). Completed 4. Start implementation of greater access, by The GoDR complied with first stage of beneficiaries, to data contained on the CCT expansion of the institutional network and Solidaridad payment card. This allowed beneficiaries further expansion is a trigger under PASS3. to be informed of the amount transferred and the Additional focus was added on better access available balance on their cards. to data on the debit card. II. Improved Budget Management 5. The Government has approved the Multi-Annual Originally a PASS3 policy action. The initial Completed National Plan for the Public Sector (2010-2013), trigger formulation was preparation of a containing medium term guidelines for social policy report on CCT projections leading to a protection policy for education, health care and Multi-Annual National Plan for the Public nutrition for projections of coverage, estimated budget, Sector. and financing basis. 6. The Government has made available sufficient Unchanged. A few additional actions were Completed resources to meet the output targets of the Solidaridad added/specified. Program, strengthened procedures to ensure the predictability in disbursement for budget users, and taken adequate measures to monitor and publish the use of such budget resources. III. Gradual Introduction of Performance Agreements 7. The Ministries of Health and Education agree with Unchanged. Additional actions to develop Completed the Ministry of Economy on the institutional procedures for predictable budget strengthening measures to ensure preparedness for the disbursements for the intersectoral program, introduction of their respective performance and mechanisms to monitor actual execution. agreements by October 2011. 8. Internal management agreements signed between Unchanged. The agreements represent a key Completed the Ministry of Health and the remaining Regional piece to align incentives to foster efficiency Health Services to introduce results-based and accountability at the regional level. management. 9 Prior Actions Comments Status IV. Enhanced Transparency and Civil Society Oversight 9. Implementation and development of the web-based Consolidated triggers into one prior action Completed interface to make available data on the national with the implementation of interim measures budget, and publication on the Minister of Finance’s to provide accessible budget execution data website of monthly interim reports on the execution of and transparency. the Borrower’s national budget. Additionally, it signs an administrative agreement with the Minister of Economy to establish the development of a pilot system to link budget information to performance indicators through a web-based interface. 10. Resolution of the CCT Intersectoral Committee Unchanged. The prior action reflects greater Completed instructing the timely implementation of a community detail on processes establishing a timeline for scorecard pilot scheme to monitor the availability and its implementation. improve the accountability of health and education inputs linked to co-responsibilities. 25. Further adjustments were introduced to the formulation of the prior actions under PASS3. As mentioned earlier, Annex 1 provides a detailed comparison of prior actions both with the initial formulation as well as those envisaged under PASS2. Following the experience gained under PASS2, the number of prior actions was maintained at a more manageable size, limiting them to the most critical measures needed for reaching the full potential of the reforms. The original policy actions continued to show significant advances, but some were replaced by other policy actions that were considered to be more central to the program objectives. Particularly, the original trigger in education to adjust student learning outcome tests was removed because the Government had embarked on a broader reform of its curriculum. It was replaced by a series of key policy actions to improve the efficiency of education spending, which had been identified as a key constraint for improved results. Similarly, in the health sector, the original policy action requiring the formulation of plans to improve certain programs was replaced by the formulation of new protocols, training programs and improving registration of services provided under the clinic management system. Additionally, certain actions were reformulated to reflect achievements beyond expectations. For example, the action related to the establishment of Regional Intersectoral Committees in at least half of the regions was transformed to reflect the fact that the Government had already established these committees in all regions. 26. An additional section was introduced under the policy area aimed at enhancing performance of the social sectors (introduced as a trigger for PASS3 in the program document for PASS2). It was aimed at providing support for updating the targeting instrument being used for the Solidaridad Program. A new census, reaching 1.8 million households, was carried out to update and improve the targeting of its social programs, including an update of the information on households and individuals, an increase of census coverage in geographic areas already covered by the last census, and an expansion of census coverage to geographic areas, with high poverty levels, not previously included. A summary of policy actions included in PASS3 is presented in Table 6. 10 Table 6: Policy Actions for PASS 3 Prior Actions Comments Status I. Enhance Performance of Social Sectors 1.1 Revamp of the Solidaridad program 1. The Government has adopted procedures and mechanisms to Two policy actions were combined into Completed allow for the verification of compliance with health and education one. co-responsibilities under the Solidaridad Program, and has established regional intersectoral committees in all regions. 2. The Government has designed and mandated the establishment Unchanged, slightly clarified. Completed of an integral monitoring and evaluation system for purposes of sharing technical information amongst agencies involved in the Solidaridad Program. 1.2 Health policy measures 3. The Government has mandated the daily registration of primary Simplified, one trigger kept as a prior Completed health care services through the Clinic Management action. The use of a management System, and has issued an action plan for the institutional information system was included to strengthening of entities within the health sector, training, and the enhance quality oversight of primary establishment of performance incentives for staff. health services, and to strengthen the verification of CCT co-responsibilities. To improve quality, the Government has also initiated the process of institutional strengthening of the Ministry of Health. New prior action reflecting a series of Completed 1.3 Education policy measures actions identified as critical, in analytical 4. The Government has approved a mechanism for the transfer of work undertaken, for improving financial resources to District Offices, within the education sector, education quality. for the purchase of didactic materials, financing of non-personnel services and non-financial assets, and validated student evaluation standards for secondary education. Strengthened, to include the new Completed 1.4 Improved quality of service to beneficiaries supervision agreement. 5. The Government has expanded the number of shops affiliated to the supply network to a total of 3,067 institutions, it has approved the bylaws of the supply network, and it has entered into an agreement with a consumers’ rights Non-Governmental Organization (Pro-Consumidor), to supervise shops and to inform beneficiaries of their rights. Added as a trigger for PASS3 in the Completed 1.5 Improved Targeting Performance PASS2 program document, to promote 6. The Government has launched a new census to improve targeting the completion of this critical instrument of its social programs, including an update of the information on for improved public expenditure households and individuals, an increase of census coverage in efficiency. geographic areas, and an expansion of the census coverage to geographic areas with high poverty levels. II. Improved Budget Management Completed 7. The Government has established budget planning and Consolidated multiple prior actions into coordination mechanisms that will ensure the availability of one strengthened action that covers sufficient resources to meet the results of the Solidaridad Program. medium term investment planning, allocation in annual budget, and monitoring and analysis of the results 11 Prior Actions Comments Status achieved. III. Gradual Introduction of Performance Agreements 8. Separate performance agreements have been signed with the Simplified and clarified. Performance Completed ministries of health and education, to strengthen the institutional agreements covering priority programs in budget management and accountability, through performance-based education and health were seen as pilots budgeting. for other sectors and programs. IV. Enhanced Transparency and Civil Society Oversight 9. The Government has launched an online budget transparency Unchanged. Completed tool, which allows free public consultations on public revenues and expenditures of central agencies. 10. The Government has defined and mandated the implementation Strengthened and simplified with Completed of the expansion plan of the community scorecards scheme to increased focus on the expansion of enable beneficiaries of the Solidaridad Program to voice their scorecards. opinion on the quality of the services provided. 2.2 Major Factors Affecting Implementation 27. The key factors that contributed to the successful implementation of the three operations carried out under this DPL program, and difficulties faced, are summarized below. These are structured under the following headings: commitment shown by the GoDR providing support to the DPL series, background analysis carried out, and the role of critical design features under each policy area covered by the program. The relevance of key risks identified and the effectiveness of mitigation measures are also discussed. 28. GoDR’s commitment and the looming crisis were key factors for the implementation of the social sector reforms sponsored by the program. It should be noted that, from the perspective of availability of budgetary resources, the social and economic environment prevailing in 2009 was not favorable for implementing reforms in social policy and programs. At the time of the DPL program preparation (mid 2009), serious concerns arose that the food, fuel and international financial crises could dramatically increase poverty and unemployment and severely diminish social spending for safety nets, education and health. In this context, the Government took bold steps to initiate key reforms in the social sectors consistent with the development objectives supported by the Program. The GoDR’s commitment for redesigning the Solidaridad program, as an integrated program covering health and education related services, was critical for mitigating the risk of budget cuts in social sectors linked to the prevailing crises. Improving planning and budget management for the CCT program and its associated provision of health, nutrition and education services was also a very positive step. Moreover, these efforts were integrated into the first-ever National Development Strategy 2030 that aimed at creating sustained economic growth and distribute its benefits to all Dominicans, emphasizing poverty reduction, equity, sustainable development, and efficient, transparent institutions. It is likely that the crisis gave the reforms an added sense of urgency and therefore contributed to the success of the reform program. 29. Several years of a positive dialogue on social policies and practices provided a sound basis for designing the PASS. Design of the PASS built on extensive analytical work carried out by the Bank and other agencies during the 1990s. Available analytical and advisory reports provided a solid base for defining key areas of reforms needed for improving performance and accountability of the social sectors. Analytical work done by the Bank to define a strategic approach to improve public sector performance was particularly useful. Additionally, and consistent with the CPS approach, two strategic, programmatic Non-Lending Technical Assistance products were extremely useful for supporting participating government agencies in achieving policy commitments and outcomes included in the PASS series. They 12 covered human development issues complementary to the scope covered by Solidaridad in the education sector and, the second one addressed public sector performance, focusing on the improvement of the quality of public expenditures. It proved also very useful to incorporate into PASS design relevant lessons learned, particularly from a recent Bank operation on social crisis response and the Peruvian experience on performance-informed budgeting. 30. Reforming Solidaridad was a critical decision for establishing the basis for a national social protection system. A key design feature was reorganizing the structure of the Solidaridad program, including improvement of targeting and eligibility rules, adopting more efficient transfer payments to beneficiaries and setting up effective coordination mechanisms among ministries and agencies involved. Furthermore, the redesigned Solidaridad was set up as the primary axis of the national Social Protection System adjusting its organizational structure to bring it in line with the new objectives and operating rules. The design also created a new institutional framework aimed at improving intersectoral decision making and establishing decentralized program operations. Most importantly, it introduced the practice of associating transfers to fulfillment of co-responsibilities by the beneficiaries. These co-responsibilities were linked, on the education side, to children’s enrollment in primary school (6 to 16 years old) and compliance with a minimum standard of attendance, and in health, to children’s meeting the standards of periodic controls for early detection of health problems (0 to 5 years old). One major obstacle that the program faced was related to difficulties for implementing its information systems to allow for a systematic verification of compliance with co-responsibilities and enforcing sanctions when applicable. A first verification of CCT co-responsibilities could only take place in late 2010. At that time, co- responsibilities measured only in terms of registration of families at their primary health centers and/or of school-age children in schools were verified. It appears that the complexities associated with transforming Solidaridad to a full-fledged CCT were underestimated. In particular, great difficulties were faced for implementing the verification of co-responsibilities. These are discussed in more detail in section 2.3 below. Other aspects of the DPL program were, by and large, implemented with no significant difficulties. Issues that arose were addressed by ministries and agencies involved without significant delays upon policy actions supported by the program. 31. The selection of policy actions under the program had a positive effect for improving the provision of services to Solidaridad beneficiaries. In the health sector, the GoDR put in place a series of reforms to strengthen service delivery in line with the increased demand for primary health care services generated by introducing co-responsibilities in Solidaridad. In particular, it promoted the use of preventive health services including prenatal and puerperal consultations, infant and child check-ups and immunizations. In education, critical steps were taken to strengthen its articulation with Solidaridad, by investing in bridging supply-gaps through a targeted approach. Another key set of actions were aimed at initiating an assessment of alternative transfer structures to schools, defining standards and tests to measure learning outcomes and to increasing the efficiency of education expenditures. The GoDR also took important steps for improving the payment mechanism to beneficiaries, through a debit card which can be used at participating stores (colmados). The payment agency (Administrator of Social Subsidies, ADESS) expanded the number of stores and improved access by beneficiaries to their account information. It also made arrangements with a pro-consumer organization for monitoring the quality of services and by providing beneficiaries with greater information on the services and their rights as consumers. 32. Improvements in budget management in the health and education sectors provided critical support to the reform program. In particular, the program design introduced for the first time in DR, a multi-annual plan for the public sector containing provisions for implementing social protection policy actions including projections in terms of coverage and budget. It also included the appropriation of fiscal resources for the programs aimed at closing gaps in the supply of social services. This plan represented a significant improvement to increase predictability of the budget and was an important first step for 13 developing a medium-term expenditure framework. At the same time, a special program was set up to protect the budget required to close gaps for supplying an adequate level of services in education, health and nutrition over a rolling three-year period. It also worked to increase transparency to monitor the execution of resources on a quarterly basis and publish the findings. Additionally, linkages were established with results-oriented budgeting, with the introduction of performance agreements between the Ministry of Finance; the Ministry of the Economy, Planning and Development; the Ministry of Public Administration; and key social sector ministries and agencies. 33. The design also included important features adequate for improving transparency, accountability and participation. One key aspect was the introduction of a web-based information window to enable budget analysis and monitoring with adequate coverage of centralized agencies. At the CCT program level, significant progress was also achieved in terms of improving transparency, civic participation and oversight. This area of reform focused on establishing mechanisms for improved transparency and oversight by introducing an effective social auditing scheme and also by implementing a system of complaints. The community scorecard proved to be quite a useful tool for social auditing and the Government is currently considering its use in other programs. 34. Relevant risks and mitigation measures were properly assessed. Macroeconomic risks were adequately mitigated in spite of a volatile external environment that prevailed throughout the implementation period. There were no significant shifts in institutional priorities and no budgetary constraints surfaced that could have hampered implementation. It should be highlighted that, during the period 2009-2012, the GoDR remained highly committed to the policy actions agreed for the DPL program. The only implementation risk that could have been mitigated more effectively was the management of the complexities associated with the development of the M&E integrated systems mentioned below in more details in section 2.3. Political risks associated with the presidential elections held in May 2012 were dissipated when the candidate of the ruling party won in the first ballot. The candidate had included in his program a further strengthening of the social protection programs and a proposal to expand Solidaridad to reach an additional 200,000 families. 2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization 35. The PASS program included support for the development of an integral Social Protection M&E system. The system was conceived with the broad scope of an integrated management system. The key design feature under this arrangement was that the integrated system would become a management tool for all social protection services provided to beneficiaries and coordinated by the Social Cabinet. Such an integrated system would include a common registry, an integrated system of data bases of institutions in the social protection network and a single entry point for beneficiaries. A key component of the integrated M&E system was the design and implementation of a management system for Solidaridad, which would enable its administration, monitoring its operation, and provide information for evaluating processes and results. The design of this SP M&E system included the interaction of five systems. 36. The M&E system for the Solidaridad program included modules for program management, operations monitoring, and results and impact evaluation. Initially, the plan for verification of compliance with co-responsibilities was to use a manual system in all schools and health clinics. However, in early 2011, the GoDR decided to avoid creating a duplicative system, and opted for using sectoral systems in the health and education ministries, designed to serve a series of management purposes beyond the verification for the CCT program. Shifting to these new systems was an ambitious decision, as it meant that the program would need to rely on the establishment of two much broader sectoral systems, but it was the correct decision from a development’s perspective, in that it would contribute to the develop of strategic tools (rather than opt for the easy solution of developing parallel systems limited to the function of verification). This shift led to long processes to define and procure the 14 systems, efforts for an initial uploading of basic information on each individual, and required an important shift in both ministries institutional culture. As a result, despite strong commitment, the design and implementation of these sectoral systems faced significant delays. In the interim period, additional data collection instruments were put in place to meet the needs for the verification of co-responsibilities. In addition, a series of regular data audits (on a sample of the program’s beneficiaries) has been undertaken to certify the actual level of compliance with co-responsibilities. 37. The Ministry of Education had developed a school-based management information system. This web-based system aimed at enhancing the ministry’s capacity to collect, monitor and update student, teacher and school data at the school-level. It provides for collection and exchange of information on key variables, including enrolment and attendance, to allow for the timely verification of CCT co- responsibilities. Initially, implementation faced difficulties, particularly for cross-referring its database with Solidaridad’s databases of beneficiaries. In particular, in attempting to cross-check the Ministry of Education and Solidaridad databases for student enrollment, problems were discovered in the incompatibility of the unique identifying variables across databases. However, as of the end of the implementation period of the DPL series, the compatibility between Solidaridad’s information system and the ministry’s database has been ensured (all beneficiaries with a code are found in the Ministry’s database), but the capacity of the Ministry’s system to register attendance is still incomplete. 38. The Ministry of Health had started the implementation of its Clinic Management System (CMS) as a new management information system and an integral component of its health information system. The CMS provides a platform for the registration of patients’ medical data aiming at improving the quality, accountability, and management of primary health services. The CMS is also designed to provide data for the verification of CCT co-responsibilities. The CMS represents a fundamental change in the data collected and reported by physicians, providing electronic medical records and instantaneous reporting to central and regional administrators. The cultural change, of getting doctors and/or staff to register primary health care consultations on a daily basis faced great difficulties. This was compounded by software problems, frequent power interruptions, and insufficient training on the use of computers and the new system. The ministry made significant progress in addressing these issues through establishing the mandatory use of the CMS, as well as a new ministerial incentive scheme to improve uptake, and the provision of additional training and small generators. 39. The Government has made important progress in the evaluation of its core social programs and in enhancing the GoDR’s ability to use these tools. The program introduced the practice of making routine evaluations of processes and outcomes of Solidaridad. Two surveys were conducted to identify issues that were affecting the transfers to beneficiaries that led to improvements in expanding the network of shops accepting the debit card used and access to balance of fund available. An impact evaluation was carried out during 2011, based on a survey to a sample of beneficiary households and a control group composed of household eligible to participate but not registered in the program. The impact evaluation showed significant achievements within beneficiaries, compared with the control group, on the rate of pregnant women receiving prenatal and postnatal controls and children attending periodic health controls and completing the vaccination protocol. On the education side, beneficiary households also showed positive results on improvements of school registration and attendance, particularly at the pre-school level. Equally importantly, these evaluations introduced the tools and the practice within the institutions managing the social protection programs. 40. More generally, actions supported by this DPL series have built important monitoring and governance mechanisms. Reforms to the budget management processes – including the development of logical frameworks for priority programs and the development of performance agreements on the basis of these indicators – have resulted in an increased culture of defining key indicators, establishing baselines, setting targets, and putting in place mechanisms for regular monitoring of progress. These were limited to 15 core social priority programs initially, but the Government is now contemplating the generalization of this practice to all priority programs in the country. This is part of a systematic effort to shift towards a culture of results-based management in the GoDR. 41. The PASS program also promoted progress in terms of civil society’s ability to monitor and evaluate public actions. In particular, it contributed to the effort of greater transparency in budget management through the publication of budget data on the web and the training of CSOs in its analysis and through the development of a methodology and operational procedures for community scorecards, that will be scaled up in the entire country to monitor the CCT program and its associated health, education, and payment services. These efforts have been adopted and scaled up beyond the targets set for the PASS program. 42. In summary, the overall impact of the M&E reforms supported by the PASS program has been very significant and its design, implementation and utilization are satisfactory. Indeed, while deciding to build sector-wide systems (rather than a limited ad-hoc system for the verification of co- responsibilities) has delayed the full operationalization of the verification process, it has resulted in the two sector-wide information systems that serve a much broader set of policy decision on budget allocation, quality, programming, etc. Furthermore, the Solidaridad program now has a full set of functioning M&E tools beyond the information system – impact evaluations, process evaluations, community scorecards, etc. – which have significantly changed the management culture, leading to a results-focus in the program’s management, and have been fully institutionalized. Finally, the broader efforts for greater transparency and governance have also been scaled up more broadly. 2.4 Expected Next Phase/Follow-up Operation 43. In line with the prevailing CPS, which covers the period 2010-2013, the Bank has continued the policy dialogue on social protection issues, and the provision of quality health and education services to the poorest, through the implementation of the DPL series, ongoing investment operations (in social protection and health) and its programmatic social sector non-lending technical assistance. 44. After organizing a high-level policy workshop in June 2012 to share progress, lessons, and challenges with the incoming administration (that formally took office in August 2012), with the participation of key actors of the outgoing administration, including the Vice-President and the head of the Social Cabinet. Since the workshop, the Bank team has rapidly engaged with the new team to provide the technical assistance it needed as it prepared its plan for the 4-year administration. After a series of technical events and missions, the incoming administration has fully endorsed the reforms supported by the DPL series across the board. The new administration is particularly keen to continue strengthening the core institutions supported by this DPL series (the targeting system, the payment system, the CCT program), further work for the rationalization of the sector and its institutionalization, and continue its effort to promote results-based management practices, in collaboration with the Ministry of Finance and the Ministry of the Economy. The new administration has asked the Bank to continue supporting the reform program supported by the DPL series, its investment operations, and its non-lending technical assistance during its four year mandate (2012-2016). 45. While a fourth DPL was foreseen in the CPS progress report, the country management decided to place the funding on hold due to the dialogue on the broader macro-economic context, and in particular the sharp rise in the fiscal deficit in 2012, an election year. However, the dialogue with the new authorities in the social sectors has been extremely positive, and there has been no change in the policy direction (on the contrary, the reforms continue to be consolidated and strengthened). The Bank is in the process of preparing a new Country Partnership Strategy, which will lay out its involvement. 16 3. Assessment of Outcomes 3.1 Relevance of Objectives, Design and Implementation 46. The objectives of the DPL series, which were highly relevant for the social protection sector and for the country at the time of preparation, remain relevant at the time of the ICR. The operation’s design was consistent with stated objectives, and the DPL series’ implementation proved to make an important contribution toward implementing the policy actions to strengthen implementation of social protection programs. Several government officials acknowledged that Bank played a critical role in assisting GoDR to better achieve its priorities by defining specific achievable steps within an overall strategy. The DPL series was particularly effective in contributing to foster coordination among ministries and agencies involved in the implementation of social protection programs and by introducing better budget management tools in the social sectors. The operation’s design included features that represented a sound and consistent framework with a strategically appropriate and achievable scope. As an instrument, a programmatic DPL implemented in a series of three operations allowed to adapt policy actions in the second and third operations based in the experience gained and some difficulties faced during early implementation. Finally, the implementation of the policy actions remain also highly relevant, as they have resulted in tools, systems, procedures, and practices that continue to be implemented and further strengthened by the GoDR. 3.2 Achievement of Program Development Objectives 47. The policy actions in the Policy Matrix were conditions prior to Board approval for each operation. As discussed earlier, in detail in section 2.1 and Annex 1, the program of policy actions was implemented in a satisfactory manner, setting a legal and operational framework that enabled the overall achievement of development objectives. Overall, the targets for key indicators in the four policy areas supported by the PASS program were met, with minor shortcomings in some dimensions and results that went beyond targets in others. The continued strengthening of the policy reforms in all the dimensions supported by the PASS program further confirms the sustainability of the Program Development Outcomes. Achievements for each development objective are discussed in more detail below, and achievements for the rest of the monitoring indicators are shown in Annex 2. Policy Area I – Enhancing the performance of social sector agencies 48. The objectives in terms of enhancing the performance of social sector agencies were met with minor shortcomings. The objectives fell into three categories: objectives of improvements in the use of social services (for health, education, and nutrition) for which there were small shortcomings, objectives of the program’s ability to monitor compliance with co-responsibilities which both suffered some limitations, but overall demonstrated important gains significantly beyond the initial objectives of the program, and objectives of improvements in the management of the CCT program itself (payment process improves, and targeting is updated) which were exceeded. 49. In terms of improvements in the use of social services, targets were met with some shortcomings. In the health sector, targets were only partially met (indicators 1.2.1-1.2.5). Indeed, both the share of pregnant women receiving prenatal checks and the share of children under 2 with complete vaccination set (as verified using the alternative verification system and the program’s impact evaluation) were below the set targets (68 percent, versus a target of 94 percent for pregnant women and 40.3 percent versus a target of 65 percent for children’s vaccination). However, it is important to note that these percentages reflect the number of women/children for which the services were registered in their health carnet (and is therefore expected to significantly underestimate those who actually received the services 17 since the updating of health carnets is not systematic). In terms of nutrition (indicators 1.3.1-1.3.3), similarly, targets were not fully met; with significant gaps in the number of children who receive micronutrient supplements. This is linked to the delay in the implementation of the nutrition program supported by the World Food Program. Finally, in terms of education (indicators 1.4.1-1.4.6), enrolment targets were significantly exceeded for compulsory basic education (95.9 percent versus a target of 85 percent), but not fully for pre-school and lower secondary education (with rates of 35. 6 and 47.5 percent, versus targets of 50 and 55 percent respectively). It is however, important to note that enrolment data for secondary education was calculated using the total population of children aged 14-18, without accounting for those who already finished the secondary education cycle or are still in primary education, which is expected to result in a significant underestimation of the value of this indicator (the indicator was initially going to be measured with the third round of survey of the program’s impact evaluation, which is planned for 2013, and would have excluded those children aged 14-18 who are in other educational levels). Attendance targets were met or exceeded for all levels (with attendance rates of 93-96 percent for the three educational levels, versus targets of 70-90 percent). Overall, improvements are still needed in the provision of basic health and secondary education services in the Dominican Republic. 50. In terms of the program’s ability to monitor compliance with co-responsibilities, as discussed above, compliance of co-responsibilities could not fully be verified as planned during the period of implementation of the DPL series. At the time the DPL series was designed, there was no meaningful monitoring system for co-responsibilities, and the establishment of an adequate system was defined at the outset as a priority action. The initial plan was to implement a relatively simple system to verify compliance within the Solidaridad program. But, the GoDR soon decided that, rather than to develop a parallel system which would serve only this function and work in total isolation from the sectors, it would instead invest in developing two sectoral systems that serve broader management and planning purposes within the Ministry of Health and the Ministry of Education. These systems are critical to the broader agenda of improving the quality and efficiency of health and education services, and their development is a major achievement of this PASS program. However, for the more specific purpose of verifying compliance, interim mechanisms had to be established (for instance, an assessment was made to identify beneficiaries receiving transfers who were registered with their primary health care unit and/or school, regular audits are carried out to verify compliance, etc.). This being said, the targets in terms of compliance with co-responsibilities were met or exceeded (indicators 1.1.1 and 1.1.2). Indeed, 97.7 percent of beneficiaries were registered with their primary health care unit (target was 95 percent), 85 percent of households met their health co-responsibilities (target of 80 percent) and 80.7 percent met their education co-responsibilities (target of 80 percent). Additionally, the policy reforms supported by the DPL series will result in broad improvements for both the health and education sectors, beyond the actual verification of co-responsibilities. These unanticipated results are critical to the broader policy reforms to improve the management of both sectors. The medium-term impacts of the reforms can be expected to significantly exceed those initially anticipated. 51. The objectives of improving the management and efficiency of the CCT program itself were exceeded. Under this objective, the DPL series supported reforms in two areas. First, policy reforms to significantly expand the network of stores where beneficiaries of the CCT program can use their debit cards. This network (Red de Abastecimiento, RAS) is managed by the ADESS (Administrator of Social Subsidies) and initially comprised only about 2,000 establishment, with under-coverage in certain areas, and the Government agreed to significantly broaden the network and to set up a mechanism to monitor the quality of services provided by the stores (accessibility, prices, availability, quality, etc.). By the end of the DPL series, the targets had been exceeded, with almost 5,000 establishments in the network, and with a formal agreement with a consumer protection institution to monitor the payment services. The review of payment services provided by the community scorecards implemented by the program in selected localities revealed a very high overall quality of services, as judged by beneficiaries. Also, mechanisms are in place to channel complaints or requests to the payment agency. Furthermore, the 18 Government is currently exploring additional payment mechanisms (including payment with full-fledged debit cards) as well as mechanisms to allow beneficiaries to closely monitor their balance (through the establishment of Puntos Solidarios, where all requests related to the CCT program will be submitted). Finally, the Government is exploring options to promote greater financial inclusion for CCT beneficiaries through financial education and access to other services. 52. As a second policy area under this objective of improvement in management, the DPL series supported the updating of the national targeting mechanism used to identify and select beneficiaries for the CCT program, SIUBEN (Sistema Unico de Beneficiarios). This is a critical step for the updating of the roster of beneficiaries, to reflect the evolution of living conditions for poor households, and ensure greater efficiency of public spending. The target set for the PASS program of “database update” was exceeded, as the information was indeed updated for the families that were in the initial SIUBEN, but in addition, the geographic coverage of the SIUBEN was extended beyond the initial area which covered the poorer neighborhoods. As a result, the number of families in the SIUBEN increased to 1.8 million households (increasing this number by more than 300,000). Beyond the CCT program, the SIUBEN is also used to target the subsidized health insurance regime (SENASA), as well as Bonogaz and Bonoluz (programs of energy subsidies for the poorest). These two institutions – the payment mechanism and the targeting mechanism – are critical elements of the Dominican social protection system and their consolidation is expected to have impacts that go beyond the CCT program itself, as other programs improve their targeting and channel their payments efficiently through the ADESS. Policy Area II – Improving Budget Management 53. The targets of the DPL series in terms of budget management were both exceeded. The first indicator relates to the actual budget spent by the program to close supply gaps in health, nutrition and education services for Solidaridad beneficiaries. This indicator calculates the percentage difference between planned and actual budget appropriations for the programs for closing the supply gaps (extent to which the planned budget is indeed executed), and compares it to the similar percentage difference for the overall national budget. The objective was to have an indicator of less than 1 (which would indicate that the programs for closing supply gaps have been protected from reductions more than the overall budget on average). During the period 2010-2012, the actual allocations to the priority supply-gap programs were fully consistent with the planned budgets for these items, resulting in indicators of close to zero (the best value for this indicator). This was due to the allocation mechanism adopted by the Ministry of Finance that provided an absolute protection to these items in the national budget from being revised during the fiscal year. Moreover, the Government adopted this practice for selected budgetary allocations beyond the scope agreed for the PASS. 54. The indicator that measures the degree to which the budgeted expenditure (in the national budget law) was indeed largely realized (disbursed) in practice was exceeded. The target initially set for the end of the PASS program period was for a disbursement ratio of at least 85 percent; and the actual disbursement rate was 98 percent in 2012. Furthermore, beyond the actual protection of the spending, the DPL series has also resulted in the institutionalization of the practice of multi-annual budgets, which promote medium-term planning and greater predictability, which covers all sectors, beyond those supported by the DPL series. Policy Area III – Supporting the gradual introduction of Performance Agreements 55. The objectives in terms of introducing a results-base focus in social sectors were exceeded. Five priority programs in health, nutrition and education related to Solidaridad have implemented 19 Performance Agreements (which include a logical framework), and the nutrition program and child labor eradication program have developed logical frameworks for results-based management. The Ministry of the Economy, Planning and Development took the lead in introducing performance agreements in the policy actions agreed for the DPL series. The initial phase focused on issuing the regulation needed to implement the law allowing the introduction of performance agreements. At the same time, the process was initiated to introduce the concept to core social ministries, resulting in its acceptation by authorities in the ministries of education and health. The actual drafting of the Performance Agreements had a positive impact in helping decision makers to establish a clear relationship between budgets allocated and the outcome expected for a specific program. In late 2011, it was agreed to introduce five performance agreements for the 2012 budget. These were for pre-primary, basic and secondary education in the Ministry of Education, and programs for immunization and maternal and infant care in the Ministry of Health. Furthermore, other programs, including the nutrition program and the child labor eradication program have put in place their logical frameworks. The Ministry of Economy, Planning and Development is now considering requesting Performance Agreements for all “priority” programs, as a pre-condition to them being designated as priority programs (which provides them with some protection in case of budget adjustments during the fiscal year). This would expand the use of this tool to all sectors, with a view to promote the use of logical frameworks and the focus on results in line agencies. Policy Area IV – Improving transparency and oversight 56. Both objectives in terms of improving transparency and oversight were largely exceeded, as the government has implemented reforms that go much beyond the expected advances. In the area of publication of national budget data, the Government’s website has registered over 15,000 visits during 2012, well beyond initial expectations. But, perhaps more importantly, the Government has kept increasing the quantity and type of information provided on its webpage (data both on revenues and expenditure, with disaggregation along alternative dimensions) and is planning to further publish planned investment projects, starting with the sector of education, in which the Government has launched an ambitious investment plan. The initial effort to publish basic data in the context of the DPL-supported social reforms has resulted in a significant shift in terms of transparency that goes much beyond the sectors supported by this DPL series. broader 57. In the area of oversight of the CCT program, the target set for the end of the DPL series was exceeded, with score cards distributed to beneficiary groups completed by 78,5 percent of them (target was 70 percent). More importantly, however, given the success and acceptability of this tool, the Government decided to expand its application to the entire territory, and has approved its expansion plan for 2013. Also, the Government established local-level intersectoral committees to address grievances raised by the score cards in each community, which have demonstrated large success in addressing and resolving most issues (the experience was analyzed through a process evaluation, and an impact evaluation is underway). Community scorecards, and the processes to address the issues they raise, have now become a full-fledged part of the program’s management system (with the local committees) and monitoring and evaluation system (in addition to the management information system, process evaluations, and impact evaluations). 3.3 Justification of Overall Outcome Rating Ratings: Satisfactory 58. The overall outcome rating is satisfactory, reflecting the achievements of the program development objectives, the efficiency of this achievement, and the extent to which many results went significantly beyond the agreed targets, despite the limited shortcomings noted for some outcome 20 indicators. Overall, observed progress went beyond the expected in many dimensions, not only in terms of exceeding quantitative targets, but also in terms of contributing to the institutionalization of significant systems, tools and practices that are expected to have important developmental impacts in the medium term (impacts in terms of sectoral information systems, targeting and payment mechanisms for the broader social protection sector, as well as transparency mechanisms and results-focus which have spilled over to other sectors). These policy reforms supported by the PASS program remain highly relevant, and this despite a change in administration, as reflected in their institutionalization, continued improvements and broadened use. 3.4 Overarching Themes, Other Outcomes and Impacts (a) Poverty Impacts, Gender Aspects, and Social Development 59. The key objective of this series of DPL operations was to improve results in social sectors. Given its development objective, this series of DPLs was essentially centered on social protection, education and health, preserving in the short term and enhancing in the medium term the human capital of the poorest citizens. Additionally, through the policy actions implemented by the Government, it achieved important goals for improving the targeting systems being used to allocate resources to beneficiaries of social programs. It also enhanced the quality and scope of services being provided to households under the poverty line in the access of their children to pre-school, basic and secondary education, and to primary health care and nutrition. 60. In terms of specific poverty and human capital impacts, in 2012, the CCT program managed to reach over 650,000 households, with a very strong targeting performance, as it covers more than 90 percent of the extreme poor households, and as many as 80 percent of the moderately poor households that were eligible. Within a context of crisis, we estimate that the program alone is responsible for a reduction in one percentage point in the poverty rate. In terms of impact on human development, similarly, the program has contributed to significant gains for the poorest – with the program resulting in a reduced risk of catastrophic out-of-pocket spending in health, a greater size/weight among children under the age of 3, a lower risk of teenage pregnancy, and a lower prevalence of grade repetition in middle school. More generally, the program has supported a significant effort in closing the gaps that existed in the supply of basic services in the poorest areas of the country, which has contributed to reduced inequality and greater social inclusion. 61. The targeting system has resulted in significant improvements in the efficiency of public spending, with the share of social assistance spending that is targeted to the poor increasing from 6 percent in 2005 to 53 percent in 2011. As an increasing number of programs rely on this targeting system to allocate resources, the system, which is already used the CCT program, but also by other programs, such as the subsidized health insurance regime and the targeted fuel subsidies, will continue to contribute to poverty and social impacts. The targeting of the poorest for the CCT program has also resulted in a large effort to provide identification documents to the poorest (supported by a parallel Bank investment operation), which results in greater social inclusion and provides a mechanisms for the inclusion of the poorest in other social programs. 62. The programs supported by the PASS program also have a strong gender dimension. In particular, the CCT program works mostly through mothers and empowers them by providing them with the transfers. As an indirect effect, this has resulted in a significant number of women obtaining, for the first time, their own identification document (a pre-requisite for eligibility) which opens other opportunities beyond the program itself. Also, by nature, many of the health services that have been further expanded target women, with a strong focus on maternal health. Finally, the participation in the CCT program is expected to result in greater empowerment through the various community activities and 21 participation (including through the community-scorecards). In the coming years, as the program continues to improve, it is also expected to connect women to a broader set of financial services, a key element to promote greater income-generating activities. (b) Institutional Change/Strengthening 63. The DPL program played a key role for strengthening institutions under the Social Cabinet contributing to enhance its role and improve the management of social programs. In the first place, it supported the enhancement of the CCT program Solidaridad. Secondly, it assisted in establishing the legal and regulatory framework for the restructuring and strengthening of the Borrower’s social protection systems. Thirdly, it helped developing a strong coordination among ministries and agencies involved in social protection by creating two committees (Interagency and Intersectoral), chaired by the Vice- President, which played a critical role for implementing a complex program. Lastly, it provided a template for the development of performance agreements for the social sectors, which promotes results- focus and can be replicated to other priority programs. (c) Other Unintended Outcomes and Impacts 64. The policy reform program supported by the series of DPLs had impacts beyond the CCT program and the social sectors on which it focused. Indeed, some of the tools (budget transparency, Performance Agreements) are already used, or planned to, by other sectors in the public sphere. Also, tools such as the payment system (ADESS) or the targeting system (SUIBEN) are used beyond the CCT program itself, providing other programs with both efficiency gains (e.g. in the payment of the energy subsidies) and effectiveness gains (e.g. with the targeting of the subsidized health insurance system to the poor). In the coming years, it will be critical to ensure the continued strengthening and consolidation of such public expenditure management practices and payment/targeting tools, and to continue broadening their use and application. Finally, the development of sector-wide information system discussed earlier is also an outcome that goes beyond the expected outcomes of the PASS series, and that will contribute to improvements in the quality and the efficiency of basic social services in health and education. 4. Assessment of Risk to Development Outcome Ratings: Moderate 65. There are positive expectations that the newly elected government would provide a strong commitment continuing to support the policy actions adopted during implementation of the PASS program. It has also announced the creation of the Ministry of Social Development that should provide a more solid framework for consolidating the advances made on institutional arrangements and for implementing its own agenda on social protection. Additionally, progress made on targeting tools and results achieved on development outcomes provide a sound base for having a sustainable scheme. The long term outcome will basically depend from the continuity in commitment that the newly elected government will provide to enable consolidating the social protection system that was supported by the DPL series. Finally, the new administration has fully endorsed the reform program supported by this DPL series, and asked the Bank to continue provide support to this agenda. 22 5. Assessment of Bank and Borrower Performance 5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry Ratings: Satisfactory 66. The reasons for the satisfactory Bank performance in ensuring quality at entry for the three operations of the PASS program include the team composition and level, the combination of analytical and operational inputs, and flexibility in adjusting policy actions to reflect progress and new opportunities. Building on the lessons learnt from other operations supporting decentralization, institutional reform, and social protection, the Bank deployed a large, strong, multi-sectoral team throughout the PASS program, during the preparation of each DPL and its supervision, to ensure that all aspects of the reforms were covered. Also, the design of the PASS program was strongly anchored in analytical underpinnings, both in the Dominican Republic and in the region. These prior analytical foundations established by the team members themselves were critical, especially in the context of the preparation of PASS1, which was prepared on an accelerated calendar because of the need for urgent support to help the Dominican Republic face the impact of the 2008 global crisis. Analytical work was also set up throughout the program, to inform later policy decisions, ensuring that the Bank team and the Government counterparts had the capacity to explore alternative options. For the three DPLs of the PASS program, the Bank team demonstrated flexibility in revising the triggers and prior actions to recognize areas where progress was made faster than initially planned and to integrate new areas that could benefit from inclusion in the program. An important element was the team’s ability to identify risks and mitigation measures, which proved critical to ensure the three DPLs could be implemented in a satisfactory manner. Finally, although appropriate attention was given to the importance of developing an M&E system, the one area to which closer attention could have been given is the institutional arrangements required for implementing such a complex system involving the Social Cabinet, two ministries and three government agencies. (b) Quality of Supervision Ratings: Satisfactory 67. The Bank provided an adequate supervision effort for the three DPL of the PASS program, with a positive contribution for achieving targets. In the context of a programmatic series, the task of supervising an ongoing operation was done concurrently with preparation of the following operation, and practically, it becomes a single activity for achieving both ends. Missions maintained a positive dialogue with GoDR on the policies and actions that were needed to ensure full implementation of the policy reforms and to ensure targets were met. As needed, problems that arose from time to time were adequately addressed by providing advice to seek adequate solutions, using other Bank instruments (including the simultaneous technical assistance and investment operations) to address emerging issues. When necessary, the Bank explored with the GoDR ways to maintain momentum in the reforms sought by the program, adapting policy actions in subsequent operations to changes that came up during implementation. One good example was introducing a new policy action in PASS3, not originally foreseen, aimed at improving targeting in Solidaridad and other social programs. Another area that needed close attention during supervision was the systematic verification of co-responsibilities that needed interim measures to cover the delays that occurred in the implementation of new M&E systems in Solidaridad and in the ministries of health and education. 23 (c) Justification of Rating for Overall Bank Performance 68. The overall Bank performance is considered satisfactory, since both quality at entry and quality of supervision are considered satisfactory with minor shortcomings, and contributed to the Satisfactory outcome of the program. 5.2 Borrower Performance (a) Government Performance Ratings: Satisfactory 69. Government ownership and commitment was strong from the outset. When the 2008 international crisis threatened to seriously affect the development agenda, the GoDR sought Bank assistance to define a program that could help protect social programs. Overall, good progress was made in carrying out policy actions that enabled the implementation of the program. The only major hurdle that the DPL program faced was that related to the implementation of the comprehensive M&E system. In spite of the delays faced, the GoDR continued to show its strong commitment to maintain the program on track and seek interim solutions that would enable achieving the targets set. The GoDR performed well in the timely adoption of policy actions that played an important role for improving the performance and accountability of social sectors. In particular, it was very effective at enhancing the coordination role of the Social Cabinet with social sector ministries and agencies and for improving the systems for budget allocation and control. 6. Lessons Learned 70. The programmatic development policy approach proved to be a suitable instrument for this intervention. The DPL program proved suitable to support reform processes and to ensure policy continuity in the social sectors in a period of considerable threat to social programs. It combines continuity and flexibility (that a multi-tranche or single operations might not provide). This instrument is highly suitable for providing adequate flexibility for implementing a series of policy actions over a three year period. It proved very adequate for dealing with issues and adapting to changes during the second and third operation. Looking at the evolution of the policy matrix during the three operations, it can be highlighted that the overall content of the program remained basically the same with improvements that strengthened critical areas and adjustments that helped to face difficulties that arose during implementation and some changes in the social and economic climate. 71. The process for transforming a system of subsidy transfers into a proper CCT is complex and it needs careful design and planning. The gradual transformation needed by Solidaridad to become a full-fledged CCT program proved to be more difficult than originally envisaged. The effort needed for setting up information systems for verifying compliance with co-responsibilities for an ongoing program, (initially covering 350,000 families and now reaching over 650,000 families), proved to be far beyond what was originally envisaged. It needed to develop a careful planning process setting up special coordination effort with the decentralized structures of the two ministries involved. The structure relied too much on the implementation of new information systems in both ministries (Education and Health) that took longer than anticipated. In retrospect, a simpler interim system could have been planned from the outset to start producing result at a much earlier stage. 72. Implementation of an M&E system, covering a decentralized system of service providers, is very complex, takes time, and needs a strong managerial leadership. The design and implementation 24 of information systems for the various elements of the social protection system, which involves a series of actors and sectors, proved to be more complex than anticipated. Building systems takes time, and their implementation is likely to be very progressive (even if design is complete upfront). To support such the construction and implementation of information systems, the combination of the DPL series with technical assistance (both through a NLTA and through investment operations) was critical. DPLs alone are likely not sufficient to promote the development of strong systems, at least not in the Dominican Republic, and a strong technical assistance would have helped further strengthen this aspect. Also, the DPL series could have focused more strongly on the intermediate steps that are required to build these systems to ensure the adequate focus on each of these steps. Similarly, the reforms that promoted a shift in budget management are likely to continue requiring support for years to come, as these changes are likely to be gradual, requiring significant cultural changes to take place. 73. Reducing the number of policy actions agreed in each operation was useful to have a more manageable program. PASS1 included 18 policy actions. These original policy actions had been well studied based on preparation work done specifically for the DPL program and related ongoing projects and analytical work. During the first year of implementation and while preparing the second operation, it became apparent that the program needed to be more selective and better focused on fewer policy actions. A special effort was needed to revise and adjust the policy actions originally planned for PASS2. Eventually, the number was reduced considerably and this proved to be a wise decision that allowed a more focused policy dialogue and supervision effort during the subsequent operations. It should be noted however that, at times, this reduction posed a threat in the dialogue with key actors who saw the DPL series as a good opportunity to introduce changes and improvements in their sectors by introducing more explicit policy actions. In particular, actions that support the development of the systems would have been useful. 74. Having a multi-sectoral team was critical to achieving synergies; working across sectors can reinforce results. The team for the DPL series was built from a multitude of sectors – social protection, health, education, public sector management, economic management, and social development. Similarly, on the Government side, the team comprised key members of the social cabinet (and its associated institutions including the SIUBEN and ADESS), social ministries (health and education), as well as the ministry of finance and the ministry of the economy. Bringing to the table both sectoral and central agencies was paramount to some of the structural reforms supported by the PASS program – changes in the way budgets are prepared (pluri-annual, on basis of results), changes in the way information is managed (timely disclosure of plans and execution, role of citizens in monitoring services), changes in the way budgets are allocated (giving priority to specific areas/sectors where analysis shows gaps). Having the ministries of finance and economy onboard meant that the policy reforms could be supported (budgeted), providing incentives and rewards to the changes. For the central ministries, working with the line agencies was also a way to translate their vision, guidance and methodology to practical applications. The readiness of the social sectors to adopt some of this new results-culture was critical, and is paving the way for other sectors to also work in this direction. 75. A real programmatic approach that builds on complementarities with other Bank simultaneous interventions was highly helpful. It is particularly important to note that the reforms supported by this operation were based on a broad range of instruments, highlighting the potential synergies between instruments and across sectors. These instruments combined a multitude of types of instruments – investment operations, development policies loans, analytical pieces, non-lending technical assistance, Trust Fund, and partnerships with other donors. This breadth of support was critical in ensuring the successful implementation of an ambitious set of reforms and in ensuring that the Bank was able to effectively monitor progress and provide technical assistance as required. The Social Protection investment operations provided critical support for targeting, identification of potential beneficiaries, and social accountability mechanisms. The Health Sector Adaptable Program Loan contributed to 25 improvements on the delivery of basic health services by introducing, among other things, results-based financing mechanisms. The Early Childhood Education Project contributed to achieve important increases in access to early childhood education services, and the Youth Development Project helped to enable that poor and vulnerable youth had a second chance to complete their secondary education. Additionally, a series of technical assistance activities made important contributions to policy actions in the broader area of public expenditure management. Overall, the approach chosen by the Bank in the social sectors – truly a programmatic approach – was essential to leverage the various instruments and jointly achieve results that went beyond what could have been achieved in isolation. 76. A combination of an impending crisis, relevant analytical work, and political leadership provided strong entry points to define an ambitious reform agenda. As a backdrop to the preparation of this DPL series, the 2009 crisis provided a strong motivation for some of the most ambitious reforms of the PASS program. In particular, the fear of imminent budgetary contraction and expenditure cuts was critical in the decision to clearly target programs to those areas that needed it most (e.g. the program to close gaps in the supply of basic services), to restructure the CCT program to ensure its greater efficiency, and to keep strengthening the targeting system. But the pressure that the crisis applied to the Government would not have been sufficient to design these policies, were it not for the availability of strong analytical work that shaped the policy recommendations. Because the team invested in analyzing gaps and identifying potential efficiency gains, the team was able to propose a set of evidence-based policy recommendations. Another critical element for the development of the reform agenda was the high-level political will to take advantage of the crisis situation to address structural issues. In particular the leadership of the Vice-Presidency was instrumental to the success of the PASS program. Finally, at the time of the design of the initial operation, as well as throughout the preparation and supervision of the following ones, the team had a close dialogue with the IMF, whose encouragements with respect to strengthening social safety nets in a time of crisis were instrumental to the reforms. 77. The extra effort demanded by the implementation of a complex DPL program was more than compensated by achieving a wide range of reforms in a short period of time. It is important to note that the Social Cabinet showed a strong commitment for substantially improving interaction among social sector ministries and agencies and with ministries of finance and economic development. The management team was extremely dedicated to ensure that the policy actions were implemented following the overall directions established at the outset. In particular, they were effective for generating improvements related to the reform of the governance and operative system of Solidaridad, a better articulation with health and education actions, and to the gradual introduction of performance-informed budgeting, and improvements in transparency and accountability to users. These were impressive reforms achieved during the three years that took to implement the DPL program of reforms. 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (a) Borrower/Implementing agencies. The Government received the ICR and provided positive comments, which highlighted their endorsement of this ICR and their appreciation of the Bank support for these operations (see Annex 4). (b) Co-Financiers (c) Other partners and stakeholders 26 ANNEXES Annex 1 – Evolution of the Policy Matrix PASS1 PASS2 PASS3 Prior Actions Proposed Reforms Prior Actions Agreed Proposed Reforms Proposed Reforms Revised Prior Actions Agreed (October 2009) (October 2009) (October 2010) (October 2009) (October 2010) (October 2011) I. Enhance Performance of Social Sectors 1.1 Redesign of the Solidaridad program 1. Presidential Decree 1. GoDR approves 1. GoDR approves 1. Verification of co- 1. Verification of co- 1. GoDR has adopted establishing the legal and regulations for the regulations for the responsibilities for at least responsibilities for at least procedures to allow for the regulatory framework for the Interagency and Intersectoral Interagency and Intersectoral 80% of families. 80% of families. verification of compliance restructuring and committees. committees; and the with co-responsibilities under strengthening of the social implementation of an 2. Regional Intersectoral 2. Regional Intersectoral the Solidaridad Program, and protection system, organized 2. Establishment of a organizational development committees in half the committees in half the has established regional as non-conditional cash monitoring and evaluation plan for Solidaridad. regions. regions. intersectoral committees in transfers. system, including definition all regions. of baselines. 2. The Intersectoral 3. M&E system shared by 3. M&E system shared by 2. Resolutions redesigning Committee agrees that (i) Solidaridad, Education, Solidaridad, Education, 2. GoDR has designed and the institutional framework 90 % of beneficiary Health, ADESS and Health, ADESS and mandated the establishment and operative rules of the households receiving SIUBEN. SIUBEN. of an integral monitoring and Solidaridad program, transfers will be registered in evaluation system for including the compliance a Primary Care Unit and/or purposes of sharing with and verification of co- school or have received a information amongst responsibilities, establishing letter warning of potential agencies involved in the indicators of management suspension due to Solidaridad Program. and impact, and approving incompliance; and (ii) defines appropriate operational procedures and a timeline for manuals. the systematic verification of co-responsibilities. 1.2 Health policy measures 3. Formulation of a four year 4. Start implementation of 4. The Ministry of Health 3. The Government has action plan to improve four year action program launches mandatory training mandated the daily prenatal control and quality (prenatal control and quality on primary health care registration of primary of delivery services. of delivery). including new protocols for health care services through maternal-infant care. the Clinic Management 4. Formulation of an action 5. Start implementation plan System, and has issued an plan to improve vaccination to improve vaccination rates. 5. The Ministry of Health action plan for the rates. implements evaluation institutional strengthening of system to assess adherence to entities within the health new manuals for maternal- sector, training, and the infant care. establishment of performance 6. GoDR implements incentives for staff. informal tool for daily registry of primary health care activities. 27 PASS1 PASS2 PASS3 Prior Actions Proposed Reforms Prior Actions Agreed Proposed Reforms Proposed Reforms Revised Prior Actions Agreed (October 2009) (October 2009) (October 2010) (October 2009) (October 2010) (October 2011) 1.3 Education policy measures 3. Resolution validating 5. Implementation of the 3. Resolutions formalizing 6. New system of transfers 7. New system of transfers 4. GoDR has approved a new student evaluation standards school management system. the introduction of the defined. defined. system for the transfer of for pre-primary education and student learning outcome financial resources and the first cycle of Basic 6. Carryout pilot test for new tests for the first cycle of 7. Implement student learning 8. Implement student learning validated student evaluation Education. system of transfers. basic education and outcome test for eighth grade. outcome test for eighth grade. standards for secondary 7. Implement student learning validating the evaluation 8. Validation of standards for 9. Validation of standards for education. test for fourth grade. standards to be used in the secondary education. secondary education. second cycle of basic 8. Implement validation of education. standards for second cycle of basic education. 1.4 Improved quality of service to beneficiaries 4. Resolution approving a 9. Network is expanded to 4. Resolution is issued 9. Network is further 10. Network is further 5. GoDR has expanded the plan to expand the network of meet 1st year target. implementing greater access expanded to meet target for expanded to meet target for number of shops affiliated to shops affiliated to the to information in the 2nd year. 2nd year the supply network to a total Solidaridad program in order 10. GoDR approves and start Solidaridad debit card. of 3,067 institutions, has to promote competition and implementing plan to approved the bylaws of the expand the supply and types enhance transparency of supply network, and has of products that can be Solidaridad card. entered into an agreement purchased with the with a consumers’ rights Solidaridad debit card. Non-Governmental Organization to supervise shops and to better inform beneficiaries of their rights. I.5 Improved Targeting Performance 11. GoDR will implement a 6. GoDR will implement a new census into new new census into new geographic zones with high geographic zones with high poverty levels and update poverty levels and update program databases. program databases. II. Improved Budget Management 5. Providing an assessment of 11. Policy Paper with 5. GoDR has approved the 10. Review progress in 12. Review progress in 7. GoDR has established the costs of supply-gaps medium-term budget Multi-Annual National Plan closing supply-gaps in closing supply-gaps in budget planning and linked to the redesigned CCT envelopes to cover supply- for the Public Sector, prioritized areas. prioritized areas. coordination mechanisms that program, covering the gaps in relevant education, containing guidelines for will ensure the availability of provision of education and primary health care and social protection policy for 11. Policy Paper projections 13. Policy Paper projections sufficient resources to meet primary health care services nutrition expenditures linked education, health care and reflected in pluri-annual plan reflected in pluri-annual plan the results of the Solidaridad and micronutrients. to CCT program. nutrition. and medium-term budget and medium-term budget Program. framework. framework 6. Sufficient funds will be 12. 2010 Budget includes 6. The Government has made included on the 2010 Budget sufficient resources to meet available sufficient resources to cover the supply-gaps output targets. to meet the output targets of 28 PASS1 PASS2 PASS3 Prior Actions Proposed Reforms Prior Actions Agreed Proposed Reforms Proposed Reforms Revised Prior Actions Agreed (October 2009) (October 2009) (October 2010) (October 2009) (October 2010) (October 2011) linked to the redesign of the the Solidaridad Program, Solidaridad Program, as well ensure the predictability in as ensuring that those funds disbursement for budget are disbursed in a timely users, and taken adequate fashion. measures to monitor and publish the use of such budget resources. III. Gradual Introduction of Performance Agreements 7. An institutional diagnostic 13. * Institutional 7. The Ministries of Health 12. Performance agreements 14. Performance agreements 8. The Government has has been completed to assess strengthening plans to and Education agree with the signed with Health and signed with Health and signed a separate the preparedness and capacity introduce performance Ministry of Economy on the Education ministries and Education ministries and performance agreement with building needs for the agreements in Health and institutional strengthening Social Cabinet for the Social Cabinet for the the ministries of health and introduction of Performance Education. measures to ensure Solidaridad Program Solidaridad Program education, to strengthen the Agreements in the education preparedness for the included as annex to the included as annex to the institutional budget and health sectors. 14. Diagnostic and draft introduction of their Budget. Budget. management and institutional plans for respective performance accountability, through 8. The Secretariat of Health introducing a performance agreements by October 2011. 15. Other triggers to be performance-based budgeting has signed results-oriented agreement in Solidaridad. reassessed after redesign of internal management 8. Internal management Solidaridad. agreements with two 15. Health Management agreements signed between Regional agreements signed with the Ministry of Health and 16. Diagnostic and draft remaining regional services the remaining Regional institutional plans for Health Services to introduce introducing a performance results-based management. agreement in Solidaridad. IV. Enhanced Transparency and Civil Society Oversight 9. The Solidaridad program 16. Website tool developed 9. Implementation and 13. Launching the Consulta 17. Launching the Consulta 9. The Government has has published electronically and approved by the Ministry development of the web site Amigable tool. Amigable tool. launched an online budget the list of beneficiaries and of Finance to enable access to to make available data on the transparency tool, which the assessment quantifying budget data. national budget, and 14. Publication of community 18. Publication of community allows free public and estimating the costs of publication of monthly scorecards pilot results. scorecards pilot results. consultations on public supply gaps in health, 17. Agreement between reports on the execution of revenues and expenditures of Ministry of Finance and 15. Complaint system 19. Complaint system education and nutrition. the budget. Additionally, enhanced. enhanced. central agencies. Ministry of the Economy, establish the development of Planning and Development to a pilot system to link budget 10. The Government has include a module linking information to performance defined and mandated the budget information to indicators. implementation of the performance indicators. expansion plan of the 10. Resolution instructing the community scorecards 18. Solidaridad website implementation of a scheme to enable publishes its M&E system community scorecard pilot to beneficiaries of the and Policy Paper on budget. monitor the availability of Solidaridad Program to voice 19. Approval of social health and education inputs their opinion on the quality of auditing scheme including linked to co-responsibilities. . the services provided. use of community scorecards 29 Annex 2 - Key Development Indicators This annex provides a selection of key monitoring indicators, baselines (when available) and targets for the three-loan PASS series. Baseline Target Target Target Actual Status and comments Indicator End DPL1 End DPL2 End DPL3 Nov. 20091 value Nov. 2010 Nov. 2011 Dec. 2012 Dec. 2012 Policy Area 1: Enhanced performance of social sectors to promote human capital for the poor I.1 Overhaul of the CCT Solidaridad program Interim phase (September– December 2010): 1.1.1. Share of beneficiary households receiving transfers, who are 0% 92% 93% 95% 97.7% Target met (health): The indicator increased to 97.7% by registered with their Primary Care Unit (UNAP) or school, or who November 2012 (share of families with information letters to received a letter warning of potential suspension due to signal registration in a primary health care unit, data from the incompliance with registrations program’s information system). Starting January 2011: 85% (health) Target met (education and health): The indicator increased 1.1.2. Share of CCT Solidaridad transfers paid based on the timely NA NA 65% 80% 80,7% to 85% for health co-responsibilities and 80.7% for education verification of compliance with co-responsibilities. (education) co-responsibilities in July 2012 (share of families who comply with their co-responsibilities, data from the recurring audit organized by the IDB). 1.2 Improved articulation with health actions According to national health protocol or Basic Health Care Plan: 1.2.1. Share of pregnant women from CCT Solidaridad who receive 91.7% 92% 93% 94% 68% Target partially met: Overall, as mentioned in the main text prenatal checks of this ICR, health targets have not been fully met. However, 1.2.2. Share of puerperal women from CCT Solidaridad who attend 41.9% 42.5% 45% 50% 43.8% the data for indicators 1.2.1 and 1.2.3 reflect the share of postnatal checks women (children) with a prenatal (regular) visit registered in 1.2.3. Children between 0 and 5 years old in the CCT program 54.4% 55% 60% 65% 65.3% their health carnet (the actual number of women or children comply with the series of consults established by the national who received the services could be higher). The data for 1.2.1, standards of comprehensive care for children (growth and 1.2.3 are from the alternative verification system put in place development check-ups) while the sectoral information systems become fully 1.2.4. Share of children between 18 and 23 months from CCT 49.3% 50% 60% 65% 40.3% operational. Data for 1.2.2., 1.2.4 is for 2011 and comes from Solidaridad fulfilling the complete vaccination protocol2 the last impact evaluation data available. 1.2.5. Share of elderly aged over 65 years old from CCT 35.1% 37% 50% 60% N/A Solidaridad receiving a health check visit once a year. 1.3 Nutrition 1.3.1. Share of pregnant women (first pregnancy) in the CCT 68.3% 69% 70% 73% 55.4% Targets mostly not met: Targets for nutrition for receiving some vitamins or micronutrients during their pregnancy.3 pregnant/puerperal women were almost met on average, but 1.3.2. Share of puerperal women from the CCT program receiving 63.3% 65% 66% 68% 74.1% the target for coverage of children with nutrition supplements 1 Baseline data reflect administrative data gathered for the period at the start of PASS DPL1 in Nov 2009; additional baseline data was gathered in July 2010 through the Social Protection Evaluation Study (EEPS). 2 To ensure measurability, this indicator replaces the initial one which referred to children 0 to 5 years old. 3 To ensure measurability, this replaces the initial indicator (share of pregnant women in the CCT program who receive micronutrients according to the national protocol). 30 Baseline Target Target Target Actual Status and comments Indicator Nov. 20091 End DPL1 End DPL2 End DPL3 value Nov. 2010 Nov. 2011 Dec. 2012 Dec. 2012 supply of micronutrients in accordance with the national protocol was not met. This is linked to the delays in the implementation 1.3.3. Share of children between 6 and 60 months from CCT 1.4% 5% 60% 80% 12.6% of the program sponsored by the World Food Program. As Solidaridad receiving micronutrient sprinkles (iron and zinc).4 mentioned in the ICR document, the information system meant to provide information on this indicator is not fully functional. As a result, indicators 1.3.1 and 1.3.2 were measured using data from the impact evaluation survey (2011), and indicator 1.3.3 was measured using data on the number of beneficiaries from the World Food Program distribution program as a numerator and the number of Solidaridad beneficiaries as the denominator (December 2012). 1.4 Improved articulation with education actions Enrollment (for CCT Solidaridad children) Targets partially met: Enrolment targets met for compulsory 1.4.1. Early Childhood Development 14.1% 15% 16% 50% 35.6% education only (see below note on indicator for secondary 1.4.2. Basic Education 95.2% 80% 83% 85% 95.9% education), attendance targets met for all levels. Enrolment 1.4.3. Secondary Education (First Cycle) 42.2% 45% 48% 55% 47.5% data were calculated using the number of children enrolled as numerators, and the total population of school age as School attendance (80 percent of school days) for CCT Solidaridad denominators (age 5 for ECD, 6-13 for primary, and 14-18 for children secondary education). For secondary education, the 1.4.4. Early Childhood Development 48.8% 50% 60% 70% 95.6% denominator does not exclude children who already finished 1.4.5. Basic Education 93.7% 80% 85% 90% 94.2% the secondary education cycle or those who are still in primary 1.4.6. Secondary Education 87.1% 70% 80% 85% 93.5% education (and uses a very large age group), which likely results in an underestimation of the value of this indicator. Attendance data were estimated using the alternative co- responsibility verification system. 1.5 Payment mechanisms and targeting 1.5.1. Number of affiliated institutions in the Red de Abastecimiento 1,988 3,067 4,904 Target exceeded. The RAS has been expanded beyond the Social (RAS) initial plan, and the Government is planning to pilot alternative 1.5.2. Monitoring mechanism for issues with payment mechanisms Plan Actual Ongoing payment mechanisms that would further broaden options for beneficiaries. An agreement has been signed with Pro- Consumidor to monitor the quality of payment services. And mechanisms are in place to process requests and complaints. 1.6 improved targeting performance 1.6.1. Revision of the SIUBEN census Launch Database Target met. Census was concluded end 2012, and includes updated over 1.7 million households. Policy Area 2: Improved budget management for enhanced performance of social sectors 4 To ensure measurability, this replaces the initial indicator by broadening the age range from 0 to 6 months to 0 to 60 months. 31 Baseline Target Target Target Actual Status and comments Indicator Nov. 20091 End DPL1 End DPL2 End DPL3 value Nov. 2010 Nov. 2011 Dec. 2012 Dec. 2012 2.1.1. Deviation between proposed and actual budget for programs NA 1.00 0.90 0.85 0.08 Target exceeded: for 2012, the deviation was almost zero for to close supply gaps in health, nutrition, and education services, programs to close supply gaps (1.6%) and larger for the overall relative to the deviation for the overall budget.5 budget (19.6%), resulting in an indicator 0.08 (the best value for this indicator is zero). In addition during 2012, 98 percent 2.1.2. Average annual ratio between quarterly disbursement to, and NA 0.50 0.65 0.85 0.98 of the planned quarterly budget allocations were disbursed planned quarterly budget allocation for, programs aimed at closing quarterly. the supply gaps in health, nutrition, and education services. Policy Area 3: Gradual introduction of performance agreements 3.1.1 Number of priority programs in education, nutrition, and 0 2 4 6 7 Target almost met: Five priority programs are covered by the health, related to the Solidaridad CCT Program that have Performance Agreements (pre-primary, basic, and secondary successfully developed the log-frame methodology. education programs, as well as the immunization and the Maternal and Infant Health and Nutrition programs). In addition, the nutrition program, and the child labor eradication program have developed their logical framework for results- based management. Policy Area 4: Enhanced Transparency and Civil Society Oversight 4.1 Enhanced Budget Transparency and Oversight 4.1.1. Number of independent users of the Portal del Ciudadano 0 Tool ready 15 60 n/a Targets exceeded: during January-December 2012, the "Consulta Amigable" budget information portal. system registered a total of over 15,000 visits (corresponding 4.1.2. Number of times the portal website, where free information is 0 Tool in 50 1,500 15,281 visits to 37,000 pages visited). available, is accessed (annual hits). progress 37,420 pages 4.2 Enhanced Transparency and Oversight of the CCT Solidaridad 4.2.1. Number of community-scorecards completed by beneficiary 0% 0% 50% 70% 78.5% Target exceeded. Since then, the Government has decided to committees, as a share of total number of community-scorecards scale up the community scorecard process to the entire distributed. territory, as a core element of its management processes. 5 Percentage difference between the planned (Bplan-supply) and the actual (Bactual-supply) budgets for programs to close the gaps in supply in health, nutrition, and education services, relative to the percentage difference between the planned (Bplan-national) and the actual (Bactual-national) for the overall national budget: ((Bactual-supply – Bplan-supply)/Bplan-supply) / ((Bactual-national – Bplan-national)/Bplan-national). 32 Annex 3 - Bank Lending and Implementation Support/Supervision Processes (a) Task Team members P116972 - First Performance and Accountability of Social Sectors Development Policy Loan Names Title Unit Task Team Leader, Sr. Social Protection Carine Clert LCSHS Specialist Helena Ribe Sector Manager LCSHS David Warren Sector Leader LCSHD Catherine Abreu Rojas Procurement Specialist LCSPT Pablo Acosta Economist/YP LCSHS Ana Bellver Public Sector Management Specialist LCSPS Raja Bentaouet Kattan Sr. Education Specialist LCSHE Maurizio Bussolo Sr. Economist LCSPE Miguel Ceara Country Officer LCCDO Caroline Charpentier Operations Analyst/Consultant LCSHS Christian Contin Consultant LCCDO Mary A. Dowling Program Assistant LCSHD Myrna Machuca- Sierra Education Consultant LCSHE Fernando Montenegro Sr. Health Economist LCSHH Maria Poli Civil Society/Transparency Specialist LCSSO Maritza Rodríguez Sr. Financial Management Specialist LCSFM Maria Concepcion Steta Sr. Social Protection Specialist LCSHS Theo Thomas Sr. Public Sector Management Specialist LCSPS Keith Hansen Sector Manager LCSHH Chingboon Lee Sector Manager LCSHE Nick Manning Sector Manager LCSPS Roby Senderowitsch Country Manager LCCDO Edward Mountfield Economic Adviser OPCCE Mutukhurama Mani Sr. Environmental Economist SASDI William Reuben Sr. Social Accountability Expert, Consultant Ian Walker Lead Social Protection Specialist LCSHS Theresa Jones Lead Operations Officer, Peer Reviewer LCSHS Alberto Rodríguez Country Sector Coordinator, Peer Reviewer ECSH2 Jehan Arulpragasam Country Sector Coordinator, Peer Reviewer EASHS Yasuhiko Matsuda Sr. Public Sector Specialist, Peer Reviewer EASPR Omar Arias Sector Leader LCSHD External Peer Reviewer, former Head of the Rogelio Gomez Hermosillo Mexican CCT Program Oportunidades P121778 - Second Performance and Accountability of Social Sectors Development Policy Loan Names Title Unit Task Team Leader, Sr. Social Protection Carine Clert LCSHS Specialist Helena Ribe Sector Manager LCSHS David Warren Sector Leader LCSHD Catherine Abreu Rojas Procurement Specialist LCSPT Cristian D’Amelj Counsel LEGLA Pedro Arizti Public Sector Specialist LCSPS 33 Maurizio Bussolo Sr. Economist LCSPE Timothy Cheston Jr. Professional Associate LCSHS Christian Contin Consultant LCCDO Cynthia Hobbs Sr. Education Specialist LCSHE Patricia de la Fuente Hoyes Sr. Finance Officer CTRFC Javier Luque Sr. Education Economist LCSHE Fernando Montenegro Sr. Health Economist LCSHH Patricia Orna Program Assistant LCSHD Mariana Montiel Sr. Counsel LEGLA Gunars Platais Sr. Environmental Economist LCSEN Maria Poli Civil Society/Transparency Specialist LCSSO Maritza Rodríguez Sr. Financial Management Specialist LCSFM Maria Concepcion Steta Sr. Social Protection Specialist LCSHS Ludovic Subran Economist LCSHD P125806 - Third Performance and Accountability of Social Sectors Development Policy Loan Title Unit Unit Aline Coudouel Task Team Leader, Lead Economist LCSHS Mansoora Rashid Sector Manager LCSHS David Warren Sector Leader LCSHD Catherine Abreu Rojas Procurement Specialist LCSPT Fabiola Altimari Sr. Counsel LEGLA Pedro Arizti Public Sector Specialist LCSPS Jasmin Chakeri Sr. Country Economist LCSPE Timothy Cheston Jr. Professional Associate LCSHS Christian Contin Consultant LCCDO Andrea Gallina Civil Society/Transparency Specialist LCSOS Cynthia Hobbs Sr. Education Specialist LCSHE Christine Lao Pena Sr. Human Development Economist LCSHH Javier Luque Sr. Education Economist LCSHE Patricia Orna Program Assistant LCSHD Maritza Rodríguez Sr. Financial Management Specialist LCSFM Miguel Eduardo Sanchez Jr. Professional Officer LCSPE Martin Maria Concepcion Steta Sr. Social Protection Specialist LCSHS Ludovic Subran Economist LCSHD Dena Ringold Senior Economist, Peer Reviewer HDNCE Jehan Arulpragasam Advisor, Peer Reviewer MDI Yasuhiko Matsuda Sr. Public Sector Specialist, Peer Reviewer EASPR 34 (b) Staff Time and Cost Staff Time and Cost (Bank Budget Only) USD Thousands Stage of Project Cycle No. of staff weeks (including travel and consultant costs) P116972 - First Performance and Accountability of Social Sectors Development Policy Loan Lending FY09 8.23 58,028.16 FY10 22.41 110,288.28 Total: 30.64 168,316.44 Supervision/ICR FY10 19.67 84,402.53 FY11 0.95 3,334.29 Total: 20.62 87,736.82 Staff Time and Cost (Bank Budget Only) USD Thousands Stage of Project Cycle No. of staff weeks (including travel and consultant costs) P121778 - Second Performance and Accountability of Social Sectors Development Policy Loan Lending FY10 12.89 45,317.23 FY11 47.69 164,448.70 Total: 60.58 209,765.93 Supervision/ICR FY11 1.23 5,203.95 FY12 0.45 1,955.88 Total: 1.68 7,159.83 35 Staff Time and Cost (Bank Budget Only) USD Thousands Stage of Project Cycle No. of staff weeks (including travel and consultant costs) P125806 - Third Performance and Accountability of Social Sectors Development Policy Loan Lending FY11 30.03 133,165.14 FY12 37.18 142,664.31 FY13 2.48 14,324.10 Total: 69.69 290,153.55 Supervision/ICR FY12 7.74 63,777.10 FY13 5.78 45,187.34 Total: 13.52 108,964.44 36 Annex 4 - Summary of Borrower’s ICR and/or Comments on Draft ICR The Ministry of Finance reviewed the ICR and had no comments to the document. The Ministry of the Economy, Planning and Development reviewed the ICR and had the following comments: From: Dominican Republic Ministry of Economy, Planning and Development Santo Domingo, National District May 23, 2013, To: Aline Coudouel Task Manager of the PASS operation Human Development Department World Bank, Washington DC Subject: Implementation Completion and Results Report – PASS operations – Dominican Republic Dear Ms. Coudouel, We have reviewed with care the Implementation Completion and Results Report for the Performance and Accountability in the Social Sectors (PASS) operations in the Dominican Republic. Regarding this report, we are happy to inform you that: 1. We validate the content of the report; we understand that it presents the development of the operations, the processes that these operations put in motion, and the results that arose from these processes with objectivity and wisdom. 2. These three operations clearly supported complex management reforms focused on results, which successful implementation resulted from intelligent leadership and a very close, at times tense but always productive, collaboration between the World Bank and the Government of Dominican Republic teams. The frequent and long coordination meetings also strengthened the Government’s capacity, which is critical for improved performance in the management of social programs. 3. We understand that the good development and results of the operations covered by the Implementation Completion and Results Report represent a good reference for potential and future operations that the Dominican Government could be interested in implementing to strengthen the reform processes in this important sector of public policies. 4. We reiterate our gratitude to the World Bank team for the knowledge it brought to the Dominican Government counterpart in the development and management of the reform processes. I take advantage of this opportunity to reiterate our best considerations and send our greetings, Sincerely, Ing. Juan Temistocles Montas, Minister cc: Simon Lizardo, Ministry of Finance and Public Credit cc: Margarita Cedeño de Fernández, Vice-President of the Republic, Cabinet for the Coordination of Social Policies. 37 38 Annex 5 - Comments of Cofinanciers and Other Partners/Stakeholders Not applicable 39 Annex 6. List of Supporting Documents World Bank Documents  Country Partnership Strategy, August 2009  First Development Policy Loan on Performance and Accountability of Social Sectors, Appraisal Document, November 2009  Second Development Policy Loan on Performance and Accountability of Social Sectors, Appraisal Document, October 2010  Third Development Policy Loan on Performance and Accountability of Social Sectors, Appraisal Document, October 2011  Social Protection Investment Project, Appraisal Document, July 2007  Social Protection Investment Project, Additional Financing, Appraisal Document, August 2009  Public Finance And Social Sector Development Policy Loan, ICR, June 2011  Early Childhood Education Project, ICR, May 2012 Borrower Documents  Estrategia Nacional de Desarrollo de la República Dominicana 2030, Diciembre 2011  Plan de Gobierno 2012-2016, Candidatura Danilo Medina, Marzo 2012  Relatoría Seminario Técnico Cómo Consolidar una Visión Integral de la Protección Social en la República Dominicana, Enero 2011  Estudio Línea de Base y Evaluación de Impacto, Informe Preliminar, Universidad Nacional, Diciembre 2011  Manual Operativo del Programa de Transferencias Condicionadas de Solidaridad, Tercera Versión, Septiembre 2011 .   40 72º W 71º W 70º W DOM INICAN AT LA NT IC O CEA N REP UBL IC 20º N SELECTED CITIES AND TOWNS 20º N PROVINCE CAPITALS Luperón Monte Cristi NATIONAL CAPITAL Puerto Plata Pepillo Salcedo MONTE Villa Vásquez C ord Imbert Sousúa ESPAILLAT RIVERS CRISTI Yaq ille PUERTO PLATA MAIN ROADS or t e r a ue el N Cabrera d Sep Rio San To tent Fort Liberté Fort-Liberté Dajabón Mao 3 riona l Gaspar Hernández Juan RAILROADS MARÍA PROVINCE BOUNDARIES Santigo TRINIDAD 1 Sabaneta Moca 4 SÁNCHEZ INTERNATIONAL BOUNDARIES 2 Jánico San Francisco Salcedo de Macorís Nagua Restauración San Jose This map was produced by the Map Design Unit of The World Bank. de las Matas HAITI La Vega SAMANÁ The boundaries, colors, denominations and any other information shown on this map do not imply, on the part of The World Bank AC SANTIAGO Pimental Sánchez Group, any judgment on the legal status of any territory, or any Camu DUARTE endorsement or acceptance of such boundaries. 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