Document of The World Bank Report No: ICR00004065 IMPLEMENTATION COMPLETION AND RESULTS REPORT (IBRD-74510 and IBRD-81160) ON A LOAN AND ADDITIONAL FINANCING IN THE AMOUNT OF US$ 22.1 MILLION TO THE ORIENTAL REPUBLIC OF URUGUAY FOR A INSTITUTIONS BUILDING TECHNICAL ASSISTANCE PROJECT (IBTAL) June 30, 2017 Governance Global Practice Argentina, Paraguay, and Uruguay Country Management Unit Latin America and the Caribbean Region CURRENCY EQUIVALENTS Currency Unit = Uruguayan Peso April 16, 2007 UR$1.00 = US$ 0.04 US$ 1.00 = UR$24.1 December 31, 2016 UR$1.00 = US$ 0.03 US$ 1.00 = UR$29.09 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS AF Additional Financing AGESIC Agency for the Development of E-Government and an Information and Knowledge Society (Agencia para el Desarrollo de Gobierno Electrónico y la Sociedad de la Información y del Conocimiento) AGEV State Management and Evaluation Area (Área de Gestión y Evaluación del Estado) AIN National Internal Auditing Agency (Auditoría Interna de la Nación) AMV Stock Market Regulator (Area de Mercado de Valores) ATYR Tax and Collection area of the Social Security System (Asesoría Tributaria y Recaudación) BCU Central Bank (Banco Central de Uruguay) BPS Social Protection Bank (Banco de Protección Social) DGI General Directorate of Tax Administration (Dirección General de Impuestos) DNA National Customs Directorate (Dirección Nacional de Aduanas) DPL Development Policy Lending ENDIS Nutrition, Child Development and Health Survey (Encuesta de Nutrición, Desarrollo Infantil y Salud) FIS-T Fiscal Risk Case Selection System in DGI GDP Gross Domestic Product IBTAL Institutions Building Technical Assistance Project ICR Implementation Completion and Results Report IDB Inter-American Development Bank IFRS International Financial Reporting Standards IMF International Monetary Fund INE National Statistics Institute (Instituto Nacional de Estadísticas) ISR Implementation Status Report M&E Monitoring and Evaluation MEF Ministry of Economy and Finance MIDES Ministry of Social Development (Ministerio de Desarrollo Social) OPP Office of Planning and Budget (Oficina de Planeamiento y Presupuesto) PAD Project Appraisal Document PCU Project Coordination Unit PDO Project Development Objective PPP Public Private Partnerships SGCC System for Centralized Purchases (Sistema de Gestión de Compras Centralizadas) SICE Information System for State Purchases (Sistema de Información de Compras Estatales) SISCA Fiscal Risk Case Selection System in BPS (Sistema de Selección de Casos) SIIAS Integrated Social Information System (Sistema de Información Integrada para el Área Social) XBRL eXtensible Business Reporting Language UCA Centralized Procurement Unit (Unidad Centralizada de Adquisiciones) Senior Global Practice Director: Deborah L. Wetzel Practice Manager: Arturo Herrera Gutierrez Project Team Leader: Daniel Alvarez, Carolina Rendon ICR Team Leader: Adrienne Hathaway URUGUAY Institutions Building Technical Assistance Project (IBTAL) 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 Project Performance in ISRs H. Restructuring I. Disbursement Graph 1. Project Context, Development Objectives and Design ............................................... 1 2. Key Factors Affecting Implementation and Outcomes .............................................. 7 3. Assessment of Outcomes .......................................................................................... 12 4. Assessment of Risk to Development Outcome......................................................... 19 5. Assessment of Bank and Borrower Performance ..................................................... 19 6. Lessons Learned ....................................................................................................... 20 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners .......... 22 Annex 1. Project Costs and Financing .......................................................................... 23 Annex 2. Outputs by Component ................................................................................. 24 Annex 3. Economic and Financial Analysis ................................................................. 35 Annex 4. Bank Lending and Implementation Support/Supervision Processes ............ 38 Annex 5. Beneficiary Survey Results ........................................................................... 40 Annex 6. Stakeholder Workshop Report and Results................................................... 41 Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR ..................... 42 Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ....................... 55 Annex 9. List of Supporting Documents ...................................................................... 56 Annex 10. Adjustments to PDO Indicatos .................................................................... 58 Annex 11. Adjustments to Allocation of Financing by Component and Expenditure Categories…………………………………………………………………………...59 MAP A. Basic Information UY Institutions Building Country: Uruguay Project Name: TAL P097604 (Original Loan) IBRD-74510, IBRD- Project ID: L/C/TF Number(s): P123461 (Additional 81160 Financing) ICR Date: 06/30/2017 ICR Type: Core ICR Lending Instrument: TAL Borrower: Original Total USD 12.10M Disbursed Amount: USD 20.51M Commitment: Revised Amount: USD 20.51M Environmental Category: C Implementing Agencies: Ministry of Economy and Finance Cofinanciers and Other External Partners: B. Key Dates Revised / Actual Process Date Process Original Date Date(s) Concept Review: 12/05/2006 Effectiveness: 08/06/2007 08/06/2007 01/11/2010 02/10/2011 Appraisal: 03/12/2007 Restructuring(s): 12/05/2011 06/18/2015 4/15/2010 05/18/2010 Approval: 05/30/2007 Mid-term Review: 05/29/2015 05/20/2015 Closing: 12/30/2011 12/31/2016 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Satisfactory Risk to Development Outcome: Low or Negligible Bank Performance: Satisfactory Borrower Performance: Satisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) 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 Implementation QAG Assessments (if Indicators Rating Performance any) Potential Problem Project Quality at Entry No None at any time (Yes/No): (QEA): Problem Project at any Quality of Supervision No None time (Yes/No): (QSA): DO rating before Moderately Closing/Inactive status: Satisfactory D. Sector and Theme Codes Original Actual Major Sector/Sector Public Administration Law and Justice 1 1 Central Government (Central Agencies) 83 83 Social Protection Public Administration - Social Protection 16 16 Major Theme/Theme/Sub Theme Economic Policy Fiscal Policy 17 17 Tax policy 17 17 Private Sector Development Business Enabling Environment 17 17 Regulation and Competition Policy 17 17 Enterprise Development 16 16 MSME Development 16 16 Public Sector Management Public Administration 9 9 Transparency, Accountability and Good Governance 9 9 Public Finance Management 17 17 Domestic Revenue Administration 17 17 Public Expenditure Management 9 9 Social Development and Protection Social Protection 17 17 Social Insurance and Pensions 17 17 E. Bank Staff Positions At ICR At Approval Regional Vice President: Jorge Familiar Calderon Pamela Cox Country Director: Jesko S. Hentschel Axel van Trotsenburg Practice Manager Arturo Herrera Gutierrez Fernando Rojas Daniel Alvarez Estrada Task Team Leader(s): Mario Francisco Sangines Carolina Rendon ICR Team Leader: Adrienne Elizabeth Hathaway ICR Primary Author: Adrienne Elizabeth Hathaway F. Results Framework Analysis Project Development Objectives (from Project Appraisal Document) The objective is to improve the Borrower's public sector performance by: (i) supporting its public sector modernization program in the areas of customs administration, monitoring and evaluation, performance-based budgeting, and e-government; and (ii) strengthening its institutions involved with the design and implementation of public policy reforms in the areas of taxation, promotion of the business environment, and social protection. Revised Project Development Objectives (as approved by original approving authority) The objective is to improve the Borrower's public sector performance by: (i) supporting its public sector modernization program in the areas of monitoring and evaluation, performance-based budgeting, e-government, tax administration and statistics; and (ii) strengthening its institutions involved with the design and implementation of public policy reforms in the areas of taxation, promotion of the business environment, and social protection. (a) PDO Indicator(s) Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised approval Completion or Target Values documents) Target Years Improvements in the design and management of monitoring and evaluation methodologies and tools for improved results budgeting in the Central Indicator 1 : Government Budget. Seven priority areas and 7 priority areas, 5 Value 31 expenditure programs non-priority areas, quantitative or 40 have identified output and 21 expenditure Qualitative) and outcome indicators programs. Date achieved 12/06/2011 08/31/2015 11/30/2015 Partially achieved. 5 non-priority areas added and improvements in indicator quality undertaken, improving the design and management of monitoring and evaluation and tools for improved results-based budgeting. [Indicator changed Comments (incl. % in December 2011 Additional financing. Original indicator: Internal and achievement) external performance reviews show improvements in the design and management of government projects and the production of quality information for results based budgeting in 9 areas (Final target: 9 ministries)] E-Government strategy is implemented, ensuring connectivity through a common platform of the principal state agencies, allowing safe, fast and easy Indicator 2 : exchange of information between agencies and between agencies and citizens E-government strategy implemented. As of 2016, 146 agencies were connected to E-government agency the REDuy network Value functioning and strategy quantitative or 150 which connects the adopted and under Qualitative) entire Uruguayan implementation. state and allows for the secure exchange of information between entities. Date achieved 12/06/2011 08/31/2015 12/31/2016 Almost achieved. [Indicator changed in December 2011 Additional Financing. Comments Original indicator: E-government strategy is implemented, resulting in lower (incl. % costs and times for procurement and faster and easier access by citizens to online achievement) services (Final target: 90%)] Entities responsible for selected policy reform initiatives in taxation, capital markets, social protection, and bankruptcy regulation have the necessary Indicator 3 : technical tools for the implementation of the reforms once approved. 100% tax, capital The Stock Market Value Partial markets, social Law (Law quantitative or Qualitative) protection, No.18627) was bankruptcy approved in Dec.2009 and Law of Judicial Declaration of Insolvency and Corporate Reorgani zation (Law No. 18387) was approved in Oct. 2008, and supporting systems and tools acquired. SIIAS (social protection) and SISCA, FIT-T (taxation) were implemented Date achieved 05/30/2007 12/31/2011 12/31/2016 Comments Achieved. The new governance model for DGI was also approved and is now (incl. % under implementation achievement) The ratio of the yearly variation in the nominal tax collections over the yearly Indicator 4 : variation in the nominal GDP 26.8% in 2012, Value 17.47% in 2013, quantitative or 13% 5.3% 14.26% in 2014 Qualitative) -0.29% in 2015 Date achieved 12/06/2011 08/31/2015 12/31/2015 Almost achieved. In 2015, the value was -0.29%, as the region experienced Comments (incl. % economic slowdown due to falling commodity prices. In years prior, tax achievement) collection variation exceeded the variation in GDP by more than annual targets. (b) Intermediate Outcome Indicator(s) Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised Target approval Completion or Values documents) Target Years A new human resources management strategy has been defined and presented Indicator 1 : for the approval of DNA directives Value (quantitative None Yes N/A or Qualitative) Date achieved 05/30/2007 05/30/2008 12/31/2016 Comments (incl. % Dropped in January 2010 restructuring. achievement) Review of job profiles for 100% of operational staff has been achieved Indicator 2 : Value (quantitative None 100% N/A or Qualitative) Date achieved 05/30/2007 12/31/2011 12/31/2016 Comments (incl. % Dropped in January 2010 restructuring. achievement) Skills evaluation of 80% of the operational staff has been carried out Indicator 3 : Value (quantitative None 80% N/A or Qualitative) Date achieved 05/30/2007 12/31/2011 12/31/2016 Comments (incl. % Dropped in January 2010 restructuring achievement) All new recruitments are based on a competitive, merit based recruitment policy Indicator 4 : Value (quantitative Approximately 50% 100% N/A or Qualitative) Date achieved 05/30/2007 12/31/2011 12/31/2016 Comments (incl. % Dropped in January 2010 restructuring. achievement) Entry and exit and performance evaluation policies have been implemented Indicator 5 : Value (quantitative No Yes N/A or Qualitative) Date achieved 05/30/2007 12/31/2011 12/31/2016 Comments (incl. % Dropped in January 2010 restructuring. achievement) A methodology for the use of Indicators, Log Frame, Information management and PMG has been defined and implemented in 3 pilot institutions included in Indicator 6 : the national budget (YR2) and in 6 additional institutions Value The software for Software for 9 (quantitative dashboards (Tableros de dashboards or Qualitative) Control) has been installed in 9 installed in five ministries ministries by the and another 3 are being end of 2012. implemented. Date achieved 12/06/2011 08/31/2015 12/31/2012 Achieved. Ministry of Housing, Territorial Planning and Environment; Ministry of Industry, Energy and Mining; Ministry of Public Health; Ministry of Social Development; Ministry of the Interior; Office of Planning and Budget; State Purchasing and Contracting Agency; National Institute of the Child and Comments (incl. % Adolescent of Uruguay; and the National Administration of Public Education. achievement) [Indicator changed in December 2011 AF. Original indicator: A methodology for the use of indicators, log frame, information management and PMG has been defined and implemented in 3 pilot ministries (yr 2) and in 6 additional ministries (Yr 4)] Representatives of Parliament, the Court of Accounts, the Internal Auditor’s Office, and at least 2 civil society organizations have been trained in the use of Indicator 7 : M&E information 15 staff from the legislative branch Value were trained in the (quantitative None 25 use of indicators or Qualitative) and change management. Date achieved 05/30/2007 12/31/2011 06/30/2011 Comments (incl. % Partially achieved. Activity discontinued in 2012 in agreement with the Bank. achievement) Number of Rapid Evaluations concluded Indicator 8 : 24 rapid evaluations were completed in sectors including Value (quantitative None 24 security, health, or Qualitative) education, rural development, housing, and infrastructure. Date achieved 12/05/2011 08/31/2015 12/31/2016 Comments Achieved. [Indicator changed in December 2011 AF. Original indicator: Rapid (incl. % evaluations have been performed every 18 months in the three pilot (Final achievement) target: 6)] Web page and printed reports available to civil society with M&E information Indicator 9 : Value (quantitative No Yes Yes or Qualitative) Date achieved 05/30/2007 12/31/2011 12/31/2016 Achieved. Available on the internet: Interactive information of the National Budget on the Uruguayan Observatory of Public Policies (http://www.agev.opp.gub.uy/observatorio/servlet/maininicio), including a public policy simulator (http://www.opp.gub.uy/hacemos/spp). Additional available reports include the Uruguay 2015 Report Comments (incl. % (http://www.opp.gub.uy/reporte-uruguay); Methodological Guide and achievement) Management Commitments (http://www.opp.gub.uy/hacemos/comision-de- compromiso-de-gestion ; Standardized Budget and execution data using the World Bank BOOST methodology (http://wbi.worldbank.org/boost/country/uruguay) The budget decision-makers receive quality M&E information from at least nine Indicator 10 : ministries to be used in the budgeting process for 7 programmatic areas Not yet due. With the new methodology for planning and budgeting and the reformulation of PEGSEV system, budget Value decision makers will (quantitative Yes Yes receive adequate M&E or Qualitative) reports to support the decision making progress. (Orig. baseline, slightly diff indicator: No) Date achieved 12/05/2011 12/31/2012 12/31/2012 Achieved. Volume 2 – Planning and Evaluation” which accompanies the 2015 Accountability reporting sent to Parliament contains pertinent information for improving authorities’ decision making, linking strategic planning with the Comments assignment of resources. It has financial information on credits and execution (incl. % for 17 programmatic areas and performance (context indicators) for 12 achievement) programmatic areas, program level results for 7 priority programmatic areas, result for 21 budget programs, and financial and performance indicators for the 14 subsections of the Central Administration and for entities under Article 220 of the Constitution. [Indicator changed in December 2011 AF. Original indicator: The budget decision-makers receive quality M&E information from at least 9 ministries to be used in the budgeting process (Final target: yes)] Number of Budget Execution reports submitted to Congress, including data on Indicator 11 : indicators Value (quantitative 1 4 4 or Qualitative) Date achieved 12/05/2011 12/31/2014 12/31/2014 Achieved. The 20 reports making up “Volume 2: Planning and Evaluation” for Comments (incl. % the 2015 Accountability Reporting (described in the indicator above) were achievement) presented to Congress. The strategy and technical requirements for the implementation of e-government Indicator 12 : strategy have been defined Yes. Uruguay Digital Agenda 2011-2015, which aimed to coordinate and prioritize programs that promote the more Value efficient use of (quantitative No Yes ICTs in activities or Qualitative) developed by citizens, businesses and the Government, was approved by presidential decree in Nov 2011 Date achieved 05/30/2007 12/31/2008 12/31/2011 Additionally, AGESIC has developed and implemented strategies for 2007- Comments (incl. % 2009, and 2011-2015. The Agenda Uruguay Digital 2020 was approved in achievement) December 2016 (Decree 459/016, December 30, 2016). Transactional e-procurement platform for purchases of medicines and food Indicator 13 : implemented in central government including ASSE In the last semester Value No Yes of the Project, the (quantitative or Qualitative) platform entered into production with two calls managed by the food sector. Date achieved 04/15/2015 12/31/2015 12/31/2016 Achieved. [Indicator changed in December 2011 AF and June 2015 restructuring. Original indicator: At least 80% of central government Comments procurement of food and medicine is done through a transactional e- (incl. % achievement) procurement platform. December 2011 AF indicator: At least 80% of central government procurement of medicines and food, including ASSE, is done through a transactional e-procurement platform.] At least 100 public sector transactions are accessible through a unified portal Indicator 14 : Value (quantitative TBD 100 308 or Qualitative) Date achieved 05/30/2007 12/31/2011 12/31/2010 Achieved. Since then, outside of IBTAL, there has been additional progress. Currently, there are 823 administrative processes available online (127 which Comments can be carried out completely through the portal (https://portal.gub.uy/) and 696 (incl. % that can be initiated there). Additionally, all of the information needed to carry achievement) out 2,343 State administrative processes is available from: https://tramites.gub.uy Implementation of the modernization program of the collections area of BPS has Indicator 15 : advanced in accordance with action plan Value (quantitative 0% 100% 100% or Qualitative) Date achieved 05/30/2007 12/31/2011 12/31/2011 Achieved. Gradual incorporation process for obligatory presentation of Comments (incl. % declarations and changes via web completed in 2011; 100% of the business achievement) required to present salaries can only do so through the web. Increase in real terms of collection of social security contributions (used as a Indicator 16 : proxy for IRPF tax collections by BPS) increase 6.8% annual Value (quantitative 28,962.8 million TBD 2% average (2006- or Qualitative) 2010). Date achieved 12/31/2007 12/31/2011 12/31/2011 09/30/2010 Comments Achieved. Additional increases were not expected in the years following 2010 (incl. % given the high degree of compliance. However, from 2011-2015, revenue achievement) continued to increased (4.4% annual average). [Indicator changed in January 2010 restructuring. Original indicator: Revenue yield of the personal income tax reaches a level similar to the regional average (Final target: TBD)] Five central government institutions have integrated information on social protection programs and beneficiaries on the SIIAS and the information is used Indicator 17 : for policy making Value (quantitative No Yes Yes or Qualitative) Date achieved 05/30/2007 12/31/2011 12/31/2011 Achieved. The first five institutions were: the Administration of State Health Services (ASSE), BPS, the Uruguayan Institute of the Child and Adolescent, the Comments Ministry of Social Development, and the Ministry of Public Health. [Indicator (incl. % changed in December 2011 AF. Original indicator: 5 central government achievement) institutions have integrated information on social protection programs and beneficiaries on the SIIAS and the information is used for policy making] Number of additional Government agencies that have data on their social Indicator 18 : programs’ beneficiaries and benefits integrated in SIIAS Value (quantitative 5 8 15 or Qualitative) Date achieved 12/05/2011 12/31/2015 12/31/2016 Comments Achieved. Target of 8 achieved in 2014. Over the course of implementation, a (incl. % total of 23 entities were integrated into the SIIAS. achievement) International standards for securities market regulation and securities settlement Indicator 19 : have been applied Yes. The Stock Market Law (Law No. 18627) was approved in Value December 2009, (quantitative No Yes contributing to or Qualitative) improved regulatio n in alignment with international standards Date achieved 05/30/2007 12/31/2011 12/31/2011 Comments Achieved. Regulations for the law were approved in September 2011 (Decree (incl. % 322/011). A re-ordering of the rules was approved in June 2012, and Law achievement) 18930, approved in July 2012 created a registry of holders of equity shares, increasing the transparency of information. In January 2013, new regulations for Law 18627 were approved (Circular 2139) for public offerings, investment representatives, corporate governance practices for stock issuers, use of privileged information, public takeover bids, and penalties. Private corporations are submitting financial reports according to the new Indicator 20 : strengthened statutory and institutional framework Value (quantitative No Yes Yes or Qualitative) Date achieved 05/31/2007 12/31/2011 12/31/2011 Achieved. Businesses are submitting financial statements as required under Decree 124/11, which required the presentation of accounting statements in Comments (incl. % alignment with the IFRS established by the International Accounting achievement) Standards Board. [Target changed to 4,000 in December 2011 AF, and then appears to have been changed back to Yes in the June 2015 restructuring.] A sustainable and effective process for adopting IFRS has been applied Indicator 21 : Yes. Continual actualization with accounting Value regulations. Since (quantitative No Yes January 2009, the or Qualitative) application of IFRS has been mandatory. Date achieved 05/31/2007 12/31/2011 12/31/2009 Achieved. Rules requiring the registry of financial statements have been issued (Decree 156/16 and AIN Resolution), and were applicable starting June 30, Comments (incl. % 2016 (for registry of information by December 27, 2016). The Electronic achievement) Central Balances began implementation in 2016 for the registry of publicly traded companies’ financial statements, and became obligatory in June 2016. An independent control system for all forms of accounting report certification Indicator 22 : (including audits) is being used. Value (quantitative No Yes N/A or Qualitative) Date achieved 05/31/2007 12/31/2011 12/31/2016 Comments (incl. % Eliminated during 2011 Additional Financing achievement) Indicator 23 : Draft implementing regulations for the new bankruptcy law have been prepared Value (quantitative No Yes Yes or Qualitative) Date achieved 05/31/2007 12/31/2009 04/30/2009 Comments Achieved. Three regulatory decrees were prepared (Decree No. 46/009, March (incl. % 2009; 716/009, April 2009; and 723/009, April 2009). achievement) A study has been presented of the impact of the new legal framework and of the institutional strengthening activities supported by the project on times and costs Indicator 24 : for bankruptcy cases Value (quantitative No Yes N/A or Qualitative) Date achieved 05/31/2007 12/31/2011 12/31/2016 Comments Moved to Component 7 in 2011 Additional Financing and then eliminated in (incl. % 2015 restructuring achievement) Incentive based performance has been implemented for Human Resources in Indicator 25 : Customs Administration Value (quantitative No Yes Yes or Qualitative) Date achieved 12/05/2011 12/31/2012 01/01/2014 Achieved. On December 16, 2013, the Executive Branch approved the decree Comments (incl. % creating the new incentive system for DNA personnel, effective since January 1, achievement) 2014. Proportion of intensive audits generated by the risk management system audits Indicator 26 : over the total intensive audits Strictly speaking, as the information system just entered into operation in Value (quantitative 0% 20% January 2017, there or Qualitative) were no advances on this indicator during IBTAL’s implementation. Date achieved 12/05/2011 12/31/2015 12/31/2016 Not achieved. Nevertheless, it should be noted that from January-June 2015 and Comments (incl. % 2016, approximately 85% of intensive audits were selected from the application achievement) of objective risk analysis based on data processing Software to support the Electronic Accounting Application developed and Indicator 27 : operating New model prepared and approved in the Value second half of (quantitative No Yes 2016, with or Qualitative) implementation beginning at that time. Date achieved 04/15/2015 12/31/2015 12/31/2016 Partially achieved. As of December 2016, approximately 90% of the formal Comments (incl. % changes associated with the reform had been carried out, but in terms of actual achievement) implementation, approximately 50% of the changes had been completed Capacity building plan concluded and implemented in indicated percentages Indicator 28 : Value (quantitative 0% 70% N/A or Qualitative) Date achieved 12/05/2011 12/31/2014 12/31/2016 Comments (incl. % Eliminated in 2015 restructuring achievement) Panel Survey of most vulnerable population concluded Indicator 29 : Value (quantitative No Yes Yes or Qualitative) Date achieved 12/05/2011 12/31/2015 04/30/2016 Achieved. Work for the first wave of the Nutrition, Child Development, and Comments Health Survey (Encuesta de Nutrición, Desarrollo Infantil y Salud, ENDIS) was (incl. % completed in April 2015, and fieldwork for the second wave was concluded in achievement) April 2016. G. Ratings of Project Performance in ISRs Date ISR Actual Disbursements No. DO IP Archived (USD millions) 1 06/19/2007 Satisfactory Satisfactory 0.00 2 09/25/2007 Satisfactory Satisfactory 0.00 3 04/10/2008 Satisfactory Satisfactory 0.27 4 11/25/2008 Moderately Satisfactory Moderately Satisfactory 0.95 5 06/10/2009 Moderately Satisfactory Moderately Satisfactory 1.71 6 12/20/2009 Moderately Satisfactory Moderately Satisfactory 2.24 7 06/25/2010 Satisfactory Moderately Satisfactory 3.59 8 12/12/2010 Satisfactory Satisfactory 4.29 9 06/20/2011 Satisfactory Satisfactory 5.38 10 08/10/2011 Satisfactory Satisfactory 5.79 11 03/11/2012 Satisfactory Satisfactory 7.06 12 11/17/2012 Satisfactory Satisfactory 9.99 13 06/08/2013 Satisfactory Satisfactory 11.70 14 12/02/2013 Satisfactory Satisfactory 12.14 15 06/27/2014 Satisfactory Satisfactory 13.95 16 01/16/2015 Moderately Satisfactory Satisfactory 14.71 17 07/16/2015 Moderately Satisfactory Satisfactory 15.74 18 01/27/2016 Moderately Satisfactory Satisfactory 16.64 19 07/22/2016 Moderately Satisfactory Satisfactory 17.74 H. Restructuring (if any) ISR Ratings at Amount Board Restructuring Restructuring Disbursed at Reason for Restructuring & Key Approved PDO Date(s) Restructuring Changes Made Change DO IP in USD millions Adjustment to PDO, results framework and resource allocation by components made to reflect elimination of Components 1 and 7.2. Component 1 was eliminated due to emergence of new 01/11/2010 Y MS MS 2.48 challenges and the Government’s decision to refocus reform interventions within the customs administration, and Subcomponent 7.2 because the commission it was designed to support no longer existed, ISR Ratings at Amount Board Restructuring Restructuring Disbursed at Reason for Restructuring & Key Approved PDO Date(s) Restructuring Changes Made Change DO IP in USD millions following the transfer of its mandate and functions to other agencies. Categories of eligible expenditures were also adjusted. Extension of closing date from December 31, 2011 to September 30, 2013 to allow for completion of activities expected to substantially 02/10/2011 N S S 4.39 contribute to the PDO and which had faced delays related to Project initiation and preparation of the associated procurement processes. Additional financing for US$10 million. Adjustments to allocation of loan proceeds reflecting new resources. Addition of Components 8 and 9 to reflect new areas of work, scaling up of financing to four 12/05/2011 Y S S 6.16 components to expand their original coverage, and the revision or elimination of a few activities in the original Loan Agreement which were no longer relevant. New closing date: August 31, 2015. Extension of closing date from August 31, 2015 to December 31, 2016 to allow for full execution of the two new components and provide the 06/18/2015 N MS S 15.64 new administration with additional time to assess the Project strategically and allocate resources to consolidate progress. ISR Ratings at Amount Board Restructuring Restructuring Disbursed at Reason for Restructuring & Key Approved PDO Date(s) Restructuring Changes Made Change DO IP in USD millions Adjustments to selected intermediate results indicators to reflect the current institutional context, and shifting of some Project resources towards components foreseeing new activities. If PDO and/or Key Outcome Targets were formally revised (approved by the original approving body) enter ratings below: Outcome Ratings Against Original PDO/Targets Satisfactory Against Formally Revised PDO/Targets Satisfactory Overall (weighted) rating Satisfactory I. Disbursement Profile 1. Project Context, Development Objectives and Design 1.1 Context at Appraisal 1. At the time of appraisal, Uruguay was an upper-middle income country characterized by a mature and stable democracy, high caliber public institutions, and a long track record of reforms aimed at public sector modernization. Although the country had embarked on a series of programs aimed at strengthening public sector administration in the 1990s, certain areas of the modernization process lagged and continued to challenge the overall efficiency and transparency of the State apparatus. The importance of improving public sector performance to achieve sustainable and equitable growth was acknowledged by President Tabaré Vazquez’s administration, which took office in March 2005, and in August 2006, the State modernization process was relaunched. With the objective of building an "active, friendly, approachable and sensible" State, the President outlined additional areas to pursue, including civil service, e-government and improved performance monitoring of institutions, among others. A coordinating group for State modernization was set up, helping to catalyze initiatives at the level of several key public sector institutions, with the Ministry of Economy and Finance (MEF) serving to articulate the institutional development needs for improved public sector performance as well as those arising from implementing the agenda of public policy reforms. 2. Core Public Administration Issues. At the time of appraisal, Uruguay was facing several important challenges in key areas of the public administration. While Uruguay boasted state-of- the-art customs information technology systems, outdated human resources management practices - including discretionary recruitment procedures and outdated staffing profiles within customs - were viewed to be the single overriding impediment to the overall efficiency and transparency of customs operations. Similarly, over the last decade, Uruguay had worked hard to develop tools to improve public sector performance, including important instruments such as the Results-Based Management Evaluation System (Sistema de Evaluación de la Gestión). However, full implementation of a proper results-based budgeting framework faced important challenges - institutions were not applying the best tools available for the design and implementation of their projects and programs, compromising the quality of outcomes as well as the reliability of the indicators feeding into the budget process, and the monitoring and evaluation framework was focused exclusively on the budget process, and did not support social oversight or the "macro- level'' monitoring of government programs. In the areas of e-government, while Uruguay generally ranked well in the region in terms of e-government penetration, the continued development and roll-out of a state-of-the-art e-government platform was considered pivotal to Uruguay's state modernization agenda. Having recently established the Agencia para el Desarrollo de Gobierno Electrónico y la Sociedad de la Información y del Conocimiento (AGESIC), the e-government development and information society agency, improving the e-procurement platform (which was facing limited coverage and significant challenges in becoming fully functional) and developing a unified transactions portal for administrative procedures were identified as central to the agenda. 3. Ongoing Policy Reform Initiatives. There were also a number of ongoing public sector policy reform initiatives. Following the introduction of personal income taxes in 2006, with collection to be managed by the Social Protection Bank (Banco de Protección Social, BPS) (due to its role as administrator of social security contributions and the to-be-eliminated wage tax) and overseen by the General Directorate of Tax Administration (Dirección General de Impuestos, 1 DGI), close collaboration and information exchange between DGI and the BPS was required. The Government was also working to replace the National Social Emergency Assistance Plan with a new Equity Plan focused on eliminating extreme poverty. To undertake the reform, BPS was in the need of substantial institutional strengthening, and a system was needed to integrate information on the social programs of Uruguay’s various public sector entities. The legal framework for bankruptcies was also identified as an area in which reform could have a positive impact. Insolvency legislation in Uruguay was outdated, cumbersome and therefore hardly used, with no unique law on corporate insolvency. New draft legislation was pending parliamentary approval, and its implementation would require further actions like the passing of by-law regulations, dissemination campaigns and training and educations activities geared to corporate, financial, labor, legal and judicial sector stakeholders. Finally, in light of Government’s prioritization of the development of capital markets through a new capital markets law, achieving an adequate level of professionalism amongst key market players and infrastructure improvements, defining the institutional arrangements for the market regulator (Area de Mercado de Valores), providing a new regulatory framework for the dissemination of financial information and improvements in the application of international accounting system standards were pending. 1.2 Original Project Development Objectives (PDO) and Key Indicators 4. The original PDO was to improve the Borrower's public sector performance by: (i) supporting its public sector modernization program in the areas of customs administration, monitoring and evaluation, performance-based budgeting, and e-government; and (ii) strengthening its institutions involved with the design and implementation of public policy reforms in the areas of taxation, promotion of the business environment, and social protection1. Original and revised PDO indicators are presented in the table in Annex 10. 1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification 5. The final revised PDO is to improve the Borrower's public sector performance by: (i) supporting its public sector modernization program in the areas of monitoring and evaluation, performance-based budgeting, e-government, tax administration and statistics; and (ii) strengthening its institutions involved with the design and implementation of public policy reforms in the areas of taxation, promotion of the business environment, and social protection. 6. The PDO was revised twice. In the first restructuring (approved by the Board on January 11, 2010 2 ), “customs administration” was removed from part (i) of the PDO to reflect the elimination of Component 1. Subsequently, with the 2011 Additional Financing (AF)3, which was designed to support the scaling up of the well-performing IBTAL operation and enhance its 1Wording in the Legal Agreement, dated June 21, 2007 was slightly different, but does not materially impact interpretation: “The objective of the Project is to improve the Borrower’s public sector performance by: (i) supporting the implementation of [italics added] its public sector modernization program in the areas of customs administration, monitoring and evaluation, performance- based budgeting and e-government; and (ii) strengthening its institutions involved with the design and implementation of public policy reforms in the areas of taxation, promotion of business environment and social protection.” 2 Institutions Building Technical Assistance Project (Loan 7451-UR), The Oriental Republic of Uruguay Datasheet for Project Paper. December 3, 2009. Report No. 52421. 3 Project Paper on a Proposed Additional Loan in the Amount of US$10 million to the Oriental Republic of Uruguay for a Institutions Building Technical Assistance Project. November 2, 2011. Report No. 65001-UY. 2 development impact while also providing a continuation of technical assistance to critical reform areas supported under the parallel development policy lending (DPL) series (discussed further below), “tax administration and statistics” were added to part (i) to reflect the addition of Components 8 (Institutional Strengthening of DGI) and 9 (Institutional Strengthening of the National Statistics Institute, (Instituto Nacional de Estadísticas, INE))4. No PDO-level indicators were changed in the 2010 restructuring; however, with the December 2011 AF, the wording of PDO indicators was changed, a new indicator related to tax collection added, and targets revised to reflect the extended implementation period. (See table in Annex 10.) 1.4 Main Beneficiaries 7. Public sector institutions in Uruguay were the Project’s main beneficiaries. The following entities were the principal direct beneficiaries: the National Customs Directorate (Dirección Nacional de Aduanas, DNA); the State Management and Evaluation Area (Área de Gestión y Evaluación del Estado, AGEV); AGESIC; the State Purchasing and Contracting Agency (Agencia de Compras y Contrataciones del Estado); the Centralized Procurement Unit (Unidad Centralizada de Adquisiciones, UCA); the Tax and Collection area of the Social Security System (Asesoría Tributaria y Recaudación, BPS); the Ministry of Social Development (Ministerio de Desarrollo Social, MIDES); the Central Bank (Banco Central de Uruguay, BCU); the National Internal Auditing Agency (Auditoría Interna de la Nación, AIN); the Judicial Branch; MEF); DGI; and INE. The public and private sectors as well as citizens at large were the indirect beneficiaries of the Project, benefitting from the strengthening of public sector institutions and their ability to carry out their responsibilities more effectively and efficiently. 1.5 Original Components 8. The Project was originally comprised of six main components, in addition to a component supporting overall project management and strategy development. 9. Component 1. Strengthening Customs Administration’s Human Resources Management. Aimed at supporting the modernization of the DNA through improvements to its human resources management functions, activities included: design and application of an integrated human resources management strategy; review of job profiles, design of an exit policy for those employees not matching skill requirements; establishment of competitive, merit-based selection and recruitment policies; design and deployment of a performance evaluation policy and process; proposal of a new incentive-pay system for customs; and other related activities identified during implementation. 10. Component 2. Improving Institutional Planning, Monitoring and Evaluation. Aimed at enhancing public sector performance and transparency, activities included: strengthening of the institutional framework for monitoring and evaluation (M&E); design, implementation, M&E of central government programs in approximately nine central government institutions; design of instruments to include civil society in M&E processes; and other related activities identified during implementation. 4The slight difference in wording noted above between the original project document and legal agreement was not repeated in the Legal Agreement associated with the AF (dated March 16, 2012). 3 11. Component 3. Supporting E-Government. Aimed at increasing the transparency and efficiency of the interaction between the public sector and individuals and companies, activities included: development of a national e-government strategy and a strategy for public sector electronic information exchange; definition of public sector information technology security policies; improvement of the Government’s registry of suppliers and contractors; redesign and enhancement of the e-procurement platform and strategy to promote its broad-based use by suppliers and contractors; design and implementation of a national strategy to extend access to and usage of the e-procurement platform to all beneficiaries and broaden the e-procurement information technology platform to accommodate broad-based usage; and design and development of a public transactions portal for broad-based access and use by citizens; and other related activities identified during implementation. 12. Component 4. Institutional Strengthening of BPS for the Implementation of Tax and Social Protection Reforms. Aimed at strengthening BPS’s institutional capacity to implement the Government’s new personal income tax, activities focused on the development of systems, infrastructure and technical capacity necessary to improve BPS’s operation of the tax and collections areas including: human resources management; information systems management; control, business intelligence, collections, and risk management; taxpayer assistance; outreach, information campaigns and surveys; and other areas related to the implementation of the new personal income tax. The component also supported undertaking structural improvements to the Government’s social protection system by designing, developing and implementing an integrated, inter-institutional, social information system that brings together data on the characteristics and beneficiaries of social programs from various entities (Sistema de Información Integrada para el Área Social, SIIAS). 13. Component 5. Supporting Capital Markets and Corporate Transparency Reforms. Aimed at addressing challenges associated with reforming the institutional, legal and regulatory, and infrastructure framework underlying capital markets, activities included: securities market promotion; institutional strengthening of the Government’s securities regulator; development and support for the implementation of changes to the regulatory framework governing the Government’s capital markets; implementation of international standards for securities markets regulation and securities settlement; development of a risk-based supervisory framework; provision of computer hardware and software to support the institutional strengthening process; and other related activities identified during implementation. The component also supported strengthening of the Government’s corporate financial reporting framework through the updating and strengthening of the regulatory and institutional framework for the submission of financial reports; establishment of a sustainable and effective process for the adoption of international financial reporting standards (IFRS) and an independent control system for all forms of accounting report certification (including audits); and other related activities identified during implementation. 14. Component 6. Supporting Bankruptcy Regulation Reforms. Aimed at supporting the implementation of reforms to the Government’s bankruptcy legal framework, activities included: preparation of draft regulations to the new bankruptcy law, including a report on procedural changes needed to support its implementation; provision of logistical support for court implementation of the reforms; activities for awareness, outreach, and promotion of best practices; and other related activities identified during implementation. 4 15. Component 7. Project Coordination and Strategy Development. This component supported the project coordination unit (PCU), the Government’s Presidential Commission for the Transformation of the State (Comisión para la Transformación del Estado) in monitoring and evaluating the overall reform process; and the carrying out of studies and other consultancies related to Project coordination and/or strategy development. 1.6 Revised Components 16. Component 1 was eliminated from the Project in the January 2010 restructuring due to the emergence of new challenges and the Government’s decision to refocus its reform interventions. In light of the Presidential Commission for the Transformation of the State ceasing to exist, Subcomponent 7.2 (designed to support the commission) was also dropped. 17. The 2011 AF added Components 8 and 9, described below, increased financing for four of the original components to expand their coverage, and revised or eliminated a few activities from the original Loan Agreement which were no longer relevant5. Specifically, within Component 2, the activity related to the design of instruments to include civil society in M&E processes was modified to support activities aimed at increasing the transparency and dissemination of M&E processes’ results, and other activities to carry out rapid evaluations on priority government activities within programs under programmatic areas of the budget, capacity building for evaluation of public sector projects, programs and policies, design an institutional framework for the carrying out of impact evaluations on public projects, programs and policies and other activities aimed at enhancing public sector performance and transparency were added. Within Component 3, the activities related to the enhancement of the e-procurement platform and the strategy to extend its use were modified to focus support on the e-procurement platform for all food, medicine and medical supplies purchased by UCA and the activity supporting the broadening of the e- procurement platform for broad-based usage eliminated. Within Component 4, activities related to the SIIAS were detailed further and extended to include the incorporation of additional entities, studies on the impact of social programs included within the system, and support for activities aimed at strengthening the SIIAS and enhancing its role. Within Component 5, work related to the establishment of an independent control system for accounting report certification was removed and an activity added to support the strengthening of AIN's institutional capacity through the adoption of the eXtensible Business Reporting Language (XBRL) taxonomy for financial report submission added. Activities supporting awareness, outreach, and promotion of best practices related to the Bankruptcy Law were eliminated from Component 6, and activities related to the carrying out of minor works for the installation of computer hardware added to Components 2, 4, 5 and 7 (as well as minor works related to refurbishing of office facilities to Component 7). 18. Component 8. Institutional Strengthening of DGI. Aimed at strengthening the DGI with focus on improving tax compliance by taxpayers, activities included: design and implementation of a risk management information system for the selection of tax audits and the detection of tax evasion; assessments of risk management processes and procedures for case selection; and other related activities including the development of computer software and 5Project Paper on a Proposed Additional Loan in the Amount of US$10 million to the Oriental Republic of Uruguay for a Institutions Building Technical Assistance Project. November 2, 2011. Report No. 65001-UY. 5 guidelines, the provision of computer hardware (including minor works for the installation of hardware), staff training, and the carrying out of an internal communication plan; coordination with other tax and control agencies to exchange tax information; and other related activities identified during implementation. It was also to support the development, implementation and dissemination of a computer system for managing and filing financial accounting records. 19. Component 9. Supporting Institutional Strengthening of INE. Aimed at strengthening of INE, activities included: design and implementation of a panel survey of the most vulnerable population aimed at obtaining data on living conditions to support evidence-based policy making; standardization of processes for conducting household surveys; development of an integrated system of economic surveys; improvement of INE's enterprise directory; exchange of survey and administrative record data with the SIIAS; provision of training on statistical methods to INE's staff and other members of the National Statistical System; improvement of survey data documentation and dissemination; support for INE's coordination of the poverty measurement working group of the Statistical Conference of the Americas; and other activities related identified during implementation. 1.7 Other significant changes 20. Financing Allocations. With the elimination of Component 1 in the January 2010 restructuring, unutilized funds that were allocated to Component 1 were shifted to Component 7. At that time, the allocation of funds by expenditure category was also adjusted to include the front- end fee; and to allocate undisbursed funds from the Project Preparation Advance and previously unallocated funds. Allocations by component were subsequently re-adjusted in the December 2011 AF for US$10 million, as were allocations by expenditure category. In the June 2015 restructuring, funds were shifted from components with a low probability of execution to those that foresaw new activities. (See Annex 11 for details.) 21. Closing Date. In the February 2011 restructuring, the closing date was extended from December 31, 2011 to September 30, 2013 to allow for the completion of activities expected to substantially contribute to the PDO and which had faced delays related to Project initiation and preparation of the associated procurement processes6. This date was moved to August 31, 2015 with the approval of the December 2011 AF. Through the June 2015 restructuring, the closing date was subsequently further extended to December 31, 2016 to allow for the full execution of the two new components (Components 8 and 9), and provide the new administration with additional time to assess the Project strategically and allocate resources to consolidate progress7. 22. Indicators. In addition to the changes to PDO indicators referred to in Section 1.3 and detailed in Annex 10, intermediate indicators were adjusted in the January 2010 restructuring, the December 2011 AF, and the June 2015 restructuring to adapt to changes in Project activities, the evolving institutional context (e.g. dropping of the customs component, expansion of the SIIAS, etc.), and identified data limitations. 6 Restructuring Paper on a Proposed Project Restructuring of Institutions Building Technical Assistance Loan (IBTAL) Project Approved on May 30, 2007 to the República Oriental de Uruguay. February 8, 2011. Report No. 59001-UY 7 Restructuring Paper on a Proposed Project Restructuring of the Institutions Building Technical Assistance Project (IBTAL) to the Republic of Uruguay, May 20, 2015. Report No. RES18226 6 2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design and Quality at Entry 23. The Project was well-designed, incorporating lessons learned from previous operations, adequately assessing potential risks, and aligning well with Government priorities and the 2005- 2010 Country Assistance Strategy (Report No. 31804-UY, May 10, 2005). While quite broad in terms of the number of areas covered, the operation focused on prioritized areas within the Government’s modernization agenda, and was carefully designed to be complimentary to and coordinate with parallel efforts in similar areas being supported by the Inter-American Development Bank (IDB). The Strategy, in its support to the Government’s objective of attaining equitable and sustainable economic development through support to specific requests covering a range of areas (tax reform, capital market development, state modernization, among others), anticipated an institutions building operation focused on the implementation of institutional reforms in core fiscal, financial and social areas which would be able to accommodate demands for institutional reforms that emerged during implementation. The Project was highly consistent with this intent, building from recent analytical work that had been undertaken by the Bank and being highly aligned with a parallel DPL series supporting reforms in the areas of tax reform, business climate and capital market development, and social protection (P083927 for US$100 million and P106724 for US$400 million). 24. Recognizing lessons learned from other institutions building technical assistance loans which had encountered challenges in their implementation due to rigidity in their design and consequent Bank guidance8, design contemplated space within each component for Government- identified activities to be introduced during implementation provided they were consistent with the PDO and agreed upon with the Bank, as well as for flexibility within Component 7 through space for strategy development. While there was initially some Bank concern about this flexibility, during implementation it added significant value to the Project by allowing space for the natural evolution of institution-building activities over the almost ten-year duration of the original project and additional financing, and was highly valued by the Government. Design also incorporated lessons learned on the need for strong leadership given the number of project components, placing the PCU within the politically strong and capable MEF, and anticipated the formation of a Steering Committee to facilitate the involvement of the participating agencies. 25. Design also contemplated a thorough risk assessment, including potential risks associated with duplication of IDB efforts, resistance from the customs administration, coordination challenges between the PCU and implementing entities, and the PCU’s lack of experience with Bank operations. During implementation, only those risks associated with the customs administration materialized; as a result, the component was dropped. However, importantly, given the Government’s continuing commitment in this area, the flexibility within Component 7 allowed for the agenda to advance when the political climate later evolved. 2.2 Implementation 8 “[Institutional development technical assistance] should be flexible enough to allow for any needed modification that the changing circumstances might dictate…[while] precise enough to allow for the identification of monitorable [sic] outputs and for the hiring of experts according to meaningful criteria.” (PAD, page 8) 7 26. Implementation progressed well, although albeit at varying paces, with all areas eventually making substantial advances by closing. Below, the most important factors impacting implementation are presented. 27. Project Coordination. Throughout implementation, the PCU played an instrumental role in ensuring the Project’s success, coordinating activities across the numerous components and centralizing interactions with the Bank. It executed its fiduciary responsibilities well, thereby facilitating implementation, and worked hard to expeditiously resolve any issues and bottlenecks that arose. During the early stages of implementation, coordination of the World Bank and IDB activities was largely carried out through meetings organized by the two entities. Following the creation of the Office of Multilateral Organizations in MEF in 2010, this coordination was largely taken over by the Government.9 While design contemplated a Steering Committee, in practice the Committee was never convened and the planning and accountability activities it anticipated were undertaken directly within the beneficiary entities during supervision missions. 10 While a departure from design, this did not negatively impact implementation thanks to the existing high level of coordination between entities. 28. Leadership. While the Project spanned three Government administrations, changes in the administration did not have a significant impact on implementation. Continuity within BPS across administrations helped to provide stability to work on the fiscal risk case selection system (Sistema de Selección de Casos, SISCA) and the SIIAS. Some shifts in the prioritized areas and methodologies within work by the Office of Planning and Budget (Oficina de Planeamiento y Presupuesto, OPP) to strengthen institutional planning and M&E did occur, but did not significantly impact planned project activities. Work within customs was initially a bit more constrained by differing priorities within the Government on the question of whether to prioritize oversight or facilitation. However, with the later appointment of a new customs director, positions within Customs and MEF aligned in agreement with a focus on facilitation, and Project activities in this area successfully advanced under the umbrella of Component 7. 29. Government Team Composition. As is to be expected, team composition played a critical role in the ease of implementation. Across the Project, Government teams demonstrated a high level of capacity and continuity over the years. High quality staff with significant knowledge of technology and experience working with contractors were particularly important to the successful implementation of SISCA and the adoption of XBRL. The implementation of the centralized purchasing e-procurement system for food, medicine, and medical supplies did experience greater difficulties in part due to the division of responsibilities across UCA (which was responsible for the initial functional document for the system) and MEF (which was responsible for coordination of the technical aspects of the system, contract management, and interaction with developers), contributing to a mismatch between the functional specifications and business model, and the eventual need to reduce the scope of the system’s modules due to issues that could not be resolved before the system’s launch in 2016. 9López Acosta, 2016, Government of Uruguay Final Report, page 30 10 López Acosta, 2016, Government of Uruguay Final Report, page 31-32 8 30. Flexibility. Project design had the foresight to recognize the difficulty of fully anticipating all of the needs of a multi-year institutional reform engagement at the outset- and contemplated some flexibility. In practice, within the context of strong and high capacity Government counterparts, this flexibility was beneficial, allowing for mid-course additions (with Bank review and approval) of activities aligned with the PDO in order to support the natural evolution of the reform process. This included support to customs administration following the dropping of Component 1 once consensus was reached on the direction of reforms, the allocation of additional resources to BPS for work related to SISCA due to their strong performance, as well as support to a variety of smaller activities in entities requiring institutional strengthening support in order to more fully advance in Project’s areas of modernization. 31. Procurement. Procurement posed some initial challenges– with issues stemming from both the particularities of the work undertaken, characteristics of the Uruguayan market, and Bank procurement guidelines. However, issues were overcome as work progressed, counterparts gained better understanding of the applicable rules, and the Bank team and the Government worked together to find appropriate solutions. Challenges associated with the particularities of activities included: a lack of antecedents related to XBRL due to the cutting edge nature of the technology; a limited number of consultants with the required profile for results-based budgeting work not already working for the Government; and specific issues related to how statistics surveyors are typically contracted. Other issues, more associated with the Bank, included complex processes to justify the presentation of five firms for a process (what the Uruguayan market supported) when Bank rules required six, the formulation of terms of reference for survey work such that they met Bank guidelines but were unclear to providers, and initial delays in Bank responses to No Objection requests. In the end, it was a learning process for both, with smoother processes proceeding along the anticipated timelines by the end of implementation. 32. Change Management. Recognizing the potential impacts of stakeholders’ resistance to change, many of the components undertook change management activities geared at building support for reforms. Both the DNA and AIN undertook diffusion activities within their audiences of interest (the customs administration, and chambers of commerce and the accounting association, respectively), which helped to raise awareness and buy-in. Generating support for reforms was also key to the successful implementation of the SIIAS, which adopted a cooperative strategy emphasizing the importance and logic of unifying social information to encourage entities to integrate their data within the system rather than mandating participation through regulatory requirements. 33. Bank support. The Bank provided solid implementation support, channeling regular communication and coordination through the PCU and engaging in-depth with individual implementing entities during supervision missions. Implementation of some activities was a bit slow at first, as the Bank team had to confirm that the proposed structure of activities was based on solid diagnostics by the counterparts. After building a strong working relationship, implementation proceeded smoothly, although changes in the leadership of the Bank team11 at times resulted in temporary slowdowns but did not impact overall Project outcomes. During implementation, the team brought a number of regional examples to counterparts; while some were 11 Over the course of Project preparation and implementation, there were four sets of TTLs/co-TTLs. 9 useful, counterparts noted that they would have benefited from more global examples of advanced countries who were working on similar issues. 34. Complementarity with DPL series. Over the course of implementation, the Project was accompanied by a series of DPLs which focused on similar areas as IBTAL. 12 This complementarity conferred a number of benefits, with technical assistance under IBTAL supporting progress in areas where substantial reforms were then recognized through the DPLs and their outcome indicators (e.g. development and implementation of SIIAS, results-based budgeting, approval of the capital markets law) and also serving as a channel for continuous long- term policy dialogue on critical topics in the Government’s reform agenda. 2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization 35. Overall, the design, implementation, and utilization of the M&E framework is considered to be moderately satisfactory. 36. Design of the M&E framework is considered moderately satisfactory. The PDO (both original and subsequent adjustments) was clearly formulated and well-aligned to Project areas. Typical of Bank projects designed around that time, the framework included many intermediate indicators which comprehensively covered the Project’s various areas of engagement. While providing a complete perspective, the volume of indicators was higher than could be easily monitored during implementation, and there were some differences in the presentation of PDO indicators across sections of the PAD and the restructurings (see table in Annex 10). Many of the Project’s indicators’ target values were not particularly informative, possessing yes/no as target values, while others did not have well-defined units or mistaken units of measurement. 37. Implementation and utilization of the M&E framework is considered moderately satisfactory. Design anticipated the hiring of two senior consultants to oversee each of the Project’s two clusters of components13 – including the results matrix. But during implementation, this function was largely decentralized with the PCU being responsible for the overall monitoring and the technical coordinators within each component were responsible for maintaining and supervising the results matrix for their own components. During implementation, the PCU compiled these inputs in bi-annual implementation reports which it shared with the Bank. These reports were very detailed, containing each area’s annual operating plan, procurement plan, and indicators – but did not explicitly include PDO indicators14. During implementation, the quality and timeliness of these reports, which supported a detailed tracking of progress, was praised by the Bank 15 . The Bank’s restructurings seem to have been a bit loose in tracking the results framework, with indicators marked as completed in past restructurings disappearing in the next results framework, leaving later Bank restructuring papers without a comprehensive presentation 12 First and Second Programmatic Reform Development Policy Lending (DPLs) 2007-2012 (P083927 for US$100 million; P106724 for US$400 million), the First and Second Programmatic Public Sector, Competitiveness and Social Inclusion DPLs 2010-2018 (P116215 for US$100 million; P123242 for US$260 million), and the Public Sector Management and Social Inclusion DPL 2012-2019 (P131440 for US$260 million) 13 Institutional Strengthening of Core Public Administration, and Institutional Strengthening for Policy Implementation. 14 Due to a mismatch in timing of counterpart’s implementation reports and ISRs, updates on the PDO indicators were generally requested by the Bank separately. 15 Aide Memoire, Mission October 6-10, 2008 10 of the entire framework. Nevertheless, this did not impact overall project implementation nor the achievement of the overall outcome. 38. It is important to note that the final form of three of the four PDO indicators (PDO#1, PDO#2, and PDO#4) did not measure Project impacts very well. PDO#1, which targeted an increase in the number of expenditure programs with context and results indicators did not align with the strategy pursued by AGEV since 2014, under which it has worked to improve the quality and quantity of indicators within priority areas (which actually resulted in fewer expenditure programs with indicators). Similarly, PDO#2 was oriented toward measuring entities’ connection to REDuy – work that, strictly speaking, was not financed by the Project and there were mixed signals in restructurings as to the indicator’s final target value. Finally, PDO#4 was oriented towards measuring downstream impacts of the broader tax reform and not specifically the impact of Project activities.16 This indicator also tends to be pro-cyclical, making it difficult to extract the impact of broader tax reform from overall economic trends. The June 2015 restructuring was not used as an opportunity to adjust these indicators. However, thanks to counterpart’s detailed and comprehensive monitoring of Project advances including and extending beyond intermediate results indicators, there is significant evidence to support the achievement of Project outcomes. 2.4 Safeguard and Fiduciary Compliance 39. At design, FM risks were considered to be low, thanks to the soundness of the proposed FM and governance-wide arrangements. No major issues were identified in the procurement assessment at design, and procurement risks were considered to be moderate. Throughout implementation, both procurement and financial management performance were considered to be satisfactory or higher17. Acceptable financial reports were submitted to the Bank in a timely manner throughout implementation, and external audits received unqualified opinions. Similarly, ex-post procurement audits noted the good quality of procurement processes. The procurement plan remained updated throughout implementation, with advances documented in the bi-annual progress reports submitted to the Bank.18 40. No safeguards policies were triggered at design of the original loan or the AF. In the AF, attention was paid to ensuring that studies and other consultancies financed under Component 7(c) did not have downstream social or environmental implications. At that time, it was also agreed that the Government and the Bank would review future terms of reference for activities financed under Component 7(c) and 9 (c) (design and implementation of the Nutrition, Child Development, and Health Survey (Encuesta de Nutrición, Desarrollo Infantil y Salud, ENDIS) for potential downstream social and environmental implications, with terms of reference including a standardized safeguards section including the identification, assessment, and if necessary, implementation of resulting recommendations. No safeguards issues arose during implementation. 2.5 Post-completion Operation/Next Phase 16 López Acosta, 2016, Government of Uruguay Final Report, pages 31 and 32. 17 Financial management was evaluated to be highly satisfactory in ISRs No.4 and 5 (dated November 25, 2008 and June 10, 2009, respectively). 18 López Acosta, 2016, Government of Uruguay Final Report, pages 35 11 41. With work in many areas of engagement having continued to advance over recent years outside of the Project supported by both the Government’s own-resources and support from other multilateral institutions, there is already significant evidence of the sustainability of reforms beyond the Project’s scope. Looking ahead, now that the basis for cooperation has been built within the SIIAS, the Government is looking to strengthen the corresponding regulatory framework. While there are some pending challenges related to cases stuck between the old and new bankruptcy laws (without a legal mechanism to allow them to opt for the new framework) officials working on the Bankruptcy law are looking towards the future and thinking about how the information being generated through fiscal information system can be used to help prevent bankruptcies. Counterparts are also continuing to advance on next steps related to XBRL. Own resources for related personnel costs were allocated in 2017 (previously financed by the IDB, with hardware supported by IBTAL), and counterparts are working on developing business intelligence tools, as well as increasing use, and implementing sanctions for the late submission of information. Additionally, the Government and the Bank are now preparing a new investment lending project focused on improving the quality of e-government services which builds on some of the advances made under IBTAL, including work on e-government and with DGI. 3. Assessment of Outcomes 3.1 Relevance of Objectives, Design and Implementation 42. Overall Project relevance is rated high. The Project’s objectives are highly relevant to the three pillars of the Country Partnership Framework for FY16-FY20 (Report No. 97063-UY, December 21, 2015). Advances in M&E, results-based management, and tax administration are highly relevant to Pillar 1’s objective to increase the efficiency of public investment and strengthen the management of SOEs, where it commits to supporting the Government with respect to fiscal management, with a focus on improving public expenditure efficiency and bettering public investment practice. The development of the SIIAS is likely to be an essential input for work under Pillar 2 to rebalance the social compact, and in particular to Objective 3’s work to promote early childhood development of the bottom 40 percent – work that implies understanding the intersection of various social programs. Finally, advances related to customs, as well as financial markets and bankruptcy regulations are broadly aligned with Pillar 3’s objective of integrating into global value chains, with improvements in customs administration in particular aligning with Objective 5’s focus on making logistics and transport networks more efficient. 43. Project design and implementation is rated highly relevant. Design focused on selected elements within key areas of the Government’s broader modernization program, and was well- suited to the PDO. As designed, Project activities were complementary to ongoing Government efforts (including work with other multilateral institutions), and no coordination issues arose during implementation. By making strategic decisions as to what to support with Bank financing versus own-resources, the Government facilitated implementation. While changes in Government priorities resulted in the dropping of Component 1, work was still able to continue under Component 7 once the political context allowed. The Government highly valued the support received through IBTAL, and the flexibility provided through the technical assistance loan instrument for institutional strengthening work - something that is no longer as easily available through either the World Bank or the IDB. 3.2 Achievement of Project Development Objectives 12 44. The PDO can be broken down into eight objectives which are identified and evaluated below. Annex 2 contains a detailed assessment of the achievements by objective as captured within the Results Framework as well as outputs by component. Information comes from the Borrower’s completion report and final bi-annual implementation report, as well as external sources where available. The Project’s objectives were: “To improve the Government’s public sector performance by: (i) supporting its public sector modernization program in the areas of: a. Objective 1. … monitoring and evaluation and performance-based budgeting19; b. Objective 2… e-government; c. Objective 3. … tax administration; d. Objective 4… statistics; e. Objective 5. … customs administration (dropped in the January 2010 restructuring); and, (ii) strengthening its institutions involved with the design and implementation of public policy reforms in the area of: f. Objective 6. … taxation; g. Objective 7. … promotion of the business environment; h. Objective 8. … promotion of social protection. 45. The objective related to monitoring and evaluation and performance-based budgeting (Objective 1) is considered to have been substantially achieved. M&E were institutionalized through AGEV’s creation (supported through the Project). Ministerial capabilities were strengthened through improvements to the systems that organize information of outputs and results (with the installation of ministerial control dashboards in nine entities). Following work with ministries to help them elaborate and improve their context and results indicators, these indicators have been incorporated into yearly accountability reports – currently, there are indicators for seven priority areas, five non-priority areas, and 21 expenditure programs – and interactive budget, management commitment, and other related information is available to the public online20. The last two quinquennial budgets were prepared using new tools and methodologies, and entities are now requesting the application of a methodology developed to evaluate the impact of public interventions, with which 24 evaluations have been carried out to date. Looking ahead, this year AGEV plans to create a national evaluation registry covering all of the central administration and entities under Article 220 of the Constitution. Notably, while progress cannot be attributed solely to IBTAL, between 2007 and 2013, Uruguay’s performance in the IDB’s results-based budgeting index rose from 1.8 to 2.9 (on a scale from 1 to 5), putting it substantially above the regional average of 1.821. Its performance in the IDB’s monitoring and evaluation index also rose similarly (from 1.1 in 2007 to 2.2 in 2013), again placing it above the regional average22. 46. The objective related to e-government (Objective 2) is considered to have been substantially achieved. As a result of Project activities, the Government’s general e-government 19 Due to the inter-related nature of monitoring and evaluation and performance-based budgeting, these two sub- objectives are jointly assessed here. 20 http://www.agev.opp.gub.uy/observatorio/servlet/maininicio, http://www.opp.gub.uy/hacemos/spp, http://www.opp.gub.uy/reporte-uruguay, http://www.opp.gub.uy/hacemos/comision-de-compromiso-de-gestion. http://wbi.worldbank.org/boost/country/uruguay 21 Building Effective Governments: Achievements and Challenges for Results-Based Public Adminstration in Latin America and the Caribbean. Eds. Jorge Kaufmann, Mario Sangines, and Mauricio Garcia Moreno. IDB, 2015. Figure 4.2 22 Kaufmann et al, 2015. Figure 7.2 13 strategy was defined, shaping the path for later advances, five models for the digitalization of administrative processes developed, and the first digital administrative processes implemented. Since then, and building from this work (using other sources of financing), the Government has made 823 administrative processes available online - a dissemination campaign for which was then supported by IBTAL in 2016 – and the Agenda Uruguay Digital 2020 was approved in December 2016 (Decree 459/016, December 30, 2016). These advances within IBTAL as well as concurrent IDB operations and the Government’s own resource financed initiatives have together likely contributed to Uruguay’s advancement from a score of 0.5084 (on a scale of 0 to 1) in the UN’s 2008 e-government online services index to 0.7754.23 The Project also supported a number of advances in e-procurement, including the re-design of security features of the Information System for State Purchases (Sistema de Información de Compras Estatales, SICE) and its catalogue – with the SICE channeling purchases of approximately US$510 million each year - and training for more than 4,000 staff and providers on the system’s use; design and installation of the Single State Provider Registry (Registro Único de Proveedores del Estado)- which contains updated information on all of the physical and legal persons interested in contracting with the State (currently more than 23,000 active providers) -in 249 executing units; and the development and implementation of the Management System for Centralized Purchases (Sistema de Gestión de Compras Centralizadas, SGCC), which was recently used for the procurement processes for milk and rice, as a result of which there are early indications of time savings. 47. The objective related to tax administration (Objective 3) is considered to have been substantially achieved. Modernization advances include the development of the SISCA within BPS. The internationally-recognized system24, which allows for the selection of tax cases for further analysis based on the behavior of personal income taxpayers and a fiscal risk model, uses an innovative combination of tools for business intelligence and predictive analytics. As a result of SISCA’s use, the average time for case selection has been reduced from five days to twenty minutes, and effectiveness in the detection of irregularities of large contributors increased from 60 percent to 90 percent. Subsequently, the FIS-T system was developed to support DGI’s fiscal risk management and oversight using lessons learned from SISCA’s successful implementation. Once in full use (it entered into production in December 2016), the system will analyze the behavior of taxpayers paying taxes administered by DGI to identify the cases to oversee based on assessed fiscal risks. Thanks to a combination of modernization efforts and a positive macroeconomic situation throughout most of the later years of implementation, the ratio of the yearly variation in nominal tax collections over the yearly variation in nominal GDP (PDO#4) was 26.8% in 2012, 17.47% in 2013, and 14.26% in 2014 before becoming negative in 2015 as the country experienced an economic slowdown due to falling commodity prices. 48. The objective related to statistics (Objective 4) is considered to have been substantially achieved due to the Project’s support to the institutionalization of the ENDIS survey. In particular, under the Project, the first and second waves of the ENDIS were finalized, and the third wave has 23 United Nations E-Government Knowledge DataBase, Urguguay. < https://publicadministration.un.org/egovkb/en- us/Data/Country-Information/id/185-Uruguay/dataYear/2016> 24 In 2016, SISCA was awarded a prize for its use of good practice and innovation from the Regional Forum of Social Security for the Americas, organized by the International Social Security Administration (“BPS was recognized for SISCA Project (implemented by QUANAM) in the Regional Social Security Forum,” https://www.quanam.com/en_US/blog/noticias- 20/post/bps-was-recognized-for-sisca-project-implemented-by-quanam-94) 14 been budgeted for by MIDES, leaving the survey well-institutionalized. Morever, INE and National Statistics System staff were trained in statistical methods; the administrative business directory was improved, with a focus on the quality of information of small businesses (the most difficult to update); and the dissemination of survey data strengthened. 49. The objective related to customs administration (Objective 5) (for analysis vis-à-vis the original PDO) is considered to have been substantially achieved. Advances under IBTAL include the formulation and implementation of a performance-based remuneration system which became effective in January 2014. Under this system, supervisors measure individuals’ performance based on responsibility, work quality, initiative and team work. Human resources management information systems were also updated, and profiles for high level and middle managers were defined. According to internal climate surveys carried out over the years, opinions on the adequacy of customs administration salaries in relation to the market and responsibilities improved from 2.4 (on a scale from 1 to 5) in 2011 to 4.6 in 2014 and 4.4 in 2016 (in relation to the market, on a scale from 1 to 7), and 4.4 in in 2014 and 4.0 in 2016 (in relation to responsibilities)25. 50. The broad objective related to improving the Government’s public sector performance by strengthening the Government’s institutions involved with the design and implementation of public policy reforms in the areas of taxation, promotion of the business environment, and social protection is considered to have been substantially achieved (PDO#3). In particular, the objective related to taxation (Objective 6) was substantially achieved. In addition to the development of SISCA and FIS-T noted above, which strengthened BPS’s and DGI’s capacities to carry out their respective tax compliance responsibilities that translated into the improvements in management noted above, a new governance model for DGI aimed at improving the quality of management through a global vision of processes and results, and based on recommendations from the International Monetary Fund (IMF), was developed and approved through Decree 265/2016 in August 2016. Hiring processes and performance evaluations have also been re-designed, and a horizontal mobility system designed. 51. The objective related to the business environment (Objective 7) is also considered to be substantially achieved. Following the December 2009 approval of the new Stock Market Law (Law No. 18627), the corresponding regulations were designed. Today, international norms for stock market regulation and share liquidation are now being applied, and risk based supervision is being carried out. An electronic central balance sheet which uses XBRL, allowing information to be available and useable within and outside of Uruguay, is now in use, and following the adaptation of international rules and financial statements for use in Uruguay, businesses now submit financial statements in alignment with the IFRS established by the International Accounting Standards Board, helping to ensure greater transparency. As an indirect result of changes to the regulatory framework, there has been an increase in market capitalization, which rose from US$139 million in 2009 to US$864 million in 2015. New emissions in the capital market increased from 8 to 16 over the same period, and activity in the primary and secondary stock markets passed from US$1.5 25Estudio de Clima Interno de la Dirección Nacional de Aduanas, Informe Final, March 2011; Informe de Estudio de Clima Interno, Aduanas, December 2016. 15 million to US$32.1 million.26 However, there remains more space for additional improvements, with investments in Uruguay remaining focused in the establishment of firms or actions to take control of existing firms but without a significant presence from investment funds27. The Law of Judicial Declaration of Insolvency and Corporate Reorganization (Law No. 18387), which aims to help economically viable businesses facing challenges survive, and to equitably and efficiently liquidate those that are not viable, was approved in October 2008 and regulated in 2009, and Government counterparts note that anecdotal evidence suggests that it has reduced the times and costs associated with bankruptcy processes. Data from Doing Business support this finding on time (with the number of years to close a business/resolve an insolvency dropping from 2.1 in 2008/2009 to 1.8 in 2016/2017) while costs remaining stable at 7% of the estate (while the recovery rate fell slightly from 43 cents on the dollar to 41.9 cents).28 Finally, within customs, a new system of incentives for staff was developed, existing human resource management information systems updated, and an analysis of staffing needs and existing profiles carried out, as a part of work to shift the focus from oversight to facilitation, a change which should help to strengthen the business environment. 52. The objective related to social protection (Objective 8) is also considered to have been substantially achieved, with advances made in SIIAS representing critical strengthening of the institutional environment. Thanks to work under the Project, the SIIAS, which is now located within the Ministry of Social Development, consolidates information on 3.2 million beneficiaries of social programs in areas including social security, education, and health, among others, from 23 entities sharing their information with the system. By bringing this information together in one place, the Government now has a more complete picture of the social programs being provided to a particular individual as well as the ability to analyze groups of individuals, including displays using tables, graphs, and maps, when designing and evaluating social assistance policies, and citizens are also provided with better and more transparent information on existing social programs. Thanks to the SIIAS, 200,000 eligible households no longer have to complete complicated forms or present certificates to receive family allowances, and for example, the system’s data was used to automatically select 46,000 households to receive a water subsidy, 67,000 households to receive an electricity subsidy, and 48,400 students to receive the Montevideo Cultural Card (which provides discounts on cultural activities)29. In September 2015, the SIIAS was chosen from among 218 submissions from 16 countries for the Inter-American Prize for Innovation for Effective Public Management by the Organization of American States30. 53. Overall, as presented above, the Project demonstrates a substantial level of achievement of its final objective as well as earlier formulations. While shortcomings with the results framework (described above) left three of the indicators (PDO#1, 2 and 4) not-well suited to measure Project impacts, and its achievements are not well-captured by PDO indicators, this rating 26 Aide memoire from the December 2015 supervision mission for P097604, P131440, and P123242) and the supervision results matrix for P123242, as cited in the Government’s Final Report. 27 U.S. Department of State, Bureau of Economic and Business Affairs, Investment Climate Statements for 2016, Uruguay. http://www.state.gov/e/eb/rls/othr/ics/investmentclimatestatements/index.htm?year=2016&dlid=254563 28 World Bank and International Finance Corporation. Doing Business 2009: Reforming Through Difficult Times. 2009; World Bank Group. Doing Business 2017: Equal Opportunity for All. 2017 29 Till Hartmann and Courtney Price Ivans, “Uruguay’s award-winning innovations for social protection,” Blog. March 14, 2016, http://blogs.worldbank.org/governance/uruguay-s-award-winning-innovations-social-protection 30 http://siias.mides.gub.uy/innovaportal/v/58827/12/innova.front/te-paso-el-dato 16 is substantiated by significant additional evidence demonstrating Project impacts in all of its eight objectives. 3.3 Efficiency 54. Given the Project’s focus on institution-building – the economic and financial benefits of which are difficult to quantify - a quantitative economic and financial analysis was not carried out at design. Instead, it pointed to various areas where positive benefits were expected, including fiscal benefits from more efficient public expenditures, solid administration of the new personal income tax, and improved control of contraband as well as positive impacts on economic growth arising from capital market, corporate transparency, and bankruptcy reforms. 55. The Project is evaluated to have demonstrated substantial efficiency. Project costs are well aligned with – if not lower than – what one would expect for reforms of their nature (e.g. US$1.3 million for development and implementation of the SISCA, U.S.$4 million for development and implementation of SIIAS 31 ) and project efficacy, as presented above is substantial, having made significant advances in the areas targeted within the areas covered within the PDO. The operation’s efficacy was enhanced by the complementary activities undertaken within Component 7 to explore other areas of related reforms linked to the PDO but not directly addressed within the other components; their inclusion within the Project allowed their management costs to be absorbed within the fixed costs of the PCU’s management. While the cumulative three year extension to the duration of the original project (4 years) and the additional financing (3 years) suggests that the delays encountered in some areas may have made Project implementation less efficient than expected, it is important to remember that there were also notable increases in the scope of activities (e.g. the adoption of XBRL and additional work related to the SIIAS) and that new areas of engagement were added through the additional financing (Components 8 and 9) which increased the Project’s area of impact and almost doubled the amount of loan resources. It is also important to recognize that World Bank experience in public sector reform projects has shown that such projects typically have relatively longer durations due to their complexity and political nature32. 56. There is already evidence of important efficiency gains in the areas covered by the operation, which over the coming years seem likely to translate into important savings. These include a reduction in the average time required to select personal income tax cases for additional review from five days to 20 minutes and improved detection of irregularities (from 60 to 90 percent), anecdotal evidence of reduced times and costs associated with bankruptcy processes subject to the new law, and early indications of time savings for the first procurement processes carried out using the SGCC. Additionally, as a result of work under IBTAL and other work to modernize customs, in 2015, between 58 and 76 percent of operations subject to customs control by the Montevideo Customs were managed in less than 24 hours – more than 200 percent more than the year prior – something which is estimated to have saved operators approximately US$25 31 For reference, the development of the SINTyS system, which integrates social and fiscal information of physical and legal persons in Argentina, while of a somewhat different scope and purpose, cost US$38 million over the course of three operations covering 13 years. 32 Independent Evaluation Group, Public Sector Reforms: What Works and Why? An IEG Evaluation of World Bank Support, The World Bank: Washington, D.C., 2008. Page 74 17 million. Ex-post, other (unquantified) efficiency gains from the Project similar to a number of those expected at design have been identified by the Government.33 See Annex 3 for details. 3.4 Justification of Overall Outcome Rating 57. Rating: Satisfactory. The Project’s overall outcome is considered to be satisfactory (See Table 1 below). While this is an upgrade from the Project’s last ISR (ISR#19, dated July 22, 2016) which rated PDO achievement as Moderately Satisfactory, advances in the last six months of implementation combined with the ICR’s holistic view of the Project and analysis of additional information support an overall satisfactory outcome rating. The Project made substantial progress towards its development objective. The operation’s objectives remain of high relevance for both the Government and the Bank, and given the high relevance of design and implementation, overall relevance is considered high. The Project’s substantial scope and efficacy combined with on par to lower than typically observed costs for reforms of their type, and initial evidence of increased management efficiency lead to an overall assessment of substantial Project efficiency. Table 1. Overall Outcome Rating Item Rating (1st PDO) Rating (2nd PDO) Rating (3rd PDO) - Relevance High Relevance of Objective High Relevance of Design/ High Implementation - Efficacy, Objective No. and 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 Rating S S - - S S S S S S - - - S S S S S S S - S S S Substantial Substantial Substantial - Efficiency Substantial Outcome Satisfactory (5) Satisfactory (5) Satisfactory (5) % of Disbursements 12% 18% 70% Weighted outcome 5*0.12=0.60 5*0.18=0.90 5*0.7=3.5 Overall Outcome Satisfactory (5) 3.5 Overarching Themes, Other Outcomes and Impacts (a) Poverty Impacts, Gender Aspects, and Social Development 58. Work under the Project to integrate the data of recipients of Uruguay’s many social programs within SIIAS is expected to have important impacts on the Government’s ability to effectively manage its social programs. Prior to the creation of the system, information was not regularly shared between entities, leaving policy makers within institutions with an incomplete picture of recipients’ individual situations and the broader context in which social development policy was being implemented. Thanks to the implementation of SIIAS, it is now possible to have an integrated view of social policy and its scope, helping to better define target populations. Data collected through the two waves of the ENDIS supported under IBTAL will also help to inform the design and evaluation of social policies targeted at children. (b) Institutional Change/Strengthening 59. As an institutional strengthening project, the Project’s impacts on institutional change and strengthening as linked to the main components have already been detailed above in Section 3.2. In addition to those impacts, the Project also helped to strengthen the PCU within MEF’s capacity to manage multi-entity World Bank projects – something that is proving to be of importance for 33 López Acosta, 2016, Government of Uruguay Final Report, pages 42 and 43 18 planned future engagement between the Bank and the Government in the lending operation currently under preparation. Moreover, it is important to note that the flexibility provided through Component 7 also provided the Government with the opportunity to work on a set of smaller institutional strengthening activities in a larger set of entities. Examples of such include support to the updating of rural property cadastral values based on the implementation of a new methodology, the Modernization of the Mortgage Bank of Uruguay’s legal services, and the preparation and evaluation of a new Public Private Partnerships (PPP) law. (c) Other Unintended Outcomes and Impacts (positive or negative) 60. The international awards received for work on the SIIAS and SISCA (mentioned above) provided an unexpected opportunity for the Government to highlight its advances and share its knowledge with an international audience. 3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops 61. A beneficiary survey was not carried out. In April 2017, a stakeholder workshop was held to present the findings of the Government’s final report, and disseminate the Project’s results across the components to the various entities involved in implementation. Within individual interviews held with each of the participating entities, staff highlighted the value of collaboration with the World Bank through the Project. 4. Assessment of Risk to Development Outcome 62. Rating: Low. Risks to the sustainability of the development outcome are considered to be low. Throughout implementation, all of the counterpart entities were highly committed to Project activities, in a number of cases complementing loan financing with own resources to advance in complementary areas, and remain highly committed to the reforms that were undertaken. In the case of the systems that were developed (e.g. SIIAS, SISCA, FIS-T, electronic invoicing, adoption of XBRL, etc.), advances are not the type that can be easily rolled back, nor is such expected, with the Government continuing to advance on its own in these areas as well as the continuation of some areas of engagement (with DGI and AGESIC) planned under the lending operation currently under preparation with the Bank. 5. Assessment of Bank and Borrower Performance 5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry 63. Rating: Satisfactory. The Bank team did a good job of designing the Project to respond to the institutional strengthening needs identified by the Government for prioritization. Design drew upon lessons learned from similar types of operations in other contexts, and was highly complementary to both concurrent DPL operations as well as support from the IDB. The Bank’s recognition at design that implementation might not go as planned – particularly important given the evolving nature of institutional strengthening reforms – and this factor’s reflection in the flexibility built into Component 7 proved to be an important way to support needs in related areas that were identified during implementation while maintaining highly pertinent dialogue with the Government. (b) Quality of Supervision 19 64. Rating: Satisfactory. Throughout implementation, the Bank team provided solid implementation support to the many areas covered by the Project, working with counterparts to facilitate activities and proactively resolve any issues that arose, helping to support the Project’s satisfactory outcome. Due to the high complementarity between concurrent DPL operations and IBTAL, joint supervision missions were used as an opportunity to efficiently monitor the progress of both operations. The team supported implementation by bringing regional experiences to the Project, but could have perhaps done a bit more to share pertinent global examples applicable to Uruguay’s advanced stage. While starting from the basis of an overly complex and imperfect results framework, more could have been done during implementation to ensure its adjustment during Project restructurings. However, given the high quality of Government monitoring reports, this did not impact the ability to monitor Project progress or document results. (c) Justification of Rating for Overall Bank Performance 65. Rating: Satisfactory. Overall Bank performance is considered to be Satisfactory. It provided solid support during Project design and implementation, helping to ensure the successful implementation of the Project’s modernization goals, while adjusting to the ongoing evolution of the Government’s reform needs. 5.2 Borrower Performance (a) Government Performance 66. Rating: Satisfactory. Strong government support and ownership of the modernization reforms pursued were critical to the Project’s substantial achievements across almost ten years of implementation. As a result, changes in the administration did not impact implementation, with commitment for reform priorities and Project activities remaining strong. Shifting priorities initially impacted work on the customs administration, but it was later able to progress under Component 7 when the context allowed. (b) Implementing Agency or Agencies Performance 67. Rating: Satisfactory. The PCU provided the project with strong project coordination, ensuring the effective implementation of planned activities, and the resolution of any challenges that arose thanks to its proactivity and collaborative relationship with the Bank. All of the participating implementing agencies also performed well, putting a lot of effort into diagnostics and preparatory work, ensuring that the proposed advances were well-aligned to respond to the challenges at hand and desired outcomes. While components advanced at different paces, in the end all made important contributions to the achievement of the Project’s development objectives. (c) Justification of Rating for Overall Borrower Performance 68. Rating: Satisfactory. Given that both the Government and the implementing agencies demonstrated overall strong performance, ensuring the successful implementation of Project activities and achievement of the Project’s objectives, overall Borrower performance is considered to be satisfactory. 6. Lessons Learned 69. Broadly focused institutional strengthening projects can be successful within the right context of small countries with a high level of political commitment and implementation capacity – which in the case of this Project, translated into strong existing coordination 20 mechanisms – but this experience may not be easily transferrable to other countries. While even more narrowly defined institutional strengthening projects in other countries have experienced substantial challenges, IBTAL was able to be successfully implemented thanks to the Government’s high level of commitment and clear identification of needed reforms, as well as high capacity implementing entities, fostered in part by the significant stability of the civil service, and pre-existing natural coordination mechanisms between entities. These existing coordination mechanisms were so strong, in fact, that the Steering Committee anticipated at design was found not to be necessary during implementation. 70. Contemplating space for a more flexible approach to some activities within Project design to allow for inevitable adjustments in reform trajectories can be of great value to the client and the Bank. The flexibility created within each of the main components as well as in Component 7 allowed for mid-course adjustments to activities to align them with the natural evolution of institutional strengthening reforms over the multi-year course of implementation without necessarily requiring a restructuring. This facilitated implementation and left restructurings for more substantial changes in project design, and provided space for the Government to engage with a broader set of entities and explore other related elements of reforms not directly addressed within Project components. 71. The Bank needs to revisit its approach to working in high capacity countries such as Uruguay. By not always fully recognizing the country’s stage of development and level of implementation capacity, and focusing on lessons learned from other countries in the region (instead of bringing a broader, more global focus), within IBTAL, the Bank missed some opportunities in its role as a knowledge exchange facilitator to share more cutting edge international experiences. Given the innovativeness of the activities undertaken, and their potential to inform other countries’ reforms, it also would have been useful to have had more resources for the international dissemination of lessons learned, such as the successful implementation of innovations in tax administration and social protection systems through the SISCA and SIIAS. 72. Although at the corporate level, the Bank is now prioritizing larger lending operations, IBTAL demonstrates that small loans can also be very important. While IBTAL’s interventions were spread across a number of entities, its complementarities with the Government’s broader reform agenda (including support from other multilateral institutions) and the high level of Government commitment to Project objectives resulted in the operation’s high value added on substantive areas of institutional strengthening. 73. Information management is not simply a technical issue – it is a political one that requires institutional change accompanied by a solid change management strategy. The implementation of the SIIAS - which changed the fundamental nature of how data on social programs within Uruguay are managed – could have faced significant challenges if it had lacked support for the institutional change implementation required. Recognizing this – and that these issues could be just as challenging as any technical issue that arose – counterparts placed significant emphasis on building consensus for the system, a decision that paid off with the successful integration of 23 entities into the system. 21 74. By correctly sequencing a series of reforms, greater support for more challenging issues can be generated. The Government’s decision to initiate work on a fiscal risk management system within the institutionally stronger BPS was very strategic. The successful implementation of the SISCA to evaluate fiscal risk associated with the new personal income tax allowed for the lessons learned from that experience to be applied to the subsequent development of a similar model (FIS-T) within DGI for application to all of the other taxes that it administered, and helped to facilitate that system’s implementation. 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (a) Borrower/implementing agencies 75. The Borrower did not have comments on the draft ICR. In December 2016, the Borrower prepared its own final report; ratings were the same as presented in this ICR, with the exception of the performance of the implementing agency, which was evaluated as highly satisfactory. An excerpt from this report is provided in Annex 7. (b) Cofinanciers 76. Not applicable –activities were not co-financed. (c) Other partners and stakeholders (e.g. NGOs/private sector/civil society) 77. N.A 22 Annex 1. Project Costs and Financing (a) Project Cost by Component (in USD Million equivalent) Appraisal Estimate Actual/Latest Percentage of Components (PAD)* Estimate Appraisal (US$ millions) (US$ millions)*** Component 1 0.75 0.15 20% Component 2 1.21 1.44 119% Component 3 1.55 1.93 125% Component 4 5.92 5.92 100% Component 5 2.05 1.98 97% Component 6 0.27 0.12 44% Component 7 1.62 7.63 471% Component 8 - 1.53 N/A Component 9 - 0.76 N/A PPF 0.20 0 Total Baseline Cost 13.56 21.45** 158% Contingencies (Bank costs and foreign exchange fees) 0.43 0.04 9% Total Project Costs 14.03 21.48** 153% 0.00 .00 Front-end fee IBRD 0.00 0.03 N/A Total Financing Required 14.03 21.52** 153% *Excludes Additional Financing of US$10 Million **Does not exactly equal sum of components due to rounding ***Source: Government of Uruguay. Ministry of Economy and Finance. Préstamo BIRF-7451/UR – Programa de Modernización Institucional, Préstamo BIRF 8116/UR – Adicional al Programa de Modernización Institucional. Informe de Avance del Segundo Semestre de 2016. To December 31, 2016. Includes IBRD and local financing. (b) Financing Appraisal Actual/Latest Type of Percentage of Source of Funds Estimate* Estimate** Cofinancing Appraisal (USD millions) (USD millions) Borrower 1.93 2.07 107% International Bank for Reconstruction 12.10 19.45 161% and Development *Excludes Additional Financing of US$10 Million **Source: Government of Uruguay. Ministry of Economy and Finance. Préstamo BIRF-7451/UR – Programa de Modernización Institucional, Préstamo BIRF 8116/UR – Adicional al Programa de Modernización Institucional. Informe de Avance del Segundo Semestre de 2016. To December 31, 2016. 23 Annex 2. Outputs by Component Component 1. Component was dropped. Component 2 Outputs Indicators Other Related Name Target Final Value Outcomes AGEV created in 2007 and PDO Indicator: 40 Partially achieved. 7 Between 2007 and 2013, strengthened during the Improvements in the priority areas, 5 non- Uruguay’s performance in following government design and management priority areas, and 21 the IDB’s results-based administrations. This support of monitoring and expenditure budgeting index rose from includes: evaluation programs. Addition 1.8 to 2.9 (on a scale from methodologies and tools of 5 non-priority 1 to 5), putting it  Support to the for improved results areas and substantially above the formation of technical budgeting in the Central improvements in regional average of 1.8. teams and the creation of a Government Budget. indicator quality Its performance in the Data Bank of results and undertaken, IDB’s monitoring and execution of public improving the design evaluation index also rose policies and management of similarly (from 1.1 in 2007  Computer equipment monitoring and to 2.2 in 2013), again for offices and meeting evaluation and tools placing it above the rooms Intermediate indicators: for improved results- regional average. based budgeting.  Training and exchanges within and A methodology for the 9 Achieved. Software outside of Uruguay on use of Indicators, Log for dashboards results-based management Frame, Information installed in 9 management and PMG ministries by the end has been defined and of 2012. Ministry of Information systems in public implemented in 3 pilot Housing, Territorial entities strengthened with institutions included in Planning and integrated dashboards and other the national budget Environment; developments, and delivery of (YR2) and in 6 Ministry of Industry, associated training. Dashboards additional institutions Energy and Mining; developed in: Ministry of Ministry of Public Housing, Territorial Planning Health; Ministry of and Environment; Ministry of Social Development; Industry, Energy and Mining; Ministry of the Ministry of Public Health; Interior; Office of Ministry of Social Planning and Development; Ministry of the Budget; State Interior; Office of Planning and Purchasing and Budget; State Purchasing and Contracting Agency; Contracting Agency; National National Institute of Institute of the Child and the Child and Adolescent of Uruguay; and the Adolescent of National Administration of Uruguay; and the Public Education. National Administration of New methodologies and tools Public Education. for the monitoring of results and elaboration of the last two Representatives of 25 Partially Achieved. quinquennial budgets. Parliament, the Court of 15 staff from the Improved product, results and Accounts, the Internal legislative branch context indicators in 12 Auditor’s Office, and at were trained in the programmatic areas and 21 least 2 civil society use of indicators and expenditure programs. organizations have been change management. 24 evaluations of design, trained in the use of implementation, and M&E information 24 performance in the health, education, Security, agricultural, housing, and infrastructure sectors. Number of rapid Achieved. 24 rapid evaluations concluded 24 evaluations were 2 impact evaluations carried out completed in sectors by AGEV and technical including security, assistance on impact evaluations health, education, carried out by public entities. rural development, Multiple dissemination housing, and initiatives for citizens and infrastructure. transparency through the OPP’s website. Web page and printed Yes. Achieved. Yes. reports available to civil Achieved. Available Development and society with M&E on the internet: implementation of the System information Interactive Vital Statistics, Pregnancy, and information of the Childhood (SEVEN) National Budget on  Development of the Uruguayan Version 2 of the Live Observatory of Birth Certificates Public Policies, integrated into the including a public Perinatal Information policy simulator. System Additional available reports include the  Construction of an Uruguay 2015 online information Report; registry system for Methodological health monitoring of Guide and early infancy Management Commitments;  Implementation of a Standardized Budget solution for integrated and execution data management of the using the World vaccination process Bank BOOST (donated by the methodology Generalitat Valencia)  Detection of opportunities for The budget decision- Yes. Achieved. Yes. interoperability with makers receive quality Volume 2 – Planning other systems M&E information from and Evaluation” at least nine ministries to which accompanies be used in the budgeting the 2015 process for 7 Accountability programmatic areas reporting sent to Parliament contains pertinent information for improving authorities’ decision making, linking strategic planning with the assignment of resources. It has financial information on credits and execution for 17 programmatic areas and performance (context indicators) for 12 programmatic areas, program level results for 7 priority 25 programmatic areas, result for 21 budget programs, and financial and performance indicators for the 14 subsections of the Central Administration and for entities under Article 220 of the Constitution. Number of Budget 4 Achieved. 4. The Execution reports 20 reports making up submitted to Congress, “Volume 2: Planning including data on and Evaluation” for indicators the 2015 Accountability Reporting (described in the indicator above) were presented to Congress. Component 3 Outputs Indicators Other Related Name Target Final Value Outcomes Definition of the PDO Indicator: E- 150 Almost achieved. E- AGESIC has general strategy, Government strategy is government strategy developed and prioritization of implemented, ensuring implemented. As of implemented administrative connectivity through a 2016, 146 agencies strategies for 2007- processes to be common platform of were connected to the 2009, and 2011-2015. digitized, and support the principal state REDuy network which The Agenda Uruguay to the implementation agencies, allowing connects the entire Digital 2020 was of the first online safe, fast and easy Uruguayan state and approved in administrative exchange of allows for the secure December 2016 processes. information between exchange of (Decree 459/016, agencies and between information between December 30, 2016). Improvements to the agencies and citizens entities. SICE’s security and creation of the Intermediate Since then, outside of catalogue. Indicators IBTAL, progress has Achieved. Yes. progressed. Currently, 2,291 staff and 2,393 The strategy and Yes Uruguay Digital there are 823 providers trained in technical requirements Agenda 2011-2015, administrative State purchases. for the implementation which aimed to processes available of e-government coordinate and online (127 which can Single Registry of strategy have been prioritize programs be carried out Providers, containing defined that promote the more completely through information on more efficient use of ICTs in the portal than 23,000 active activities developed by (https://portal.gub.uy/) providers, developed citizens, businesses and 696 with can be installed in 249 and the Government, initiated there). executing units. was approved by Additionally, all of the information 26 Development of the presidential decree in needed to carry out System for Nov 2011 2,343 State Management of administrative Centralized Purchases, Achieved. In the last processes is available recently used for two Transactional e- Yes semester of the from: processes. procurement platform Project, the platform https://tramites.gub.uy for purchases of entered into production medicines and food with two calls Since 2008, Uruguay implemented in central managed by the food has advanced from a government including sector. score of 0.5084 (on a ASSE scale of 0 to 1) in the UN’s e-government online services index At least 100 public 100 Achieved. 308. to 0.7754, likely due sector transactions are the Government’s accessible through a advances under unified portal IBTAL, concurrent IDB operations, and the Government’s own-resource financed initiatives. Component 4 Outputs Indicators Other Related Outcomes Name Target Final Value Development and PDO Indicator implementation of Average time for SISCA in BPS Entities responsible 100% Tax, social Achieved. SIIAS selection of cases was for selected policy protection. (social protection), reduced from five Tax advice on the reform initiatives in SISCA and FIS-T days to twenty supervision strategy taxation, capital (taxation) were minutes, and and model. markets, social implemented. effectiveness in the protection, and detection of SIIAS developed and bankruptcy regulation irregularities of large implemented in 21 have the necessary contributors increased organizations. technical tools for the from 60 percent to 90 implementation of the percent. Institutionalization of reforms once the SIIAS in MIDES. approved. In 2016, SISCA was awarded a prize for its The ratio of the yearly 5.3% Almost achieved. use of good practice variation in the 26.8% in 2012, and innovation from nominal tax 17.47% in 2013, the Regional Forum of collections over the 14.26% in 2014 Social Security for the yearly variation in the -0.29% in 2015. Americas, organized nominal GDP by the International In 2015, the value Social Security was -0.29%, as the Administration region experienced economic slowdown due to falling commodity prices. In years prior, tax collection variation Thanks to the SIIAS, exceeded the variation 200,000 eligible in GDP by more than households no longer annual targets. have to complete complicated forms or 27 Intermediate present certificates to Indicators receive family allowances, and for Implementation of the 100% Achieved. 100%. example, the system’s modernization Gradual incorporation data was used to program of the process for obligatory automatically select collections area of presentation of 46,000 households to BPS has advanced in declarations and receive a water accordance with changes via web subsidy, 67,000 action plan completed in 2011; households to receive 100% of the business an electricity subsidy, required to present and 48,400 students to salaries can only do so receive the through the web. Montevideo Cultural Card (which provides discounts on cultural Increase in real terms Achieved. 6.8% activities) of collection of social 2% annual average (2006- security contributions 2010). Additional In September 2015, (used as a proxy for increases were not the SIIAS was chosen IRPF tax collections expected in the years from among 218 by BPS) increase following 2010 given submissions from 16 the high degree of countries for the Inter- compliance. However, American Prize for from 2011-2015, Innovation for revenue continued to Effective Public increased (4.4% Management by the annual average). Organization of American States. Five central government Yes. Achieved. Yes. The institutions have first five institutions integrated information were: the on social protection Administration of programs and State Health Services beneficiaries on the (ASSE), BPS, the SIIAS and the Uruguayan Institute of information is used for the Child and policy making Adolescent, the Ministry of Social Development, and the Ministry of Public Health. Number of additional Achieved. 15. Over Government agencies 8 the course of that have data on their implementation, a social programs’ total of 23 entities beneficiaries and were integrated into benefits integrated in the SIIAS. SIIAS Component 5 Outputs Indicators Other Related Name Target Final Value Outcomes New Stock Market PDO Indicator Regulations for the Law approved and law were approved in regulated. Entities responsible 100% capital markets Stock Market Law September 2011 for selected policy (Law 18627) was (Decree 322/011). A reform initiatives in approved in December re-ordering of the rules 28 International rules for taxation, capital 2009 and supporting was approved in June the regulation of the markets, social systems and tools 2012, and Law 18930, stock market and protection, and acquired. approved in July 2012 securities settlement bankruptcy regulation created a registry of under application. have the necessary holders of equity technical tools for the shares, increasing the Risk based supervision implementation of the transparency of implemented, reforms once information. In including development approved. January 2013, new of methodologies for regulations for Law supervision and 18627 were approved control, generation of (Circular 2139) for risk matrices, public offerings, elaboration of XBRL investment taxonomies, staff Intermediate representatives, training, and Indicators corporate governance acquisition of practices for stock equipment for issuers, use of oversight and International standards Yes Achieved. Yes. The privileged monitoring. for securities market Stock Market Law information, public regulation and (Law No. 18627) was takeover bids, and Strengthening of the securities settlement approved in December penalties. BCU in the Stock have been applied 2009, contributing to Market Area - Stock improved regulation in Market Registry, alignment with Rules requiring the exchange of international standards registry of financial experiences with other statements have been countries, training, issued (Decree 156/16 updating of the and AIN Resolution), website and adaptation and were applicable of computer starting June 30, 2016 equipment. (for registry of information by Acquisition of December 27, 2016). software to manage The Electronic Central and edit XBRL, and Balances began training for staff on implementation in such 2016 for the registry of publicly traded Central Electronic companies’ financial Balance Sheet using statements, and XBRL developed and became obligatory in in use. June 2016. Consultancy on operator certification Private corporations Yes Achieved. Yes. are submitting Businesses are Adaptation of financial reports submitting financial international financial according to the new statements as required standards and rules for strengthened statutory under Decree 124/11, the local context and institutional which required the framework presentation of Training of AIN staff accounting statements on topics related to in alignment with the central balances and IFRS established by XBRL, and technical the International staff trained at the Accounting Standards Bank of Spain and Board. Bank of Italy 29 A sustainable and Yes. Achieved. Yes. effective process for Continual adopting IFRS has actualization with been applied accounting regulations. Since January 2009, the application of IFRS has been mandatory. Component 6 Outputs Indicators Other Related Name Target Final Value Outcomes Law approved and PDO Indicator Anecdotal evidence regulated. from counterparts of Entities responsible 100% bankruptcy Law of Judicial reduced time and costs 12 courts strengthened for selected policy Declaration of of bankruptcy for implementation of reform initiatives in Insolvency and processes. the law through taxation, capital Corporate provision of computer markets, social Reorganization (Law Data from Doing equipment and a protection, and No. 18387) was Business support this training room. 10 bankruptcy regulation approved in October finding on times (with training workshops have the necessary 2008 and supporting the number of years to were also organized technical tools for the systems and tools close a by the Center on implementation of the acquired. business/resolve an Judicial Studies reforms once insolvency dropping approved. from 2.1 in 2008/2009 Acquisition of to 1.8 in 2016/2017) insolvency books. while costs remaining stable at 7% of the estate (while the recovery rate fell slightly from 43 cents on the dollar to 41.9 cents Component 7 Outputs Indicators Other Related Name Target Final Value Outcomes Support to specific Intermediate Yes Achieved. Yes. On Internal climate aspects of reforms in Indicators December 16, 2013 surveys carried out DNA (coordination of the Executive Branch over the years within work to define Incentive based approved the decree the Customs profiles, training and performance has been crating the new Administration show human resource needs; implemented for incentive system for that opinions on the definition of profiles; Human Resources in DNA personnel, adequacy of salaries in and adjustments to Customs effective since relation to the market human resource Administration January 1, 2014. and responsibilities information systems; rose from 2.4 (on a formulation and scale from 1 to 5) in implementation of an 2011 to 4.6 in 2014 30 incentive based and 4.4 in 2016 (in remuneration system) relation to the market, on a scale from 1 to 7), Support to the and 4.4 in in 2014 and management and 4.0 in 2016 (in relation oversight of the PCU, to responsibilities) including financial and procurement areas and oversight. Acquisition of PCs, notebooks, printers, memory, projectors, screens, software licenses, office supplies, etc. Evaluation of the fiscal impacts of public health reforms. Study to support the diagnostic of the Armed Forces Register Law Project for Public-Private Partnerships in infrastructure Support to the programming and monitoring of the National Housing Fund. Support to the MTOP in analysis of the load systems of the road network. Updating of the cadaster values of rural property based on the implementation of a new methodology. Modernization of the judicial services of the Mortgage Bank of Uruguay. Advice on the re- definition of the competitiveness and productivity strategy Support to the institutional consolidation of the Uruguay Concursa Unit of the National Civil Registry Office. 31 Other consultancies, including support to: Strengthen coordination with multilateral institutions Study results-based budgeting in other countries The accounting and finance divisions of MEF to improve processes, the Debt Management Unit, and the Macroeconomic Area The Consumer Protection Directorate in information management for its consumer price information system and advice to users of consumer financial services The Treasury in its analysis of bank accounts and changes in procedures The Private Sector Unit Commercial policy and competitiveness The General Accountants Office - Systems Division and Rental Collateral Services Component 8 Outputs Indicators Other Related Name Target Final Value Outcomes Development and PDO Indicator implementation of the oversight and fiscal Entities responsible 100% Tax Achieved. FIS-T for selected policy (taxation) were 32 risk management reform initiatives in implemented, and new system, FIS-T. taxation, capital governance model for markets, social DGI approved and New governance protection, and under implementation. model approved and bankruptcy regulation starting have the necessary implementation. technical tools for the implementation of the Initiation of changes in reforms once human resource approved. management, including the redesign of hiring processes and performance-based evaluations. The ratio of the yearly 5.3% Almost achieved. Improvement in DGI’s variation in the 26.8% in 2012, systems through the nominal tax 17.47% in 2013, consolidation of high collections over the 14.26% in 2014 capacity servers in a yearly variation in the -0.29% in 2015. new platform. nominal GDP In 2015, the value was -0.29%, as the region experienced economic slowdown due to falling commodity prices. In years prior, tax collection variation exceeded the variation in GDP by more than annual targets. Intermediate Indicators Proportion of intensive 20% Not achieved. Strictly audits generated by the speaking, as the risk management information system system audits over the just entered into total intensive audits operation in January 2017, there were no advances on this indicator during IBTAL’s implementation. Nevertheless, it should be noted that from January-June 2015 and 2016, approximately 85% of intensive audits were selected based on the application of objective risk analysis based on data processing 33 Software to support Yes Partially achieved. the Electronic New model prepared accounting and approved in the Application developed second half of 2016, and operating with implementation beginning at that time. As of December 2016, approximately 90% of the formal changes associated with the reform had been carried out, but in terms of actual implementation, approximately 50% of the changes had been completed Component 9 Outputs Indicators Other Related Name Target Final Value Outcomes First and second waves Intermediate Indicators The third wave of of the ENDIS finalized. the ENDIS has already been Approximately 100 INE Panel survey of most Yes Achieved. Yes. Work budgeted for by and National Statistics vulnerable population for the first wave of MIDES, leaving the System staff trained in concluded ENDIS was completed survey statistical methods. in April 2015, and institutionalized. Topics included: panel fieldwork for the surveys, follow-up second wave was studies on children for concluded in April performance analysis 2016. and policy design; metadata documentation; accelerated data program; population projections with probability distributions; the statistical software R; sampling; geo- referencing; projection of agricultural statistics; and Java programming. Improved administrative records – directory of businesses Improved dissemination of survey data. Re-design of INE’s website and improved search engine 34 Annex 3. Economic and Financial Analysis As discussed in the main text, given the Project’s focus on institution-building – the economic and financial benefits of which are difficult to quantify - a quantitative economic and financial analysis was not carried out at design. Instead, design signaled to various areas where positive economic and financial benefits were expected to accrue, including fiscal benefits from more efficient public expenditures, solid administration of the new personal income tax, and improved control of contraband as well as positive impacts on economic growth arising from capital market, corporate transparency, and bankruptcy reforms, among others. Project costs were well aligned with – if not lower than – what one would expect for reforms of their nature (e.g. US$1.3 million for the development and implementation of the SISCA, US$4 million on the development and implementation of SIIAS) and project efficacy, as presented above is substantial, having made significant advances in the areas targeted within the areas covered within the PDO. The operation’s efficacy was further enhanced by the complementary activities undertaken within Component 7 to explore other areas of related reforms not directly addressed within the other components, and their inclusion within the Project allowed the fixed costs associated with their management to be absorbed within the fixed costs of the PCU’s management, thereby further increasing efficiency. While the cumulative three year extension to the duration of the original project and the additional financing suggests that the delays encountered in some areas may have made Project implementation less efficient than initially expected, it is important to remember that there were also notable increases in the scope of activities (e.g. the adoption of XBRL and additional work related to the SIIAS) and that new areas of engagement were added through the additional financing (Components 8 and 9) which add to the Project’s area of impact There are already some evidence of important efficiency gains in the areas covered by the operation, which over the coming years seem likely to translate into important savings. These include a reduction in the average time required to select personal income tax cases for additional review from five days to 20 minutes and improved detection of irregularities (from 60 to 90 percent), anecdotal evidence of reduced times and costs associated with bankruptcy processes subject to the new law, and early indications of time savings for the first procurement processes carried out using the SGCC. Additionally, as a result of work both under IBTAL and other work to modernize customs, in 2015, between 58 and 76 percent of operations subject to customs control by the Montevideo Customs were managed in less than 24 hours – more than 200% more than the year prior – something which is estimated to have saved operators approximately US$25 million. Ex-post, the Government has identified the following fiscal and economic benefits of Project activities detailed in the table below. 35 Fiscal and Economic Impacts of the IBTAL Project (Government of Uruguay Final Report*) Component Expected Fiscal Impacts Expected Economic Benefits 1. Human As a result of work under IBTAL and Similarly, as a result work under IBTAL Resource other projects in customs modernization, and other customs modernization Management in an increase in fiscal revenues as a result projects, the following improvements the DNA of improved customs controls and less have been noted: contraband is expected.  Reduced time spent on controls; in 2015, between 58 and 76% of Montevideo’s customs Operations were handled in less than 24 hours, 200% more than the year prior.  Expected savings for operators of approximately US$25 million per year. 2. Planning, Strengthening of the quality of monitoring and monitoring and evaluation systems will evaluation lead to improvements in planning and management, as a result of which positive impacts due to the more efficient use of resources are expected. 3. E- Efficiency and security gains through the Reduced time in procurement processes government interconnection between public entities due to improved management by the information systems State. Reduced times for managing State Reduction in the time needed for the purchases. presentation of documentation from providers which the State already has. Reduced costs for purchases due to better process control and inputs for planning Improved transparency in State of such purchases. purchases increases competition between companies. Less time required to carry out administrative processes with the State. Improved access to State services across the country. . 4.1 Support to Reduction in the average times for case Potential reduction in fiscal evasion by BPS for tax selection from 5 days to 20 minutes. - big taxpayers. reform Increased effectiveness in the detection of irregularities (from 60% to 90%) 4.2 Support to Improved identification and targeting of Increased access to social benefits for BPS for Social social protection programs with the groups for whom it was previously not Protection potential to generate benefits in the possible to reach with social policy Reforms efficiency of the assignment of public instruments. expenditure. 36 Component Expected Fiscal Impacts Expected Economic Benefits 5. Support to the The strengthening of regulation and implementation infrastructure in which capital markets of capital function, and improved information in market reforms the hands of investors could help to and corporate increase the efficiency of private transparency. investment. . 6. Support to the Bankruptcies potentially avoided as a Allows for the conservation of implementation result of the law preventing a reduction businesses and productively viable units of bankruptcy in the corresponding tax revenues when they encounter economic law difficulties. Reduction of time and costs for the state Reduction of time and costs in judicial in judicial processes processes. 8. Strengthening Improvements in the management impact Potential reduction in fiscal evasion by of the DGI of the efficiency of DGI’s resources, as big taxpayers. well as potentially the efficacy of supervision. 9. Strengthening The availability of the results of the Indirect long term impacts through of the INE ENDIS will help to improve policy improvements in the health, nutrition, design, and potentially their effectiveness and development of children as a result by generating benefits in the efficiency of better designed policies of the assignment of public resources. *López Acosta, 2016. 37 Annex 4. Bank Lending and Implementation Support/Supervision Processes (a) Task Team members Responsibility/ Names Title Unit Specialty Lending Lisa Bhansali Lead Public Sector Specialist GGO28 Senior Financial Management Regis Cunningham GGO20 Specialist Enrique Fanta Ivanovic Senior Private Sector Specialist GTC04 Co-TTL Pilar Gonzalez Senior Counsel LEGLE Ana Maria Grofsmacht Senior Procurement Specialist GGO04 Efraim Jimenez Consultant OPSPF Ricardo Eduardo Lugea Consultant GGO04 Maria Del Carmen Minoso Senior OperationsOfficer GWASO Xiomara A. Morel Lead Financial Management Specialist GGO22 Juan Manuel Quesada Delgado Carolina Rendon Senior Public Sector Specialist GGO16 Jeffrey James Rinne Fernando Rojas Consultant GGO14 Milena Sanchez de Boado Mario Francisco Sangines Senior Public Sector Specialist TTL Andres Eduardo Santoro Customs Consultant Alejandro Roger Solanot Senior Financial Management Specialist GGO22 Supervision/ICR Daniel Jorge Arguindegui Senior Procurement Specialist GGO04 Amparo Ballivian Lead Economist DECDG TTL Marcelo Daniel Barg E T Consultant LCC6C Ezequiel Cambiasso Roland N. Clarke Lead Public Sector Specialist GGO16 TTL Patrick Conroy Regis Thomas Cunningham Sr Financial Management Specia GGO20 Ivanna Echegoyen Ferreira Senior Public Sector Management Daniel Alvarez Estrada GGO28 TTL Specialist Enrique Fanta Ivanovic Senior Private Sector Specialist GTC04 Henry Forero Ramirez Senior Public Sector Specialist GGO16 Pilar Elisa Gonzalez Rodriguez Senior Counsel LEGLE Ana Maria Grofsmacht Senior Procurement Specialist GGO04 Marcela Guzman Till Johannes Hartmann Junior Professional Associate GGO16 Adrienne Elizabeth Hathaway Research Analyst GGO16 Ana Mie Horigoshi Reis Junior Professional Associate LCSPS Ana Isabel Lariau Bolentini Ricardo Eduardo Lugea Consultant GGO04 Maria Del Carmen Minoso Senior Operations Officer GWASO 38 Xiomara A. Morel Lead Financial Management Spec GGO22 Zafer Mustafaoglu Practice Manager GFM04 Program Leader May Cabilas Olalia Senior Public Sector Specialist GGO16 LCSPS - Juan Manuel Quesada Delgado E T Consultant HIS Carolina Rendon Senior Public Sector Specialis GGO16 TTL Rafael P. Rofman Program Leader LCC7C Fernando Rojas Consultant GGO14 Andres Eduardo Santoro HQ Consultant ST GTC04 Peter Siegenthaler Economic Adviser OPSPQ Alejandro Roger Solanot Sr Financial Management Specia GGO22 Theo David Thomas Economic Adviser OPSPQ Eduardo Martin Urdapilleta Senior Public Sector Management Fanny Weiner Speciaist, GGO14 (b) Staff Time and Cost Staff Time and Cost (Bank Budget Only) Stage of Project Cycle USD Thousands (including No. of staff weeks travel and consultant costs) Lending FY06 5.60 104.75 FY07 44.06 294.01 FY08 0.50 2.18 Total: 50.16 400.94 Supervision/ICR FY08 26.67 132.12 FY09 30.36 169.91 FY10 17.71 93.66 FY11 9.66 71.67 FY12 3.29 19.37 FY13 8.9 66.44 FY14 32.52 165.60 FY15 31.87 154.03 FY16 49.99 227.07 FY17 27.31 128.18 Total: 238.28 1,228.05 39 Annex 5. Beneficiary Survey Results N/A 40 Annex 6. Stakeholder Workshop Report and Results In April 2017, a stakeholder workshop was held to present the findings of the Government’s final report, and disseminate the Project’s results across the components to the various entities involved in implementation. Within individual interviews held with each of the participating entities, staff highlighted the value of collaboration with the World Bank through the Project. 41 Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR The Borrower did not have comments on the draft ICR. In December 2016, the Borrower prepared its own final report; ratings were the same as presented in this ICR, with the exception of the performance of the implementing agency, which was evaluated as highly satisfactory. This report was used by the Bank and used as an input to the preparation of this ICR. A summary presentation of this report’s main conclusions can be found here: https://www.mef.gub.uy/innovaportal/file/21234/3/presentacion-icr.pdf. An excerpt from this report (in Spanish), detailing the Borrower’s assessments of outcomes, risks to the development objective, Bank and Borrower performance, and lessons learned is presented below. The entire report, including a detailed presentation of Project outputs and outcomes by component has been saved in Project files and is available upon request. ------------ Excerpted from: Luciana López Acosta, Consultoría individual para la “Evaluación de Cierre de Proyecto” Producto 3 – Informe Final. Programa de Asistencia Técnica de Modernización Institucional (MEF/BIRF), Préstamos Nos. 7451-UR y 8116-UR (IBTAL). December 31, 2016. ----------------- 3. Evaluación de los Resultados 3.1 Relevancia de los Objetivos, Diseño e Implementación Relevancia: Alta 62. El Objetivo de Desarrollo del Proyecto (ODP) era: mejorar el desempeño del sector público del prestatario a través de las siguientes medidas: i) apoyar su programa de modernización del sector público en las esferas de seguimiento y evaluación, elaboración del presupuesto basado en el desempeño, gobierno electrónico, administración tributaria y estadística, y ii) fortalecer las instituciones involucradas en el diseño y la ejecución de las reformas de las políticas públicas en las áreas de impuestos, promoción del clima para los negocios y protección social. 63. El ODP ha mantenido su relevancia en todo el período de ejecución del Proyecto, y los tres gobiernos por los que éste ha transcurrido: 2005-2009, 2010-2014, y 2015-2019. Desde el primer gobierno del Presidente Tabaré Vázquez, se han emprendido reformas que han ido cambiando la estructura institucional y organizacional del Estado, con el objetivo de mejorar su desempeño. Han ocurrido aportes importantes en áreas estratégicas de la gestión como fue la profundización del gobierno electrónico, la regulación financiera, o la gestión impositiva, y esfuerzos por avanzar en la lógica de la evaluación basada en el desempeño, y en la flexibilización de las estructuras de carrera administrativa. 64. Los distintos procesos de reforma han buscado fortalecer las capacidades de la Administración Central, incorporando la lógica de la gestión por desempeño, la toma de decisiones 42 basada en evidencia y el foco en los ciudadanos. En los tres períodos de gobierno, se ha buscado mejorar la capacidad de diseño de las políticas y dotar al Estado de sistemas de monitoreo y evaluación de esas políticas, así como facilitar su acercamiento a la ciudadanía, tanto en la promoción de la transparencia y rendición de cuentas, como a través de la creación de ventanillas únicas de atención ciudadana y la simplificación e interconexión de trámites en distintos organismos públicos. En términos de la institucionalización de estas iniciativas, se crearon agencias como la AGESIC, para liderar la política de gobierno electrónico y sistemas de información, y la AGEV, que tiene competencias en planificación estratégica y evaluación de políticas públicas. 65. Al momento del ICR, es posible constatar que el objetivo de “mejorar el desempeño del sector público” mantiene su relevancia al interior de cada uno de los organismos participantes del Proyecto. Asimismo, el gobierno que asumió en 2015, amplía los desafíos de mejora del desempeño incorporando también a las empresas públicas. En este sentido ya se han comenzado a fortalecer las capacidades de planificación y coordinación de la inversión, a través de la creación de la Dirección de Planificación y el Sistema Nacional de Competitividad, ambas al interior de la Oficina de Planeamiento y Presupuesto. 66. El diseño de la operación también continúa siendo relevante. En el contexto de que no hay una única iniciativa de mejora de la gestión pública, ni una única institucionalidad que lidere los distintos procesos de modernización que se llevan a cabo en los organismos públicos, es razonable que un Proyecto como el IBTAL sea ejecutado en el MEF, organismo que tiene un importante rol en la validación y promoción de las iniciativas de reforma, y que a lo vez se lo dote de herramientas flexibles para darles impulso. 3.2 Cumplimiento de los Objetivos de Desarrollo del Proyecto Calificación: Satisfactorio 67. El ODP se considera cumplido en forma satisfactoria, como resultado de los avances logrados en cada uno de los componentes, y el grado de cumplimiento en los indicadores de ODP y en los indicadores de resultados intermedios. 68. El grado de avance de los componentes es heterogéneo, pero es coherente con los procesos de fortalecimiento institucional, que muchas veces insumen más tiempo y/o recursos de los esperados. Los componentes con mayor grado de cumplimiento de metas y compromiso de recursos son el 3 (gobierno electrónico), el 4 (BPS y SIIAS) y el 6 (normas concursales), con un avance alto, seguidos del componente 5 (mercado de capitales y transparencia corporativa) con un avance medio-alto, y finalmente los componentes 9 (INE) y 8 (DGI) con una ejecución media y baja respectivamente. 69. A continuación se resumen los principales resultados por Componente, que se detallan en el Anexo 2. (A) Modernización del sector público en las esferas de seguimiento y evaluación, elaboración del presupuesto basado en el desempeño, gobierno electrónico, administración tributaria y estadística. 70. Gestión de recursos humanos de la Dirección Nacional de Aduanas (DNA) fortalecida. Se lograron reformas en el área de recursos humanos vinculadas con la política de ingresos y egresos de funcionarios, y con el sistema de incentivos para el personal. Los tiempos políticos que 43 requirió el proceso de modernización de la DNA condujeron a reducir la participación del Proyecto IBTAL como instrumento de financiamiento. A pesar de ello, se constata que el organismo ha continuado avanzado hacia una gestión por resultados, consolidando el instrumento de evaluación de desempeño de los funcionarios a nivel individual y grupal, y la implantación de un cuadro de mando integral para la planificación estratégica. Como resultado del proceso de modernización se destacan mejoras en indicadores operativos, como la eficiencia en controles y su tiempo promedio de realización34. En particular como efectos en términos de los recursos humanos, se aprecia una mayor participación de los funcionarios de entre 21 y 40 años (pasa de 2% a 26% en el período 2005-2016)35 y mayor profesionalización, disminuyendo también la cantidad total de funcionarios de 1.222 a 863 en el período señalado36. Asimismo, el ratio de declaración de importaciones procesadas por cantidad de oficiales37 se incrementó en un 69,5% en los últimos diez años. 71. Capacidades de planificación, monitoreo y evaluación institucional mejoradas. Se institucionalizaron las capacidades de planificación, monitoreo y evaluación institucional con la creación de la AGEV, cuyo desarrollo ha sido apoyado por el Proyecto IBTAL. Asimismo, se fortalecieron las capacidades ministeriales, a través de la mejora de los sistemas de información que alimentan indicadores de productos y resultados, y el desarrollo de actividades de capacitación. Se desarrollaron nuevas metodologías y herramientas para la elaboración del presupuesto nacional 2010-2014 y 2015-2019. Se desarrolló una metodología de evaluación de los resultados de las intervenciones públicas, que consolidó su implementación y ya es demandada por los organismos. Las evaluaciones de impacto han avanzado con menor ritmo que lo esperado en el proyecto, pero se mantiene como línea prioritaria dentro de la AGEV. Como desafío pendientes queda avanzar en (i) la retroalimentación del proceso presupuestario con base en los instrumentos de monitoreo y evaluación, y en (ii) el desarrollo de las evaluaciones de impacto. 72. Principales productos:  AGEV creada en 2007 y fortalecida en los siguientes períodos de gobierno.  Sistemas de información en organismos públicos fortalecidos con cuadros de mando integrales y otros desarrollos a medida.  Metodologías y herramientas para el seguimiento de resultados. Mejora de los indicadores de productos, resultados y contexto en 12 áreas programáticas y 21 programas de gasto.  24 evaluaciones de Diseño, Implementación y Desempeño, en los sectores de salud, educación, seguridad, sector agropecuario, vivienda, e infraestructura. 34 Como producto de la modernización de la DNA, “se logró en el año 2015 que entre el 58% y el 76% de las operaciones de la Aduana de Montevideo se gestionen en menos de 24 horas, un nivel 200% superior al año anterior. Esto tiene un impacto directo en los operadores, permitiéndoles un ahorro estimado aproximadamente en US$ 25 millones al año”. Fuente: “Modernización de Aduanas”. Dirección Nacional de Aduanas (2016). 35 Si bien la participación de los funcionarios mayores de 60 años continúa en 17% de la plantilla, han disminuido en cantidad de 204 a 151 personas. 36 El personal con más de 12 años de formación aumenta de 44% a 57%, y en particular los profesionales y técnicos se incrementan de 11% a 26% en el período 2005-2016. 37 Indicadores incorporados en el diagnóstico para el diseño de la operación, dentro del documento Project Appraisal Document (PAD). 44  2 evaluaciones de impacto realizadas por AGEV y asistencia técnica en evaluaciones de impacto conducidas por organismos públicos.  Iniciativas múltiples de divulgación a la ciudadanía y transparencia a través del sitio web de OPP.  Desarrollo e implantación de software para el Sistema de Estadísticas Vitales, Embarazo y Niñez (SEVEN). 73. Aplicaciones de gobierno electrónico consolidadas. Se implementaron desarrollos informáticos que mejoran la transparencia y la eficiencia en las transacciones entre la ciudadanía y el Estado. En este sentido, las mejoras en el Sistema de Compras Estatales (SICE), el Registro Único de Proveedores (RUPE), y el Sistema de Gestión de Compras Centralizadas (SGCC) apuntan a ahorrar tiempos a los proveedores en su vínculo con el Estado, proveer información confiable en tiempo y forma y controlar y planificar las compras. Asimismo, el proyecto IBTAL contribuyó a dar el impulso inicial a la iniciativa de trámites en línea, que hoy cuenta con 823 trámites en línea, 127 de los cuales pueden ser realizados en forma completa en https://tramites.gub.uy 74. Principales productos:  Definición de la estrategia general y la implantación de las primeras aplicaciones de trámites en línea.  Mejoras al sistema SICE y creación del Catálogo. La cantidad de compras a través del SISE aumenta cada año, y se constata un aumento total de 19% en el período 2012-2015. El 82% de los usuarios está satisfecho con el funcionamiento general del sistema y el 74% de los usuarios considera que el catálogo es útil o muy útil para realizar la gestión de las compras.  2.291 funcionarios y 2.393 proveedores fueron capacitados en todo el país en compras estatales.  Registro Único de Proveedores instalado en 249 Unidades Ejecutoras, con 23.501 proveedores activos.  Sistema de Gestión de Compras Centralizadas, utilizado recientemente en dos procedimientos, a través de los cuales ya se percibe una reducción en los tiempos de la gestión. 75. Dirección General Impositiva fortalecida. Con apoyo del Proyecto IBTAL se han realizado actividades que apuntan a la mejora de la gestión de la institución. Por un lado, se ha incorporado recientemente un sistema de gestión del riesgo fiscal para la identificación y selección de casos a fiscalizar, así como para el seguimiento de los resultados, que dotará a los procesos de fiscalización de mayor eficacia y eficiencia en el uso de los recursos. Asimismo, se ha apoyado el diagnóstico, propuesta e inicio de la implementación de un nuevo modelo de gobernanza que apunta a mejorar la calidad de la gestión, incorporando un cambio en la forma de trabajar que implica una visión global de los procesos y sus resultados. 76. Principales productos:  Desarrollo e implementación del sistema de fiscalización y gestión del riesgo fiscal FIS-T. 45  Nuevo modelo de gobernanza aprobado e iniciando su implantación.  Inicio de cambios en la gestión humana, que involucra el rediseño de procesos de concurso y evaluaciones pro desempeño.  Mejora del desempeño de los sistemas de DGI a través de la consolidación de servidores de gran capacidad en una nueva plataforma. 77. Instituto Nacional de Estadísticas fortalecido. Como principal logro se encuentra la exitosa ejecución de la Primera y Segunda Ola de la Encuesta Nacional de Nutrición y Desarrollo de la Niñez, que ha sido producto del trabajo interinstitucional al interior del sector público y con la academia nacional e internacional, y que termina institucionalizándose en el MIDES. Los resultados de la ENDIS son fundamentales para el diseño y evaluación de políticas sociales dirigidas a la infancia. Asimismo, el INE ha mejorado la divulgación de la información que genera, ha capacitado a sus funcionarios y a los del SEN y ha mejorado la calidad de los Registros Administrativos. Como desafíos pendientes quedan: (i) el fortalecimiento de las estadísticas económicas y (ii) la integración de las encuestas. 78. Productos principales:  Primera y Segunda Ola de la ENDIS finalizadas.  Funcionarios de INE y el SEN capacitados en métodos estadísticos.  Mejora de los registros administrativos – directorio de empresas.  Mejora de la diseminación de los datos de las encuestas.  Rediseño del Sitio Web de INE y mejora del Buscador. (B) Fortalecimiento de las instituciones involucradas en el diseño y la ejecución de las reformas de las políticas públicas en las áreas de impuestos, promoción del clima para los negocios y protección social. 79. Banco de Previsión Social fortalecido para la aplicación de reformas fiscales y de protección social. Por un lado, el Estado ha incorporado un instrumento central para el diseño y evaluación de políticas de asistencia social, el Sistema de Información Integrada del Área Social (SIIAS), herramienta alojada en el MIDES, que permite integrar, construir y presentar información e indicadores a partir de datos de individuos y/o individuos beneficiarios de programas sociales de los organismos que aportan información al sistema. El SIIAS posibilita la definición de las poblaciones objetivo y la implementación de programas sociales, y permite tener una visión integrada de la política social y su alcance. Por otro lado, se ha fortalecido el área de fiscalización del Banco de Previsión Social, a través de la (i) la incorporación de una herramienta informática para la selección y seguimiento de casos de inspección (SISCA), (ii) el asesoramiento tributario en las etapas finales de implementación de la reforma tributaria; (iii) la recepción de declaraciones y rectificativas por vía Web. 80. Principales productos:  SIIAS desarrollado e implantado en 21 organismos. La información ya es utilizada para el diseño y evaluación de políticas. Sistema galardonado por la Organización de Estados Americanos (OEA). 46  Institucionalización del SIIAS en el MIDES.  Desarrollo e implantación del SISCA en BPS, que ha permitido reducir tiempos promedios de selección de casos de fiscalización (de 5 días a 20 minutos), y aumentar la efectividad de la detección de irregularidades (de 60% a 90%). Sistema galardonado por la Asociación Internacional de Seguridad Social (AISS).  Asesoramiento tributario para la estrategia y el modelo de fiscalización 81. Reforma de marco institucional, legal, regulatorio, e infraestructura de los mercados de capital. Se promulgó la Ley de Mercado de Valores, Nº 18.627 de 2/12/2009, que contribuye a la mejora de la regulación de acuerdo a los estándares internacionales y promueve el desarrollo del mercado. Su reglamentación ha apuntado a la profesionalización de los actores y la promoción de la transparencia. Asimismo, se han realizado cambios en la regulación banco-centralista necesarios para mejorar el cumplimiento de estándares internacionales en el mercado de valores. Los estados contables de las entidades son presentados de acuerdo a las NIIF. Finalmente se incorpora un marco metodológico para la supervisión y control de riesgos de intermediarios de valores. 82. Principales productos:  Nueva Ley del Mercado de Valores aprobada y reglamentada.  Normas internacionales para la regulación de los mercados de valores y la liquidación de valores en aplicación.  Supervisión basada en riesgos implementada.  Fortalecimiento del BCU en el Área de Mercado de Valores (Registro del Mercado de Valores, intercambio de experiencias con otros países, capacitaciones, actualización del sitio web y adecuación informática). 83. Marco de información financiera empresarial fortalecido. Los avances liderados por la AIN apuntan a promover la inversión privada y mejorar el gobierno corporativo, a través de la mejora del registro y difusión de la información financiera, la creación de una Central de Balances Electrónica, que utiliza lenguaje XBRL que permite que la información esté disponible y sea explotable en el país y el exterior, y la adecuación de normativa internacional financiera al ámbito local. 84. Principales productos:  Central de Balances Electrónica en uso.  Adecuación de normativa y estándares financieros internacionales al ámbito local.  Capacitación de funcionarios de AIN. 85. Reforma al marco legal de la quiebra implementada. Durante la crisis de 2002, las entidades privadas que se valieron de los mecanismos de insolvencia existentes se enfrentaron a una combinación complicada de disposiciones legales, en lugar de una ley específica que rigiera la insolvencia corporativa, así como una amplia gama de procedimientos de quiebra inconexos, a menudo contradictorios. Asimismo, únicamente dos tribunales de primera instancia tenían jurisdicción sobre los procedimientos de insolvencia, ambos ubicados en Montevideo. En 2008 se 47 aprobó la Ley No. 18.387 de Declaración Judicial del Concurso y Reorganización Empresarial, que tiene dos objetivos principales: la supervivencia de las empresas que, aún con dificultades, son económicamente viables y una eficiente y equitativa liquidación de las que no lo son. La Ley procura implementar un mecanismo de “alerta temprana” para que las empresas que atraviesan problemas financieros puedan alcanzar soluciones con sus acreedores cuando todavía existen posibilidades reales de reencausarla. El Proyecto IBTAL, a través del Componente 6, se constituyó en apoyo sustantivo para la rápida aplicación de la Ley, a través del fortalecimiento de la infraestructura de dos juzgados de Montevideo y diez juzgados del interior del país, y la capacitación de operadores judiciales con competencia en materia concursal de todo el país. 86. Se estima que como consecuencia de la aplicación de la Ley No. 18.387 se han reducido los tiempos en los procesos y por tanto en sus costos, pero no se dispone de evidencia. El uso de este instrumento ha venido aumentando en los últimos años, cerrando 2016 con el año de mayor cantidad de concursos luego de 2002, y se interpreta que no sólo está vinculado a una desaceleración de la economía, sino al mayor uso de la herramienta, que permite la conservación de las empresas como unidades productivas viables, cuando atraviesan dificultades económicas38. Como desafíos pendientes restan la solución de los casos anteriores a la Ley y una evaluación del impacto económico. 87. Principales productos:  Ley aprobada y reglamentada.  12 Juzgados fortalecidos para la implementación de la Ley. 88. Desarrollo de estrategias de modernización. El Componente 7 dotó al MEF de un instrumento flexible y de rápida respuesta a diversas iniciativas de modernización y de apoyo que fueron surgiendo en distintas áreas del Estado. 89. Principales productos:  Evaluación de los impactos fiscales de las reformas en salud pública;  Aspectos puntuales de apoyo a la reforma de DNA;  Estudio para apoyar el diagnóstico de la Caja de las Fuerzas Armadas;  Proyecto de Ley de Asociación Público-Privada para infraestructura;  Apoyo a la programación y seguimiento del Fondo Nacional de Vivienda;  Apoyo al MTOP en análisis de los sistemas de carga a los usuarios de la red vial;  Actualización de los valores catastrales de los inmuebles rurales en base a la implantación de nueva metodología;  Modernización de los servicios jurídicos del Banco Hipotecario del Uruguay;  Asesoramiento para la redefinición de la estrategia de competitividad y productividad;  Apoyo a la consolidación institucional de la Unidad Uruguay Concursa de la Oficina Nacional del Registro Civil; etc. 3.3 Eficiencia 38 Con base en estudio realizado por Ferrere Abogados, según nota del Diario El País del 30/11/16: 48 90. La operación propuesta es un proyecto de fortalecimiento institucional diseñado para apoyar la agenda de modernización del sector público del Uruguay y proporcionar la base de la asistencia técnica para importantes reformas de política en materia de fiscalidad, protección social y mercados de capitales, entre otros. Como tal, es difícil llevar a cabo un análisis de costo-beneficio preciso, dado que los beneficios son en su mayoría mejoras en el desempeño institucional que no pueden traducirse con exactitud a un monto en dólares39. Sin embargo, varios componentes de la operación tienen claras repercusiones fiscales y económicas que pueden ser al menos articuladas, si no completamente cuantificadas, como se presenta a continuación. Impacto fiscal y económico del Proyecto IBTAL Componente Impacto fiscal esperado Ganancias económicas esperadas 1. Gestión de Como producto de la combinación con Como producto de la combinación con los RRHH en la otros proyectos de Modernización de la otros proyectos de Modernización de la DNA Aduana, se espera aumento del ingreso Aduana, se constata: fiscal mediante la mejora de los controles - reducción del tiempo insumido en los aduaneros y la reducción del controles: en 2015 entre el 58% y el 76% contrabando. de las operaciones de la Aduana de Montevideo se gestionaron en menos de 24 horas, un nivel 200% superior al año anterior. - ahorro estimado para los operadores de aproximadamente en US$ 25 millones al año.40 2. Planificación, - el fortalecimiento en la calidad de los - vínculo entre asignación presupuestal y monitoreo y sistemas de monitoreo y evaluación análisis del desempeño institucional evaluación conduce a mejoras en la planificación y derivaría en mejoras de eficacia y en la gestión, que se espera impacte en eficiencia de los recursos, por la vía del un uso más eficiente de los recursos estímulo a una mejor gestión del públicos. presupuesto. 3. Gobierno - ganancias de eficiencia y seguridad a - reducción de tiempos en procesos electrónico través de la interconexión lograda entre licitatorios, por mejora en la gestión del los sistemas de información de los Estado. organismos públicos - reducción de - reducción de los tiempos requeridos en tiempos de gestión de compras para el la presentación de documentación de los Estado. proveedores que el Estado ya dispone. - reducción de los costos de las compras, - mayor transparencia en los procesos de con base en un mayor control de los compra del Estado fomentan la procesos e insumos para la planificación competencia entre las empresas. de las mismas. - menor tiempo requerido para la información y realización de trámites en el Estado. - mayor acceso a los servicios del Estado en el territorio nacional. 4.1 Apoyo al - reducción de los tiempos promedios de - potencial desestímulo a la evasión BPS para la selección (de 5 días a 20 minutos) fiscal en los grandes contribuyentes. reforma - aumento de la efectividad de la tributaria detección de irregularidades (de 60% a 90%). 39 Documento de PAD, Análisis Económico y Financiero. 40 Fuente: “Modernización de Aduanas”. Dirección Nacional de Aduanas (2016). 49 Componente Impacto fiscal esperado Ganancias económicas esperadas 4.2 Apoyo al - la mejora la identificación y - aumenta el acceso a beneficios sociales, BPS para focalización de los programas de de grupos a los que antes no era posible reforma de protección social tiene el potencial de llegar con los instrumentos de política protección generar ganancias de eficiencia en la social. social asignación del gasto público 5. Apoyo a la - el fortalecimiento en la regulación y la implementación infraestructura sobre la que funcionan los de reformas en mercados de capitales, y la mejora de la el mercado de información en manos de los inversores capitales y podría dar lugar a un aumento general de transparencia la eficiencia en la inversión privada. corporativa 6. Apoyo a la - quiebras potencialmente evitadas con la - permite la conservación de las implementación Ley previene de caída en la recaudación empresas como unidades productivas de la reforma en por este concepto. viables, cuando atraviesan dificultades la regulación de - reducción de tiempos y costos para el económicas. quiebras estado en los procesos judiciales. - reducción de tiempos y costos para el estado en los procesos judiciales. 8. - mejoras en la gestión impactan en la - potencial desestímulo a la evasión Fortalecimiento eficiencia en el uso de los recursos de la fiscal en los grandes contribuyentes. de DGI DGI, así como potencialmente en la eficacia en la fiscalización. 9. - la disponibilidad de los resultados de la - impactos indirectos de largo plazo, a Fortalecimiento ENDIS mejoran en el diseño de políticas, través de la mejora en la salud, nutrición de INE y aparte de mejorar su efectividad, y desarrollo de los niños, consecuencia potencialmente podrían generar de la mejora en la calidad del diseño de ganancias de eficiencia en la asignación las políticas. del gasto público. 3.4 Justificación de la Calificación General de los Resultados Calificación: Satisfactoria 91. Como fuera detallado antes en este capítulo, el Proyecto continúa siendo relevante, el ODP fue alcanzado en forma satisfactoria, contribuyendo al fortalecimiento de al menos trece organismos en forma indirecta, y el sector público en general en forma indirecta. 3.5 Temas Generales, Otros Resultados e Impactos 92. Impactos en los Niveles de Pobreza y Desarrollo Social. Se espera que la dotación de nuevos instrumentos de información, como son la ENDIS y el SIIAS contribuyan a la mejora del diseño de instrumentos de política social, y por tanto mejoren el acceso de la población más vulnerable a los servicios de asistencia social del Estado. 93. Fortalecimiento institucional. Como resultado indirecto del Programa, queda una UCP institucionalizada en el MEF, con alta calificación y experiencia para la gestión de proyectos con financiamiento de organismos multilaterales de crédito. La experiencia de contar con una UCP para todos los proyectos del Ministerio, ya ha empezado a ser replicada en otros organismos, como ser el MIDES y el MGAP. 3.6 Resumen de los Hallazgos de las Encuestas de Beneficiarios y/o Talleres con los Actores Involucrados 50 94. 94. No aplicable. 4. Evaluación de Riesgos frente a los Resultados de Desarrollo Calificación: Bajo 95. El riesgo de no preservar el ODP es bajo. En el marco de la elaboración del ICR se ha constatado un alto grado de apropiación de los productos logrados con el Proyecto IBTAL, y la adopción de medidas para sostener los productos y resultados en el tiempo. El compromiso de los organismos en los procesos de modernización a lo largo de todo el período de ejecución es una garantía de que éstos continuarán avanzando en su profundización una vez finalizado el Proyecto. 5. Evaluación del Desempeño del Banco y del Prestatario 5.1 Desempeño del Banco (a) Desempeño del Banco para Garantizar la Calidad de Entrada Calificación: Satisfactorio 96. El diseño estuvo alineado con las prioridades del gobierno, con base en un diagnóstico completo acerca de la problemática o áreas de oportunidad en cada sector, y refleja las buenas prácticas relacionadas con los proyectos de modernización institucional del sector público. 97. En particular, el gobierno destaca la amplitud de componentes (inicialmente siete, y posteriormente nueve), lo cual le ha permitido acompañar los procesos de fortalecimiento institucional de distintos organismos de diversos sectores, así como las estrategias de mejora de servicios al ciudadano. Asimismo, es muy valorada la incorporación de un subcomponente estratégico dentro del Componente 7, con presupuesto disponible para llevar a cabo estudios adicionales y otras consultorías relacionados a la coordinación de Proyectos y/o desarrollo de estrategias propuestas por el Prestatario y aprobadas por el Banco. Este subcomponente permitió apoyar en forma rápida y flexible diversos procesos de cambio en el MEF y en otros organismos, como ser: la incorporación de metodologías y herramientas de gestión en el marco del nuevo Sistema Nacional Integrado de Salud, el apoyo a la elaboración del marco legal y evaluación de Proyectos de Participación Público-Privada, el fortalecimiento de la Dirección Nacional de Vivienda del Ministerio de Vivienda Ordenamiento Territorial y Medio Ambiente, y de la Dirección Nacional de Logística, Planificación e Inversiones del Ministerio de Transporte y Obras Públicas, la modernización de los servicios jurídicos del Banco Hipotecario del Uruguay, el asesoramiento para la redefinición de la estrategia de competitividad y productividad, el apoyo a la consolidación institucional de la Unidad Uruguay Concursa de la Oficina Nacional del Registro Civil, el fortalecimiento del Servicio de Retiros y Pensiones de las Fuerzas Armadas, entre otras actividades. 98. A lo largo de la ejecución se fueron modificando los indicadores de ODP y de resultados intermedios propuestos en el documento de diseño del Proyecto, con base en la dificultad que presentaban para medir estrictamente la contribución de los productos previstos a los resultados esperados. Asimismo, se constata la falta de definición de unidades de medida, y valores de línea de base, que no fue superada en la instancia de Manual Operativo, sino en etapas avanzadas de le ejecución. (b) Calidad de la Supervisión Calificación: Satisfactoria 51 99. La Agencia Ejecutora destaca el valor agregado por las misiones de supervisión a los procesos de monitoreo de los Componentes en los distintos organismos, y de revisión de la planificación en cada sector. La incorporación de expertos internacionales significó un aporte valioso para los sectores que presentaban mayores desafíos en su desarrollo, en particular en las primeras etapas de implementación, así como el nexo realizado con otras experiencias de la región41. 100. La documentación de la supervisión a través de Ayuda Memorias de Misiones, así como de los indicadores de PDO e indicadores fue de mucha utilidad para el monitoreo del Programa. 101. El sector fiduciario del Banco también acompañó la ejecución con capacitación y visitas de inspección. En una primera etapa de implementación se identificaron algunos cuellos de botella en los procesos de no objeción a los pliegos, que fueron superadas con el conocimiento del ejecutor por parte del Banco, así como de la UCP de la política fiduciaria. 102. Finalmente, las reestructuras del Proyecto fueron exitosas en el marco de los resultados logrados, lo que es un resultado de la supervisión oportuna y receptiva del Banco. (c) Justificación de la Calificación del Desempeño del Banco Calificación: Satisfactorio 103. El desempeño general del Banco se clasifica como Satisfactorio, como reflejo de la calidad de la preparación y la supervisión del proyecto. 5.2 Desempeño del Prestatario (a) Gobierno Calificación: Satisfactorio 104. El gobierno ha demostrado gran compromiso con los procesos de modernización institucional y de mejora de servicios a la ciudadanía, durante todo el período de ejecución. Esto garantiza, asimismo, la sostenibilidad de los resultados en cada uno de los organismos que se ha intervenido, los que han mostrado alto grado de satisfacción y apropiación de los mismos. El compromiso del gobierno es posible apreciarlo también en aquellos componentes que se discontinuaron antes de tiempo 42 , los que actualmente han consolidado sus procesos de modernización, aunque en tiempos mayores a los planeados originalmente. 105. El inicio de la ejecución fue más lento de lo esperado, pero es propio de los procesos de fortalecimiento institucional y cambios organizativos. (b) Entidad Ejecutora Calificación: Muy Satisfactorio 41 Por ejemplo, con SINERGIA (Colombia) y CONEVAL (México) para el desarrollo de institucionalidad en evaluación de políticas públicas. 42 Componente 1 “Fortalecimiento de la gestión de recursos humanos de la Dirección Nacional de Aduanas del Prestatario Aduana” y Componente 5 “Apoyo a las reformas para la transparencia empresarial y de mercados de capitales”. 52 106. Se destaca el excelente desempeño de la Unidad Coordinadora del Proyecto, en cuanto a la ejecución y supervisión de los procesos de selección y contratación de consultores, en la adquisición de bienes, así como su rigurosidad en el manejo financiero y contable, y en el cumplimiento de las políticas del Banco. La coordinación operativa y técnica se mantuvo estable desde poco tiempo de iniciada la ejecución y hasta el final del plazo. Los organismos relacionados con los distintos componentes, resaltan la eficacia de la UCP, y en particular, la proactividad de su personal para dar solución a las dificultades que se presentaron en algunas etapas del desarrollo de contratos con proveedores, y en el comienzo de algunos procesos de licitación. Es importante resaltar, que el rol de la UCP en la ejecución, ha sido destacado también en otros proyectos que ejecuta el MEF con financiamiento multilateral. 107. La Agencia Ejecutora no hizo uso del Comité de Dirección que estaba previsto en el esquema organizativo del Proyecto en el diseño con partición de los organismos subejecutores, y que tenía funciones de planificación y monitoreo. Tampoco se concretó la contratación de dos consultores senior responsables del monitoreo de la implementación y supervisión de la matriz de resultados, que actuarían como enlace entre la coordinación y los respectivos componentes. Esto condujo a que la función de monitoreo y evaluación fuera delegada sobre la UCP, sin asignarle personal con este perfil y responsabilidad específica, y sobre las misiones de supervisión que realizara el Banco, en las que como parte de sus actividades recolectaron información para el seguimiento de la Matriz de Resultados. (c) Justificación de la Calificación del Desempeño del Prestatario Calificación: Satisfactorio 108. El desempeño del gobierno y de la Entidad Ejecutora se consideran ambos Satisfactorios. Por ende, el desempeño en general del Prestatario se clasifica como Satisfactorio. 6. Lecciones Aprendidas Lecciones aprendidas del diseño del Proyecto 109. El fortalecimiento institucional requiere de un Proyecto flexible. Esta lección del Banco fue incorporada en el diseño de la operación y su utilidad fue comprobada a lo largo de la ejecución. Algunos procesos de modernización demoraron en madurar, y fue necesario redefinir estrategias y productos nuevos. El Proyecto otorgó esta posibilidad al interior de cada Componente siempre que se respetara la lógica vertical de la intervención. Asimismo, el Banco pudo reestructurar el Proyecto cuando fue necesario, así como dotarlo de financiamiento adicional, como forma de responder en forma oportuna a las nuevas demandas. 110. La necesidad de un liderazgo fuerte durante la implementación. La exitosa ejecución de un proyecto que involucró a un gran número de organismos participantes, es prueba de que también fue acertada la decisión de centralizar la ejecución en el MEF, institución respetada y con capacidad de movilizar a los organismos hacia los objetivos del proyecto. 111. La importancia de la coordinación con otros organismos multilaterales. La coordinación con el BID facilitó el proceso de diseño y las primeras etapas de la planificación de las actividades en los organismos participantes, a través de reuniones y talleres conjuntos. Una vez avanzada la ejecución, esta coordinación fue materializada principalmente a través de la Oficina de Organismos Multilaterales del MEF. 53 Lecciones aprendidas de la implementación del Proyecto 112. La experiencia en gestión de proyectos es un factor de éxito. Cuando un organismo participante no asigna personal con experiencia en gestión de proyectos a las tareas de planificación y ejecución de las actividades esto dificulta el logro de las metas previstas en el Componente en tiempo y forma. La asignación de personal con experiencia para apoyar la ejecución de cada Componente debería ser una condición que habilite la participación de un organismo en el Proyecto. 113. Incentivos al involucramiento de otros actores en actividades del Proyecto de larga duración. En las iniciativas que requieren del involucramiento de actores fuera del Proyecto para concretarse, disponer de recursos de fortalecimiento institucional facilita su participación, reduciendo los costos de la dedicación institucional al proyecto y mejora el compromiso. Esto se constató en el desarrollo e implementación del SIIAS. 114. Equipos de contraparte técnicos y funcionales sólidos como factor de éxito de desarrollos informáticos complejos. Disponer de equipos funcionales y técnicos que lideren los proyectos informáticos desarrollados por firmas consultoras es fundamental para cumplir plazos y alcances planeados. La conformación de éstos es necesaria desde etapas tempranas, como son la redacción de los términos de referencia y el relevamiento de procesos, hasta la puesta en producción de los sistemas. Esto se constató positivamente por ejemplo en DGI, BPS, MIDES, mientras no fue posible lograrlo en el MEF para con la UCA. 115. La sostenibilidad de las mejoras realizadas en los sistemas de información en los organismos públicos requiere de la construcción y/o consolidación de las capacidades de sus recursos humanos. Esto se ha constatado en los procesos que realiza AGEV con los ministerios y otros organismos. Para que la iniciativa de fortalecimiento sea apropiada por cada organismo, debe procurarse capacitar a los recursos humanos y/o facilitar la contratación de personas con los perfiles requeridos para la utilización de las herramientas y su mejora en el tiempo. 116. En procesos de desarrollo institucional de larga duración es relevante prever el logro de hitos intermedios que validen y legitimen el proceso. Esto se comprobó en el proceso de desarrollo e implementación del SIIAS, en el cual fue importante responder a demandas inmediatas como una forma de legitimar la iniciativa y de validar los hitos de corto plazo como productos intermedios (si bien esto fue difícil de lograr a tiempo, fue una estrategia para lograr socios). 117. La ejecución de actividades de fortalecimiento que exigen la coordinación de dos o más entidades pares, puede dificultarse si una de ellas se autodefine líder de la iniciativa. Esto se verificó en el Componente de DGI, que no logró formalizar la coordinación con otros organismos fiscales de control para el intercambio de información con el objetivo de mejorar la eficiencia en la detección de la evasión fiscal. En estos casos el liderazgo de un actor externo podría facilitar su concreción. 54 Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders N/A 55 Annex 9. List of Supporting Documents “Estudio de Clima Interno de la Dirección Nacional de Aduanas”, Informe Final, March 2011; Informe de Estudio de Clima Interno, Aduanas, December 2016. Mimeo. Hartmann, Till and Courtney Price Ivans, “Uruguay’s award-winning innovations for social protection,” Blog. March 14, 2016, http://blogs.worldbank.org/governance/uruguay-s-award- winning-innovations-social-protection Government of Uruguay. Ministry of Economy and Finance. Préstamo BIRF-7451/UR – Programa de Modernización Institucional, Préstamo BIRF 8116/UR – Adicional al Programa de Modernización Institucional. Informe de Avance del Segundo Semestre de 2016. To December 31, 2016. Kaufmann, Jorge; Mario Sangines, and Mauricio Garcia Moreno, eds. Building Effective Governments: Achievements and Challenges for Results-Based Public Administration in Latin America and the Caribbean. IDB, 2015 Loan Agreement. (Institutions Building Technical Assistance Project) between República Oriental del Uruguay and International Bank for Reconstruction and Development. Loan 7451- UR. June 21, 2007. Loan Agreement. (Additional Financing for the Institutions Building Technical Assistance Project) between República Oriental del Uruguay and International Bank for Reconstruction and Development. Loan No. 8116-UY. March 16, 2012. López Acosta, Luciana. Evaluación de Cierre del Proyecto, Programa de Asistencia Técnica de Modernización Institucional (MEF/BIRF). Préstamos Nos. 7451-UR y 8116-UR (IBTAL). Government Final Report. Mimeo, December 31, 2016. World Bank. Independent Evaluation Group. Public Sector Reforms: What Works and Why? An IEG Evaluation of World Bank Support, The World Bank: Washington, D.C., 2008 World Bank. Implementation Status and Results Reports (ISR). Reports No. 1-19. June 19, 2007-July 22, 2016. World Bank. Institutions Building Technical Assistance Project. Aide Memoires. August 2007- June 2016. World Bank. Institutions Building Technical Assistance Project (Loan 7451-UR), The Oriental Republic of Uruguay Datasheet for Project Paper. December 3, 2009. Report No. 52421. World Bank. Project Appraisal Document on a Proposed Loan in the Amount of US$12.1 Million to the Oriental Republic of Uruguay for an Institutions Building Technical Assistance Project (IBTAL). April 19, 2007. Report No. 39027-UY. 56 World Bank. Project Paper on a Proposed Additional Loan in the Amount of US$10 million to the Oriental Republic of Uruguay for a Institutions Building Technical Assistance Project. November 2, 2011. Report No. 65001-UY World Bank. Restructuring Paper on a Proposed Project Restructuring of Institutions Building Technical Assistance Loan (IBTAL) Project Approved on May 30, 2007 to the República Oriental de Uruguay. February 8, 2011. Report No. 59001-UY World Bank. Restructuring Paper on a Proposed Project Restructuring of the Institutions Building Technical Assistance Project (IBTAL) to the Republic of Uruguay, May 20, 2015. Report No. RES18226 World Bank. Uruguay - 2005-2010 Country Assistance Strategy. Report No. 31804-UY. May 10, 2005. World Bank. Uruguay - Country Partnership Framework for FY16-20. Report No. 97-63-UY. December 21, 2015. World Bank Group. Doing Business 2017: Equal Opportunity for All. 2017 World Bank and International Finance Corporation. Doing Business 2009: Reforming Through Difficult Times. 2009; U.S. Department of State, Bureau of Economic and Business Affairs, Investment Climate Statements for 2016, Uruguay. http://www.state.gov/e/eb/rls/othr/ics/investmentclimatestatements/index.htm?year=2016&dlid= 254563 United Nations E-Government Knowledge DataBase, Urguguay. < https://publicadministration.un.org/egovkb/en-us/Data/Country-Information/id/185- Uruguay/dataYear/2016> 57 Annex 10. Adjustments to PDO Indicators Adjustments to PDO indicators Main PAD Text and Results Framework PAD Results Framework Matrix and December 2011 AF Summary January 2010 Restructuring PDO#1: The design, implementation, PDO #1: Internal and external PDO#1: Improvements in the design and impact, and value for-money of projects and performance reviews show management of monitoring and evaluation programs in nine government institutions, improvements in the design and methodologies and tools for improved results have been improved as certified by external management of government projects budgeting in the Central Government Budget. independent reviews. and the production of quality (2007 Baseline: None; 2011 Progress to Date: 7 information for results-based budgeting priority areas and 31 expenditure programs have PDO#2: Monitoring and evaluation in 9 ministries. (Baseline: None; Year identified output and outcome indicators; Year 8: information of nine central government 4: 9 institutions) 40) institutions is being used for results-based budgeting. PDO#3: Independently qualified decrease of PDO #2: E-government strategy is PDO#2: E-Government strategy is implemented, 10% in the average cost of key public sector implemented, resulting in lower costs ensuring connectivity through a common platform inputs through the use of an e-procurement and times for procurement and faster of the principal state agencies, allowing safe, fast platform and of 15% in the average time to and easier access by citizens to online and easy exchange of information between access at least 100 public sector transactions services (Baseline: None, Year 4: 90%) agencies and between agencies and citizens. (2007 made available through a unified e- Baseline: None; 2011 Progress to Date: E- government portal. government agency functioning and strategy adopted and under implementation; Year 5: 150%*) (*Note: Unit of measurement in AF indicated to be percent, but later monitoring suggests that the correct unit was number of agencies.) PDO#4: Policy reforms in the areas of PDO #3: Entities responsible for PDO#3: Entities responsible for policy reform taxation, capital markets, social protection, selected policy reform initiatives in initiatives in taxation, capital markets, social and bankruptcy regulation are being taxation, capital markets, social protection, and bankruptcy regulation have the implemented within a robust institutional protection, and bankruptcy regulation necessary technical tools to implement reform. and technical environment, as verified by have the necessary technical tools for (Baseline: Partial; 2011 Progress to Date: Technical independent evaluation the implementation of reforms once tools for BPS tax collections implemented. K-Mkts approved. (Baseline: Partial; Year 1: Law approved. Software development for social 100% tax; Year 3: 100% Bankruptcy, protection programs underway. Bankruptcy Law Social Protection; Year 4: 100% Capital passed.; Year 5: All responsible entities have Markets necessary technical tools to implement reform) PDO #4: The ratio of the yearly variation in nominal tax collections over the yearly variation in the nominal GDP. (Baseline N/A; 2011 Progress to Date: 13%, Year 8 Target: 5.3%) 58 Annex 11. Adjustments to Allocation of Financing by Component and Expenditure Categories Loan Allocations by Component 2010 Additional Reallocation of Original Loan 2015 Component Name PAD Restructuring Financing Original Loan 43 +AF (2011) Restructuring (2011) (2011) 1. Customs Administration44 750,000 153,930 0 153,930 153,930 153,930 2. Improving Institutional Planning, Monitoring, and 1,210,000 1,210,000 1,000,000 1,210,000 2,210,000 2,210,000 Evaluation 3. E-Government 1,550,000 1,550,000 0 1,550,000- 1,550,000 2,000,000 4. Support to BPS for institutional strengthening 4,081,000 4,081,000 1,100,000 4,081,000 5,181,000 5,561,000 and implementation of tax and social protection reforms 5. Support for Capital Markets and Corporate 2,050,000 2,050,000 500,000 2,050,000 2,550,000 2,210,000 Transparency Reforms 6. Support for Bankruptcy 265,000 265,000 0 120,000 120,000 120,000 Regulation Reforms 7. Project Coordination and 1,622,000 2,218,070 3,000,000 2,363,070 5,363,070 5,343,070 Strategy Development 8. Support Institutional - 3,000,000 - 3,000,000 2,530,000 Strengthening of DGI 9. Support Institutional - - 1,100,000 - 1,100,000 1,100,000 Strengthening of INE Contingencies (3%) 376,900 - - Project Preparation Facility 195,100 Front end fee 30,250 30,250 30,250 30,250 Unallocated 541,75045 300,000 - 841,750- 841,75046- Total: 12,100,000 12,100,000 10,000,000 - 22,100,000 22,100,000 43 2011 Additional Financing noted that a reallocation would be processed concurrently with the Additional Financing; subsequent documentation not located. 44 Allocations other than those in the PAD refer to amount of actual disbursement before the component was dropped. 45 In the January 2010 restructuring, according to the Expenditure Category allocations, these funds were allocated to the category broadly corresponding to Components 1, 2, 3, 4, 5, and 7 of the Project. However, they do not appear in the presentation by component. 46 The table with costs by Components mistakenly notes the total of unallocated funds to be US$872,000 (which sums both the front end fee and the unallocated funds). 59 Loan Proceeds by Expenditure Category (Original Loan) Category Amount of the Loan January 2010 Allocated Restructuring (Original Loan Agreement) (1) Good, works, consultants’ 11,263,000 11,804,750 services, non-consultant services, Training and Operating Costs for Parts 1,2,3,4,5 and 7 of the Project (2) Goods, consultants’ 265,000 265,000 services, non-consultant services, Training and Operating Costs for Part 6 of the Project (3) Refund of the Project 200,000 0 Preparation Advance (4) Premium for Interest Rate 0 0 Caps and Interest Rate Collars (5) Unallocated 372,000 0 (6) Front End Fee 30,250 Total 12,100,000 12,100,000 Loan Proceeds by Expenditure Category (Additional Financing) Category Amount of the Additional Financing Allocated (1) Good, works, consultants’ 10,000,000 services, non-consultant services, Training and Operating Costs for Parts 2(c), (d), (e), (f), and (g), Parts 4(b)(ii), (iii), (iv) and (v), Part 7(a) and (c), and Parts 8 and 9 of the Project Total 10,000,000 60 61