Documentof The World Bank FOROFFICIALUSEONLY ReportNo: 35738-BF PROJECTAPPRAISAL DOCUMENT ON A PROPOSEDCREDIT INTHEAMOUNT OFSDR33.0MILLION (US$47.7MILLION EQUIVALENT) TO BURKINAFASO FOR A HEALTH SECTOR SUPPORT AND MULTISECTORAL AIDS PROJECT March 30,2006 HumanDevelopmentI1 Africa Region This document has a restricted distribution and may be used by recipients only in the performance o f their official duties. Its contents may not otherwise be disclosed without World CURRENCY EQUIVALENTS (ExchangeRateEffectiveJanuary 2006) CurrencyUnit = FCFA FCFA500 = US$1 U S 1.44899 $ = SDR 1 FISCALYEAR January 1 - December31 ABBREVIATIONSAND ACRONYMS AIDS AcquiredImmuneDeficiencySyndrome SyndromeImmunoddjicitaire Acquis AfDB African DevelopmentBank Banque Africaine de Diveloppement AWP Annual Work Program Programme de TravailA nuel CAS Country Assistance Stratigie d ilssistance au Pays CAMEG Central BuyingStore for Essentialand Generic Drugs Centre d'achat des Midicaments Essentiels Gendriques CBO Community-basedorganization Organisation d Base Communautaire CFAA Country FinancialAccountabilityAssessment Evaluation Financiere et Comptabledu Pays CHR RegionalHospital Centre Hospitalier Rdgional DAF Budget and AdministrativeDirectorate Direction de [`Administrationet des Finances DEP Planningand Studies Directorate Direction des Etudes et de la Planification DHS Demographicand Health Survey EnquBte Ddmographique et de Santd DOTS DirectlyObserved Treatment Short-course Cours Brefsur le Traitement Directement Observe DS Sanitary District District Sanitaire DTC3 Third Dose of Diphtheria toxoid, Tetanus toxoid and Pertussis TroisidmeDose du Vaccin Diphtdrie. Tdtanos et Coqueluche ENSP EcoleNationale de Sante Publique Ecole Nationale de Santd Publique ESW Economic Sector Work Travail Economique Sectoriel EU European Union Union Europienne FMS FinancialManagement Specialist Spdcialiste en GestionFinanciere FMU FinancialManagementUnit Unitede Gestion Financidre GDP Gross Domestic Product Produit Domestique Brut HSSMAP Health Sector Support and MultisectoralAIDS Program) Projet d `Appui nu Secteur Santi et a la Lutte contre le SIDA H N Human ImmuneDeficiencyVirus Virus Immunoddjicitaire Humain HIPC HeavilyIndebtedPoor Country Programmepour les Pays Trts Enddttds ICB InternationalCompetitive Bidding Appel d 'Offres International Compititif IDA InternationalDevelopmentAssociation Association Internationale de Diveloppernent IMCI IntegratedManagementof Childhood Illnesses Gestion Intdgrie des Maladies de l%nfance IMF InternationalMonetary Fonds Monitaire International MSD NationalInstituteof Statistic and Demography Institut National de la Statistiqueet de la Dimographie M&E Monitoringand Evaluation Suivi et Evaluation MDGs Millennium DevelopmentGoals Objectifs de Ddveloppement du Milldnaire MIS ManagementInformationSystem Systemede Gestion de I'lnformation MoH Ministryof Health Ministdre de la Santd MOU Memorandumof Understanding Protocole d 'Accord MTEF MediumTerm ExpenditureFramework Cadredes Dipenses a Moyen-Terme NHDP National HealthDevelopmentPlan Plan National de Ddveloppement de la Santd NGO Non-GovemmentalOrganization) Organisation Non-Gouvernementale PADS SanitaryDevelopmentSupportProgram Programme d ilppui au DiveloppementSanitaire PDSSN DevelopmentProjectof the National Statistics System Projet de Diveloppement du SystBmeStatistiqueNational PER Public ExpenditureReview Revue des Dipenses Publiques PHC PrimaryHealthCare Soins de Santi Primaires PAMAC Support Projectto the Association and Community World Programme d ilppui au Monde Associatif et Communautaire PNGTZ Community-BasedRuralDevelopment Programme National de Gestion des Terroirs PNDS National Health Plan Plan National de diveloppernent sanitaire SP-CNLS PermanentSecretariat of the NationalAIDS Council Secretariat Permanent du Conseil National de Lutte contre le SIDA PRSC PovertyReduction StrategyCredit * Crkdit de Soutien a la Reduction de la Pauvreti PRSP PovertyReduction StrategyPaper Document Stratigiquede Reduction de la Pauvreti SIM Sector Investmentand MaintenanceLoan Prit Sectoriel d'Investissement et de Maintenance SOE Statement of Expenditure Relevd des Dipenses STI SexuallyTransmitted Infections Infections Sexuellement Transmisess SWAp Sector Wide Approach Approche Sectorielle TAP Treatment AccelerationProgram Programme de Traitement Acciliri TFR Total Fertility Rate Tam Totalde Fertiliti TOR Terms of Reference Termes de Rifirence TTL Task Team Leader Chef d'Equipe UNAIDS United Nations AIDS Program Programme des Nations Unies sur le SIDA UNDP UnitedNations DevelopmentProgram Programme des Nations Uniespour le Diveloppement UNICEF United Nations Children's Fund Fonds des Nations Uniespour I'Enfance UNGASS United Nations GeneralAssembly Special Session on Assemblee Geniralelies Nations Unies (SessionSpiciale sur HIViAIDS le YIHBIDA) UNFPA United Nations Population Fund Fonds des Nations Uniespour la Population WHO World Health Organization Organisation Mondiale de la Santi Vice President: Gobind T. Nankani Country ManagedDirector: Mats Karlsson Sector Manager: Alexandre V. Abrantes Task Team Leader: Timothy Johnston FOROFFICIAL USE ONLY This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not be otherwise disclosed without World Bank authorization. BURKINA FASO HEALTH SECTOR SUPPORT AND MULTI-SECTORAL AIDS PROJECT TABLE OF CONTENTS Page A. STRATEGIC CONTEXTAND RATIONALE ............................................................................................... 4 1. COUNTRY AND SECTOR ISSUES ................................................................................................................. 4 2 RATIONALE FORBANKINVOLVEMENT ..................................................................................................... 7 8 B.3.. HIGHER LEVEL OBJECTIVES TO WHICH THE PROJECT CONTRIBUTES .......................................................... PROJECTDESCRIPTION .............................................................................................................................. 9 1. LENDING INSTRUMENT ............................................................................................................................. 9 2. PROGRAM OBJECTIVEAND PHASES ........................................................................................................... 9 3 DEVELOPMENT OBJECTIVE AND KEYINDICATORS ................................................................................. 10 4.. ......................................................................................................................................... (A) Support for health sector progress toward the MDGs(approximately $26.7 million) ..................... COMPONENTS 11 (B) Support for NationalMulti-sectoral HIV/AIDS Strategy (approximately $21 million) ..................11 13 14 Financing and disbursements criteria ..................................................................................................... Cross-Cutting Reforms to be Supported by the HSSMAP..................................................................... 15 5. LESSONS LEARNED AND REFLECTEDINTHE PROJECT DESIGN ................................................................. 16 6. ALTERNATIVES CONSIDERED AND REASONS FORREJECTION .................................................................. 17 C. IMPLEMENTATION ..................................................................................................................................... 18 PARTNERSHIP ARRANGEMENTS .............................................................................................................. 18 2. 1. INSTITUTIONAL AND IMPLEMENTATION ARRANGEMENTS ......................................... 3. MONITORING AND EVALUATION OF OUTCOMES/RESULTS 20 4. ....................................................................... SUSTAINABILITY ..................................................................................................................................... 21 5. CRITICAL RISKS AND POSSIBLE CONTROVERSIAL ASPECTS ...................................................................... 21 6. LOAN~CREDIT CONDITIONS AND COVENANTS .......................................................................................... 22 D. APPRAISALSUMMARY .............................................................................................................................. 24 1. ECONOMIC AND FINANCIALANALYSIS 2. TECHNICAL ................................................................................................................................ ........................................................................................................24 24 3. FIDUCIARY.............................................................................................................................................. 25 I 4. 5. SOCIAL ................................................................................................................................................... 25 ENVIRONMENT ........................................................................................................................................ 26 6. SAFEGUARD POLICIES .............................................................................. ................................. 7. POLICY EXCEPTIONS AND READINESS .................................................................................................... 27 ANNEX 1: COUNTRYAND SECTOR BACKGROUND .................................................................................... 28 ANNEX 2: RELATEDPROJECTS FINANCEDBY THE BANKAND OTHER AGENCIES ........................ 35 ANNEX 3: RESULTSFRAMEWORK AND MONITORING ............................................................................ 36 ANNEX 4: DETAILED DESCRIPTION ................................................................................................................ 43 ANNEX 5: PROPOSEDFINANCING .................................................................................................................... 57 ANNEX 6: IMPLEMENTATION ARRANGEMENTS ........................................................................................ 58 ANNEX 7: FINANCIAL MANAGEMENTAND DISBURSEMENT ARRANGEMENTS .............................. 62 ANNEX 8: PROCUREMENT ARRANGEMENTS ............................................................................................... 74 ANNEX 9: ECONOMICAND FINANCIAL ANALYSIS ..................................................................................... 86 ANNEX 10: SAFEGUARDPOLICY ISSUES ........................................................................................................ 92 ANNEX 11:HSSMAPPREPARATIONAND SUPERVISION ........................................................................... 93 ANNEX 12:DOCUMENTS INTHE PROJECTFILE ......................................................................................... 94 ANNEX 13: STATEMENT OF LOANSAND CREDITS ..................................................................................... 95 ANNEX 14: COUNTRY AT A GLANCE ............................................................................................................... 96 ANNEX 15:DECLARATIONOF HEALTHPOLICYINBURKINA FASO .................................................... 97 ANNEX 16: MAP.................................................................................................................................................... 104 MAP No IBRD33379 . BURKINAFASO HEALTH SECTOR SUPPORT AND MULTI-SECTORALAIDS PROJECT (HSSMAP) PROJECT APPRAISAL DOCUMENT AFRICA AFTH2 Date: March30,2006 Team Leader: Timothy Johnston Country Director: Mats Karlsson Sectors: Health(75%); Other social services Sector Manager: Alexandre V. Abrantes (25%) Themes: HIV/AIDS (P); Healthsystem performance (P); Child health (S); Other communicable diseases (S); Population and reproductive health (S) Project ID: PO93987 Environmental screening category: Partial Assessment Lending Instrument: Sector Ir ,estment and Safeguardscreening category: Limitedimpact - Maintenance Loan -CategoryB ProjectFinancingData [ ] Loan [XI Credit [ ] Grant [ ] Guarantee [ ] Other: For Loans/Credits/Others: Total Bank financing (US$m.): 47.7 BORROWEWRECIPIENT 0.0 0.0 0.0 INTERNATIONAL DEVELOPMENT 0.0 47.7 47.7 ASSOCIATION Total: 0.0 47.7 47.7 ResponsibleAgency: Ministryof Health;PermanentSecretariat oftheNationalAIDS Council Ouagadougou, BurkinaFaso Tel: : (226) 50 324159 (226) 50 324188 Fax: (226) 50 317024 ;50 314001 1 Does the project depart from the CAS incontent or other significant respects? Re$ PAD A.3 []Yes [XINO Does the project require any exceptions from Bank policies? Re$ PAD D.7 Have these beenapproved by Bank management? I s approval for any policy exception sought from the Board? []Yes [IN0 Does the project include any critical risks rated"substantial" or "high"? Re$ PAD C.5 [XIYes [ ] N o Does the project meet the Regional criteria for readiness for implementation? Re$ PAD D.7 [XIYes [ ] N o Project development objective Re$ PAD B.2, TechnicalAnnex 3 The objective o fthe HSSMAP i s to support implementation of the Borrower's health sector and multi-sectoral HIV/AIDS strategies, inorder to accelerate progress toward the Millennium Development Goals (MDGs) for health, nutrition, and combating HIV/AIDS.. Project description Re$ PAD B.3.a, TechnicalAnnex 4 The HSSMAP's support for the government's health sector program will help to: (i) improve the quality and utilization ofmaternal and child health services; (ii) expand the national response to malaria prevention and treatment, at both community and health district levels; and (iii) improve quality and coverage o f treatment for HIV/AIDS and sexually transmissible infections. IDA'Ssupport for the National AIDS Strategy will contribute to: (i) improve knowledge o f HIV prevention and encourage adoption o f lower risk behaviors, among high-riskgroups as well as the general population; and (ii) mitigate the socio-economic consequences o f the AIDS epidemic through improved coverage o f social safety nets for orphans and vulnerable children, and improved coverage of community care and support. Which safeguard policies are triggered, if any? Re$ PAD D.6, TechnicalAnnex 10 Environmental Assessment - Medical Waste Management. Significant, non-standard conditions, if any, for: Re$ PAD C.7 NONE 2 Covenants applicable to project implementation: (a) The Recipient shall have: (i)developed an a chart o f cost accounting (analytical nomenclature), in form and substance satisfactory to the Association, and (ii)adapted the computerized information system for the financial management o f PADS MU (including the software customization, the adaptation o f the Health Manual o f Financial and Administrative Procedures and the Health Program Implementation Manual, the training and short term assistance, no later than December 31,2006; (b) The Recipient shall have organized, and all staff of the CNLS MU, Provincial and Regional AIDS Committees, shall have participatedin,a training on financial management, no later than December 31,2006; (c) The Recipient will organize, and all staff o f the PADS MU will participate in, a training on financial management, no later than December 31,2006; (d) The Recipient shall have recruited an internationally qualified consultant to strengthen the procurement capacity o f the Ministry o f Health and PADS management unit, no later than December 31,2006; (e) The Recipient shall have entered into an agreement with one or several duly qualified institutions or non governmental organizations for the provision o f technical assistance to the villages participating in the implementation o f Component B o f the HSSMAP, in form and substance satisfactory to the Association, no later than December 31,2006; (0 The Recipient shallhave developed an actionplanfor the strengthening ofthe capacities ofthe Department responsible for the Administration and Finances o f the SP-CNLS-IST, in the mediumterm, no later than December 31,2006; and (g) The Recipient shall have developed an action plan for the strengthening o f the capacities o f the Department responsible for the Administration and Finances o f the MOH, inthe mediumterm, no later than March 31,2007. 3 A. STRATEGIC CONTEXT AND RATIONALE 1. Country and sector issues 1. Country Context. Burkina Faso has established a strong track record on reform and growth in the past decade. But despite this recent progress, Burkina remains one o f the poorest countries in Africa, with per capita income o f $350 and a poverty incidence o f 46 percent in 2003, Social welfare indicators lag behind even modest Sub-Saharan averages, placing Burkina near the bottom o f the HumanDevelopment Index. . 2. Despite promising trends in some health service and outcome indicators, Burkina Faso remains "off track" to achieving the MDGs for health. Most key indicators for child health and nutrition worsened during the 1990s, but inthe past five years, child mortality has declined (from 219 per thousand in 1998/99 to 184 per thousand in 2003) and coverage o f preventive and curative health services improved (the percent o f children fully vaccinated increased from 22% to 44%). Butjuvenile mortality (ages 1-5) remains at the same level as in 1993 (111 deaths per 1000 in 2003 compared to 109 per thousand in 1993) -- probably due to limited progress in combating malaria and child malnutrition. 3. Malaria is the biggest killer o f children, followed by diarrhea, respiratory infections, and malnutrition. Yet only 7 % o f children and pregnant women sleep under insecticide-treated bednets, and child malnutrition i s worse than a decade ago, with 38 percent o f children suffering from chronic malnutrition. Maternal mortality rates are high(484 deaths per 100,000 births). The percentage o f women delivering at health facilities with trained personnel has increased slowly (to 33 percent in 2003), but only about 5 % o f rural women use modem contraception. 4. HIV rates are among the highest in the sub-region, but there are signs the epidemic is stabilizing. A national survey in 2003 found that 1.8% o f adults were infected, with significant variations within the country. UNAIDS estimated national adult seroprevalence to be 2.3% in 2005. Preliminary data on HIVIAIDS knowledge and behavior change show positive trends in HIV knowledge, but further progress is needed (only two-thirds o f men and 40% o f women spontaneously cited condoms as a means o f preventingHIV/AIDS). As o f December 31, 2005, 8,136 persons infected with HIV, including 420 children, were receiving ARV treatment, but up to 30,000 persons are inneed o f ARVs. AIDS i s exacerbating poverty by generating a large and unsustainable financial burdenon affected households. 5. Health Sector strategy. The Ministry o f Health's 10-year health strategy (Plan National de development sanitaire (PNDS), 2001-2010) identifies key priorities and program objectives for the health sector. The eight priority programs for the PNDS are: (i) increase geographic coverage o f health services; (ii)improve the quality and utilization o f health services; (iii) strengthen the fight against communicable and non-communicable diseases; (iv) reduce HIV transmission; (v) improve the quality and distribution o f human resources in the sector; (vi) increase financial accessibility for the population; (vii) increase health sector financing; and (viii) strengthencapacity inthe sector. 4 6. The MOH recently completed a Medium Term Expenditure Framework (2005-2010), which provides the overall financing framework for the sector. The MTEF will form the basis for annual budgets and work programs, with priority expenditures increasingly integrated into the government budget. 7. Multi-sectoral HIV/AIDS Strategy: The new National AIDS Strategy (2006-2010) i s organized around five strategic priorities (Axes Stratigiques), including: (i)Strengthening prevention o f HIV and sexually transmitted infections (STIs), and promotion o f voluntary testing and counseling (VCT); (ii) Reinforce access to medical care and support for persons living with HIVIAIDS; (iii)Strengthen protection and support for persons living with HIV/AIDS and other vulnerable groups; (iv) Reinforce partnership, coordination, and resource mobilization; and (v) Strengthen surveillance o f the epidemic, monitoring and evaluation, and promotion o f research. 8. The National AIDS Strategy includes a financing framework which provides a baseline estimate o f the costs to achieve stated objectives, although the total amount exceeds resources that are likely to be mobilized. The strategy will be translated into annual work programs based on available financing from donors and government resources. The Secretariat o f the National AIDS Council (SP-CNLS) has developed an implementation plan for the National Strategy, and has initiated development of an operationalmanual for the pooled funds. 9. Key sector issues include the following: (a) Access to and quality of health services. Utilizationo f health services has improved in the past 5 years-with average visits per capita increasing from only 0.2 duringthe 1990s to 0.33 in 2004-due to a combination of reduced costs for preventive services and increased geographical access. But overall trends in health outcomes conceal significant variations in access to service and outcomes among urban and rural areas, and between wealthiest 20% o f population and the poorest. Physical and financial access, as well as inadequate service quality, remain problems for the rural poor. Much o f the rural populace continues to rely on traditional providers, and both the urban rich and poor are increasingly turning to private pharmacies and health clinics. (b) Scaling up AIDS and STI prevention and treatment. While HIV trends are encouraging, prevention efforts need to be consolidated and scaled up to further reduce new infections andprevent a relapse inrisk behavior, particularly as antiretroviral (ARV) treatment becomes increasingly available. Partnerships between treatment facilities, local NGOs, and associations o f persons living with AIDS are essential to ensure adherence to treatment and avoid development o f resistance to ARVs. The government has set an ambitious target o f 30,000 persons under treatment by 2007 (from 8,136 persons in December 2005. The prevention and treatment o f sexually transmitted infections (STI) should be further strengthened, for the general population and to ensure STI treatment andcounselingfor high-riskgroups. (c) Rolling back malaria and fighting communicable diseases. Although malaria is responsible for over half o f child deaths, malaria prevention and treatment are currently 5 underfinanced relative to its importance for the MDGs. Increasing coverage o f insecticide-treated bednets from current levels to 60% could reduce child mortality by 20- 30 percent. Care and treatment o fmalaria cases at bothcommunity and district levels also needs to be strengthened.Inresponse to increased chloroquine resistance, the government has changed its treatment regime to ACTs, but current financing (even with the HSSMAP) i s inadequate to fully finance ACTs. Malaria interventions have not been sufficiently integrated into health district Action Plans, and multisectoral directives for vector control at community and provincial level also need to be further developed. The National Malaria Program finalizing a new national malaria strategy, which will require an intensive process o f further defining district and community prevention and treatment priorities, and prioritizing based on available financing. In addition, Burkina i s regularly faced with epidemic outbreaks, including meningitis and cholera. In light o f the progression o f the bird flu in Africa, the government's framework for the national response calls for coordinated interventions among the ministries responsible for animal resources, environment and agriculture, and health. This will help to contain the transmission among animals and to limit the transmission from animals to humans. (d) Promotingcommunity participation and behavior change. Eventhough most of the excess mortality and morbidity is due to behavioral and environmental factors at the household and community levels, community health, nutrition, and HIV/AIDS interventions remain underfinanced and inadequately coordinated. The experience o f the MAP project in supporting community HIV/AIDS awareness activities (in 13 of 45 provinces) has been promising. A consultative process i s underway with a view toward scaling up and integrating HIV/AIDS into other disease program activities and with Community Driven Development (CDD) operations. While trends in HIV/AIDS knowledge and behavior have been encouraging, a more comprehensive approach to behavior change communications i s needed, including improved monitoring and evaluation of impact. (e) Distribution and motivation of health personnel. Doctors and nurses remain disproportionately concentrated in urban areas, and service quality i s reduced by inadequate motivation o f public sector health workers, due to low salaries, poorly developed career structures, and limited accountability for performance. The private health sector i s expanding rapidly in urban areas, but oversight and public-private contracting remain limited. The government has developed an Action Plan for improving the distribution and motivation o f health personnel, including providing salary supplements for staff in rural areas. In the context of the decentralization process, the recruitment and payment o f staff at the decentralized level will be necessary to improve geographic distribution ofpersonnel and to strengthen oversight by local authorities and communities. (f) Strengtheningdecentralizationand performance contracting. The health sector has been a leader in deconcentration o f health services to the district level, including channeling resources directly to health districts on the basis o f monitorable action plans. Performance contracting needs to be further developed with hospital, NGOs, private sectors, as well as health districts. The national HIVIAIDS strategy (with Bank support) has established HIV/AIDS committees at provincial and village levels, with hnding from the M A P for 13 (of 45) provinces. The new decentralization law (2004) calls for a transfer 6 o f responsibility for health and social services to local governments, but a number o f issues remain to be clarified, including the timing and institutional arrangements for transfer o f budgets and personnel. Strengthening the social safety net. Extended families remain the core o f the social safety net, but illness and death o f family members place severe strains on this system, The Ministry o f Social Action has finalized a Social Protection Strategy, but receives limited financing from government or donors. Most funding for orphans and vulnerable children comes from donors, particularly through HIV/AIDS projects, which creates problems o f coordination and coverage. Given the limited resources and the diversity o f interventions at village levels, there i s a need for piloting and experimentation with integrated communitycare and support. Sector performance monitoring and surveillance. Health districts provide timely reporting for the priority key health service indicators. Efforts are underway such that health regions begin producing consolidated monitoring reports. Periodic household surveys (including Demographic and Health Surveys (DHS)) provide valuable information on health and HIV/AIDS behavior, service use, and mortality, but the vital registration system is weak. For HIV/AIDS, the SP-CNLS has established standard monitoring indicators which are consolidated annually, but has experienced difficulties with timely reporting from executing structures. The designation in 2005 o f focal points for the collect and control o f data for all executing structures should help address these weaknesses. Adequacy, equity, and reliability of sector financing Public sector spending on health was about US$8 per capita in 2003 (including donor funding), a modest increase in real terms since 1998. While government has made an effort to prioritize funding for districts and rural services, utilization o f public health facilities by the poorest remains low, thus public health spending tends to disproportionately benefit the better off. The Ministryo f Health has prepared its first Medium Term Expenditure Framework (MTEF), but more needs to be done to align spending with PRSP and MDG priorities, and to further improve the reliability o f budget transfers to health districts. Integration of priority programs and harmonization of external financing. The multitude o f bilateral, multilateral, and nongovernmental donors in the HIV/AIDS and health sectors, as well as various vertical disease control programs, has created a significant coordination burden on government. The M O H and National AIDS Council, as well as donor partners, have taken a number o f steps to improve coordination, but harmonization remains a priority, including moving toward common procedures and pooled fundingto the extent possible. Rationalefor Bank involvement The Bank's engagement in the health and HIV/AIDS sectors is justified for several reasons. First, improving health, nutrition, and HIV/AIDS outcomes i s hndamental to achieving the millennium development goals (MDGs), to which both the government and the Bank are committed. Second, the Bank has a comparative advantage in helping the government address 7 fundamental financing and structural issues facing the sector, including human resources, sector financing, decentralization, performance contracting, and development of integrated approaches to community development and social safety nets. Third, the Bank currently plays a critical role in financing HIV/AIDS prevention and treatment in Burkina Faso, and can help provide additional resources to address other persistent funding gaps in the health sector, including for malaria and maternal and childhealth. 11. While budget support through the annual Poverty Reduction Strategy Credit will remain the primary vehicle for supporting the government's PRSP and for promoting cross-cutting structural reforms, the Bank's engagement indirect sector support isjustified for several reasons. First, the Bank is well-positioned to help promote harmonization among donor partners, including for HIV/AIDS, healthprograms, and community interventions. Second, sector support provides greater flexibility to promote institutional reforms and finance key priorities essential for MDGs-including funding for community and nongovernmental organizations, and strengthening monitoring and evaluation-and to pilot reforms that are later integrated into national systems (such as performance contracting). Third, sector support can bothreinforce and help manage the risks associated with decentralization and the increasing importance o f budget support, including strengtheningcapacity, and mitigatingcontinued difficulties with liquidity and execution o f the national budget. 3. Higher level objectives to which the project contributes 12. In 2000, Burkina became one of the first countries to prepare a full poverty reduction strategy, or Cadre Stratbgique de Lutte contre la Pauvretb (CSLP).' A revised PRSP for 2004- 2006 was adopted by Government inNovember 2004, which builds on the main objectives o f the earlier strategy, namely: i)accelerate equity-oriented growth; ii)increase access o f the poor to basic social services; iii)expand income and employment opportunities for the poor; and iv) promote good governance. Its four overarching medium-term goals include raising life expectancy to at least 60 years by 2015 through reductions in infant, child and maternal mortality. The government has demonstrated its commitment to combating HIV/AIDS through the establishment o f a National AIDS Council, chaired by the President, and adoption o f five- year HIV/AIDS strategy (2001-2005). A new National HIV/AIDS Strategy (2006-2010) was approved by the National AIDS Council on June 30, 2005 and adopted on July 27, 2005 by the government. In the health sector, the national 10-year Health Sector Strategy (PNDS) was approved in 2001,which provides the framework for government and partners. A Health Sector Monitoring Committee (Comitk de Suivi du PNDS) involving government, civil society and external partners was established in2003-chaired bythe Minister of Health-to assess progress in implementation of the strategy. The government is finalizing national strategies for social protection, for Orphans and Vulnerable Children, as well as for Youth. 13. A new results-based Country Assistance Strategy (CAS) for the World Bank's Burkina Faso program was approved by the Board in July 2005, which supports the pillars o f the revised Poverty Reduction Strategy Paper (PRSP). The proposed health and HIV/AIDS Program will support two of the four major objectives o f the CAS: improved access to basic social services, as well as better governance with greater decentralization. Within the social sectors, IDA'Sstrategy 1 PRSP Report # 21027 (Board: 6/30/00) 8 seeks to continue to support access to basic education and improved quality o f teaching, expanded coverage of basic health care and HIVIAIDS prevention and treatment and increased access to clean water and sanitation. IDA and other partners will also provide technical input for better targeting of social protectionto the most vulnerable groups. 14. The long-term objective of the Credit i s to contribute to progress toward the health, nutrition, and HIVIAIDS MDGs, including reducing child and maternal mortality, combating child malnutrition, strengthening family planning, and decreasing HIV prevalence (particularly among young adults). While medium to long-term progress of the national program will be measured according to these outcome indicators, changes in these indicators will occur slowly and cannot be attributable to the program alone. B. PROJECT DESCRIPTION 1. Lendinginstrument 15. The HSSMAP will be financed through a Sector Investment and Maintenance Loan o f US$47.7 million equivalent. The operation supports a Sector Wide Approach (SWAP)and will provide flexible financing to the national health sector and multi-sectoral HIV/AIDS programs through two separate pooled hnding mechanisms: one managed by the Ministry o f Health, the other by the National AIDS Council. Program activities will be executed through performance- based contracts with central ministries, decentralized structures (regions, health districts, and provinces), health facilities, NGOs, private sector, and communities. Both the Ministry of Health and the SP-CNLS are committed deepening their sectoral approaches, with greater harmonization and coordination o f donor activities. The Credit will complement other instruments, including the PRSC, community-driven development program (PNGT2); support for basic education (PDDEB), the intersectoral capacity building projects for public administration (PRCA) and for statistics systems (PDSSN). 2. Programobjective and Phases 16. The HSSMAP will support along with other partners implementation o f the 10-year National Health Development Plan (2001-2010) and the current National AIDS Strategy (2006- 10). The HSSMAP will support all major objectives o f these national strategies, including improving the quality and coverage o f service delivery as well as supporting key sectoral reforms. Annual support from the Credit to the respective funds for the health and HIV/AIDS sectors will consist of a baseline financing level, which will be adjusted dependingon progress in meeting agreed performance indicators and implementing sector reforms. As part o f the sectoral financing plan, and the pooled funds, the Credit will finance certain critical commodities, including the purchase o f long-lasting insecticide impregnated bednets, medicines for treating malaria and HIV/AIDS, and incinerators for medical waste management. An agreed program o f health sector reforms will be negotiated and updated annually, with cross-cutting reforms (human resources, decentralization, improved budget execution) integrated into the PRSCs as well. The HSSMAP will seek to improve the alignment between resource allocations at both national and district levels and the disease burden - most notably in light o f the current underfinancing of malaria control activities relative to AIDS treatment, for example. Sector dialogue and pooled financing will also emphasize provision o f public goods (such as behavior 9 change activities) and interventions with high externalities (such as mosquito bednets), which also need greater focus inpublic expenditures. 3. DevelopmentObjectiveand Key Indicators 3.1 Development Objective 17. The objective of the HSSMAP i s to support implementation o f the Borrower's health sector and multi-sectoral HIV/AIDS strategies, in order to accelerate progress toward the Millennium Development Goals (MDGs) for health, nutrition, and combating HIV/AIDS, The HSSMAP's support for the government's health sector program will help to: (i) improve the quality and utilization of maternal and child health services; (ii) expand the national response to malaria prevention and treatment, at both community and health district levels; and (iii)improve quality and coverage of treatment for HIV/AIDS and sexually transmissible infections. IDA'S support for the National AIDS Strategy will contribute to: (i)improve knowledge ofHIV prevention and encourage adoption o f lower risk behaviors, among high-risk groups as well as the general population; (ii) mitigate the socio-economic consequences o f the AIDS epidemic through improved coverage o f social safety nets for orphans and vulnerable children, and improved coverage o f community care and support. 3.2 Key performance indicators 18. To monitor implementation o f the National Health Strategy (PNDS), government and health sector partners have agreed on a list o f about 35 indicators, o f which a core subset are used to monitor PRSP implementation (child vaccination coverage, assisted births, child mortality, HIV prevalence, child malnutrition, and low birth-weight). The National AIDS Strategy also defines an extensive list o f indicators, and reports annually on internationally , agreed UNGASS indicators. 19. A subset o fthese health and HIV/AIDSindicators will be usedto monitor the HSSMAP, which focus on results under the control o f the Ministry o f Health and the National AIDS Council (see Annex 3). Some indicators will be monitored on an annual basis, others every two years. Mechanisms for monitoring, and the annual review framework have been agreed between the Government and participating sector donors. In addition, a smaller subset o f indicators will be usedto evaluate the annual level o f additional perfonnance-based financing from the Credit, These indicators and target levels will be negotiated annually among government, IDA, and other donors to the pooled funds. 20. For the health sector, key indicators include: (i) percentage o f children (under age 5) sleeping under treated bednets; (ii) percentage o f children under one year o f age receiving the third dose of pentavalent vaccine (DPT3 Heb3 Hib3); (iii)percentage o f births assisted by trained personnel; (iv) percentage of children (6-59 months) receiving vitamin A supplements; and (v) number o fHIV positive persons receiving antiretrovirals (ARVs). 21, For HIV/AIDS support, key indicators include : (i)percentage o f young adults (age 15- 24) who report having used a condom during their previous sex with a non-regular partner; (ii) percentage o f STI patients who are correctly diagnosed, counseled, and treated; (iii) o f number 10 persons receiving voluntary HIV testing and counseling; (iv) number o f communities/villages implementing HIV/AIDS activities; and (v) number o f orphans and vulnerable children receiving care and support. 4. Components 22. Proposed components for the operation `are organized according to institutional arrangements for implementationand the flow o f funds. Component (A) will provide support for the national health strategy for: (i) improved quality and utilization of maternal and child health services; (ii) malaria prevention and treatment; and (iii) treatment for HIV/AIDS and sexually transmissible infections. Component (B) will support the National HIV/AIDS Strategy through a pooled fund at the National AIDS Council to: (i)improve knowledge o f HIV prevention and encourage adoption o f lower risk behaviors, among high-risk groups as well as the general population; and (ii) mitigate the socio-economic consequences o f the AIDS epidemic through improved coverage o f social safety nets. 23. The HSSMAP through its support for the pooled funds will seek to balance allowing flexibility for executing entities to determine their priorities based on local disease burden, while ensuring that priority activities and interventions are financed. This will be achieved through (i) strengthening o f medium-termexpenditure frameworks for health and HIV/AIDS,to ensure the overall sector expenditures are aligned with MDG and PRSP priorities; (ii) ensuring transparent allocation formula for program finding, by levels and among priority programs, based on agreed annual work programs with the M O H and SP-CNLS; (iii) improving the alignment between resource allocations at the disease burden at national and district levels; (iv) strengthening performance-based contracting and systems for results monitoring for both health and HIV/AIDS sectors, The Credit support the purchase of priority commodities, including purchasing treated bednets, which represent amongthe most cost-effective intervention for reducing child mortality inBurkinaFaso, as well as medicines for treating malariaandHIV/AIDS. (A) Supportfor health sectorprogress toward theMDGs (approximately $26.7million) 24. This component will support implementing o f the national health strategy through the pooled health sector fund (subject to transitional arrangements further described in Section "Financing and Disbursement Criteria", and Part D, Section 3: "Fiduciary"), accordance with the revised Memorandum of Understanding (MOU) to be signed by government and PADS donors. Activities to be financed will include procurement of critical goods and commodities, and flexible support for the annual work programs o f health districts, hospitals, central directorates, research centers and non-governmental organizations. The annual work programs will be financed through the national budget, pooled donor hnding, parallel financing from other partners, and cost recovery finds. Executing structures will sign annual performance contracts with clearly specified outcome indicators. An agreed program o f health sector reforms will be negotiated and updated annually, with priority cross-cutting reforms (human resources, budget execution) supported by a series o f PRSCs as well. (i) Improve quality and utilization of maternal and child health services. To improve quality and access to maternal and child care services, the HSSMAP will support annual action plans to scale up integrated management o f child illnesses (IMCI); improve quality and reduce 11 the costs for emergency obstetrical care and normal deliveries (including through limited civil works); support basic training and equipment for maternal and child health services; improve medical waste management; and enhance supervision, training, and outreach activities (including vaccination). Planning tools and guidelines for districts will be further strengthened to ensure funding for a minimum package of priority maternal and child health activities at facility and community levels. Incentives for provision o f key services (vaccination, prenatal care, assisted deliveries, vouchers for indigents) will also be strengthened through piloting o f output-based payments. The HSSMAP will also support national and district level health promotion campaigns, including for rural radio, for priority issues such as malaria prevention, improved nutrition practices, sanitation, etc. (ii)Scalingupthe malariaresponseandcontrolof communicablediseases: As part ofthe Roll Back Malaria initiative and World Bank Africa Region's Malaria Booster Program, IDA'S contribution to the pooled health fund will help community and district-level malaria prevention and treatment activities, which will be integrated into district and community action plans and financed through pooled funds at district level. h addition, the HSSMAP will finance key commodities for malaria control, particularly subsidized procurement and distribution of over 1.5 million long-lasting insecticide-treated bednets, bednet retreatment kits, and subsidized distribution o f malaria medicines, with a particular focus on children under five and pregnant women. To scale up coverage before the next malaria season begins in June 2006, up to US$3.0 million for bednet purchases (600,000 long-lasting nets) will be eligible for retroactive financing under the Credit, with additional nets and 200,000 bednet retreatment kits to be ordered soon after Credit effectiveness. IDA will support the national Malaria Program in finalizing their next phase Malaria Strategy (2006-2009), including establishing a prioritized and costed financing framework. The HSSMAP will also provide flexible support to allow rapid response to epidemics, including meningitis, cholera, and bird influenza. IDA will monitor the bird flu situation closely with government and partners, and support integration o f bird flu response into annual work programs and seek additional financing ifnecessary. (iii) Scaling up AIDS treatment. IDA will seek to ensure continuity o f AIDS treatments programs initiated under the MAP (850 persons under treatment) and the Treatment Acceleration Program (TAP, up to 7000 persons), which will be integrated into the HSSMAP in 2007/08. Treatment will be financed and executed through the Ministry o f Health, with policy coordination and oversight provided by the SP-CNLS. Prior to 2008, most o f the direct costs for HIV/AIDS treatment, including purchases o f drugs, supplies, and equipment, will be financed through the TAP, but these costs will be financed by the HSSMAP through the pooled health fund following the close o f the TAP. The TAP covers currently 21 health districts, and will therefore be reoriented to become more fully aligned with a nationwide program supported through the pooled funding mechanism (PADS). The TAP i s currently funding NGOs and associations o f persons living with AIDS to carry out AIDS treatment, care and support, and voluntary counseling and testing. Following close of the TAP, financing to NGOs and the private sector for treatment will be financed through the HSSMAP's contribution to the pooled health fund. 12 (B) Supportfor National Multi-sectoral HIV/AIDS Strategy (approximately $21 million) 25. This component supports the implementation of the National AIDS Strategy and i s coordinated by the National AIDS Council. A pooled donor fund for HIV/AIDS, which i s being established with support from IDA and participating partners, will ensure financing for essential activities, and encourage the integration o f HIV/AIDS activities into ongoing programs and the national budgets. A Memorandum o f Understanding(MOU) will be signed between government, partners, and the National AIDS Council, which will spell out the intent o f the signatories with respect to the pooled fund. Similarly, the National AIDS Council will sign performance-based contracts with executing structures, including sectoral ministries (including the Ministry o f Health), regions andprovinces, non-governmentalorganizations, andprivate sector entities. 26. The indicative financing fi-amework in the national AIDS strategy will be translated into annual work programs that integrate all sources o f government and external financing, including the pooled donor fund. Resources from the pooled fund will be distributed among central and decentralized levels, different executing structures, and thematic areas according to an allocation formula that will be agreed annually betweenthe SP-CNLS and participatingpartners. (i) HIV prevention and behavior change. IDA will support scaling up coverage of HIV prevention programs among high-riskgroups (commercial sex workers, miners, truckers, youth) through NGOs and CBOs; development and implementation o f an integrated "second generation" HIV/AIDS behavior change communications strategy for both vulnerable groups as well as the general population; and community- and village-level awareness-raising activities. The HSSMAP will also support further scaling up voluntary testing and counseling for local NGOs and associations; strengthening HIV/AIDS and reproductive health programs for in- and out-of-school youth; and training, supervision, and monitoring o f STI treatment and prevention inpublic and private sectors. Following the close o f the TAP, VCT and non-medical care and support currently financed by the TAP will be fundedthrough the HSSMAP's contribution to the pooled fund at the SP-CNLS (ii) Mitigatesocio-economicconsequencesof HIV/AIDS epidemic. IDA will support national efforts to strengthen care and support for persons infected and affected, in the context o f the national Social Protection strategy. This will include providing support to the Ministry o f Social Affairs at central and decentralized level to strengthen their role in policy and monitoring, as well as direct support for NGOs, CBOs, and communities/villages (through direct support to village committees) for care and support for orphans and vulnerable children and persons living with HIV/AIDS. 27. These objectives will be implemented through various executing structures, including the following: (a) Decentralized support and community micro-projects: HSSMAP will support the pooled fund to further scaling up prevention, care and support activities by village AIDS committees, local community-based organizations, and local governments, and strengthen the coordinating role o f regional, provincial, and local AIDS committees, based on integratedprovincial HIV/AIDS action plans; 13 (b) Nongovernmental, civil society interventions. Priorities for support include prevention, care and support activities for high-risk groups (including sex workers) and vulnerable populations (orphans, widows, youth, handicapped persons), implemented through national and local NGOs, associations o f persons living with AIDS, religious organizations, and traditional authorities; (c) HIV/AIDS action plans of ministries and public sector institutions. Routine activities o f ministry AIDS committees increasinglywill be financed through the national budget, but pooled resources will provide complementary financing to scale up programs for priority beneficiary populations, including education and youth (in and out o f school, with cofinancing from education projects), transport workers, and security personnel, The Ministry o f Social Action will be responsible for coordinating interventions for orphans and vulnerable children; (d) Private sector. The program will provide technical support and cofinancing for prevention and care activities among formal and informal sector enterprises, with a particularly focus on priorities subsectors (for example, transport, hotels and nightclubs, etc.); and (e) National and local coordination structures: IDA will support strengthening o f the SP- CNLS as well as regional and provincial coordination structures, including strengthening the supervision, monitoring and evaluation (M&E) systems for the national AIDS program, including routine monitoring, behavioral surveys and HIV surveillance, and operational research; support for coordination activities o f SP-CNLS; and project management, including procurement and financial audits. Cross-Cutting Reforms to be Supported by the HSSMAP 28. IDAwill support cross-cutting reforms for the health sector andmulti-sectoral HIV/AIDS interventions through this operation, with support from a series o f PRSCs: (a) Promoting an integrated approach to community participation. IDA will support development o f an integrated "package" o f community-level health, nutrition, and HIV/AIDS programs, with technical support from district health teams, local NGOs and CBOs. In the context o f the national decentralization process, village-level health, nutrition, and HIV/AIDS activities will be increasingly integrated with the national Community Driven Development (CDD) programs under the guidance o f Village Development Councils (which are to be established in 2006), with technical oversight fi-om district health teams and with general supervision and oversight by Provincial AIDS Councils; (b) Distributionand motivationof healthpersonnel. IDAwill support implementationof the human resources actionplan, including strengthening capacity and systems for decentralizinghealth sector personnel, to complement structural reforms implemented with support from the PRSC (including decentralization ofpersonnelrecruitment, management andbudget posts). The HSSMAP will provide technical support to improve the quality and efficacy o fpre-service and in-service training programs; 14 (c) Strengthening decentralization and performance contracting. The HSSMAP will support the M O H to integrate into the national decentralization process. As the decentralization process moves forward, contracting will shift from vertical contracting with health districts to horizontal contacting with provinces and communes -beginning with urban communes. The HSSMAPwill also seek to improve hospital management and monitoring through performance contracting, both between the central ministry and hospital administration, and betweenthe hospital and departments; (d) Sector performancemonitoringand surveillance. The HSSMAP will support further strengthening of the health information and surveillance systems, includingenhanced use o f information for decision-making, as well as the HIV/AIDS program monitoring system. Support will also be provided for periodic surveys on survey quality, household surveys on health and HIVIAIDS behavior and practices (including DHS 2008), and strengthening community-level surveillance and vital registration systems; (e) Adequacy, equity, and reliability of sector financing. Sector dialogue and monitoring will review allocation and execution o f all sector resources - budget, cost recovery, external financing. Targeted support will also be provided to further strengthen budget systems, the MTEFprocess, and development o f planning and monitoring tools to better align financing with objectives at district level; and (f) Integrationof priority programsand harmonizationof externalfinancing. Program dialogue and financing will support integration o f vertical programs, particularly at district and community levels. The use o f pooled funding, and strengthening o f harmonized procedures andjoint government-donor sector reviews will further advance the harmonization agenda. Financing and disbursementscriteria 29. The HSSMAP will finance two separate pooled funding mechanisms: one managed by the Ministry of Health, the other by the National AIDS Council. A pooledhealth fund is already inplace (with financing from Dutch, French, and Swedish cooperation), and a pooled HIV/AIDS fund is being established with support from this operation and Dutch, French, and possibly Danish cooperation. The Recipient will open and maintain two additional accounts for the HSSMAP: one pooled account for financing the national HIV/AIDS strategy, and one temporary IDA account for financing internationally bid health sector procurements in 2006, managed by the same unit that manages the pooled health fund. This transitional arrangement i s necessary to maintain momentum in ongoing program activities while modifications are being made to the PADS procedures to permit full IDA integration inthe pooled funding mechanism. In addition, an internationally qualified procurement consultant or firm will be recruited by the Ministry o f Health, to strengthen procurement capacity o f the PADS and the Ministryoverall. 30. An average indicative amount o f $5.0 million will be allocated annually to the health sector for activities directly executed by health districts, hospitals, central directorates, etc. (not including an estimated $6 million in direct costs for international procurement o f bednets and medicines for malaria in 2006). For multi-sectoral HIV/AIDS activities, IDA will contribute on average $4.0 million annually to the pooled fund, including costs o f international procurement 15 (see Annex 5). The amount o f annual financing will be determined following annual joint program reviews (in April/May) for the previous year, to allow integration into the national budget. The annual contribution will be adjusted based onprogress toward agreed indicators and reforms. To harmonize with other donors, payments will be made intwo roughly equal tranches. The first disbursements into the pooled finds would take place in December or early January, and would be triggered by: (i) finalization o f an annual work program for the upcoming year adopted by government and endorsed by key donors; (ii)organization o f an annual joint performance review for the health sector and for the HIV/AIDS program, and (iii) presentation of the first semester monitoring report, including evidence o f progress in sector performance based on agreed performance indicators and policy reforms. The second tranche (June) will be triggered based on (i)submission o f financial management and procurement audits for the previous year, andprogress on recommendations o fprevious audit reports; and(ii) submission o f the 2ndsemester monitoring report. Ifone sector does not fulfill trigger criteria, funds for other could still be disbursed. Duringthe transition period in2006, IDA will disburseinto the separate IDAhealthaccount once the HSSMAPis effective. 5. Lessons learnedand reflectedin the projectdesign 31. HSSMAP design and preparation took into account the following lessons from the performance o f IDA-financed projects in Burkina Faso, other SWAPS, and Economic Sector Work (ESW): 0 Complementarity of budget and sectoral support: In2001, the Bank discontinued direct project lending for the health sector in favor o f budget support through the PRSC. The PRSCs have proven effective instruments for pursuing policy and structural reforms, particularly those that require involvement o f central ministries (e.g., budget reforms, human resource reforms). But experience suggests that in the medium term, providing harmonized support to a sector program could help ensure reliability of financing for priority activities, particularly at decentralized levels, strengthen ministerial and decentralized capacity, accountability, and performance management, and finance activities at community-level that would be difficult to support through the budget alone (see also "Alternatives Considered.. ." below). 0 Harmonization and coordination. Harmonization o f financing arrangements (particularly in social sectors) i s an important element in reducing transaction costs and improving development effectiveness. Budget support and pooled funding seem to reduce transaction costs for government in the medium term. Vertical disease programs and multi-sectoral activities also need to be integrated, particularly at decentralized levels and community levels. 0 Results-based planning, contracting and monitoring. Increased resources or donor harmonization, while important, will not necessarily lead to improved health outcomes. Resource allocations need to be aligned to disease profiles, and performance toward objectives regularly monitored. Although Burkina was among the first countries in the region to develop performance contracting for districts, additional technical support and guidance are needed to ensure that 16 district action plans prioritize the most important actions to achieve sector objectives (e.g., malaria, malnutrition, IMCI). The HIV/AIDS program also needs to shift from a focus on planning and processes to a performance-based ,management culture. e Strengthening health systemperformance. Improving the quality and accessibility o f medical treatment - whether for AIDS, malaria, or TB - requires addressing fundamental weaknesses in the health system. These include the quality, distribution, and motivation o f health providers; as well as the adequacy o f sector financing, sector monitoring and surveillance systems, and logistics systems. 6. Alternativesconsideredand reasonsfor rejection 32. Several alternative approaches were considered, including (i)MAP2repeaterprojectfocusingprimarilyonpreventionandtreatmentofHIV/AIDS and other sexually transmitted infections (STIs), with continued budget support for the health sector through the PRSC; (ii)Expanding the scope o f the M A P project to include malaria and TB prevention and treatment; and (iii) separateHIV/AIDSandhealthsectoroperations. Prepare 33. Following extensive discussion within the Country Team, with government and partners, options (i) and (ii) rejected for several reasons. First, while budget planning and execution were for the health sector has improved under the PRSCs, delays, cumbersome procedures, and weak procurement capacity continue to pose risks to program execution, and the decentralization process will inevitably be accompanied by disruption due to weak capacity and new procedures. Second, despite the intention to shift toward budget support and reduce management burdens on the Ministryo f Health, the Bank has continued to provide project support for the health sector through both disease-specific (MAP and TAP) and multisectoral projects (capacity building, statistics). Harmonizing among these various Bank-financed projects i s therefore a priority. Third, the national malaria program is in need o f significant additional resources, capacity building, and technical support, but earmarking funds for malaria in addition to HIV/AIDS would have further contributed to fragmentation in the health sector. Option (iii) rejected was because preparing two separate Credits would pose unnecessary transaction costs on both the Bank and borrower. 34. The country team therefore agreed that an integrated health and HIV/AIDS sector operation was the most effective means to address health system weaknesses, increase use o f services by the poor, and to consolidate and mainstream HIV/AIDS prevention activities. 17 C. IMPLEMENTATION 1. PartnershipArrangements 35. Other key partners supporting HIV/AIDS and health programs in Burkina Faso include bilateral donors, UNAgencies, regional development banks, the Global Fund, and international NGOs(see Annex 2). Relations and consultation among donors are strong, althoughjoint annual program reviews needto be further formalized. WHO plays a leadrole for coordination activities inthe health sector, including convening meetingsfor all healthpartners every two months, and hosts technical meetings for HIVIAIDS, incollaboration with UNAIDS. 36. With the rapid growth in the number o f partners and programs inrecent years, both the National AIDS Council and the Ministry o f Health have asked donors to harmonize procedures and move to sector-wide support and pooled funding ifpossible. A pooled fundingmechanism i s already in place for the health sector (PADS), financed by Dutch, Swedish, and French cooperation. MAP funding for the Ministry o f Health and the TAP project are also implemented through the PADS management unit, although the funds are earmarked for HIV/AIDS. For multi-sectoral HIV/AIDS activities, the MAP project unit was transferred in mid-2005 to the National AIDS Council so that it can serve as a Financial Management Unit for multiple partners. Several donors have expressed interest in pooled funding for HIV/AIDS (including Dutch, French, Danish cooperation); the SP-CNLS i s developing the institutional framework and related manuals for pooled funds, and an MOU has been drafted. UN Agencies have sought to strengthen coordination and harmonization through preparation o f a joint 5-year action plan (WAF), and are discussing further harmonization o f procedures and possible participation in pooled funding. The United Nations Fund for Population Activities (UNFPA) has already agreed to channel part o f its financing through the healthpool, beginningin2006, andUNDP has expressed interest inparticipating inthe pooled HIV/AIDS fund. 2. Institutionaland implementationarrangements 37. Central level -- Health. Within the health sector, overall policy guidance and oversight i s provided by the steering committee (Comitk de Suivi) of the National Health Development Plan (PNDS), which i s chaired by the Minister o f Health, and includes representatives o f other key ministries, donor partners, and civil society. A technical secretariat (ST-PNDS) based in the Department o f Planning and Research provides technical support to the Committee, including sector monitoring and reviews. Several commissions provide for technical discussions on key sector issues, including humanresources, sector financing, and decentralization. 38. The HSSMAP will use the same implementation and coordination mechanisms as the Programme d 'appui au De'veloppement Sanitaire (PADS), which i s financed through pooled funds of participating donors. The pooled f h d is managedby a project management unit, which i s well-integrated within the Directorate o f Planning and Research (DEP). This same unit also manages funds from the IDA-financed TAP project, and will be responsible for fiduciary aspects of the HSSMAP health sector component. The PADS i s overseen by a steering committee chaired by the General Secretary o f the Ministry o f Health, and includes Directors o f all major departments, representatives o f donors participating in the pooled fund, as well as WHO. A limitation o f the existing approach is that the Directorate for Finance and Administration 18 (Direction de 1'Administration et des Finances (DAF))has limitedday-to-day involvement inthe management o f pooled funds. The HSSMAP will support capacity building for the DAAF to improve the monitoring and execution o f budgets and expenditures within the ministry o f health, incollaboration with other partners. 39. Health regions, district, and hospital levels: The 13 health Regions (Directions Rkgionales de la Santk (DRS)) provide technical oversight for 55 health districts. The PADS provides flexible funding for the action plans o f health districts, regions, university and regional hospitals. Following review and approval o f Action Plans in January, the PADS disburses funding intwo annual tranches, with the second tranche based on verification of activities inthe first semester. Annual global audits review on a sample basis all non-wage financing o f health districts and health regions (delegated budget transfers, PADS, cost recovery funds, and other donor projects), and PADS has initiated similar audits for regional and central hospitals. As decentralization moves forward, funding and performance contracts will be shifted to provinces and local communes. Several autonomous health research centers receive only core operational funding from the government; these will be integrated into the PADS through provision o f flexible funding against an agreed program o f operationalresearch and evaluation activities. 40. Support for the fight against HIV/AIDS - national level: The National AIDS Council (CNLS) provides oversight and policy guidance for the National HIV/AIDS program. It i s chaired by the President o f Faso, with the Ministers o f Health and o f Social Action serving as First and Second Vice-Chairs, respectively, and includes representatives of civil society (including persons living with HIVIAIDS), donors, private sector, and other key ministries. Program coordination i s the responsibility o f the Secretariat o f the National AIDS Council (SP- CNLS), based in the office o f the President, and with about 50 staff. The SP-CNLS was established in 2001, and initially did not have capacity to manage large donor projects. The project management unit for the World Bank's MAP project (PA-PMLS) has been transferred to the SP-CNLS, however, and will be merged with other project units to create a multi-donor Financial Management Unit (FMU). Management o f Global Fund resources are currently delegated to UNDP, but will be transferred to the SP-CNLS by the end o f 2006 along with technical and fiduciary staff. This combined unit will be responsible for financial management o f pooled funds, and some parallel funds for donors unable to join the pool. The Department o f Planning, Monitoring and Evaluation o f the SP-CNLS will be responsible for technical monitoring, including producing semester Financial Monitoring Reports in coordination with the FMU.A steering committee with representatives of government, donors, and civil society will provide financial and technical oversight, with an annual joint program review (involving all major development partners) taking place insecond halfo f each year. 41. Support for the fight against HIV/AIDS- Regions. Provinces, and communes: The HSSMAP will support decentralized coordination structures, including o f Regional, Provincial AIDS committees, to prepare annual multi-sectoral work programs. These work programs will integrate prevention activities, care and support for infected and affected civil servants, orphans and vulnerable groups, and the general population --- to be carried out by various implementing structures, including local NGOs, village and communal AIDS Committees. Since funding has been mostly centralized and vertical to date, capacity will need to be reinforced through contracting (or hiring) o f part- or full-time administrator, who will provide technical, administrative, and monitoring support to their respective regional and provincial committees. 19 As technical and fiduciary performance improves, support will be increasingly channeled through delegated budgetsallocations. The HSSMAP support for the pooled fund will thus serve as an entry point for strengthening capacity and "learning by doing" as a precursor to further decentralization of social services. 42. Community interventions. The HSSMAP will facilitate a phased transition toward harmonized planning and funding o f community-driven development, in the context o f the new decentralization law. Local government elections are being held in April 2006, and after which Village Development Committees will be established ineach village. These will eventuallyhave overall responsibility for planning and execution o f village development programs, but are not yet functional. The HSSMAP will support capacity building and the integration o f HIV/AIDS, health, nutrition, into the participatory rural appraisal process, and provide financing for a minimum package o f village-level HIV/AIDS, health, nutrition activities. During a transition period, the SP-CNLS will continue to provide direct funding to the 13 MAP and 12 African Development Bank (AfDB) provinces, but with greater flexibility for integrating health, nutrition, care and support activities. The SP-CNLS will also sub-contract with the CDD program to expand coverage o f its existing HIV/AIDS activities, and to eventually provide support for community HIV/AIDS, health, and nutrition, with technical support from local health teams andNGOs. 43. Civil societv and private sector. To reduce fragmentation o f funding for civil society organizations, the HSSMAP will build on the experience o f P A M A C (which channels funds to associations and NGOs involved in VCT, prevention, care and support activities) to finance along with other donors a pooled fund at central level for funding o f national and international NGOs, using output-based performance contracts, with a steering committee that includes government (MOH, SP-CNLS, etc), donor, and civil society representatives. Funds may also be delegated to regional and provincial committees for funding o f smaller local NGOs and CBOs, with indicative allocations for priority programs (HIV/AIDS awareness, high-risk groups, integrated health and nutritionprograms, orphans and widows). Local committees will carry out routine supervision, but financial and technical audits will be contracted out to verify, on a sample basis, the quality o f interventions and use o f funds. For medical care activities, including ARV treatment, NGOs and private sector providers will continue to operate under a convention with the Ministry o fHealth. 3. Monitoring and evaluation of outcomes/results 44. Monitoring and evaluation o f progress toward program objectives will rely on a combination o f routine health services data, monitoring data on HIV/AIDS program activities, public expenditure tracking surveys, periodical household surveys (including a Demographic and Health Survey in 2008, and Poverty Surveys), and periodic surveys on quality and coverage o f health and HIV/AIDS services. Local research institutes will be subcontracted to carry out evaluations and operational research. The HSSMAP will support efforts to improve the timeliness, reliability, and use o f routine service statistics for the health sector and multi-sectoral HIV/AIDSactivities, as well as the development o fperiodic surveys on service quality as well as expenditure tracking surveys every one to two years (see Annex 3). Technical capacity and oversight for monitoring and evaluation at the regional level will be strengthened. The HSSMAP will be considered satisfactory ifsubstantialprogress is made inmost o fthe targeted areas. 20 Scaling up o f ARV treatment could have unintended (i)supportpatientcompliance,including negative consequences, including: (i)emergence o f through associations o fpersons living ARV resistance due to inadequate adherence to with HIV/AIDS; (ii) information protocols andor emergence of a parallel drug S campaigns at national and community market; (ii)increased high-riskbehavior due to level; (iii) use treatment as entry point to perception that AIDS can be treated; (iii) diversion strengthen overall health systems. of human and financial resources away from other health sector priorities. Overall RiskRating M Jote: S = substantial; M = Modest 6. Loadcredit conditions and covenants 46. Conditions for effectiveness: (a) The Recipient has opened a Designated Account in CFA Francs in a commercial bank on terms and conditions satisfactory to the Association, as a transitional arrangement for the disbursement o f the funds to Component A (health sector) to be procured through international competitive bidding; (b) The Recipient has developed terms o f reference acceptable to the Association and negotiated the agreement with the consultant for the adaptation o f the computerized information system for the financial management (including the software customization, the adaptation o f the Health Manual o f Financial and Administrative Procedures, the training, and short term assistance) in the PADS MU,inamanner satisfactory to the Association. 47. Conditions for disbursementto pooled HIV/AIDS fund: The Recipient has nominated a Manager and appointed the following staff for the CNLS MU, on the basis o f terms o f references and with qualifications and experience satisfactory to the Association: a Chief Financial Officer; a Senior Accountant; three accountants; a Procurement Specialist; and an Internal Controller; The Recipient has appointed an accountant for the PAMAC on the basis o f terms of reference and with qualifications and experience satisfactory to the Association; The Recipient has established a computerized information system for the financial management (including software customization, the adaptation o f the HIV/AIDS Manual of Financial and Administrative Procedures, the training, and short term assistance) inthe CNLS FMU, ina manner satisfactory to the Association; The Recipient has adopted the HN/AIDS Program Implementation Manual, in form and substance satisfactory to the Association; 22 (e) The Recipient has established a Steering Committee (Comit6 Technique de Programmation et de Suivi (CTPS); ( f ) The Recipient has opened a Designated Account in CFA Francs in BCEAO on terms and conditions satisfactory to the Association, for the disbursement of the funds of Component B (HN/AIDS); (g) The Recipient has recruited an external auditor for the SP-CNLS-IST under terms and conditions acceptable to the Association. 48. Covenants: The Recipient shall have: (i) developed a chart o f cost accounting (analytical nomenclature), in form and substance satisfactory to the Association, and (ii) adapted the computerized information system for the financial management o f PADS MU (including the software customization, the adaptation o f the Health Manual o f Financial and Administrative Procedures and the Health Program Implementation Manual, the training and short term assistance, no later than December 31,2006; The Recipient shall have organized, and all staff o f the CNLS MU,Provincial and Regional AIDS Committees, shall have participated in, a training on financial management, no later than December 31,2006; The Recipient will organize, and all staff o f the PADS MUwill participate in, a training on financial management, no later than December 31,2006; The Recipient shall have recruited an internationally qualified consultant to strengthen the procurement capacity o f the Ministry o f Health and PADS management unit, no later than December 31,2006; The Recipient shall have entered into an agreement with one or several duly qualified institutions or non governmental organizations for the provision of technical assistance to the villages participating in the implementation o f Component B o f the HSSMAP, in form and substance satisfactory to the Association, no later than December 31,2006; The Recipient shall have developed an action plan for the strengthening o f the capacities o f the Department responsible for the Administration and Finances o f the SP-CNLS-IST, inthe mediumterm, no later than December 31,2006; and The Recipient shall have developed an action plan for the strengthening o f the capacities of the Department responsible for the Administration and Finances o f theMOH, inthe mediumterm, no later thanMarch31, 2007. 23 D. APPRAISAL SUMMARY 1. Economic and Financial Analysis 49. The respective synergies between health status, poverty, and growth have been well- established. Within the health sector, the recently complete Public Expenditure Review (2004) provides an overall assessment o f the allocative and technical efficiency o f health sector financing and expenditures. Several other health financing studies have recently beencompleted, including the preparation o f the first National Health Accounts for Burkina. Since the HSSMAP support the overall health sector program, economic and financial analysis i s based primarily on a review o f overall expenditures for the sector. 50. Interms of allocative eflciency, resources allocations among categories of expenditures (wages, salaries, infrastructure) are generally within accepted norms - for example, wages represent only about 40% o f sector spending. Current expenditure tracking systems make it difficult to estimate the percentage o f all resources (budget, donor) that arrive at decentralized and community level, but government has sought to increase allocations to peripheral services, and hospitals consume less than a third o f the budget. The larger problem has been a lack o f alignment between resource allocations at both national and district level and the disease burden -most notablytheunderfinancing ofmalariacontrol activities relativeto AIDS treatment, for example. Public goods (such as behavior change activities) and interventions with high externalities (such as mosquito bednets) also need greater focus in public expenditures. Sector dialogue and multi-donor pooled financing will emphasize provision o f these goods. The sectoral MTEF i s an important step toward aligning sector expenditures with objectives, and will be the basis for annual arbitrage o f government and donor resources. The criteria for allocation among structures and programs need to be further developed, however. With regard to equity, public health spending remains skewed toward the relatively better off, because the poor use health services less often for reasons o f cost and accessibility. Self-targeted subsidies for priority health measures used by the poor (such as making vaccination and antenatal care free) have helpedincrease service utilization, but targeting needs to be further developed for maternal and emergency services. 2. Technical 51. The overall technical design o f the operation i s consistent with international good practice, and aligned with the technical priorities for the country. First, sector approaches (SWAPS) and pooled funding, in the context of an overall expenditure framework, reduce transaction costs while seeking to align both donor financing and government budget with sector objectives. Second, by addressing both HIV/AIDS and the health sector, the HSSMAP will be more fully aligned with the national disease profile, and will be able to capitalize on synergies between the health sector and multi-sectoral HIV/AIDS activities. Third, sector dialogue and financing priorities for the pooled fund will emphasize interventions and policies that have been demonstrated to be effective - for example, scaling up coverage o f bednets, integrated management o f child illness (IMCI), integrated behavior change interventions, and focusing on prevention among groups at highrisk o f transmitting HlV. Finally, the emphasis on performance contracting and strengthening monitoring and evaluation strengthens incentives at all levels o f 24 the system to achieve sector objectives, and will allow for adjustments instrategies and activities to increase the likelihood o f achieving MDGs. 3. Fiduciary 52. IDA will seek to harmonize fiduciary arrangements as much as possible with other donors and with government procedures. Inthe health sector, because a Financial Management Unit is already inplace to manage the pooled funds, and is well integrated into the DEP, it was agreed that the HSSMAP will maintain this arrangement, while a capacity strengthening program i s being implemented at the M O H Budget and Finance Directorate (DAF). For HIV/AIDS, the former MAP project unit has been transferred to the SP-CNLS and will be integrated with other project units to form a common Financial Management Unit. A capacity building action plan will be undertaken with the Budget and Finance Department (DAF/SP-CNLS) to allow it to better manage and monitor funds of the SP-CNLS. All funds (health and HIV/AIDS) will be subject to annual reviews by private auditors, as well as periodic reviewsby national authorities. conducted jointly by Government, the Bank, and African Development Bank -- concluded that 53. With regard to procurement, the 2005 Country Procurement Assessment (CPAR) - existing national procedures and laws are acceptable for all national procurement, but that certain reforms remain necessary with regard to International Competitive Bidding. An action plan has been prepared and was approved by the Council o f Ministers inMarch 2006. The health pooled fund currently used national procedures for all procurement, however. After intensive discussions duringproject preparationwith government and partners, it has been agreed that IDA will disburse its financing in the pooled fbnd, account, subject to the following covenants, representations and warranties, and the implementation o f the following transitional measures: (i) willcontinuetousenationalproceduresforallnationalprocurement; (ii) will PADS PADS adopt internationally accepted procurement procedures for contracts financed by the pooled fund that exceed IDA procurement thresholds (see Annex 8). These thresholds could be revisedbased on annual reviews of PADS procurement performance; (iii)annual independent procurement audits will be financed by PADS for a sample o f all contracts (national and international); and (iv) the Ministryo f Health will recruit an internationally qualified procurement consultant (firm) to strengthen procurement capacity o f the PADS unit, DAF/health, and Ministry o f Health overall. As a transition measure, a separate IDA-designated account will be opened to finance ICB contracts for the health sector in 2006. In addition, ex post procurement audits will be undertaken for a sample o f all procurements financed by the SP-CNLS pooled fund. 4. Social 54. N o negative social consequences are anticipated. But a number o f socio-cultural issues will have a significant influence on the design and effectiveness o f interventions supported by the program. First, social factors and traditional beliefs influence health-seeking behavior and householdhealth practice. Strengthening community-based health, nutrition, and HIV/AIDS and behavior change interventions i s therefore important, as well as ensuring that behavior change campaigns are adapted to prevailing beliefs, cultures, and languages. Second, low female literacy rates and disadvantaged position o f women renders women more vulnerable to HIV infection and represents a barrier to improved reproductive health. In addition to support for girl's education and improving income-earning opportunities for women (supported through other 25 programs), funding criteria for NGO and community interventions will be sufficiently flexible to allow an integrated approach to women's empowerment in addition to health promotion and treatment. Third, policy dialogue and institutional designwill seek to adapt to local participatory structures, and strengthen voice and accountability for service delivery. Finally, the program will support periodic qualitative and quantitative beneficiary assessment. 5. Environment 55. The major environmental issue i s medical waste management. Proper management and disposal o f medical waste i s an important issue for avoiding accidental exposure to HIV and other blood-related illnesses by health workers and by persons in surrounding communities. Some laboratory reagents usedby hospitals are also toxic, and can have harmful environmental consequences if not disposed of properly. The malaria program's vector control policy does not emphasize insecticide spraying (which remains too costly even with .the additional resources from HSSMAP) and the environmental risks associated with bednets and bednet retreatment are limited. 6. Safeguard policies Environmental Category: B 56. This operation falls under environment category B. A medical waste management plan was prepared by the Government and reviewed by the Bank. Its quality and content have been judged satisfactory; and the report has been disclosed in-country and at Bank Info Shop prior to appraisal. The HSSMAP i s not expected to have substantial adverse environmental effects, The environmental risks pointed out by the report include particularly: (i)the inappropriate handling and disposal o f medical waste by untrained staff; (ii)the inadequate management of the respective disposal sites in urban, peri-urban and rural areas where domestic and medical waste are often mixed; (iii) use of untrained staff to handle the medical waste; and (iv) disposal of waste on open sites, easily accessible to scavengers and the communities surrounding those sites, The proposed Plan identifies measures to mitigate these potential risks, including clear institutional arrangements to implement and monitor those measures. The plan also includes a costed awareness and capacity building framework to effectively implement the plan, costed mitigation measures and monitoring plan, and an implementation schedule. 57. The action plan proposed by the Plan includes amongst other provisions: (i) the adoption of a sound policy for medical waste management; (ii) the reorganization o f the legal framework with the enactment of proper laws and decrees; (iii) launching o f awareness campaigns to the sensitize the general population, health care workers, dump site managers, incinerator operators, CSOs and CBOs; and (iv) development o f training programs for health care professionals. This training will include instruction on appropriate separation, transport, and disposal o f hazardous medical waste. 58. The Waste Management Plan was prepared in close consultation with the Unit of the Ministry o f Health responsible for medical waste management oversight, the managers and staff of public and private health care facilities, municipalities garbage collection managers and janitors' supervisors, community leaders, hotel managers, mass transportation managers, private 26 health facility managers, managers o f industrial plants and SMEs, regional and secondary town municipal administrators, NGOs and private institutions working on sanitation matters, and environmental groups, as well as the general public. A national workshop endorsed the report and its recommendation inNovember, 2005, and signedby the Minister o f Health on November 23, 2005. SafeguardPolicies Triggeredby the Project Yes N o Environmental Assessment (OP/BP/GP 4.01) [XI [I Natural Habitats (OP/BP 4.04) [I [XI Pest Management(OP 4.09) [I [XI Cultural Property (OPN 11.03, beingrevisedas OP 4.11) [I [XI Involuntary Resettlement (OP/BP 4.12) [I [XI Indigenous Peoples(OD 4.20, beingrevised as OP 4.10) [[I I [XI Forests(OP/BP 4.36) [XI Safety ofDams (OP/BP 4.37) [I [XI Projects inDisputedAreas (OP/BP/GP 7.60)* [I [XI Projects on International Waterways (OP/BP/GP 7.50) 1 1 [XI C 7. Policy Exceptions and Readiness 59. For the health sector, the pooled financing arrangement (PADS) has been in place for three years, and operational procedures and manuals have already been developed and are working well. The TAP project has also been under execution for a year, and the PADS manual has already been adapted to incorporate IDA procurement procedures for TAP funds, as well as direct disbursements to districts and hospitals. Only minor modifications will be necessary to existing manuals and procedures to accommodate the HSSMAP financing. For HIV/AIDS, Burkina Faso already has ten years of experience implementing Bank-financed projects. Core members o f the MAP project team will form the basis for the new financial Management Unit. A draft Operational Manual for the pooled HIV/AIDS fund has beenprepared, and the existing M A P Finance and Administrative Manual will be adapted for the pooled fund prior to the first disbursement. The updates in the relevant manuals for the health pooled fund were reviewed during negotiations and still need to be completed prior to disbursement into the pooled fund -- which is anticipated for end o f June 2006. * By supporting theproposed project, the Bank does not intend toprejudice thefinal determination of theparties' claims on the disputed areas 27 ANNEX1:COUNTRYAND SECTORBACKGROUND A. Countrybackground Burkina Faso has established a strong track record on reform and growth in the past decade. Real GDP increased by an average o f 5.6 percent per annum in the 1994-2004 period, which contributed to an estimated 8 percent decline inthe poverty headcount between 1998 and 2003 -- led by cotton-producing rural areas. But despite this recent progress, Burkinaremains one of the poorest countries inAfrica, with per capita income o f $350 and a poverty incidence o f 46 percent in 2003. Social welfare indicators lag behind even modest Sub-Saharan averages, placing Burkina near the bottom of the Human Development Index. Primary school enrollment has improved, but nearly 80 percent of rural women are illiterate, and two o f every five children are not attending school. About 85 percent o f the population lives in rural areas, where households are vulnerable to uncertainrainfall andother shocks. Table 1.1: 3urkinaFaso HealthandHIV/AIDS MDGs Goal 1. Eradicateextreme povertyand hunger 4. Reduce child mortality 5. Improvematernal health 6. Combat HIVIAIDS,malaria and others diseases 7. Ensure Environmental sustainability sanitation I Management and InformationSystem (HMIS); UNAIDS; FA0 Note: Indicators inbold are among annual programmonitoring indicators for Program. 28 B. Health and HIV/AIDSSector Background Structure and Organization of the Health System Burkina Faso's health system at independencewas characterized by limited hospital services in urban areas and almost absence o f modem health facilities in rural areas. Health services were expanded in the 1970s and 1980s but suffered from chronic shortages. In the 1990s, the government introduced cost recovery for health services, and drug availability improved sharply, but costs remainedprohibitive for many. The major source o f modem health care for the rural andpoor majority o f Burkina Faso remains the public health system, which is organized into primary, secondary, and tertiary levels. Health districts, primarily through a network of centers for health and social promotion (CSPS) provide primary care. The district hospitals (CMA) serve as referral centers for the CSPS. Nine regional hospitals (CHR) and three university hospitals (CHU) in Ouagadougou and Bobo Dioulasso provide the second and third levels o f care. Administratively, the ministry o f health i s organized into three levels: the central ministry o f health, 13 Regional Health Directorates (DRS), and 55 health districts, which are administered by a district health team (ECD). The University and regional hospitals all enjoy a degree o f managerial autonomy, and receive their budgets through a direct transfer from the central government. The number of government health facilities has increased over the past decade, but geographic access remains a constraint in many rural areas. About 58 percent o f the population lives within 5 km o f a health facility, and 19 percent live 10 km or more-with an average distance to a health center o f nine kilometers. Physical access i s determinednot just by distance to the health facility but time, including availability of roads and transport. The number o f health personnel also has increased, but remains below the sub-Saharan African average, and personnel are heavily concentrated in urban and semi-urban areas. Medicine supply has improved through the establishment o f the purchasing center for essential generic drugs (CAMEG), but stock outs still occur. Maintenance and replacement o fmedical equipment is often inadequate because o f lack o f an efficient monitoring system and limited resources. Traditional medicine continues play an important role in health care and treatment, particularly for the rural majority, for reasons o f culture, cost, and ease of access. Nongovernmental and religious organizations operate health centers and district hospitals under a framework agreement with the ministry o f health. Trends in health and HIV/AIDS indicators Despitepromising trends insome health service and outcome indicators, Burkina Faso remains "off track" to achieving the MDGs for health. Most key indicators for child health andnutrition worsened duringthe 1990s, but inthe past five years, childmortality has declined (from 219per thousand in 1998/99to 184per thousand in2003) and coverage o fpreventive and curative health services improved (the percent o f children fully vaccinated increased from 22% to 44%). Butjuvenile mortality (ages 1-5) remains at the same level as in 1993 -- probably due to limitedprogress in combating malaria and child malnutrition. 29 Malaria i s the biggest killer o f children (accounting for at least one-third o f child deaths), followed by diarrhea and respiratory infections. Yet only 7 % o f children and pregnant women sleep under insecticide-treated bednets, mainly due to high cost. Moreover, despite recent economic growth, child malnutrition i s worse than a decade ago, with 38 percent o f children suffering from chronic malnutrition. Maternal mortality rates are high (an estimated 484 deaths per 100,000 births), particularly in rural areas, due to high fertility and insufficient access to reproductive health services. The percentage of women delivering at health facilities has increased to 39 percent in2003, and only about 5 % o f rural women use modem contraception. Malnutrition and high fertility contribute both directly and indirectly to the high rates o f child and maternal mortality. Moreover, community and household factors play an important role in the high rates o f morbidity and mortality, particularly among the poor. Lack of access to safe water, low female literacy, lack o f food security, inappropriate feeding and repeated illnesses all contribute to highmortality and malnutrition rates. Access, utilization, and quality o f health care also contribute and explain in part the regional and socio-economic differences in health outcomes, as prenatal care can significantly reduce the risk of maternal and child mortality, as can early treatment o f malaria and respiratory diseases. HIV rates are among the highest inthe sub-region, but there are signs the epidemic is stabilizing. A national survey in2003 found that 1.8% of adults were infected, with significantly variations within the country (3-4 percent inurban areas, but lessthan 0.5 percent inthe ruralnorth and east o f the country). HIV infections among young women (15-24) at urban antenatal sentinel surveillance sites have decline slightly, however (from 3.3% in2001 to 1.9% in2003). Infections among commercial sex workers have also declined, but remain high (from over 60% inthe mid- 1990s, to 20% in a 2002 survey). Preliminary data on HIV/AIDS knowledge and behavior change show positive trends in HIV knowledge, but further progress i s needed (only two-thirds o f men and 40% of women spontaneously cited condoms as a means of preventingHIV/AIDS). About 8,136 HIV positive persons received ARV treatment as o f December 31, 2005, but as many as 30,000 are in need. AIDS i s exacerbating poverty by generating a large and unsustainable financial burdenon affectedhouseholds. Health service utilization and coverage: Patterns o f health services use vary by residence and income. Rural households have to rely mostly on nearest health centers, with urban residents having access to public hospitals and private clinics. Richer households are significantly more likely to visit modernhealth facilities. Overall vaccination rates have improved inthe past five years, but large differences remain between richer and poorer households. Utilization of health services has improved only slowly, and the referral hospitals seem to be largely accessed by the local population, with limiteduse bypopulation inremote areas. C.National Policy: National Health Development Plan and National AIDS Strategy The Ministry o f Health's 1O-year health strategy (Plan National de development sanitaire (PNDS), 2001-2010) identifies key priorities and program objectives for the health sector, including increased accessibility o f health services, improved quality, increased financial access for the poor. The eight priority programs for the PNDS are: increase geographic coverage of health services; improve the quality and utilization o f health services; strengthen the fight against 30 communicable and non-communicable diseases; reduce HIV transmission; improve the quality and distribution o f human resources in the sector; increase financial accessibility for the population; increase health sector financing; and strengthencapacity inthe sector. The National AIDS Strategy is organized around five strategic priorities (Axes Stratkgiques), including: (i)Strengthening prevention o f HIV and sexually transmitted infections (STIs), and promotion o f voluntary testing and counseling (VCT); (ii) Reinforce access to medical care and support for persons living with HIV/AIDS; (iii) Strengthen protection and support for persons living with HIV/AIDS and other vulnerable groups; (iv) Reinforcepartnership, coordination, and resource mobilization; and (v) Strengthen surveillance o f the epidemic, monitoring and evaluation, andpromotion o f research. D. Key Sector Issues Key sector issues include the following: a Access to and quality of health services. Utilization o f health services has improved in the past 5 years - due to a combination of reduced costs and increased access. But overall trends in health outcomes conceal significant variations in access to service and outcomes among urban and rural areas, and between wealthiest 20% o f population and the poorest. The introduction o f cost recovery for essential drugs and health services in the early 1990s has significantly improved drug availability, but created financial barriers for the poor. The government's decision in 2002/2003 to make vaccination and prenatal care free o f charge contributed to increased coverage o f preventive services, but both physical and financial access remains a problem for the rural poor. Inadequate service quality, due to inadequate provider training, lack o f equipment and supplies, reduces service use and the effective o f services. Much o f the rural populace continues to rely on traditional providers, and both the urban rich and poor are increasingly turning to private pharmacies and health clinics. a Scaling up AIDS prevention, treatment. While HIV trends are encouraging, prevention efforts need to be consolidated and scaled up further reduce new infections and prevent a relapse in risk behavior, particularly as antiretroviral (ARV) treatment becomes increasingly available. Prevention strategies will need to be adapted at regional level, in light o f variations in prevalence - in low prevalence rural areas, for example, the focus should be on high-riskgroups (such as sex workers and their clients) to prevent spread into the general population. With regard to AIDS treatment, the government has set a ambitious target o f 30,000 persons under treatment by 2007 (from 8,136 persons currently), which will require a rapid expansion of testing and treatment programs, integration o f AIDS care into the health delivery system, and improved synergy with other programs, including tuberculosis. 31 a Adequacy, equity, and reliability of sector financing Public sector spending o n health was about US$8 per capita in2003 (including donor funding), a modest increase'in real terms since 1998. While government has made an effort to prioritize hnding for districts and rural services, because the poorest use public health services less than wealthier persons, public health spending tends to disproportionately benefits the better off. Overall private out-of-pocket spending exceeds to government spending (US$9 per capita), but 60% i s from the richest quintile, and 90% for pharmaceuticals. The MOH has developed its first Medium Term ExpenditureFramework (MTEF), and districts prepare annual action plans based on agreed performance indicators. But there i s a need to further align health spendingwith PRSP and MDGpriorities as bothnational and district levels (for example, malaria and malnutrition remain significantly underfinanced). The government has improved the reliability o f budget transfers to health districts- delegated credits are now released by March rather than June-and introduced cash advance accounts, but the flexibility and reliability o f budget transfers need to be further improved. a Distribution and motivation of health personnel. The number, distribution, and motivation o f health care personnel have emerged as a key constraint on sector performance. Doctors and nurses remain disproportionately concentrated inurban areas, and service quality is'reducedby inadequate motivation of public sector health workers, due to low salaries, poorly developed career structures, and limited accountability for performance. The private health sector is expanding rapidly in urban areas, but oversight and public-private contracting remain limited. The government has developed an Action Plan for improving the distribution and motivation o f health personnel, including providing salary supplementsfor staff inrural areas. a Integration of priority programs and harmonization of external financing. The multitude of bilateral, multilateral, and nongovernmental donors in the HIV/AIDS and health sectors has created a significant coordination burden on government. The M O H and National AIDS Council, as well as donor partners, have taken a number o f steps to improve coordination, but harmonization remains a priority, including moving toward common procedures and pooled funding to the extent possible. Moreover, most disease control programs rely on external financing, which has contributed to increased transaction costs and loss o f synergies among programs. The variety o f different funding sources for NGOs has rendered coordination difficult and contributed to uneven or fragmented coverage of regions and critical interventions (e.g., limited financing for malaria or malnutrition compared to HIV/AIDS). a Strengthening decentralization and performance contracting. As in many francophone Afican countries, centralization has constrained the effectiveness o f service delivery. The health sector has been a leader in deconcentration of health services to the district level, including channeling resources directly to health districts on the basis o f monitorable action plans (initiated in 1999 with support o f 32 a Bank-financed health project). This approach was continued (with bilateral support), and further was extended to hospitals in 2005. But performance contracting needs to be further developed both at hospital and district levels-to encompass budget transfers as well as external financing-as well as with the private and NGO sectors. The national HIV/AIDS program has established HIV/AIDS committees at provincial and village levels, with funding from the MAP for 13 (of 45) provinces. Fundingcontinues to be centralized, however. In 2004, the government adopted a long-awaited Law on Local Administration, which provides a framework for decentralization that includes establishment o f rural communes in2005, and local elections in 2006. A number o f issues remain to be clarified regarding the planned transfer o f responsibility for health to communes in the coming years. Performance contracting will shift to "horizontal" contracts between the Ministry o f Health and local governments, and the "rules o f the game" for resource transfers will have to ensure accountability for performance and adequate financing, implementation, and supervision o f public health programs. 0 Hospitals and the referralsystem.The three UniversityHospitals (CHU) and 11 Regional Hospitals (CHR) have semi-autonomous status [Etablissements Publics de la Sante` (EPS)], and receive direct budget transfers to finance their operation. But the information systems and the performance management framework remains weak for hospitals. The Ministryi s beginning to develop a performance contracting framework for hospitals, but it remains to be made operational. In addition, the referral and counter-referral system among district, regional and national hospitals needs to bebetter developed. a Sector performance monitoring and surveillance. Performance contracting requires reliable health information. The health sector has established surveillance systems for notifiable diseases and epidemics, and health districts provide timely reporting for the priority key health service indicators. But the production o f the complete Annual Health Statistics report is typically delayed by more than 6 months, and regions are not yet producing consolidated monitoring reports. Periodic household surveys (including DHS) provide valuable information on health and HIV/AIDS behavior, service use, and mortality, but the vital registration system i s weak. For HIV/AIDS, the SP-CNLS has established standard monitoring indicators which are consolidated annually, but has experienced difficulties with timely reporting from executing structures. The designation in 2005 o f focal points for the collect and control of data for all executing structures should help address these weaknesses. A shift toward results-based monitoring and financing i s needed, such that continued funding will dependon provision o f required monitoring data. Finally, hrther support for operational research, particularly through independent local and regional research institutes, would strengthen evidence-based decision making e Promotingcommunityparticipationand behavior change. Eventhough most o f the excess mortality and morbidity is due to behavioral and environmental factors at the household and community levels, community health, nutrition, and 33 HIV/AIDS interventions remain underfinanced and inadequately coordinated. Community management committees at health centers typically focus on managing cost recovery funds for drugs, but typically have little engagement in community-level public health activities, including for malaria, reproductive health, sanitation. The MAP project's experience in community HIV/AIDS awareness activities has been promising, but activities not sufficiently coordinated with other disease program activities or with Community Driven Development (CDD) operations. The new decentralization law has established "Village Development Committees," and the M O H i s developing a "package" o f community health, nutrition, and HIV/AIDS activities, which can be rolled out in parallel with scaling up and harmonizing CDD approaches. A variety o f cultural practices that reinforce poor health and poverty, including forced marriage and female circumcision, could also be integrated into these community activities, with support from CBOs andNGOs. Behavior change communications. Trends in HIV/AIDS knowledge and behavior have been encouraging, but there i s a need to develop a comprehensive communications strategy, and a more coordinated approach to behavior change communications, including through TV, radio, and interpersonnel communications. BCC activities are financed on a limited basis in the health sector, but need to be strengthened at mainstreamed at both national and decentralized levels, with strengthened evidence base for message development and monitoring o f reach and impact. a Strengtheningthe social safety net. Extended families core o f social safety net, but illness and death of family membersplace severe strains on this system. The Ministryof Social Action is developing a Social Protection Strategy, but receives limited financing from government or donors. Most funding for orphans and vulnerable children comes from donors, particularly through HIV/AIDS projects, which creates problems o f coordination and coverage. Because it i s neither practical (due to stigma) nor ethical to distinguish AIDS orphans from others, the goal must be to strengthen the overall social protection system. Widows are also extremely vulnerable to poverty and discrimination. Given the limited resources and weak capacity at village levels, there i s a need for piloting and experimentation with community care and support. E. Key SectorReforms supportedthrough PRSCs Burkina Faso was among the first countries in Africa to adopt the Poverty Reduction Strategy Credit (PRSC) framework for budget support, beginning in 2002 (for US$60 million). PRSC V was disbursed in July 2005, and objectives for PRSC VI have already been negotiated with government. Discussions have begun for key measures to be supported through PRSC 7-9, which will focus on cross-cutting reforms, including decentralization and humanresources. The HSSMAP will complement PRSC reforms through support for sector-specific reforms and provision o f technical and capacity building support for implementation o f structural reforms (see Annex 4). 34 ANNEX2: RELATEDPROJECTSFINANCED THE BANKAND OTHERAGENCIES BY Sector Issue Project Latest supervision (PSR) Ratings (Bank financed oject only) Implementation Development Progress(IP) 3bjective (DO) Health and Nutrition Healthand Nutrition ProjectCr.25950- closed MS MS Agriculture, Extension SecondNationalAgricultural ServicesDevelopmentProjectCr. MU MU 29740 closed Education Post-primaryEducationProjectNO070 - closed S S Populationand AIDS Populationand AIDS Control Project Cr.26190 - closed MU MU Agriculture, Irrigation Pilot PrivateIrrigation DevelopmentProjectCr.31610- closed S S Poverty Poverty ReductionSupport Credit 1 (Cr. 35650-BUR) S S Poverty Poverty ReductionSupportCredit2 (Cr. 36910-BUR) closed --closed S S Poverty PovertyReductionSupportCredit 3 (Cr. H0580- BUR) - closed S S Poverty PovertyReductionSupport Credit4 (Cr. 39000 - BUR) -closed S S Poverty PovertyReductionSupportCredit 5 (Cr. 40530 - BUR) - closed MS S Education Basic EducationSectorProjectCr.35970 - active S S Rural Development Community-basedRuralDevelopmentProjectCr.34360 - active S MS HIV/AIDS HIV/AIDS Disaster ResponseCr.35570- active S MS HIV/AIDS HIV/AIDS Disaster ResponseSupplementalH1600- active S S RegionalAIDS Program TreatmentAccelerationProgram(TAP) H1040 - active S S Transport Transport Sector ProjectCr. 37450 - active S S Capacity Building Administration Capacity Building ProjectH1510 - active Others development Agencies Bilateral Dutch, French(AD) and Swedish Supportto pooledhealthsector fund (PADS) Cooperation Dutch, French(AfD), andDanish Institutional Strengtheningfor NationalAIDS Council; support to Cooperation NGOs/AssociationsthroughPAMAC (including VCT) 1German Cooperation Support for reproductivehealthandHIVIAIDS (GTZ), support for socialmarketingof condoms(KfW) BelgianCooperation Capacitystrengtheningfor DAAFihealth; support to healthdistricts Multilateral Global Fund(3rdRound) HIV/AIDS Treatment Global Fund(4rdRound) Support for NationalTuberculosis Program African DevelopmentBank Support for healthand HIViAIDS (targetedby region) (AfDB) IslamicDevelopment Bank -1DB Support for constructionof healthclinics andinfrastructure UNSystem WHO Technical support for healthsector andHIV/AIDS treatment UNICEF Maternaland child healthprograms,with regionalfocus UNFPA Support for reproductivehealth World FoodProgram(WFP) Support for feeding programs for HIV+ persons,nutrition support UNAIDS Coordinationof UNsystemHIV/AIDS interventions UNDP Institutional support for AIDS Council; support to PAMAC NGOs PlanInternational Integratedhealth, HIV/AIDS, andeducation (intarget provinces) CatholicRelief Services Fooddistribution, MkdecinsSans frontikre (MSF) Support for AIDS treatment inurbanhealthdistrict (Pissy) 35 I I rr 0 a E 35 4 0 d a B -r i 2 3 m 3 3m c l c c I sn 0 0 N Q gs Q\ sQ g n s gh w, .r eE O " 0 r-, 8 .L c E C +U E I 8L 5L cE2 U 0 E $L 4 2Z?4a 3 8 w 8 u o 0- N g s s 2 2 m s P D 3 W r, m M s g W N W g N 0 Y I I 0 0 8 0 N 8 E- N C. Summary of monitoringand evaluationinstruments Monitoring and evaluation of progress toward program objectives will rely on a combination o f routine health services data, monitoring data on HIV/AIDS program activities, public expenditure tracking surveys, periodical household surveys (including a Demographic and Health Survey in 2008, and Poverty Surveys), and periodic surveys on quality and coverage of health and HIV/AIDS services. The HSSMAP will support efforts to improve the timeliness, reliability, and use of routine service statistics for the health sector and multi-sectoral HIV/AIDS activities, as well as the development o f periodic surveys on service quality as well as expenditure tracking surveys every one to two years. (see Annex 3). Technical capacity and oversight for monitoring and evaluation at the regional level will be strengthened. 0 Routine health system monitoring (HMIS). The routine HMIS works relatively well at the health district level, although the use o f information for decision-making needs to be strengthened at district and regional levels, financial monitoring i s not fully integrated with technical monitoring, and lack of compatibility between district-level and Central- level software systems leads to six-month delays in finalizing the annual o f statistics reports (an issue that should be resolved inthe first year o f implementation). Information systems at national and regional hospitals remain weak, however, and must be strengthened ifa performance-based contracting is to be successful. Key priorities will include harmonizing HMIS software among district, regional, and central levels; improving malaria surveillance and response systems; strengthening analysis and use o f HMIS data through development o f standard semestrial and annual performance reports (to be shared with local and national stakeholders); and integrating technical, financial and human resource monitoring. 0 Routine multi-sectoral HIVAIDSprogram monitoring. The National AIDS Council has established standard indicators for activity monitoring and produced a monitoring and evaluationmanual, and has recently required that each executing structure and establish a focal point for monitoring and evaluation. This should help improve the timeliness and reliability of activity monitoring data. 0 Disease Surveillance. The Ministry o f Health has established a weekly reporting system for tracking notifiable diseases, including polio, measles, and cholera. Malaria i s not yet integrated into this surveillance system, which will be an objective during program implementation. HIV Surveillance. The Ministry o f Health has managed five urban HIV Sentinel surveillance sites at antenatal clinics since the late 1 9 9 0 ~and ~ recently added eight additional sites, including three rural sites. HIV and STI surveillance for high-risk groups, including commercial sex workers, is carried out in several project-sponsored sites. The program will support integration o f high-risk group o f surveillance into the national surveillance system. 41 0 Service coverage surveys. The M O H currently sponsors periodic service coverage surveys, particularly to verify vaccination data, with support from WHO and UNICEF. These could be expanded to incorporate other key service indicators, including bednets and vitamin A distribution. Population Services International (PSI) also periodically undertakes rapid "reach and recall" surveys to measure the effectiveness o f IEC campaigns: this methodology should be further generalized for both HIV-AIDS and health IEC. 0 Sewice quality andfinancing surveys. The national statistics Institute (INSD) carries out surveys of health and education facilities every two years, which includes basic information on cost of services and perceived client satisfaction. Inaddition, the program will finance Quality o f Service Delivery Surveys (QSDS) and Public Expenditure Tracking Surveys (PETS) every two years, with technical support from the World Bank's research department. 0 Household surveys. The INSD sponsors household surveys every several years to measure householdwell-being and expenditures, including nutrition indicators and health expenditures. The most recent Demographic and Health Survey (DHS) was completed in 2003, which included HIV prevalence, and the program the next survey in 2008. A household survey on AIDS prevention and treatment will also be fielded in early 2006 (through the BNPP trust fund, administered by the Bank's research department), to evaluate the AIDS treatment program, which will be repeated two years later. UNICEF also sponsors Multi-Indicator Cluster Surveys (MICS) in their intervention areas every two to three years. 0 Demographic surveillance and sample vital registration systems. The Program will pilot development of community-based Sample Vital Registration (SVR) system, building on the two sites (in Ouagadougou and Nouna) that are already part o f the international INDEPTHnetwork. DSS will provide population-based data on program toward health, nutrition, AIDS, and PRSP objectives, and help improve targeting and impact o f health and HIVIAIDS programs. The STACAP program is also seeking to improve vital registration nationally - an important priority, given that only a third of births are currently registered. 0 Evaluation and operational research. Local research andregional research institutes will be subcontracted to carry out evaluations and operational research. National research institutes will also be integrated into the pooled health and HIV/AIDS financing mechanismbeginning in2007. 42 ANNEX4: DETAILEDDESCRIPTION HEALTHSECTOR SUPPORT AND MULTISECTORAL AIDS PROJECT (HSSMAP) The operation i s conceived as a Sector Wide Approach (SWAP) which will provide flexible financing to the national health sector and multi-sectoral HIVIAIDS programs through two separate pooled funding mechanisms: one managed by the Ministry of Health (already in place), and one managed by the National AIDS Council (to be established). Program activities will be executed through performance-based contracts, including with decentralized budget centers, health facilities, NGOs, private sector, and communities. Both the Ministry o f Health and the SP-CNLS are committed to moving toward sectoral approaches, with greater harmonization and coordination o f donor activities. The Credit will complement other instruments, including the PRSC, community-driven development program (PNGT2); support for basic education (PDDEB), and the intersectoral capacity building project for public administration (PRCA). Programobjectives The long-term objective o f the Credit is to accelerate progress toward the health, - - nutrition: HIVIAIDS MDGs, including reducing child and maternal mortality, child malnutrition, fertility, and decreased HIV prevalence (particularly among youth). Overall medium to long-term progress o f the national program will be measured according to the following outcome indicators, which change relatively slowly will not be attributable to the HSSMAP alone: Base Line Target for (DHS, 2009 2003) 1. Child mortality rate (per thousand, age 0-5) 184 163 0484 38 30 3. Maternal mortality (deaths per 100,000) 313 4. Total fertility rate 6.2 5.5 5. HIV mevalence (% women aged 15-24) 1.3 0.8 To contribute toward these goals, the HSSMAP will support along with other partners implementation o f the 1O-year National Health Development Plan (2001-2010) and the new National AIDS Strategy (2006-2010). The HSSMAP will support all the major objectives o f these national strategies during this four-year period, although certain activities and reforms will be prioritized for support by the respective pooled donor funds, To strengthen performance management, annual support from the Credit to both the health and HIVIAIDS sectors will consist o f baseline financing commitment, which will be adjusted upward or downward depending on achievement o f the agreed performance indicators and sector reforms. 43 The program will seek to balance allowing flexibility for executing entities to determine their priorities based on annual action plans, while ensuring that priority activities and interventions are financed. This will be achieved through (i)strengthening o f medium- term expenditure frameworks for health and HIV/AIDS, to ensure the overall sector expenditures are aligned with MDG and PRSP priorities; (ii)ensuring transparent allocation formula for pooled funding, by levels and among priority programs, based on agreed annual work programs with the M O H and SP-CNLS; (iii) supportingdevelopment o f toolkits and capacity to further align district level action plans with disease profiles, and further development o f the minimum packet o f essential health and nutrition interventions at district and community levels; (iv) strengthening performance-based The Credit will also finance procurement of essential supplies for malaria prevention -- contracting and systems for results monitoring for both health and HIV/AIDS sectors. including purchasing treated bed nets, which i s among the most cost-effective intervention for reducing child mortality in Burkina Faso - as well as medicines and supplies for malaria, HIV/AIDS, and STItreatment. Component 1: Support for healthsector progresstowardthe MDGs($26.7 million) The health sector component o f the program will provide global support for improving sector performance through the pooled hnding mechanism, in accordance with the revisedMemorandum of Understanding(MOU) signed by government and PADS donors to finance essential commodity procurement as well as district, regional, hospital, and central action plans based on performance-based contracts with agreed targets and monitoring indicators. This component will be prepared in the context o f Medium Term Expenditure Framework (CDMThantC), which estimates costs o f achieving PNDS objectives and the MDGs. Financing in the context o f the Malaria Booster Program will be provided through this component, to ensure an integrated health systems approach. Table 4.4 below provides a summary o f key reforms and activities to be supported by the program, as well as those supported through recent PRSCs. The government's global MTEFprovides the medium-termfinding envelopes for budget allocations to the health sector. The MOH recently completed a Medium Term Expenditure Framework, which provides the overall financing framework for the sector - including budget, donor resources, and cost recovery funds. The MTEF will form the basic for annual budgets and work programs, with priority expenditures increasingly integratedinto the government budget. A pooled funding mechanism for the health sector has been inplace since 2002, through the Health District Support Project (Projet d'appui a m districts sanitaires -- (PADS), with support from Dutch, Swedish, and French cooperation. The PADS was based on the framework established by the Bank-financed Health andNutritionProject (PDSN), which initiated in 1998 performance-based financing for annual action plans o f the 55 health district and 13 health regions. The Bank discontinued direct health sector financing when the project closed in 2001, in favor o f budget support through the PRSC, at which point the Dutch continued financing the health districts action plans, using the same project unit. (In 2004, however, the Bank began channeling HIV/ALDS funding for health 44 districts through PADS to improve program execution and harmonization with health district Action Plans). In its current phase (2005-2008), the PADS has been expanded in scope to support all eight objectives o fthe nationalhealth strategy, and to also provide support to action plans of central directorates and national and regional hospitals. Inkeeping with this transition, the name has been changed to the Health Sector Support Program [Programme d'appui au de`veloppement sanitaire (PADS)]. The HSSMAP's support to the health sector will be managed by the PADS management unit, and fully integrated into the pooled fund by 2007. The IDA-financedTreatment Acceleration Program (TAP) i s also managed by the PADS management unit, but using parallel procedures for procurement and financing district and NGO activities. The MOH produced a Program Document (June 2004), which provides overall orientations for the second phase o f the PADS, including the following programmatic objectives: (i) strengthen decentralized performance-based management; (ii) increase the financing base for the PADS; (iii) ensure the effective management o f mobilized funds; (iv) capitalize on the experiences acquired through the Program. The following specific results are expected to be attained by 2008: 0 At least 50% of financing for health sector action plans are integrated into the process o f decentralized performance-based management; The financial envelop for the program increases by at least 85% compared to the first phase; 0 Allocation of funds mobilized for the sector will bebased on transparent criteria; 0 Harmonization o fprocedures for all sources o f sector financing; 0 Program implementation contributes to an improvement o f health sector indicators. Within the existingpooled health fund, program resources are distributed among levels o f the health system according to an allocation formula that gives priority to decentralized service delivery. Similarly, a transparent allocation formula (based on population, poverty, services delivered, and performance) i s used to determine resource allocation among structures (health districts, hospitals). A similar formula will be gradually adapted for budget allocations as well. The table below shows the current allocation by level for 2005, and a proposed allocation for 2006, taking into account the additional resources through the Credit and new partners. Although not foreseen for 2006, the MOH has accepted that the PADS will finance operational research activities to be submitted for fundingby national research institutes. It will also be necessary, prior to or following the conclusion o f the TAP project, to introduce financing for NGOs for AIDS treatment activities. Thus the total amount o f resources allocated to health districts will increase, but the percentage will decrease slightly to accommodate new structures. International procurement financed by the Credit will be financed by a separate IDA account in 2006, but will be integrated into the pooled fund in 2007, subject to compliance with the Recipient's commitments to improve capacity. IDA'Scontribution to the pooled fund in 2006 will therefore finance only those activities and contracts below ICB thresholds. 45 Table 4.2: Allocations of pooled and HSSMAP direct financing by levels of H e a l t h System IPrevious allocation I Proposed YOallocation (2006) I 1Structure I 1 1 1 1 I (2005) Percent CFA Percent Health Ofwhich HSSMAP (CFA response) Research Institutes, NGOs and Private sector n.a. n.a. 0 0 0 (propose to include in2007) TOTAL 3,800 4,900 1,000 0 Health Districts: Pooled funding complements budget transfers to districts, but remains the most flexible and reliable source o f funding for decentralized service delivery, including supervision, training, and outreach activities (including vaccination), as well as purchase o f necessary equipment and supplies, and has been the "entry point" for performance-based contracting for service delivery. Planning tools and guidelines for districts will be further strengthened to ensure funding for a minimumpackage o f priority maternal and child health activities at facility and community levels. Incentives for provision o f key services (vaccination, prenatal care, assisted deliveries, vouchers for indigents) will also be strengthened through pilotingo f output-based payments. 0 Regional health directorates. IDA resources will contribute to strengthening supervision and technical support from regions for health districts. 0 Central and regional hospitals. The additional resources provided through the HSSMAP (together with the pooled fund) will be used to catalyze the development o f performance-based planning and management for hospitals, with a particular focus on strengthening hospital financial, information, and logistics systems, as well as performance-based contracting. 0 Central Divectovates. Financing will focus on strengthening planning, budgeting, and monitoring systems o f core central directorates (Planning, DAF/budget, humanresources). 0 Common funds. This i s a new category introduced in 2005, which primarily allows for rapid response to epidemic outbreaks, including meningitis, cholera, and influenza. Unused funds will be rolled into the following year. It may also be usedto channel additional emergency resources inthe event o f a bird flu epidemic inBurkina. A separate "common fund" category may also be established in2007 to fund certain large, centrally managed procurements (such as malaria drugs or treated bednets). 46 Financing monitoring will encompass all sector resources, and annual audits of health districts, hospitals, and central directorates will review all non-wage program expenditures (on a sample basis), including pooled funds, government budget, cost recovery funds, and other donor financing. These global audits have helped improve financial management for health districts, and will be introduced for the first time at national and regional hospitals (the added expenses o f hospital audits and procurement audits explains why the percentage allocation for the Management Unit remains at 10% in 2006). As national financial management and audit systems improve, the scope and cost o f these independent audits will be scale back. The PADS will also finance annual independent procurement audits for a sample o f all contracts (national and international). HSSMAP Subcomponents: The HSSMAP through the pooled health fund will support all the eight major objectives o f the PNDS; funding will cover primary non-wage recurrent costs, with an emphasis on implementing a minumumpackage o f child and maternal health activities, and supporting implementation of key sector reforms (see Table below). The PADS i s one o f the first experiences with performance-based contracting for health services inthe sub-region; the current phase will seek to further strengthen planning tools and links between annual action plans and the disease burden. (i) Improve quality and utilization of maternal and child health services. To improve quality and access to maternal and child care services, IDA'Scontribution to the multi-donor pooled fund will support annual action plans to scale up o f integrated management o f child illnesses (IMCI); improve quality and reduce the costs for emergency obstetrical care and normal deliveries; support basic training and equipment for maternal and child health services; enhance supervision, training, and outreach activities (including vaccination); and improve medical waste management. As part o f this component, the HSSMAP will finance the upgrading o f a district hospital - including the operating block -- o f Pissy Health District in Ouagadougou, which serves a poor, urban population o f 600,000. PADS finding complements budget transfers to districts, but remains the most flexible and reliable source o f funding for decentralized service delivery, including supervision, training, and outreach activities (including vaccination), and has been the "entry point" for performance-based contracting for service delivery. Planning tools and guidelines for districts will be further strengthened to ensure funding for a minimum package of priority maternal and child health activities at facility and community levels. Incentives for provision o f key services (vaccination, prenatal care, assisted deliveries, vouchers for indigents) will also be strengthened through piloting o f output-based payments. The HSSMAP will also support national and district level health promotion campaigns, including for rural radio, for priority issues such as malaria prevention, improvednutritionpractices, sanitation, etc. (ii)Scalingupthe malariaresponseandcontrol ofcommunicablediseases: As part of the Roll Back Malaria initiative and World Bank Africa Region's Malaria Booster Program, HSSMAP's contribution to the pooled health fund will support community and district-level malaria prevention and treatment activities, which will be integrated into district and community action plans and financed through pooled funds at district level. 47 In addition, the HSSMAP will finance key commodities for malaria control, including subsidized procurement and distribution o f at least 1.5 million long-lasting insecticide- treated bednets (estimated cost o f US$7 million), bednet retreatment kits, and subsidized distribution of malaria medicines, with a particular focus on children under five and pregnant women. To scale up coverage before the next malaria season begins in June 2006, up to US$3.0 million for bednet purchases (600,000 long-lasting nets) will be eligible for retroactive financing under the Credit, with an additional million nets and 200,000 bednet retreatment kits to be ordered soon after Credit effectiveness. IDA will support the National Malaria Program in finalizing their new Malaria Strategy (2006- 2009), including establishing a prioritized and costed financing framework. The pooled fund will also provide flexible support to allow rapid response to epidemics, including meningitis, cholera, and bird influenza (in the case o f a human epidemic, IDA will seek additional resources to combat bird flu). (iii) Scaling up AIDS treatment. The HSSMAPwill seek to ensure continuity o f AIDS treatment programs initiated under the MAP (850 persons under treatment) and the Treatment Acceleration Program (TAP, up to 7000 persons), which will be fully integrated into the HSSMAP in 2007108. Treatment will be financed and executed through the Ministry o f Health, but the SP-CNLS will retain responsibility for coordination and oversight. Prior to 2008, most o f the direct costs for HIV/AIDS treatment, including purchases o f drugs, supplies, and equipment, will be financed through the TAP, but funded by the HSSMAP through the pooled fund health following the close o f the TAP. The TAP is also currently funding NGOs and associations o f persons living with AIDS to carry out AIDS treatment, care and support, and voluntary counseling and testing. Following close o f the TAP, financing to NGOs and private sector for treatment will be financed through the health portion o f the HSSMAP, but VCT and non-medical care and support will be fundedthrough the pooled fund at the SP- CNLS. The TAP also only covers currently 21 health districts, which is contrary to the PADS principle o f providing financing to all health districts based on a transparent allocation formula. The TAP will therefore be reoriented to become more fully aligned with PADS. 48 BOX 4.1 Scaling up malariaprevention and treatment, and control of communicablediseases: Inthe context o fRBMandthe Malaria Booster Program, the HSSMAP will focus on several priorities. First, the program would finance dramatically scale up coverage o f insecticide treated bednets (from 7% in 2003 to over 60% by 2009). Second, partners will work closely with government to strengthen integrated planning, implementation, and monitoring o f malaria prevention and treatment activities at health district level, including through scaling up o f IMCI. Third, the program will support behavior change communications (BCC) campaigns and development o f a package o f community-based health activities that will strengthen prevention and early treatment o f malaria. Finally, the program support purchase o f medicines for treating malaria, particularly for children and pregnant women. But inlight o f the rejection of Burkina's Round 5 proposal to the Global Fund, current financing is not adequate to subsidize ACT drugs for all adults as first line treatment at current prices (about $2 per dose). The HSSMAP will primarily finance subsidized procurement and distribution o f over 1.5 million long- lasting insecticide-treated bednets, retreatment kits, and malaria medicines, with a particular focus on increasing cover for childrenunder five and pregnant women. Treated bednets are too expensive for most o f the population at the current market price (about US$7 per net), but experience has shown that demand i s very highwhen sold for $3 or less. The distribution strategy will include subsidized "social marketing" o f bednets inrural areas, along with use o f targeted distribution (at further subsidized prices or free) to women seeking prenatal care and to children during routine vaccination activities or campaigns. T o scale up coverage before the next malaria seasonbegins in June 2006, up to US$3.0 million for bednet purchases (600,000 million long-lasting nets) will be eligible for retroactive financing under the Credit, with an additional million nets to be ordered soon after Credit effectiveness. Many hospitals and health clinics do not have treated bednets for their own beds; financing purchase o f nets andor retreatment will therefore be a priority for the program. Community and district-level malaria prevention and treatment activities will be integrated into district and community action plans, with technical support from WHO and other partners. Household surveys report that although only 7 percent o f children sleep under treated nets, over 40% o f households have an untreated net. Existing re-treatment kits provide only 6 months o f protection, and retreatment campaigns can be costly and logistically difficult. But WHO is currently considering approval o f a new retreatment kits that will provide 3-4 years o f protection. The component will support procurement long-lasting re-treatment kits once approved; retreatment activities will be integrated into the package of community level health and nutrition activities (to be implemented either by CBOs or directly by village committees). Component2: Support for the fight against HIV/AIDS Multi-sectoral HIV/AIDS Strategy: The new National AIDS Strategy (2006-2010) i s organized around five strategic priorities (Axes Stratkgiques), including: (i) Strengthening prevention o f HIV and sexually transmitted infections (STIs), and promotion o f voluntary testing and counseling (VCT); (ii)Reinforce access to medical care and support for persons living with HIV/AIDS; (iii)Strengthen protection and support for persons living with HIV/AIDS and other vulnerable groups; (iv) Reinforce partnership, coordination, and resource mobilization; and (v) Strengthen surveillance o f the epidemic, monitoring and evaluation, andpromotion o fresearch. The indicative financing fi-ameworkinthe national AIDS strategy will be translated into annual work programs that integrate all sources o f government and external financing, including the pooled donor fund. Resources from the pooled find will be distributed among central and decentralized levels, different executing structures, and thematic areas according to an agreed allocation formula that will be negotiated annually between the 49 SP-CNLS and participating partners. The SP-CNLS has developed an implementation plan (Plan d 'Ope`rationalisation)for the National Strategy, and has initiated development o f an operational manual for the pooled funds. communs) PrivateSector and Enterprises 3yo 60 3% 150 Coordination,monitoringand evaluation 7% 140 7% 350 Total . 100% 2000 100% 5000 Two major subcomponentsinclude: (i) HIV prevention and behavior change. The pooled HIV/AIDS fund will support scaling up coverage o f HIV prevention programs among high-risk groups (commercial sex workers, miners, truckers, youth) through NGOs and CBOs; development and implementation o f an integrated "second generation" HIV/AIDS behavior change communications strategy; and supporting HIV/AIDS awareness-raising activities at village and community levels. The project will also support further scaling up voluntary testing and counseling for local NGOs and associations; strengthening HIV/AIDS and reproductive health programs for in- and out-of-school youth; and training, supervision, and monitoring o f STI treatment and prevention in public and private sectors. Following the close o f the TAP project, VCT and non-medical care and support activities currently financed by the TAP will be financed through the HSSMM's contribution to the pooled HIVIAIDS hnd. (ii) Mitigatesocio-economicconsequencesof HIV/AIDS epidemic. The HSSMAP will support through the pooled fund national efforts to strengthen care and support for persons infected and affected, in the context o f the national Social Protection strategy. This will include providing support to the Ministry o f Social Affairs at central and decentralized level to strengthen their role in policy and monitoring, as well as direct support for NGOs, CBOs, and communities (through CDD mechanism) for care and support. 50 These sub-components will be implemented integrated into the activities or various executing structures, including: (1) HIV/AIDS actionplans of public sector ministries and institutions.: AIDS activities of non-health ministries would refocused from general awareness raising toward encouraging voluntary counseling and testing, further strengthening care and support for infected and affected civil servants and families, and integrating HIV/AIDS into core activities o f the ministries. These activities will be decentralized as much as possible, to ensure integration and coordination by Provincial AIDS Committees. Routine activities of ministry AIDS committees will be financed through the national budget. HSSMAP resources will provide complementary financing to scale up programs with priority beneficiary populations, including youth, orphans and vulnerable children, transport workers, and security personnel. Strengthening HIV/AIDS programs for youth in and out of schools will be a major priority, in coordination with UNICEF and UNFPA, with co- financing for school health activities through the education project. HIV/AIDS would be mainstreamedwhere possible into other sector loans (transport, agriculture). The Ministry o f Social Action will be responsible for coordination and monitoring o f activities for orphans and vulnerable children, as well as nonmedical care and support for infected and affected persons. AIDS treatment activities will be directly implemented through the health sector, but the SP-CNLS will provide coordination and oversight. The pooled HIV/AIDS fund will finance, however, priority prevention, monitoring, and evaluation activities for the health sector, including blood safety, treatment kits for sexually transmitted infections, monitoring and surveillance, and integrated NGOs activities for HIV/AIDSand reproductive health. (2) Decentralized and community support: This component will continue to support provincial AIDS committees and village micro-projects in 13 provinces initiated under the MAP (PA-PMLS) project, (an AfDB project i s covering 11 additional provinces) but with a phased program of: (i)scaling up coverage to all 45 provinces; (ii)further decentralized funding to provinces based on integrated action plans; and (iii) mainstreaming HIV/AIDS prevention and care into community development programs, incoordination with the CDD program and the health sector. Resources will be allocated among provinces according to a formula based on population, HIV prevalence rates, and performance in program monitoring and execution. The operation will also support piloting and evaluating models for village-based care and support. The planning, financing, implementation, and monitoring capacity o f provincial and regional HIV/AIDSprograms will be enhanced, to facilitate the transition to budget support. (3) Nongovernmental and civil society interventions. This subcomponent will support an integrated financing for civil society and private sector prevention, care and support activities, including through national and local NGOs and CBOs, associations o f persons living with AIDS, religious organizations, private sector. Fundingcriteria for the pooled multi-donor fund will be flexible to allow integrated approaches to AIDS and health, with an indicative allocation formula among national NGOs, regions (based on population and HIV prevalence), and thematic areas (high-risk groups, general prevention, care and support) : 51 0 Targeted interventions for high-risk groups. The HSSMAP would continue financing through the multi-donor HIV/AIDS fund for targeted HIV/AIDS interventions for high-risk vulnerable groups (sex workers, miners, youth), implemented by experienced national and international NGOs, but with consolidation to reduce unit costs and improve regional coverage. Several additional priority interventions would also be financed, including for prisoners, immigrants, and handicapped persons. Sentinel surveillance of HIV prevalence among risk groups also will be strengthened. NGOs also will provide technical support to provincial AIDS committees to improve targeting o f CBOs and ensure identification and coverage o f local high-transmission "hot spots." 0 Behavior change communication. Support development and implementation o f an integrated behavior change communications strategy to guide and focus messages at the national and community level, with support for message development, pre- testing, and outcome monitoring. Implementation would be subcontracted to NGOs and private sector companies, and include media channels (print, television, rural radio), NGO and community interventions, traditional communicators, etc. 0 Voluntary Counseling and testing. Inpartnership with PAMAC, the pooled fund would provide further support for expanding geographic coverage and fiu-ther improve program monitoring o f VCT, through subcontracting with local NGOs and associations, in partnership with public and private laboratories and health facilities. 4. Private sector prevention and treatment programs. The HSSMAPthrough the pooled fund will provide targeted support to catalyze and to strengthen HIV/AIDS prevention and treatment in the formal and informal private sector, with cofinancing from larger firms. 5. National and local coordination structures: The HSSMAP will support strengthening o f the SP-CNLS as well as regional and provincial coordination structures, including strengthening the supervision, monitoring and evaluation (M&E) systems for the national AIDS program, including routine monitoring, behavioral surveys and HIV surveillance, and operational research; support for coordination activities o f SP-CNLS; andproject management, including procurement and financial audits. 52 Box 4.2: Results and Lessons from the MAP (PA-PMLS) Project The Burkina Faso HIVIAIDS Disaster Response Project was approved on July 2001 for U S 2 2 million, as part o f the Africa Region's Multi-country AIDS Program (MAP). The objectives o f the project are to: (i)lower the risk o f HIV transmission, (ii)strengthen the capacity to provide care and treatment to HIV infected/affected persons, and (iii) help mitigate the socioeconomic impact of HIV/AIDS on affected households and communities. Project implementation has been satisfactory, and i s on track to meet its development objectives. The Credit was amended in February 2003 to add a subcomponent for antiretroviral treatment, and a $5 million supplemental grant was approved inMay 2005 to allow the project to complete planned activities through September 2006. Key results include the following (according to project components): Ministry Action Plans. Prevention and care activities have been scaled up within 21 line ministries, including the Ministryof Health, inaddition to support for coordination activities ofthe Permanent Secretariat ofNationalAIDS Council (SP-CNLS). In 2004, for example, the project financed 5,300 awareness-raising events for ministry personnel, and non-medical care and support for 509 infected and 1059 affected civil servants and family members. The component also helped support the Ministry o f Health to improve care and treatment for AIDS and STIs, as well as scaling up prevention o f mother to child transmission in five districts. The full cohort o f 850 patients were receiving ARV treatment by the early 2005, including 50 children, and an operational research subcomponent carried out inpartnership with local research institutes which involved400 o f these patients. Decentralized and Village Activities. The project has decentralized activities in 13 (out o f 45) provinces, including training nearly 15,000 members o f provincial, communal, village AIDS committees, and community-based organizations (CBOs) in planning, management, and monitoring o f community micro-projects. In2003, the project financed nearly 3000 villages AIDS prevention and community care micro projects, increasing to over 3,400 villages and community-based organizations in 2005. An estimated 2.6 million persons were reached in 2005 by awareness-raising activities, mostly in rural areas; about 1.5 million male condoms have been annually distributed by villages and CBOs, and about 70,000 orphans and vulnerable children received support through village AIDS committees. Targeted Interventions. The project i s supporting scaling up o f targeted interventions for a range o f vulnerable groups, including commercial sex workers, artisanal miners, youth, pregnant women, orphans, as well as strengthening the capacity o f local CBOs and associations o f persons living with HIV/AIDS, through seven large national and international NGOs. Key results in 2005 included : reaching over 10,000 sex workers and clients through awareness raising activities, including over 1,200 sex workers who accepted voluntary counseling and testing for HIV/AIDS (of which 12% were HIV+); over 50,000 orphans and vulnerable children supported through community based organizations; 143,000 youth (in and out o f school) were reached through awareness raising activities, o f which 25,500 youth agreed to undergo voluntary counseling and testing. Monitoring, Evaluation and Coordination. The project has supported strengthening monitoring and evaluation of the national HIV/AIDS program, including the 2003 Demographic and Health Survey (DHS), behavior surveillance studies, support for strengthening monitoring and evaluation capacity o f provincial AIDS committees, support for the mid-termreview o f the 2001-2005 National AIDS Strategy, as well as support for development o f the 2006- 2010 National AIDS Strategy. The project also supports annual coordination activities o f the Secretariat o f the National AIDS Council, including support for strengthened monitoring and evaluation o f the national AIDS program. Key lessons, which have been integrated into the HSSMAP, include: The multisectoral approach has contributed to significant mobilization at national and local levels, but there i s need to improve donor coordination and enhance synergies among various components; In light of the growing importance of AIDS treatment, an integrated approach to financing Ministry of Health care and treatment activities at national and district levels is essential; Strong monitoring, evaluation, and surveillance i s essential to move toward a greater results-based focus, but considerable effort is required to make monitoring system fully functional, particularly when a wide range o f actors and organization structures are involved.; A comprehensive evaluation o f various approaches to community/village interventions is necessary to move toward an integrated package o f community health, nutrition, and HIV/AIDS activities; The contracting approach with large NGOs has helped reach high-risk and vulnerable groups, but geographic coverage needs to be increased while reducing administrative costs, including through contracting NGOs to support a range o f interventions (sex workers, youth, OVC, etc.) in a given region. 53 Table 4.4: Priority Health Sector Reforms s )ported y HSSMAP and PRSCs Priority PNDS activities for support by pooledhealth funds PRSC3-6 measures Dates (2003-2005) (i)Increasecoverageof health services Develop and implement a national strategy on maintenance, including support for development and application o f norms for 2007 - Assure free distribution o f vitamin A to equipment and maintenance; financing small equipments for children under five. districts; and strengthening maintenance. Operationalize at least 50% o f health districts. Strengthen - Sponsor study on causes o f child capacity for management at district and COGES level, and malnutrition training in essential surgery for district teams (including 2006-9 cesareans). "Normalize" isolated dispensaries and maternity clinics into CSPS in order to expand access to basic health services for their 2006-9 populations. Develop a "health map" (carte sanitaire) including public and private sectors, to improve planning and monitoring o f health 2006 investments and facilities. Development o f community-based services. Support development o f a package o f community-level health, nutrition, 2006 and HIViAIDS activities, training and financing support for community health committees and health clinic management committees (COGES). 2006 Develop and implement a strategy for the promotion o f private sector; 2006-9 Strengthen collaborationwith traditional sectors. (ii) improve the quality and utilization of health services Scale up Integrated Management o f Childhood Illnesses (IMCI), 200617 Scale up IMCIat inat least 15 health including training and supervision, at health facility and districts (PRSC 6) community level. Development o f a national quality assurance plan (PNAQ), and expand its coverage to the entire health system, including 2007 development and training in diagnostic protocols, monitoring and supervision at the hospital, district, and community levels; Develop a "Quality Label" for both public and private sector, and 200617 assure monitoring. 2007 Improve availability and quality o f essential medicines, including promotion of rational use and prescription by health 2006-9 providers and public; Operationalize the national blood transfusion center 2006-7 strengthen support for health promotion, including developing and implementing a national health information, education, and 2006-7 communications (IEC) strategy Support operational research at the regional and district levels on the quality of care, community financing, and quality assurance. 2006-9 Improve medical waste management and ensure implementation o f the medical waste action plan, including purchase o f equipment (including incinerators), training and supervision for hospital and district staff. 2006-8 (iii) Strengthen thefight agaimt communicable and non- communicablediseases; scaling up the fight agairzst malaria, including developing and 2006-9 implementing the new malaria strategy (2006-09); rapidly scaling - Develop and implement subsidy system for distribution o f impregnated bednets 54 up coverage o f insecticide treatedbednets, improving community and clinic-based treatment o f malaria, introducing new treatment protocols (including ACTS),strengthening community prevention programs; health promotion programs for priority groups, including youth, and strengthening promotion o f Safe Motherhood through 2006-9 application o f national protocols, IEC, and improved reference between communities and health system. -- Provide child vaccinations and prenatal care 1 Reduction in the incidence and prevalence of notifiable diseases, services to pregnant women free o f charge to improving vaccination coverage for children and pregnant 2006-9 women, strengthening surveillance o f epidemics (including a community level), and improved treatment and response to (iv) reduce HIV transmission; Strengthening health sector prevention, counseling and treatment programs for HIV and STIs, including training in syndromic 2006-8 management o f STIs, ensuring security o f the blood supply; and reducing accidental exposure. Strengthen surveillance of epidemic, among the general 2006-7 population and certain priority high-risk groups; Improve medical care and treatment for persons living with HIV AIDS, including ARVs and treatment for opportunistic 2006-9 infections. I (v) improve the quality and distribution of human resources; - Undertake study o n motivation and Implementation of human resources Action Plan, including distributionof healthpersonnel strengthening personnel and career management systems, 2006-8 decentralization o f recruitment and budget posts; computerizing - Develop Action Plan to improve distribution personnel data-base and file management, and piloting incentives and motivation o f human resources inhealth for staff inremote areas. sector. Ensure coverage of personnel needs through implementationo f a plan for personnel redeployment, and improving organization and 2006-8 quality o f in-serve and pre-service training. (vi) increaseflnancial accessibililyfor thepopulation; 1 Designand implement subsidy system for Reduce costs for safe motherhood services, by providing emergency obstetric care and normal subsidies for normal deliveries and caesarian sections, 2006-7 deliveries financed through both the budget and the pooled funds; 1 Provide child vaccinations and prenatal Define the criteria for indigence, develop and implement a care services to pregnant women free o f system for financing care for indigents at hospitals and health 2006 charge clinics; 1 Revise texts for community drug Harmonize the application o f tariffs in all public hospitals, revolving funds (COGES) particularly with regard to emergency medical care without 2006 pre-payment Improve efficiency o f health services, including through rationalized prescription and diagnostic guides; 2006-7 Development o f equitable criteria for allocation of human and financial resources, taking into account poverty. 2006 Undertake a study o n financial impact o f free preventive care o n health facilities and drug funds. 2006-7 Promote mechanisms to increase coverage o f risk sharing mechanisms (mutuelles) and pilot exemption systems for 2006-9 indigents. (vi8 increase health sectorfinancing; Develop a health sector MTEF Further strengthen Medium Term Expenditure Framework 2006 Increase by 10% annually delegated IMTEF) at national level and introduce MTEFs at regional credits to health districts: 55 and district levels. Put inplace and monitor cash advance mobilizing additional resources through advocacy with accounts for health districts donors and parliament; Revise tariff and cost recovery system improve cost recovery system, revisions in tariff structures 2006 for hospitals for hospitals and reorganizing the payment circuit. Develop a system to cross- link the public sector budget 2006 codes with accounting framework for the PADS. improved utilization o f mobilized resources, including through donors, cost recovery, and COGES; ensuring semi- 2006-9 annual financial audits (viii)Strengtheninginstitutional and organizationalcapacity: Strengthen the regulatory framework for the sector, including strengthening capacity for control functions, 2006-9 - Develop performance contracting framework revising norms for all levels o f the system, and retraining. for public hospitals Strengthen administrative and management capacity through better utilization of existing competencies, and development 2006-8 o f a computerized human resource management system, and strengthening capacity for contracting. Improve coordination of sector interventions among the international health partners, NGOs, and strengthening 2006-9 - Establishmulti-sectoral coordination capacity for coordination o f all levels o f health system. mechanism for malnutrition Improve inter-sectoral collaboration, through strengthening existing coordination mechanisms and developing new ones 2006-9 (e.g., for malnutrition). Improve the quality, timeliness, and coverage of health 2006-9 information, through strengthening routine health statistics, financial and human resource monitoring, disease surveillance, health service quality surveys, and household- level data. 56 ANNEX5: PROPOSEDFINANCING HEALTH SECTOR SUPPORT AND MULTISECTORAL AIDS PROJECT (HSSMAP) Table5.2: OverallHealthSector FinancialFramework (billionsof FCFA) 2006 2007 2008 2009 2010 TOTAL Multi-sector HIVIAIDS Financing Government (including 1.7 1.7 1.7 1.7 1.7 8.5 HIPC) Pooled Sector funding (SP- CNLS) 2.5 5.5 5.O 4.5 3.O 20.5 Of which HSSMAP 1.5 2.75 2.75 2.75 0.75 10.5 MAP Supplemental 2.0 0 0 0 0 2.0 Financing- Other external grant 14.6 12.3 2.2 0 0 29.1 financing* * Sub-Total (excluding AIDS treatment in health sector)* 20.8 19.5 I 8.9 6.2 4.7 55.4 HIV/AIDS and STI treatment in health sector** 4 3 0.9 1.9 2.0 9.8 TOTAL 24.8 22.5 9.8 8.1 6.7 65.2 57 ANNEX6: IMPLEMENTATION ARRANGEMENTS Central level -- Health. Within the health sector, overall policy guidance and oversight i s provided by the steering committee (Comite' de Suivi) o f the National Health Development Plan (PNDS), which i s chaired by the Minister o f Health, and includes representatives of other key ministries, donor partners, and civil society. A technical secretariat (ST-PNDS) based in the Department o f Planning and Research provides technical support to the Committee, including sector monitoring and reviews. Several commissions provide fora for technical discussion on key sector issues, including human resources, sector financing, and decentralization. The HSSMAF' will use the same implementation and coordination mechanisms as the Programme d'Appui au De'veloppement Sanitaire (PADS), which i s financed through pooled funds of participating donors. The pooled fund i s managed by a project management unit, which i s well-integrated within the Directorate o f Planning and Research (DEP). This same unit also manages funds from the IDA-financed TAP project, and will be responsible for fiduciary aspects o f the HSSMAP health sector component. The PADS i s overseen by a steering committee chaired by the General Secretary o f the Ministry o f Health, and includes Directors o f all major departments, representatives o f donors participating inthe pooled fund, as well as WHO. A limitation o f the existing approach i s that the Directorate for Finance and Administration [Direction des Affaires Administrative et Financiers (DAAF)] has limited day-to-day involvement in the management of pooled funds. The HSSMAP will support capacity building for the DAAF, to strengthen its capacity to plan and monitor ministry budget processes and expenditures,incollaboration with other partners. Health regional, district, and hospital levels: The 13 health Regions (Directions Re'gionales de la Sante' (DRS)) provide technical oversight for 55 health districts. The PADS provides flexible fimding for the actionplans o f health districts, regions, university and regional hospitals. Following review and approval o f Action Plans in January, the PADS disburses funding in two annual tranches, with the second tranche based on verification o f activities in the first semester. Annual global audits review on a sample basis all non-wage financing o f health districts and health regions (delegated budget transfers, PADS, cost recovery funds, and other donor projects), and PADS has initiated similar audits for regional and central hospitals. As decentralization moves forward, funding and performance contracts will be shifted to provinces and local communes. Several autonomous health research centers receive only core operational hnding from the government; these will be integrated into the HSSMAP and the PADS through provision o f flexible funding against an agreed program o f operational research and evaluation activities. Multi-sectoral HIVIAIDS- national level: The National AIDS Council (CNLS) provides oversight and policy guidance for the National HIV/AIDS program. It i s chaired by the President o f Faso, with the Ministers o f Health and o f Social Action serving as First and Second Vice-Chairs, respectively, and includes representatives o f civil society (including 58 persons living with HIV/AIDS), donors, private sector, and other key ministries. Program coordination i s the responsibility o f the Secretariat o f the National AIDS Council (SP-CNLS), based in the office o f the President, and with about 50 staff, The SP-CNLS was established in 2001, and initially did not have capacity to manage large donor projects. The project management unit for the World Bank's M A P project (PA- PMLS) has been transferred' to the SP-CNLS, however, and will be merged with other project units to create a multi-donor Financial Management Unit.Management o f Global Fundresources are currently delegated to UNDP, but will betransferred to the SP-CNLS by the end o f 2006 along with technical and fiduciary staff. This combined unit will be responsible for financial management o f pooled funds, and some parallel funds for donors unable to join the pool. The Department o f Planning, Monitoring and Evaluation of the SP-CNLS will be responsible for technical monitoring, including producing semestrial Financial Monitoring Reports in coordination with the FMU. A steering committee with representatives o f government, donors, and civil society will provide financial and technical oversight, with an annual joint program review (involving all major development partners) taking place insecond half o f each year. Multi-sectoral HIVIAIDS - Regions, Provinces. and communes: The HSSMAP will finance annual multi-sectoral work programs o f Regional, Provincial AIDS committees, including for prevention activities, care and support for infected and affected civil servants, orphans and vulnerable groups, and the general population. Since funding has been mostly centralized and vertical to date, capacity will need to be reinforced through contracting (or hiring) o f part- or full-time administrator, who will provide technical, administrative, and monitoring support to their respective regional and provincial committees. As technical and fiduciary performance improves, support will be increasingly channeled through delegated budgets allocations. The HSSMAP will thus serve as an entry point for strengthening capacity and "learning by doing" as a precursor to further decentralizationo f social services. Communitv interventions: The HSSMAP will facilitate a phased transition toward harmonized planning and funding o f community-driven development, in the context o f the new decentralization law. Local government elections are being held in April 2006, and after which Village Development Committees will be established in each village. These will eventually have overall responsibility for planning and execution o f village development programs, but are not yet functional. The HSSMAP will support capacity building and the integration o f HIV/AIDS, health, nutrition, into the participatory rural appraisal process, and provide financing for a minimum package o f village-level HIV/AIDS, health, nutrition activities. During a transition period, the SP-CNLS will continue to provide direct funding to the 13 MAP and 12 African Development Bank (AfDB) provinces, but with greater flexibility for integrating health, nutrition, care and support activities. The SP-CNLS will also sub-contract with the CDD program (PNGT2) to expand coverage o f its existing HIV/AIDS activities, and to eventually provide support for community HIVIAIDS, health, and nutrition, with technical support from local health teams and NGOs. 59 Civil society and private sector: To reduce fragmentation o f funding for civil society organizations, the HSSMAP will build on the experience o f PAMAC (which channels funds to associations andNGOs involvedinVCT, prevention, care and support activities) to finance along with other donors a pooled fund at central level for finding o f national and international NGOs, using output-based performance contracts, with a steering committee that includes government (MOH, SP-CNLS, etc), donor, and civil society representatives. Funds may also be delegated to regional and provincial committees for funding o f smaller local NGOs and CBOs, with indicative allocations for priority programs (HIV/AIDS awareness, high-risk groups, integrated health and nutrition programs, orphans and widows). Local committees will carry out routine supervision, but financial and technical audits will be contracted out to verify, on a sample basis, the quality o f interventions and use o f funds. For medical care activities, including ARV treatment, NGOs and private sector providers will continue to operate under a convention with the Ministryo f Health. FiduciaryImplementation Arrangements. The HSSMAP will seek to harmonize fiduciary arrangements as much as possible inthe context o f pooled funding with other donors and with government procedures. In the health sector, because a Management Unit, which i s well integrated into the DEP, i s already in place, it was agreed that this arrangement would be maintained subject to temporary adaptation for the disbursement o f the IDA finds, while a capacity strengthening program i s beingimplemented at the M O H Budget and Finance Directorate (DAF). Similarly for HIV/AIDS,the former MAP project unithas beentransferred to the SP-CNLS and will be integrated with other project units to form a common Financial Management Unit. A capacity building action plan will be undertaken with the Budget and Finance Directorate (DAF/SP-CNLS) to allow it to be integrated with the FMU, preferably by the mid-termreview. All funds (health and HIV/AIDS) will be subject to annual reviews byprivate auditors, as well as periodic reviews by national authorities. With regard to procurement, the 2005 Country Procurement Assessment (CPAR) - conducted jointly by Government, the Bank, and African Development Bank -- concluded that existing national procedures and laws are acceptable for all national procurement, but that certain reforms remain necessary with regarding to International Competitive Bidding.An actionplan has beenprepared and was approvedby the Counsel of Ministers in March 2006. The health pooled find currently used national procedures for all procurement, however. After intensive discussions during preparation with government and partners, it has been agreed that IDA will disburse its financing in pooled account, subject to the following covenants, representations and warranties and the implementation o f the following transitional measures: (i) will continue to use PADS national procedures for all national procurement; (ii) PADS will adopt internationally accepted procurement procedures for contracts financed by the pooled fund that exceed IDA procurement thresholds. These thresholds could be revised based on annual reviews of PADS procurement performance; (iii) annual independent procurement audits will be financed by PADS for a sample o f all contracts (national and international); and (iv) the Ministry of Health will recruit an internationally qualified procurement consultant to strengthen procurement capacity o f the PADS unit, DAFhealth, and Ministry o f Health 60 overall. As a transition measure, a separate IDA-designated account will be opened to finance ICB contracts for the health sector in 2006. In addition, ex post procurement audits will be strengthened for all procurements financed by the SP-CNLS pooled fund. 61 ANNEX7: FINANCIALMANAGEMENT AND DISBURSEMENT ARRANGEMENTS CountryIssues. A CFAA (Country Financial Accountability Assessment) was carried out for Burkina Faso in October 2001, and finalized inJune 2002. N o major specific country risk was raised; but the following concerns were highlighted: 0 a serious staffing problem in the public and private sectors accounting services, linked to a dramatic drop inthe quantity and quality o f staff, 0 delay and irregularity in the audit o f the public entities' annual accounts because o fweak capacity o f the Public Sector Control Institutions, 0 a liquidity problem at the Public Treasury, which negatively impacts improved implementation o fthe budget; 0 weak non financial assets management: absence o f non financial assets accounting and o f annual physical inventories; 0 an absence o f an integratedcomputerizedpublic circuit o f revenue. The Government has clearly made great strides in improving financial management through the Public Financial Management Reform Program (PRGB), which sets out a methodology to carry the process forward. These initiatives are strongly supported by the donor community. For instance, the Bank processing the provision in the current fiscal year (FY06) an IDF (Institutional Development Fund) to strengthen the capacity o f the Public Sector Control Institutions. Another example i s the Administration Capacity BuildingProject (PRCA), partially financedbythe Bank. The Burkina Faso 2004 CPPR (Country Portfolio Performance Review) report highlights weaknesses in the accurate and timely reporting of financial information in terms o f producing financial monitoring reports (FRS) and annual financial reports by the majority o f projects financed by the Bank. The situation o f compliance by World Bank projects portfolio inBurkina Faso indicates no overdue audit reports as o f today. At present, the overall country risk rating is moderate inBurkina Faso despite some areas o f concern. The situation described above would have some influence on the implementation o f Health Sector Support and Multi - Sectoral AIDS Program (HSSMAP). 1. Strengthsand ChallengesNeaknesses The major weaknesses are the following: > At the time o f appraisal, the financial management system required by the implementation o f HSSMAP i s not in place yet at the Directions Administratives et FinanciBres (DAFs) o f the Ministry o f Health (MoH) and o f the National AIDS Council (SP-CNLS) for them to be effective public BMACs (Budget Management and Accounting Centers). Difficulties include lack o f staff with the right mix o f skills and absence o f sufficient experience in project/program FM. M o H and SP-CNLS are 62 developing action plans for strengtheningthe FM capacity o f their respective DAF inthe medium term, and will use respectively the PADS and FMUnit/SP-CNLS to perform FM duties and activities for HSSMAP; > The staff o f PA-PMLS (Projet d'Appui au Programme Multisectoriel de Lutte Contre le SIDA) were transferred into the FMUnit newly created by SP-CNLS without a due overall performance evaluation o f its members at the completion o f the HSSMAP. Furthermore, this staff would work inclose collaboration with those o f the DAF,which i s another fiduciary structure o f SP-CNLS; These weaknesses are being addressed as part o f the financial management strengthening action plan. The opportunities identifiedare two fold: > the FM capacity of the PMUs (Program Management Units) o f PAMAC and of PADS is good and, to satisfy the implementation needs o fnew operations, both structures foresee the recruitment o f new staff. In addition, PAMAC (which finances NGO HIV/AIDS activities) will up-date its FMmanual, and PADS will develop anduse a chart o f cost accounting; > The circuit o f public expenditure i s in general stable and reliable and i s being improved through the implementation o f the reforms for public financial management, which are underway. 2. ImplementingEntities Overall coordinating responsibility for the HSSMAP will be undertaken by the M o H for Health Sector and by SP-CNLS for Multi sectoral AIDS component, which both will execute their respective mandates by liaising with the Pool's Donors. The Secretary General (SG) o f the M o H and the Permanent Secretary (SP) o f CNLS will be responsible for the oversight and strategic coordination o f Subprograms for respectively the National Health Strategy (PNDS) andthe AIDS Strategic Framework. Under the supervision o f the SG and the SP, the respective Planning and Studies Directorate (DEP) will be responsible for the operational coordination for the implementation o f the health sector Program, and the UGF/SP-CNLS together with the Department o f Planning, Monitoring, and Evaluation will be responsible for the HIV/AIDSProgram. PADS (under the supervision o f the DEP/MoH) and FMU/SP-CNLS will be responsible for overall administrative and financial management o f their respective Programs. As the main BMACs, they are required to make operational the fully integrated financial management and accounting system, using appropriate software as well as a detailed manual o f financial procedures and chart o f accounts including the format, content and periodicity o f the various financial statements to be produced. The Management Unit o f PADS (MU/PADS)i s also required to coach and assist the sub BMACs -- 13 Regional Directorates (DRSs), the 55 Health Districts (DSs), the 9 Regional Hospital Centers (CHRs) and the 3 University Hospital Centers (CHUs) -- in their financial management duties (simple cash budget and monthly financial reporting etc.) and from which it will receive the financial informationto consolidate. 63 The same duties will be assigned to FMU/SP-CNLS for the sub BMACs which are the public structures (CMLS, CRLS, CPLS, CCLS, DCLS, Cellules relais) and the private structures (PAMAC for CBO and Associations, NGOs, Civil Society, Private Sector). The Technical Directorates of M o H and of SP-CNLS will be responsible for the development and technical implementation o f their respective annual work plans (AWP). For MoH, the RegionalDirectorates will ensure the financial management of the Program and the Health Districts (DSs), under the responsibility o f a district health team, represent the first level of management and implementation o f the program based on local needs and priorities. 3. Flows of Funds: 1. SP/CNLS:co-mingledfunds ofpoolingin a publicfinancecircuit. The Bank will transfer funds from its Loan account in Washington to the Designated Pooled Account to be opened at BCEAO (West Africa Central Bank) in Ouagadougou. The DesignatedPooled Account will receive Loanproceeds from the Pool's Donors on a semester basis, after a review o f the interim un-audited financial reports. As a deposit account, its debit cash transactions will be ordered respectively by the SP and the Coordinator of FMU.The funds transferred to the Pooled Account will be used to finance eligible expenditures for activities implemented at the levels o f Ministry, Region, Province, Commune, Community, and by NGOs, Associations, Civil Society and Private Sector etc. Advances would be made directly on the semester basis by the FMUinto the Public Treasury account o f each sub public B M A C (CMLS, CRLS, CPLS, CCLS, CDLS, Cellules relais), and o f each sub private B M A C (PAMAC for CBO and Associations, NGO, Civil Society, Private Sector) for goods and services procured to implement each decentralized entity AWP. Suppliers will be paid and advances o f funds will be made to other Implementing Cost Centers at the central and the decentralized levels for specific activities. The FMU/SP-CNLS or a designated intermediary structure (such as PAMAC or PGNT2) will be in charge to transfer funds directly into each community's bank account and the transfer to the community (CBO) i s considered as an effective expenditure. The technical and financial management performance o f the sub B M A C will be the criterion for the semestrial re-provision o f the accounts. For each level o f SP- CNLS (central or decentralized) where Subprograms activities are carried out for the implementation of the AWP, there will be a clear percentage o f the AWP expenditures as each Donor o f the Pool may determine to finance for each Fiscal Year. A semestrial report on the use of hnds by activity will be required from each decentralized entity and will be transmitted onthe time requested to the FMU/SP-CNLS. 64 Loan Account Loan Accounts Washington r IN FM~ O N J Z P P OFSPICNU rpRA PooledAccount in BCEAO Private BMACs Public BMACs(CMLS, (PAMAC, NGO, CRLS, CPLS, CCLS, CLS, et Suppliers and others decentralized Implementing Cost (eeend: emester transfer of funds supported by financial reports inthe PooledAccount Monthly reconstitution inTreasury Accounts of sub B M A C Direct Payments to various suppliers Advances for Punctual Activities 65 2. PADS/DEP/MoH: co-mingled funds of Pooling account private finance -- circuit II Loan Account Loan ,wcounts Washington II I II I HARMONIZED FM OF PADS Implementing CentralCost Suooliers .... L commercial bank for / * Other local or I \ A * decentralized Suppliersand others ImplementingCost Centers ~ I Leeend : Semester transfer o f funds inthe PooledAccount by other Donors Direct Payments to various suppliers Monthly reconstitution in30 days bank accounts for Sub BMAC Advances for Punctual Activities IDA will transfer funds from its Loan account in Washington to the Designated Pooled Account for the Government and other Donors, to finance the annual health sector work program. These transfers would be done on a semester basis, after a review o f the interim un-audited financial reports o f PADS. As a deposit account, its debit cash transactions will be ordered respectively by the Coordinator and the Senior Accountant o f MU/PADS. In addition, the MU/PADS will open and manage a temporary Designated Segregated Account in a commercial bank to receive IDA finds designated for financing International Procurement Contacts in 2006 (transitional arrangement). Disbursements into this account will be discontinued once international procurement procedures for the pooled health account arejudged acceptable by IDA, which i s expected to be the case by the date o f first disbursement for the financing of the 2007 annual health sector work program. 66 For the MoH, funds transferred to the pooled health account will be used to finance eligible expenditures for activities implemented by the CHUs, CHRs, DRSs, DSs and other central or decentralized Implementing Cost Centers, as well as international procurement contracts when IDA starts disbursing the corresponding amounts in the pooled account. Advances would be made directly on a semester basis by the M U P A D S into the commercial bank account o f each sub B M A C (CHUs, CHRs, DRSs, DSs) for goods and services procured to implement each AWP. Suppliers will be paid and advances o f funds will be made to other ImplementingCost Centers at the central and the decentralized levels for punctual activities. The technical and financial management performance of CHUs, CHRs, DSs and DRSs will be the criterion for the semestrial re- provision o f the accounts. For each level of M o H (central or decentralized) where Subprograms activities are carried out for the implementation o f the AWP, IDA will confirm annual the amount o f the AWP expenditures to be financed by the HSSMAP for each Fiscal Year. A semester report on the use o f funds by activity will be required from each decentralized entity and will betransmitted on the time requested to the MU/PADS. Staffingand Training The M U P A D S and FMU/SP-CNLS will need to have highly skilled staff and to be well equipped. The M U P A D S i s already composed o f the Coordinator for the Unit, the Chief Financial Officer (CFO), the Senior Accountant, three Accountants, the Procurement Specialist, the Internal Controller and Support Staff. An internationally qualified procurement consultant will also be recruited to strengthenthe procurement capacity o f the PADS and the Ministry o f Health. At the local level, there are an Accounting Supervisor ineach DRS and an Accountant ineach DS. The fiduciary staff to beplaced under the supervision o fthe Coordinator o fthe FMU/SP- CNLS will be composed o f a Responsible for the Unit, a Chief Financial Officer (CFO), a Senior Accountant, three accountants, a Procurement Specialist, an Internal Controller and Support Staff. The P M U o f PAMAC is staffed with a CFO and an Assistant Accountant to perform FM duties, and it will be strengthened by the recruitment of a Senior Accountant. A training program will be drawn up every year. Training is mainly conducted through the Bank's local or sub-regional training institutions (CESAG and ISADE in Dakar). Before the HSSMAP's effectiveness, the M o H and SP/CNLS are required to engage consultants (the same persons who will have developed the FMandProcurement manuals and will have installed the accounting software) to conduct procurement and financial management training for the whole staff o f the MUPADS, FMU/SP-CNLS and PMUPAMAC. 4. AccountingPoliciesandProcedures At the time of appraisal, the accounting policies and procedures as required byHSSMAP are not fully inplace yet at SP/CNLS and the practice o f project cost accounting needs to be strengthened at PADS. For this reason, the risk associated to the accounting policies 67 and procedures was rated high for SP/CNLS and moderate for PADS. The financial management system (mainly accounting software and FM manual) will be transferred from PA-PMLS to SP/CNLS with the support o f a consultant appointed on terms and conditions acceptable to the Bank. The M o H will appoint a Consultant to develop a chart o f cost accounting for PADS. Updates o f the Financial Management Manuals, correct customization of the software for SP-CNLS, and a chart o f cost accounting for PADS are conditions o f Credit effectiveness. 5. Other InternalControlArrangements The SP/CNLS will recruit an Internal Controller to control/master the maintenance o f a sound FM system. He/she will work in close collaboration with the CFO. It is expected that internal control mechanisms will be built in the FM manual for the HSSMAP. The FM manual setting up a harmonized framework will be used as an internal control tool for FMU/SP-CNLS. As part o f the Manual, a portion o f the financing destined for Communities and small CBOs will make use o f simplified FM procedures which could be based the Bank's Community Driven Development (CDD) guidelines. To develop this part, a close collaboration with PAMAC and community development programs (such as PGNT2) would be necessary. 6. ExternalAudit The Pooled account and internal control system o f the SP-CNLS will be subject to two semi-annual audits by a reputed auditing firm based on terms o f reference appropriate for the Pool's scope to be approved by the Pool Donors. These terms o f reference will cover the audit o f consolidated financial statements produced by the FMU and o f the fiduciary arrangements for Communities. The selection o f the auditor i s a condition o f effectiveness. For PADS, annual audits o f DSs, DRSs and MU are already performed and related procedures will also be usedfor IDA financing (same auditor, periodicity, etc.). 7. Reportingand monitoring The FMU/SP-CNLS would have to prepare each semester consolidated interim un- audited financial reports (FMR) during the Program implementation. The reporting format and procedures will be documented in the FM manual. As described in the FMR Guidelines issued by the Bank, the various reporting formats corresponding to the HSSMAP's features will be described inAnnex A: > Financial reports: (i)sources and uses o f funds by funding source and (ii) of uses > funds by subprograms activities o fthe Annual Work Plans (AWP); > Physical progress (output monitoring) report; Procurement monitoring report. This will be done as part o fthe financial management strengthening action plan and will represent a negotiation condition for the format. The semestrial financial management reports and annual financial reports will cover all activities financed through the SP-CNLS regardless the source o f funding. The semester 68 reports will cover financial management, procurement and physical progress monitoring. The annual MAP consolidated financial statements will be subject to external audit as described above. For PADS, the present semester interim un-audited financial reports prepared by the MU can be adopted for IDA financing but need improvements interms o f the total budget and cost o f the Program to date and o f the linkage between the physical monitoring, the disbursement o f funds and the procurement activities. The following key performance indicators relating to the health budget for PNDS and in terms o f resources allocation are: (i) o f budget allocated and transferred to regions part and districts; (ii)part o f Government budget allocated to health sector. The financial management indicators for the HSSMAP are the following: (i) part of the AWP budget disbursedevery semester at the level of each type of BMAC/PADS (FMU,CHUs, CHRs, DRSs and SDs); (ii)nature o f the opinion from the external Auditor on the annual financial statements; (iii)number o f internal control major weaknesses identified every semester at the level o f each type o f BMAUPADS; and (iv) part o f the AWP budget expended every semester at the level o f each type o f BMAC/PADS and for which goods and services are delivered. The same key performance indicators will be required for SP/CNLS regarding its various BMACs. A particular financial monitoring system would be set-up for the Communities with the guidance o f community drivendevelopment programs andthe Bank's guidelines on CDD. 8. InformationSystems A financial management software is already installed at PADS and will be used for IDA financing, but needs to be further customized. The one for PA-PMLS has been transferred to the FMU/SP-CNLS and needs to be up-dated. The terms o f reference for the selection o f the Consultant that will make provisions for the review o f the software and the manuals (production, development o f charts o f accounts, training and assistance) should specify that the financial management system should be capable o f producing the necessary financial management reports specified in the reporting and monitoring section. The manuals will disclose controls and procedures for flow o f funds, financial information, accountability, and audits between the main B M A C and the sub BMACs. They would be consistent with the M O U (Memorandum o f Understanding) between the Government and the Pool's Donors, but for PADS, an exception will be made for the procedures of budget allocations and flows o f funds regarding IDA financing. The physical monitoring will be linked to the disbursement o f funds and also to the procurement activities: this computerized arrangement will enable the FMU/SP-CNLS and MU/PADS to produce respectively the Financial Monitoring Reports (FMRs) required by IDA and the Pool's Donors and the reliable interim un-audited financial reports which will be subject to reviews carried out by the Internal Controllers. This type of reports will also be usedas a working tool by the M o H and SP/CNLS. 69 9. DisbursementArrangements Disbursement supported by interimun-audited financial reports from the beginning o f the HSSMAP is adopted for PADS and SP-CNLS. For PADS, this method is already used to re provision the Pooled Account o f other Donors. To this end for SP/CNLS, an action plan including a strengtheningo f management reporting capabilities i s designed and will be implemented from the beginning o f the operation's implementation. Interim un- audited financial reports on a semester basis, including financial, procurement and physical progress, will be prepared as soon as the project i s effective. These interim un- audited financial reports will be reviewed and the financial management capacity will continually be strengthened. To facilitate disbursements, a Pooled Account will be opened in BCEAO for SP/CNLS. The health sector program will be financed through the existing pooled health account, but a temporary Designated Segregated Account or Special Account (transitional arrangement) will be opened in a commercial bank for PADS for ICB contracts until the conditions for disbursement in the pooled account are met. These accounts are assigned to finance the AWP. Each funding request will be accompanied, as necessary, by the current semester interim un-audited financial reports (FMR for SP/CNLS and other report for PADS), the Designated Account (Pooled or Segregated) Activity Statement, the up- to-date Bank Statements, a Summary Statement o f Designated Account (Pooled or Segregated) Expenditures for Contracts subject to Prior Review, a Summary Statement o f Designated Account (Pooled or Segregated) Expenditures not subject to Prior Review. The MU/PADSand FMU/SP-CNLS will be trained on these requirements for the Pooled and SegregatedhealthAccounts and the Pooled SP-CNLS Account funding, respectively. Upon receipt o f each application for withdrawal o f an amount o f the Loan, the Association shall, on behalf o f the Borrower, withdraw from the Loan Account and deposit into the Pooled Account for SP/CNLS and into the Pooled Account or Segregated Account for PADS, as the case may be, an amount equal to the lesser of: a) the amount so requested; and b) the amount which the Association has determined, based on the interim un-audited financial report accompanying said application, i s required to be deposited in order to finance the AWP during the six month period following the date o f such report. *ejected CumulativeDisbursements Year 1 Year2 Year3 I Year4 I 1Total I FY2006 FY2007 FY2008 I FY2009 I Year5 1 FY2010 I HSSMPFinancing - 3 13 Health Sector Support 3 7.5 HSSMAP-health action 0 4.5 2.2 20.7 Internationalprocurement 3 3 0 0 0 6 ~ 1 HIV/AIDS pooled fund 0 5.5 6 6 3.5 21 1 CumulativeDisbursements I 3.0 I 16.0 29.0 I 42.0 I 47.7 1 I 70 The HSSMAP will establish three disbursement categories: (i)financing for eligible subprograms under Component A (health sector) of the operation; (ii)International Procurement under Component A o f the operation (health); and (iii) financing for eligible subprograms under Component B (HIV/AIDS) o f the HSSMAP. Categories (i) and (iii) will be financed as a percentage o f the Annual Action Plan for the respective sectors, as determined annually by the Association. Since IDA cannot currently finance ICB through the health pool, category (ii) be financed at 100% o f eligible expenditures, will given that government will provide over two-thirds o f financing for the health sector strategy. The authority to sign the withdrawal applications i s the Ministry of Finance and Budget. Allocationby DisbursementCategories(USD) Category Amount of the Percentageof Expendituresto be Financing Financed Allocated (expressedin USD) (1) Eligible Expenditures 20,700,000 Such percentage o f the Annual Action financed under Subprograms Plan as the Association may determine for the implementation o f Part for each calendar year. A o f the HSSMAP, which are not included inCategory 2 (2) . . Eligible Expenditures financed under Subprograms for the implementation o f Part A of the HSSMAP, procured under ICB: (i)Civil works for the implementation o f Part A o f the HSSMAP; (ii) Goods for the implementation o f Parts (A)(2)(i) and Part (A)(l)(iv) of the HSSMAP; and (iii) Drugs for the implementation o f Part A o f the HSSMAP. (3) Eligible Expenditures 21,000,000 Such percentage o f the Annual Action financed under Subprograms Plan as the Association may determine for the implementation o f Part for each calendar year. B o fthe HSSMAP TOTAL AMOUNT 47,700,000 I 71 Action Plan Actions Responsibilities Due date Conditionality Agreement o n the draft o f the TOR SP/CNLS and Pooling - Negotiation Copy o f TOR to for the recruitment o f the external Donors be submitted auditor for SP/CNLS Agreement on the format for interim MOH, SP/CNLS and Negotiation Copy o f formats un-audited financial reports for Pooling Donors to be attached to SP/CNLS and PADS minutes o f negotiations Development o f action plans for MOH Covenant Final documents strengthening the FM capacity o f the (December issued DAFinthe mediumterm SP/CNLS 3 1. 2006) Recruitment of an Internal Controller SP/CNLS Disbursement Staff recruited for SP/CNLS and o f an Accountant for PAMAC Overall Performance Evaluation o f SP/CNLS Disbursement Results availab1e the staff members o f the PA-PMLS transferred to SP/CNLS. For PADS, development o f the chart MOH Covenant Final document of Cost accounting (analytical (December issued. nomenclature) and review o f the 31, 2006) Review o f the computerized MOH Covenant Software information system o f financial (December customized, management Manual (including 3 1, 2006) manual available software, customization, training, short term assistance) and Production SP/CNLS Disbursement completed FMManual for SP/CNLS and PADS. Training o f all the FM and control MOH, SP/CNLS Covenant staff on the FMManual, the software, Consultant and Pooling (March 31: Microsoft office and cost and budget Donors 2007) accounting Appointment o f an External Auditor SP/CNLS Disbursement for SP/CNLS Approval o f 2006 Annual Work Plan SP/CNLS Disbursement Final document and oneninn o fbank PooledAccount issued 10. SupervisionPlan Since the financial management system i s in place at the PADS and i s transferred from the PA-PMLS to SP/CNLS, the overall fiduciary risk for HSSMAP i s moderate. The mitigation factor is represented by these BMACs and sub BMACs responsible for the overall financial management. This means that much responsibility will b e placed on the PADS and SPKNLS. As a result, the performance o f these BMACs is a key factor to ensure compliance with fiduciary requirements. HSSMAP's supervision should b e performed twice a year, ensuring that the MOH and SP/CNLS are performing as expected, The supervision of HSSMAP should focus on the financial management k e y indicators as mentioned in the paragraph on reporting and monitoring. A particular 72 attention should be paid to the sub BMACs, in order to evaluate how they are managing and accounting for program resources. Given the above, the HSSMAP requires intensive financial management supervision which should be budgeted for. Supervision missions should be done at least every six months with the first mission occurring within three months after financing effectiveness. But prior to that, a clear understanding must be reached with the M O H on its work plan and approach. The quality of the audit (internal and external) also i s to be monitored closely to ensure that it covers all relevant aspects and provide enough confidence on the appropriate use o f funds by recipients. Financial management supervision will be carried out by the Financial Management . Specialists (FMSs) of the Pool's Donors upon the Task Team Leaders' request. The .. FMSs will also: Conduct an FM supervisionbefore effectiveness/disbursement; Review the financial component o f the periodic monitoring reports; and, Review the Audit Reports and Management Letters from the external auditors and follow-up on material accountability issues by engaging with the TTLs, Client, and/or Auditors 73 ANNEX8: PROCUREMENTARRANGEMENTS A) General Background-ProcurementReform The procurement system in Burkina Faso has been under reform for over the five years based on a Country Procurement Assessment report (CPAR) conducted in 2000 by the Bank. Inlight o f the CPAR 2000's recommendations, the Government initiated a number of reforms, including enacting a procurement law through decree 2003- 269/PRES/PM/MFB dated 27 May 2003, effective since 9 July 2003 (currently inuse). In2005, a new CPAR basedinaparticipative process and including all stakeholders was launched in order to: (i) measure progress made in a the five years; (ii) analyze the current procurement environment; and (iii) the 2003 national procurement law in assess view of: (a) transparency, efficiency and competitionprinciples required for International Standards, and (b) harmonization process (among sub-regions countries) conducted by the West-African Economic and MonetaryUnion (WAEMU). The 2005 CPAR is now completed and the action plan was adopted by the Council o f Ministers in March 2006. The 2003 National Procurement Law evaluated in light of the OECD Benchmark Indicators system was found unsatisfactory (there i s a strong need to improve the institutional framework), even if major improvements were accomplished. Based on progress made since 2000 (from 31% to 55% of requirements for International Standard), however, the system was found acceptable for National Competitive bidding process, It has been agreed that the implementation o f the action plan included in CPAR 2005 would help to achieved 76% in2010. The Government has recently issued a set o f Standard Bidding Documents. These documents have been submitted to IDA for review and comments. 1) Use of Bank Guidelines Procurement through International Bidding (ICB, LIB etc.) and selection o f consultants for major assignments costing more than 100,000 US$ for firms (and 50,000 US$ for individual) will be carried out in accordance with the World Bank's Guidelines for Procurement under IBRD Loans and IDA Credits dated M a y 2004 and Guideline for selection and employment o f consultant by World Bank borrowers dated May 2004. All other procurement (excluding community-based procurement) will be carried out in accordance with Burkina Faso's procurement law, which i s promulgated by decree 2003- 269/PRES/PM/MFB dated 27 May 2003 (or other future versions found acceptable by the Bank for NCB) evaluated acceptable by the Bank for N C B and minor consultant assignments (see CPAR 2005). For International Competitive Bidding (ICB) and major consultant services, the Bank's Standard Bidding Documents and Standard Bid Evaluation Forms will be used. For National Competitive Bidding (NCB), and small assignments, National Standard bidding document recently drafted would be used up on 74 Bank agreement. Otherwise, IDA'S Standard Bidding documents will be used with necessary adaptations. 2) Advertisement Upon Board Approval, a General Procurement Notice (GPN) would be prepared and published in the UN Development Business (UNDB) online, Development Gateway's dgMarket online, and in a national newspaper o f wide circulation to advertise consulting assignments above US$200.000 equivalent and ICB for which specific contracts are expected. Specific Procurement Notices (SPN) for goods and works to be procured under ICB and NCB and for consultant services will be published in a national newspaper o f wide circulation and may (mandatory for ICB and consulting services above US$200.000 equivalent) also be advertised in the UNDB and Development Gateway's dgMarket in order to get the broadest interest possible from eligible bidders. Request for expression o f interest (EOI) for other consulting services (below US$ 200,000) will be advertised in a national newspaper o f wide circulation. At least two weeks will be allowed for submission o f expression o f interest. 3) ProcurementMethods For each contract to be financed by the Credit (both under the health and the HIV/AIDS programs), the different procurement methods or consultant selection methods, the need for pre-qualification, estimated costs, prior review requirements, and time frame will be formally agreed between the Borrower, Bank and others partners in the Procurement Plan. Procurementof Works: The programs will support minor civil works and small rehabilitation o f health center and office at regional, district, and primary levels across the country. However, civil works contracts will be limited in number and invalue, with the exception of the rehabilitation o f the district hospital and operating block in Pissy District (Ouagadougou). Incase of any major civil works inthe agreed annual work program the following rule will be used: Civil works contracts estimated to cost US$500,000 or more will be procured through International competitive bidding (ICB) method and domestic Preference will be applicable to local contractors. For any other civil works contracts, procurement method to be used will be in accordance with the National procurement law and set forth in a procurement section o f the agreed manual o fprocedures. Procurement of Goods: Goods procured under the programs will include: (a) non medical goods such as : motor vehicles, motorcycles, office equipment and furniture, computers, power generators, IEC materials, communication equipment, treated bednets, retreatment kits, various printed forms and other program related supplies, and (b) medical goods including : pharmaceuticals, ARV, drugs, reagents, vaccines, medical equipment and supplies, condoms, tests equipment, blood-taking/giving sets. Taking into account (level o f value added) manufacturers/producers capacity in the country, procurement of goods will be bulked where feasible (similar nature and need at same 75 period) into bid packages of at least US$250,000 valued (excluding reagents for which bid package of at least US$ 100,000 are recommended) so that they can be procured through suitablemethods to achieve competitive prices. Non-Medical Goods: Non medical Goods (excluding treated bednets) estimated to cost US$250,000 equivalent and above per contract will be procured through International Competitive Bidding (ICB) and Preference for domestically manufactured goods will apply in accordance with the World Bank Guidelines. For any others non medical goods contracts costing less than US$250,000 equivalent, procurement method to be used will be in accordance with the National procurement law and set forth in a procurement section o f the agreed manual o f procedure. For specifics goods such as treated bednets for which market prices range i s well known and only a few suppliers are available around the world, Limited International Bidding may be used with prior agreement o f IDA and in accordance with paragraph 3.2 o f Guidelines for Procurement under IBRDLoans and IDA Credits. Medical eauivment and HIV related Good: Regardingthe procurement o f ARVs or specifics medicals goods, the market situation o f each product, the nature of the medicines and medical supplies, and the critical dates for delivery are all major factors that will determine the choice o f suitable procurement method. The majority o f ARVs and some other HIV/AIDS related drugs are either single source or limited-source products or proprietary items. Then, International (or national) competitive bidding without pre-qualification typically cannot be the preferred method o f procurement. Instead, limited international bidding, direct contracting may be the most suitable methods. (a) Drugs and HIV/AIDS-related health commodities, (Le. ARV, drugs) will be procured with prior agreement o f the association through sole source method to the national center for essential drugs (CAMEG). CAMEG will use its own procurement procedures (agreed by IDA) to select its suppliers as done in the cases o f the two ongoing Bank Health and HIV/AIDS projects (Regional HIV/AIDS Treatment Acceleration Project (H-106-Bur) and HIV/AIDS Disaster Response Project Cr 3557 -Bur); (b) Specific medical goods such as reagents estimated at US$ 100,000 or above for which market prices are under control and only a few suppliers are known inthe world, Limited International Bidding (LIB) may be employed provided it will have been agreed by the Association and indicated inthe annual procurement plan reviewed by IDA (andothers partners ifneeded); (c) Reagents contract costing less than US$ 100,000 may be procured in accordance with Burkina procurement law and through methods set forth in the agreed manual o fprocedures; (d) Vaccines will be procuredthrough specialized agencies o fUnitedNations such as UNICEF,WHO etc, in accordance with the Bank Guidelines (paragraph 3.9 ). In 76 those cases these Agencies can be hired under sole source provision with prior agreement of the Association (and others partners ifneeded); and (e) Procurement o f reagents for HIV/AIDS and blood transfusion security medical equipment or spare parts which must be compatible with existing equipment considered as proprietary items may be procured directly (direct contracting) with prior approval of the Association (and others partners if needed) from manufacturers and authorized local distributors in view o f the requirements o f existing laboratory/testing equipmentinBurkina Faso. Community -Based Procurement: Subprojects financed under HIV/AIDS program would comprise a broad spectrum o f activities to be implemented by Village HIV/AIDS Committees (CVLS). It i s not possible to determine the exact mix o f goods, small works, and services to be procured under these activities due to their demand-driven nature. Therefore, the types of activities to be financed under subprojects and their procurement details would depend on the needs identified by community-based organizations, The contract would be procured following simplifiedprocurement procedures as described in the project implementation manual (PIM). In absence o f specifics provisions for communities-based procurement in the national procurement law, the procurement section o f the implementation manual related to Community based procurement will be developed on the basis o f the Bank Guidelines for Simplified Procurement and Disbursement for Community-Based Investments(February 1998) Selection of Consultants: Consulting services for implementation o f the program components will include various studies related to preventions, care and support, treatment, technical assistance, surveys, social marketing, financial audits, procurement audits, etc., which require the recruitment o f consulting firms or individual consultants. All consulting services contract estimated to cost US$lOO,OOO and more for firms and US$ 50,000 and more for Individuals will be procured in accordance with the Bank's Guidelines for the Selection and Employment o f Consultants by World Bank Borrowers. All others consulting services contracts may be procured inaccordance with the national procurement law All firms consulting services contracts (excluding assignments o f standard or routine nature, e.g. audits and when NGO and firm are mixed on the same list) costing equivalent US$lOO,OOO or above will be awarded on the basis o f Quality and Cost-Based Selection (QCBS) method inaccordance with Part 1o f the IDA'SGuidelines. All firms consulting services contract related to routine nature, e.g. audits and costing equivalent US$ 100.000 $ or above will be procuredthrough Least-Cost Selection (LCS) method inaccordance with provision o fparagraphs 3.1 and 3.6 o f the Guidelines. All consulting service contracts costing equivalent US$ 100.000 or above and for which mixing o f NGOs and firms on the same short list is foreseen (e.g. social marketing) will be procured on the basis o f Quality Based Selection (QBS) in accordance with provision of paragraphs 2.8 and 3.2 o f the Guidelines. 77 Consulting services contracts below the threshold o f US$l00,000 equivalent for firms will be procured with appropriate methods foreseen inthe national procurement law and mentioned inthe agreed manual o fprocedures. Shortlists for contracts costing less than US$lOO,OOO equivalent may consist o f national firms only in accordance with provision o f paragraph 2.7 o f the Guidelines provided that a sufficient number o f qualified firms are available at competitive costs. However, if foreign firms have expressed interest, they will not be excluded from consideration. Individual consultants with contract estimated above US$ 50,000 will be selected in accordance with Guidelines Part V. Others individual consultant may be procured in accordance with national procurement law. The selection o f UNagencies and NGOs will be in accordance with paragraphs 3.15 and 3.16 of the IDA'SGuidelines. Single Source Selection (for the use o f this Agencies and NGOs) may be employed with prior approval o f IDA (and others partners ifneeded) and will be inaccordance with provision o fparagraphs 3.9 to 3.13 o fthe Guidelines Duringthe entire program, the use o f civil servants as individual consultant or as a team member o f Consultants firms will strictly follow the provisions o f Article 1.9 to 1.11 o f the Consultants' Guidelines Training, Workshops, Study Tours, and Conferences: All training and workshops under the Programs will be included in the annual work programs of health and HIV/AIDS sectors, and approved annually by PADS'S Directory o f Committee (which included IDA representative) and Technical Committee o f planning and monitoring (which include IDA'Srepresentative), respectively, and for which decisions are made on the basis o f consensus among the participants. Operational costs: Operation costs which will be financed by the programs would be procured using the national procurement law and the program's financial and administrative procedures manual which will be approved IDA and participating donors. For efficiency purposes, operation's items package will be prepared on the basis o f 6 or 12 month's needs and procured competitively. For services (car maintenance, computers maintenance etc.) to be financed through operational costs, the programs will proceed by service contracting for a definedperiod. B) ProcurementArrangement & Assessment of the agency's capacity to implement procurement Bl) For Health Sectorprogram Procurement activities for Health sector component, will be done at central level by the procurement specialist of the PADS management unit and at decentralized level by beneficiaries such as : health districts, regional health directorates, central directorates, 78 Central and regional hospitals. An internationally qualified procurement consultant will be recruited to provide support and capacity building to the PADS management unit, the DAF/health, and program beneficiaries. Each beneficiary will be directly responsible o f procurement o f small items (workshops and training materials, small operations items etc.) estimated less than US$ 40,000 per contract and included in the approved annual work program. The health sector pooled mechanism has been in place since 2002, and several procurement trainings (with focus on Shopping, which i s the method used at this level) have been conducted for beneficiaries. Taking into account Staff mobility, these trainings are renewed each 2 years. The next i s scheduled inyear 2006. I t was agreed that this training will be done before effectiveness The PADS management unit (reinforced by the recruited procurement consultant) will have the overall responsibility o fprocurement under the health sector component but will be directly in charge o f all consultant selection, all procurement o f large, complex and/or pooled procurement across beneficiaries. Its task will comprise : (i)maintaining a detailed list o f technical specifications o f goods and services to be financed by the program through the Health sector; (ii) maintainingregisters o f all interestedbidders; (iii) preparing and updating procurement plans; (iv) preparing bidding documents, request for quotations and requests for proposals; (v) preparing bid evaluation reports for approving; (vi) receiving of goods and services and dispatching; (vii) monitoring o f contracts implementation; and (viii) continuing building required capacity where needed (at beneficiaries level) During preparation phase, a procurement capacity assessment of PADS'S Procurement unit was carried out by the Bank's Country office procurement specialist. A detailed procurement capacity report has been prepared and kept in the project file. The assessment revealed that the PADS'Smanagement unit i s well staffed by a Procurement specialist who has an acceptable experience. During three years, he was partly (for one component o f the project) in charge o f procurement o f closed Bank Project (Cr 2974 Bur). He also received two trainings (Goods andworks) inBank procurement at CESAG and ISADE inDakar. Based on current performance showed by the procurement specialist o f PADS'S management unit (evaluated through the ongoing Bank Regional HIV/AIDS Treatment Acceleration Project), the anticipated recruitment on an internationally qualified procurement consultant to strengthen PADS capacity, and the program implementing environment that is under reform (CPAR action plan now adopted by government), the procurement risk has been set as low. The action plan set to address risk identified during the assessment for the implementation o f the Health sector component includes among others the main following actions: 79 (i)Submit an updated draft Procurement section of the administrative and financial Manual before negotiation. This document should be finalized before effectiveness; (ii)submit before negotiation a draft detail procurement plan for at least the 12 first months (18 months if possible) o f implementation; (iii) before the end o f December 2006, recruit an internationally qualified procurement consultant to provide support and capacity buildingto the PADS management unit, the DAF/health, and project beneficiaries; (iv) finance an annual procurement audit during implementation; (v) conduct before effectiveness a procurement workshop to the beneficiaries benefit; (vi) Program as soon as possible a specific procurement courses in drugs and medical goods for the PADS procurement specialist; and (vii) a revisedMemorandum o f Understanding (MOU) will be drafted and signed by government and partners prior to IDA financing for the pooled health fund. B2) For HIV/AIDSprogram Procurement activities under HIV/AIDS Component will be handled by the following entities: The recently created National AIDS Council Fiduciary Management Unit (which will be composed as starting core by PA-PMLS Staff which have performed well) ,line ministries, PAMAC (for NGO's small needs) and Village communities. Lines ministries and provincial Aids committee (CPLS) will be incharge o f procurement o f small items (mainly for operation purpose) estimated less than US$ 40,000 per contract and included intheir approved work program. PAMAC (which i s specialized in the management o f NGOs and Associations inBurkina Faso since 2003) will be incharge o f small procurement needed for NGO's activities that it finances. In fact, NGOs that implement activities as part o f the nongovernmental and civil society response will need items for implementation purposes. Association and NGO's need will be grouped into packages and those estimated less than US$40,000 will be procured by PAMAC. PAMACs Financial Assistant (FA) will be responsible o f procurements process described above. During preparation, the Financial Assistant's procurement skill has judged acceptable for procedure (shopping) that he will undertake and for which he has 2 years experience. H e also attended two courses on the former national procurement law and two others on the current version (2003). Village HIV/AIDs communities (CVLS) will be responsible (through their representative committees) for procurement o f items included in their agreed sub-project using simplified CDD procurements procedures. CVLS that will be involved in the program will be supported and trained through NGO or Community Development Program (like PNGT2) on CDD procurement. The NGO's contract for CVLS support and/or Convention with community development program will be signedbefore effectiveness, The Fiduciary Management Unit o f the National AIDS Council will have the overall responsibility of procurement under the HIV/AIDS component and directly in charge of all consultant selections, all procurement o f large, complex and/or pooled procurement across line ministriesand/or NGOs. 80 A procurement capacity assessment oftheprocurementunit ofthe ongoing IDA-financed HIV/AIDS Disaster Response Project (Cr. 35570), which will close in December 2006, was carried out during the preparation stage. This procurement unit will form the core o f the newly created National AIDS Council Fiduciary Management Unit.The Procurement specialist o f the HIV/AIDS Disaster Response Project has enough experience to deal with procurement expected under the HIV/AIDS program. He i s familiar with the IDA'S procedures he has applied for the implementation o f the HIV/AIDS Disaster Response Project (Cr. 35570) for the past 3 years. Based on current performance shown through the ongoing project and the program implementing environment, the procurementrisk has been set as moderate The action plan set to address risk identified during the assessment for the implementation o f the Health sector component includes the following actions: (i)Submitanupdatedadministrativeandfinancialmanualbeforedisbursement; (ii) sign a contract with NGOs or others specialized institution for support to CVLS on Fiduciary aspect community driven development; (iii) Submit before negotiation a draft detailed procurement plan for at least the first 12 months (18 months if possible) o f implementation; and (iv) Finance an annual procurement audit duringimplementation. C)ProcurementPlan Due to the nature o f approach to be used(program approach) the list o f activities can not be well known at this stage. Activities to be financed under both programs would depend on needs expressed (in accordance with the program's general objective) periodically by beneficiaries, validated and then consolidated by Steering Committee o f PADS (for Health Sector activities), National AIDS Committee (for HIV/AIDS program) and agreed by Bank and others partners (with respect to the pooled funding basket where they are committed). Based on the above, it i s not possible to draft a general procurement plan for entire duration o f the programs. Furthermore, due to a periodicity o f needs expression (annually), it may be difficult to have at the beginning the complete list o f the first 18 months activities. Taking into account this constraint, a detailed procurement plan (for both HIV/AIDS and Health sector) based on approved annual action plan and containing all procurement to be carried out for at least the first 12 months (18 months if possible) will be drafted, finalized and submit to IDA (and others donors involved inthe program) before negotiation. The procurement plan (PP) will include relevant information on all items to be procured, estimated costs, selection method, timing, review status (Prior or Post) etc. As management tools, the procurement plan will be updated on an annual basis or as required (to reflect implementation needs) in agreement with the project team. The procurement plan will be available in the operation's database (and in the Bank external website). DuringHSSMAP implementation, all procurement will be carried out inaccordance with the formally agreedprocurementplan (original andformally up-dated). 81 D)Financial& AdministrativeManual(FAM): Procurement A Financial and Administrative manual is currently available at the PADS'S Management Unit level. This manual is currently used to manage the Health sector pooled fundingbasket already inplace and supported by Dutch, Swedish and French cooperation. The manual will be updated to take into account the Bank Credit specificity. For HIV/AIDS program management a MOU and a new Manual o f procedures will be drafted. For both programs, the draft MOU and draft manuals o f procedures will be discussed during negotiation and finalized before effectiveness. E)Frequencyof ProcurementSupervision In addition to the prior review supervision to be carried out from Bank offices, the capacity assessment conducted during preparation has recommended two supervision missions per year to visit the field to carry out post-review ofprocurement actions Attachment1 Detailsof the ProcurementArrangementinvolvinginternationalcompetition. 1. Goods andWorks andnonconsultingservices. (a) List o f contract Packages which will be procured following ICB and Direct contracting: Healthsector - - 1 Ref. No. Bid- Opening I 1 - 2 3 4 - 5 2008 - 7 HIViAIDS 3,000 sss NA Prior medicineand (CAMEG) - supplies 82 (b) ICB Contracts estimated to cost above 500,000.00 US$for works and 500,000.00 US$for Goods per contract, all LIB contracts and all Direct contracting will be subject to prior review by the Bank. HIVIAIDS sector 1 1 2 3 4 1 5 1 6 7 8 9 (yedno) Post) Date 1 Drugfor01 300 sss No Prior Nov 2006 and STI 2 Reagentand 400 LIB Prior Nov 2006 others related products 3 Drug for01 300 sss No Prior Nov 2007 and STI (c) ICB Contracts estimated to cost above 500,000.00 US$for works and 250,000.000 US$for Goods per contract, all LIB contracts and all Direct contracting will be subject to prior review by the Bank. 2. ConsultingServices. Healthsector (a) List of Consulting Assignments with short-list of international firms. 1 2 3 4 5 6 7 Ref.No. Description of Estimated Selection Review Expected Comments Assignment Cost Method by Bank Proposals (US$ (Prior I Submission 000) Post) Date Support and 200 QCBS Prior 2006 capacity building by international 1 1 1 procurement firm Quality of I 150 QCBS or Prior health services QBS (if survey mixing of NGO and I Firms) 2o08 (b) Consultancy services estimated to cost above l00.000 US$for fifirm and 50.000 US$for individual per contract and Single Source selection o f consultants 83 for assignments regardless of contract amount, will be subject to prior review by the Bank. (c) Short lists composed entirely of national consultants: Short lists o f consultants for services estimated to cost less than I00.000 US$ equivalent per contract, may be composed entirely o f national consultants in accordance with the provisions o f paragraph 2.7 o f the Consultant Guidelines. HIV/AIDS sector (a) List o f Consulting Assignments with short-list of international firms. 1 2 3 4 5 6 I Ref. No. Descriptionof Estimated Selection Review Expected Comments Assignment Cost (US$ Method by Bank Proposals 000) (Prior I Submission Post) Date 1 CMLS action 150 QCBS Prior Nov 2006 plan evaluation and analysis 2 Financial audit 200 LCS Prior May 2007 (public and private sector) for 3 years 4 Procurement 250 QCBS Prior Mai 2007 Audit for 3 years 6 IP6 & IP7 Survey 100 QCBS Prior May 2007 for year 2007 7 Behavior 150 QCBS or Prior May 2007 surveillance QBS (if survey ofhigh mixing of risk groups for NGO and year 2007 Finns) 8 Demographic and 600 SSS with Prior 2008 Through health survey National Convention Demographic signature and Statistic Institute (INSD) 9 Independent mid 100 QCBS Prior July 2008 term review of National Aids Strategy (2006- 2010) 10 IP6 & IP7 Survey 100 QCBS Prior July 2008 for year 2009 11 Behavior 200 QCBS or Prior May 2009 surveillance QBS (if survey of high mixing of riskgroups for NGO and year 2009 Firms) (b) Consultancy services estimated to cost above 100.000 US$for firm and 50.000 US$for individual per contract and Single Source selection of consultants 84 for assignments regardless of contract amount, will be subject to prior review by the Bank. (c) Short lists composed entirely of national consultants: Short lists o f consultants for services estimated to cost less than 100.000 US$ equivalent per contract, may be composed entirely of national consultants in accordance with the provisions o fparagraph 2.7 o f the Consultant Guidelines. 85 ANNEX9:ECONOMIC FINANCIALANALYSIS AND A. MACROECONOMIC CONTEXT Burkina's track record on reform and growth since 1994 has been laudable, with real GDP increasing by an average o f 5.6 percent per annum inthe 1994-2004decade, despite continued vulnerability to exogenous shocks. Per capita income growth increased over previous periods to around 2.6 percent per annum, contributing to an estimated 8 percent decline inthe poverty headcount between 1998 and 2003 -- ledby cotton-producing rural areas. Despite this recent progress, Burkina remains one o f the poorest countries in Africa, with per capita income o f $350 and a poverty incidence o f 46 percent in 2003. For its 12.4 million inhabitants, many social welfare indicators lag behind modest Sub- Saharan averages and childhood malnutrition has increased in the past decade, despite stable measures of inequality in the past decade o f growth. State capacity for revenue mobilization i s also relatively weak. The respective synergies between health status, poverty, and growth have been well- established. Malaria alone has been estimated to reduce GDP by up to 1% in endemic countries. Although HIV prevalence rates are estimated at 2.3% in 2004, AIDS still constitutes the major cause o f adult mortality in urban areas, and disproportionately affects those intheir most productive years. B. HEALTHFINANCINGAND EXPENDITURE Within the health sector, the recently completed Public Expenditure Review (2004) provides an overall assessment o f the trends inhealth spending, as well as allocative and technical efficiency o f health sector financing and expenditures. The PER found that while the level and allocation o f health sector financing had improved in the past five years, inefficiencies and inequities persist. Several other health financing studies have been recently completed, including the preparation o f the first National Health Accounts for Burkina. Sources and trends in healthfinancing Private households providethe largest source o f health financing inBurkina (estimated at over 60 billion CFA in 2003), followed by the government (50 billion CFA in 2005) and donors. Government health spending stagnated from 1998-2001,but has since increased steadily since then due both to increased budget allocations and the availability o f HIPC resources. Average household expenditure for health increased moderately in nominal terms between 1998 and 2003, due primarily to increased spending by higher-income households. Households in Burkina Faso spend an average o f about US$5 per month (2800 CFA) on health services. About 90% o f private spending i s out o f pocket expenditures for medicines, and the wealthiest quintile was responsible for two-thirds o f all private expenditures. 86 Poorest 4 2 4 3 4 4 Richest Total 1998 1,233 2,257 3,753 6,575 32,216 46,035 2003 1,043 3,028 4,208 9,052 44,445 61,776 Allocative efJiciency is generally acceptable among expenditure categories and levels o f the system, but expenditures are not sufficiently prioritized among disease programs. Resource allocations among categories o f expenditures (wages, salaries, infrastructure) are generally within accepted norms - for example, wages represent only about 40% o f sector spending. Current expenditure tracking systems make it difficult to estimate the percentage o f all resources (budget, donor) that arrive at decentralized and community level, but government has sought to increase allocations to peripheral services, and hospitals consume less than a third o f the budget. The larger problem has been a lack o f alignment between resource allocations at both national and district level and the disease burden- most notably the underfinancing o f malaria control activities relative to AIDS treatment, for example. In addition, while the pooled health fund (PADS) uses a transparent allocation formula to distribute resource among districts and hospitals, government budget transfers are still determined on a historic basis; the PADS formula therefore needs to be adapted for budgettransfers. Table 9.2: BudgetAllocationsby Level, millionsof CFAF (includesgovernment budget,HIPC, and externalfinancingthat is includedinbudget) 2002 2003* Common expenses (non-operational)** I - I I / Operational structures 122,708 126,915 128,919 127,429 136,566 143,483 1. Tertiary care II5,579 I3,742 I5,350 1I6,294 4,194 II7,048 II 7,535 National Hospitals 3,216 I2,380 I4,152 4,607 4,841 Other National expenses I 2,363 I1,362 I1,198 I 2,100 I 2,441 12,694 2. RegionalHospitals 1,608 1,583 2,719 2,813 2,916 3,176 3. Primary Care (CMA et CSPS) 11,230 16,669 17,858 15,025 13,786 27,095 4. Common operational expenses 4,291 4,921 2,992 3,297 12,816 5,676 Total Government Health Expenditures 25,290 29,551 32,005 32,231 41,586 49,858 The sectoral MTEF i s an important step toward aligning sector expenditures with objectives, but the arbitrage process among various priority programs needs to be further strengthened, and the MTEF process needs to be translated into the decentralized levels. Public goods (such as behavior change activities) and interventions with high 87 externalities (such as mosquito bednets) also need greater focus in public expenditures. Sector dialogue and HSSMAP financing will emphasize provision of these goods. With regardto equity, public health spendingremains skewed toward the relatively better off, because the poor make less use o f health services for reasons of cost and accessibility. Subsidies for priority health measures used by the poor (such as making vaccination and antenatal care free) have helped increase preventive service utilization. The price o f drugs also declined through reductions on margins for the purchasing center for essential generic drugs (CAMEG). Coverage with community insurance schemes remains limited, and the low monthly contributions are not sufficient to cover high-cost or urgent care. The poorest segments o f the population therefore avoid using hospital services altogether or present themselves too late. but targeting needs to be further developed for maternal and emergency services. A subsidy system for emergency obstetrical care was developed by the MOH in 2005 and the costs integrated into the 2006 national budget. Table 9.3: Trends andProjectionsfor publicsector healthfinancing HealthBudget expenditures 2007 2008 (millions FCFA) 2004 2005 2006" CDMT CDMT I I I I I TOTAL BUDGET* (including on-budget external financing) 50,853 53,087 60,447 51,999 55,049 Sources and trendsfor HIV/AIDSJinancing. The HIVIAIDS sub-sectoral has been and remains heavily dependant on external financing, although government has prioritized HIPC resources for AIDS (mostly ARV drug purchases) and has modestly increased budget allocations. Total resources mobilized increased substantially from 2001 to 2004, reflecting increased mobilization from bilateral and multi-lateral partners, as well as increased funding for AIDS treatment, care and support. While prevention remains the most cost-effective intervention, treatment, care and support are attracting increased attention and financing. First, prevention remains the most cost effective intervention for controlling the epidemic, so it i s important that care and treatment do not "crowd out" prevention programs. Second, within prevention programs, research have demonstrated the importance - particularly in concentrated epidemics - o f prevention interventions among groups at high risk o f transmitting the virus. While Burkina is above the 1% threshold for concentrated epidemic, high risk groups have not received sufficient attention relative to general population interventions. 88 Source of financing Commitments 2001 2002 2003 2004 Government 5,060.64 1 1,099.37 I 1,555.90 I 1,368.27 1 1,037.10 Budget 882.66I 162.79 I 255.90I 218.27 1 245.70 I 1 1 I 1 I I * In(:ludes TOTAL 42,020.82 3,903.43 7,828.33 14,247.35 16,041.70 funding for HIViAIDS treatment andprevention through the MOH. EconomicAnalysis of ProposedFinancing Since the HSSMAP support the overall health sector program, economic and financial analysis i s based primarily on a (i)review o f overall expenditures for the sector; (ii) allocation o f resources from the Credit and o fpooled financing (PADS). To ensure efficient allocation o f funds from the Credit, the program will seek to balance allowing flexibility (within the context o f pooled funding) for executing entities to determine their priorities based on local disease burden, while ensuring that priority activities and interventions are financed. This will be achieved through (i) strengthening of medium-termexpenditure frameworks for health and HIV/AIDS, to ensure the overall sector expenditures are aligned with MDG and PRSP priorities; (ii) using a transparent allocation formula for pooled funding, by levels and among priority programs, which prioritizes decentralized service delivery, based on agreed annual work programs with the M O H and SP-CNLS; (iii)supporting development o f toolkits and capacity to further align district level action plans with disease profiles; (iv) strengthening performance- based contracting and systems for results monitoring for both health and HIV/AIDS sectors; (iv) ensuring that the pooled funds prioritize cost-effective interventions, including distribution o f treated bednets, or HIV prevention interventions among high- riskgroups. Table 9.5: Overall Health Sector Financial Framework (billionsof FCFA) (1USD= 500 FCFAinOctober2005) 89 For multi-sectoral HIVIAIDS activities, the SP-CNLS has undertaking a costing of the National Strategy (2006- 10), based on estimated unit costs o f various activities multiplied by annual proposedcoverage indicators, andthe estimated adult HIVprevalenceof2.3 % in2004. Based on these assumptions, the SP-CNSL estimated a total cost of over 160 billion CFA, which probably twice the amount o f resources likelyto be mobilized. But an update o f the model using the revised prevalence estimate o f 2.3% for 2005 results in a total estimated cost of about 120 billion CFA for five years, which reduces the potential financing gap. The SP-CNLS and partners therefore are engaged in an arbitrage process, to identify priorities based on expected financing. The arbitrage seeks to : (i) identify source o f savings to achieve objectives at lower unit costs where possible, or through synergies among different programs and interventions (reduced administrative costs, etc.); (ii)identify "core expenditures" that need to be protected to ensure efficacy o f the national prevention and care programs (e.g., condom distribution, high-risk group prevention activities); (iii)allocate remaining resources based on relative priorities; and (iv) readjust strategies and indicators targets in relation to resources available (for example, number o fpersons to put under ARV treatment). treatment in health sector)* 20.8 19.5 8.9 6.2 55.4 HIVMDS and STI treatment in health sector** 4 3 0.9 1.9 9.8 TOTAL 24.8 22.5 9.8 8.1 65.2 ** Many Eurrent donor programsfinish in 2007/8, but are likely to be continuedsubsequently. Programming o f pooled funds will be done in the context o f the annual Plan o f Action, which will take into account "parallel financing" from donors not in the pooled fund. Pooled funds will be allocated according to a formula to be negotiated annually with SP- CNLS, which will ensure that priority interventions are covered, taking into account other source o f financing. An allocation formula will be negotiated annually for the pooled fund, accordingto levels andmajor subsectors. Fiscal Impact and Sustainability: Progress toward the MDGs will not be possible without continued external financing, whether through general budget support or sectoral support programs such as HSSMAP. In light of this reality, program planning and dialogue seeks to ensure that the overall 90 sector financing framework as well as activities financed by the program are likely to be sustained based on expected trends in revenues, budget allocations, external support, and cost recovery. Current policies and programs pose risks in terms o f long-term sustainability: these include plans to scale up ARV treatment, introduction o f new and more expensive malaria treatment protocols, proposed subsidies for priority services and the poor, as well as care and support for orphans. With regard to ARV treatment, the program will plan to maintain patients already put on ARVs under existing Bank programs, but will not seek to increase the numbers treated with Bank financing. For malaria, analysis was undertaken during preparation regarding how to prioritize prevention and treatment interventions given anticipated financing - this resulted in a decision to prioritize bednet purchases and malaria drugs for children (ACTS) and pregnant women. For orphan care, the focus will be on strengtheningcommunity-based solidarity mechanisms rather than institutional approaches, and improved targeting those ingreatestneedthroughparticipativeapproaches. 91 ANNEX10: SAFEGUARD POLICYISSUES As a category B operation, the Government of Burkina Faso developed, duringHSSMAP preparation, a Medical Waste Management Plan (MWMP), in compliance with National and World Bank safeguard policies. This study has been conducted in order to assess potential negative impacts resulting from program-related activities and to determine mitigation measures that would minimize those negative impacts. According to the report, current practices in health care waste management and contaminated health care waste handling, storage and disposal, inparticular, raise serious environmental and social concerns. The need for sound management and disposal o f contaminated medical waste i s high, as health care related activities produce considerable amount o f waste on daily basis -- some o f which tend to be highly infectious -- as a result o f preventive and curative service delivery. The composition o f waste produced i s in the form o f sharps (needles, syringes, etc.), non- sharp materials, such as blood and other body fluids that could be infected, chemicals, pharmaceuticals and medical devises needing proper handling and disposal. Currently, there i s potential for health care workers, waste handlers, users o f health facilities and the general public to be exposed to and become infected by health care related waste, as a result o f poor H C W management practices. The MWMP was prepared by an international consultant, using a broad-based public consultation approach, involving stakeholder groups in Government organizations, private sector institutions, NGOs and civil society representatives within the country. The MWMP includes a clear description o f HSSMAP components, a significant baseline information, policy, legal, administrative and institutional framework within which the program i s to be implemented, an analysis o f potential positive and negative impacts, institutional arrangements, with clear roles and responsibilities for implementing and monitoring the plan, along with its capacity buildingrequirements to effectively mitigate negative program impacts, as well as enhance its positive ones. The report also emphasizes the role o f a strong partnership among the various stakeholder groups in the public, private sector and local government to facilitate smooth implementation o f the plan and its sustainability. The MWMP benefited from a stakeholder workshop, which took place in the summer o f 2005. This workshop had a dual purpose: (i)to foster ownership on the part o f stakeholders; and (ii) to seek their input in order to improve the plan. The final draft o f the plan, which reflected stakeholders' comments and suggestions, has been reviewed and approved by ASPEN and judged satisfactory. It has been disclosed in-country at Bank Info Shop, prior to appraisal. Some o f the action plan activities, currently underway include: (i) the dissemination of the MWMP to all medical centers to facilitate the integration o f the provisions o fthe plan intheir activities; (ii) creation ofMWMcommittees within each health care facility; the and (iii)the preparation of specific MWMP for health care facility to be accounted for in the 2006 budget; and the elaboration o f training modules targeted at health care workers and other relevant stakeholders involved in medical waste management and disposal. 92 ANNEX11:HSSMAP PREPARATION AND SUPERVISION Planned Actual PCNreview March 23,2005 March 23,2005 Initial PID to PIC April 18, 2005 February 8,2006 Initial ISDS to PIC November 11,2005 November 11,2005 Appraisal November 21,2005 December 16,2005 Negotiations January 12,2006 February 28,2006 BoardRVP approval February 12,2006 April 27, 2006 Planned date of effectiveness June 30,2006 June 30,2006 Planned date of mid-termreview March 31, 2008 March 31,2008 Planned closing date September 30,2010 June 30,2010 Key institutionsresponsible for preparation ofthe HSSMAP: Ministryof Health, NationalAIDS Council (SP-CNLS) Bank staff and consultants who worked on the HSSMAPincluded: Name Title Unit Timothy Johnston Sr Human Development Specialist (TTL) AFTH2 Tonia Marek Lead HNP Specialist AFTH2 Pierre Kamano Education Specialist AFTH2 Celestin Bad0 Sr. Operations Officer AFTH2 Johanne Angers Operations Officer AFTH2 MamadouYaro Sr. Financial Mgt. Spec. AFTFM Oumar Ouattara Financial Mgt.Spec. AFTFM Asha Ayoung Sr. Procurement Spec. AFTPC William Dakpo Procurement Spec. AFTPC Wolfgang Chabab Finance Officer LOAG2 Helene Bertaud Country Lawyer LEGOP Amadou KonarC Safeguard Specialist ASPEN Menno Mulder-Sibanda Senior Nutrition Specialist AFTH2 Khama Rogo Lead ReproductiveHealth Specialist AFTHD Bintou Sogodogo Team Assistant AFMBF Nicole Hamon Language Program Assistant AFTH2 Yann Derrienick Consultant Economist Nicole Fraser Consultant Monitoring and Evaluation GAMET Specialist Government consultants: Mbaye Faye, Medical Waste Management Consultant Abdoulaye Ky, Consultant Economist Bank funds expendedto date on HSSMAPpreparation: 1. Bank resources: $180,000 2. Trust funds: $ 20,000 3. Total: $200,000 EstimatedApproval and Supervision costs: 1, Remainingcosts to approval: $ 50,000 2. Estimated annual supervision cost: $120,000 93 ANNEX12: DOCUMENTS PROJECT FILE INTHE A. NationalStrategy andImplementation NationalHealth DevelopmentPlan (PNDS), 2002 NationalAIDS Strategy (2006-2010), June 2005 Programme d'Appui au Ddveloppement Sanitaire (PADS): 2005-2008, June 2004 "Priority Action Program to Implement the Poverty Reduction Strategy Paper, 2004- 2006," Ministryof Economy and Development (EnglishTranslation), July 2004 Health Sector MediumTerm Expenditure Framework (MTEF), August 2005 National Orphans and Vulnerable Children Strategy, Cadre Stratdgique de Prise en Charge des OEV: 2004-2013 ",Ministry of Social Action, March 2004 Plan d'Opdrationnalisation du cadre stratdgique de lutte contre le VIHBIDA et les infections sexuellement transmissibles: 2006-2010, SP-CNLS, Septembre 2006 Manuel d'exdcution et de Gestion dupanier commun VIH/SIDA ,draft, December 2005 Plan d'action pour l'accdldration de la rdponse du secteur de l'dducation au VIH/SIDA et les ISTs, SP-CNLS, MEBA, MESSRS, Juillet 2005 (draft) Plan d 'actionpour lesjeunes...,draft, October 2005 Medical Waste Action Plan (Plan National de Gestion des Ddchets Biomddicaux), Novembre 2005, Direction de I 'HygiBne Publique et de 1'Education pour la Santd, Ministdre de la Santd B. BankStaff Assessments Aide Memoire of Identification Mission-December, 2004 Aide Memoire of Pre-AppraisalMission -June 2005 Quality Enhancement Review-Minutesof QER meeting; October 2005 Aide Memoire of Appraisal Mission -NovemberAIecember 2005 Aide Memoire PRSC Missions and PRSC Project Appraisal Documents(various) Aide Memoire, PRCA C.Other' Burkina Faso :Le Budget, dldment crucial de 1'exdcution du CSLP :Revue des Ddpenses Publiques, (Public Expenditure Review), Report No. 29154-BUR, June 2004 Santd et Pauvretd au Burkina Faso: Progresser vers les objectfs internationaux (AFTHD, 2002) Analyse Compldmentaire de la situation nutritionnelle au Burkina Faso, Rapport Provisoire, Ministdre de la santd, Direction de la Nutrition, September 2005 John May and others, L 'importance de I'dcart urbain-rural des indicateurs santd, nutrition, etpopulation, World Bank, Human Development Department, July 2005 Includingelectronic files 94 ANNEX13: STATEMENT OFLOANS CREDITS AND BURKINA FASO: HealthSystems Support and MultisectoralAIDS Project Active Prolects Difference Between Expected and Actual Orlainal Amount in US$ Millions Disbursements Project ID ProJectName Flscal Year IBRD IDA GRANT Cancel Undisb Orlg Frm Rev'd PO78596 BF-Admin CB (FY05) 2005 7 6022948 12527731 P000309 BF-Basic Edu Sec SIL (FYO 2002 32.6 22 33154 13834507 PO35673 BF-Com Based Rut Dev (F\I 2001 66.7 1928677 11496929 -6 556039 PO71443 BF-Compet 8 Enlerprise De 2003 30.7 27 52159 9 246064 PO76159 BF-Dev Learning Center LIL 2003 2.3 0 829082 0 2803063 -0 136361 PO52400 BF-GEF Nat Res Mgmt Prtn 2002 7.5 3083687 07403538 PO70871 BF-GEF Sahel Lowland Ecc 2004 4.5 3906263 04895966 PO71433 BF-HIVIAIDS Disaster Resp 2002 22 1 652545 -1 684197 -5 917531 PO00306 BF-Ouaga Water Suply (FYI 2001 70 4810313 23393532 PO69126 BF-Power Sec Dev (FY05) 2005 63.58 6021868 46 038152 PO85230 BF-STATCAP SIL (FY04) 2004 10 6563233 35416546 P074030 BF-Transp Sec SIM (FY03) 2003 92.1 84 8808 40 64657 Overall Result 396.98 12 286 4003 149 47624 -12 60993 BURKINAFASO STATEMENTOFIFC's HeldandDisbursedPortfolio InMillions ofUSDollars Committed Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic. ~ ~~~ 1998 AEF STCBF 0.14 0 0 0 0.14 0 0 0 2005 Hotel Independence 2.34 0 0 0 1.17 0 0 0 Total portfolio: 2.48 0.00 0.00 0.00 1.31 0.00 0.00 0.00 Approvals PendingCommitment ~~ FY Approval Company Loan E q W Quasi Partic. Totalpendingcommitment: 0.00 0.00 0.00 0.00 95 ANNEX 14: COUNTRYAT A GLANCE BURKINA FASO:HEALTH SYSTEMSSUPPORT AND MULTISECTORALPROJECT AIDS Sub- POVEKTYa d SOCIAL Burkina Saharan Low- Faso Africa imam 124 719 2.338 380 600 510 Life cmlancy 4 5 432 1.184 T 2 4 i a 2.2 1.8 1.o 21 41 i a 37 31 43 46 58 107 101 79 38 44 Acoess to immuedwater 50,rce 51 58 75 65 61 46 85 84 53 102 101 39 88 88 1994 2003 zool 1.5 20 4.2 4.8 142 183 18.7 19.1 11.0 124 8.5 8.6 Trade -3.5 i7 a 7 0 3.9 4.8 2.5 5.8 4.7 -1 a -11.8 -0.8 04 Capital 57 e 0 7 0.4 0.3 28 1 42.8 41.6 formam 8.O 122 i0.e 125 15.8 142.4 IndeMedness 1984-94 tS34-M 2003 2001 2oou18 laveweannrrafgrowfh) GOP 3.2 4 5 6 1 3.9 5.0 -8Wkina Faro GDP peccapka 0.8 20 4 1 'I.e 2.8 -Lw-hcorrwgroup Exportsoip a d s and services 2.0 4.4 10 1 2.4 4.1 STRUCTUREof& ECONOMY 1984 1994 2003 2004 (X of OW] AgriWbFe 285 31 3 31.0 30.8 Indusby 200 158 18.9 198 Manufacuring 151 119 12.9 135 Service; 51 5 51 '3 50.1 49.4 HwsehoMfmal consumptionWpmdrtre eoe T ~ E a34 822 Generalgovlfind mmptionexpenditure 130 161 12.8 13.0 lnap~m gwds and Senrice5 of 28 6 247 23.4 228 4.5 3.5 0.0 182 1.6 3.4 0.0 1.3 0.6 0.0 2 Q 6 2 12.t 283 3 1 4 0 14.0 2 6 -17 2.7 15 108 I . 1 10.8 06 6 1 31.3 3.5 Note 2004 data arepreliminaryestenates Thedum& shDwkurkeym&calors inthe country(inbold: ccmparedwth ISincomegmupaverage If dala are mi55mg.mec anmdwill be mcunpkte 96 ANNEX15: DECLARATIONHEALTHPOLICYINBURKINA FASO OF MINISTERE DE LA SANTE BURKINA FASO UNI~E-PROGRES-JUSTICE , Ouagadougou, le 0 7 p1,1F! 2$6 ObJeJ : Declaration de politique sanltaire au Burkina Faso T h e President Of theworld Bank 1818 H Street NW Washington DC 20433 USA R e :Declaration of Health policy in BurkinaFaso Mister President, Despite significant efforts made in the health sector during the past four decades in Burkina Faso -- with the support o f technical and financial partners and through the implementation o f the national health plans, national health development projects, and various specific programs -- the progress achieved in improving the population's health status i s still limited.Large investments and reforms have been undertaken, but the health situation continues to be alarming. Child and infant mortality rates, though continuing to decrease, remain high. Infant mortality rate fell from 10.5 per cent in 1998 to 8.3 per cent in 2003. The child mortality rate also decreased during the same period from 21.9 per cent to 18.4 per cent. The principle causes o f child mortality include communicable diseases, such as malaria, diseases targeted by the national vaccination program, malnutrition, diarrhoeic diseases, and severe respiratory infections. The mortality rate for mothers declined from 566 per 100,000 births in 1993 to 484 per 100 000 births in 1998. The primary causes for maternal deaths are related to infections, haemorrhages, dystocies, and abortions. Other factors also contribute, 97 including the unbalanced diet o f mothers, numerous pregnancies that often come close together and their complications, inadequate coverage o f prenatal care, and the insufficient use o fhealth services -- particularly reproductive health services. Communicable diseases are the main causes o f morbidity and mortality for the general population o f Burkina Faso. Malaria i s the major source o f morbidity, and contributed to nearly 43% o f health service consultations in2005. HIV/AIDS also i s a major concern for Burkina Faso; according to UNAIDS, the adult HIV prevalence rate was 2.3% in2004. The food situation in Burkina Faso i s characterized by pockets o f chronic malnutrition, which leads to a high endemicity o f severe and chronic malnutrition, including a high prevalence o f specific nutritional deficiencies, particularly iron, iodine and vitamin A. Protein-energy malnutrition affects 39% o f the children under 5. The chronic energy deficit among women o f reproductive age is 21%, which contributes in turn to 18% o f babies being born underweight. This illustrates the strong links between the nutrition and health situation o f the baby and that o f its mother, particularly during pregnancy and while breastfeeding. The major causes o f maternal malnutrition are inadequate food intake, high energy expenditure, inadequate consumption of micro-nutriments, and parasitic diseases. With regard to geographic coverage o f health facilities, the situation is still unsatisfactory due to insufficient quality and quantity o f basic health services, despite improvements during the past ten years. In 2004, Burkina Faso had 1,374 health facilities, all categories inclusive. The average distance to a health facility i s 8.34 kilometres. Health services are organized in a pyramid, including: (i) community health centers, which constitute the first level of care in health districts and are the primary point o f contact between population and health services. In principle, each health center (CSPS) should cover a population o f 10,000 inhabitants and carry out a minimum package o f activities; (ii)district health centers (CMA) provide a complementary package o f additional health services, and also serve as reference hospitals for the CSPS; (iii)nine regional hospitals (CHR) serve as reference hospitals to the C M A and (iv) three university hospitals (CHU) offer the highest level reference for specialized treatments. C H U are also used as training facilities for various categories o f health personnel and researchers. Two C H U are located in Ouagadougou and one inBobo Dioulasso. Existing health facilities remain underutilized, however, particularly in rural areas, This is partly due to inadequate geographical and financial accessibility, but also to shortcomings in the organization o f health services; limited information, education and communication activities; as well as socio-cultural factors. This situation contributes to relatively poor performance inhealth service delivery. In 2004, only 34% o f childbirths were assisted by qualified personnel in health centers, 62% o f pregnant women received two or more prenatal consultations, and 98 contraceptive prevalence (16.4%) remains very low. The average annual number o f contacts per capita with a health facility i s 0.34%. Human resources remain insufficient in quantity and quality. In 2004, 76% o f the CSPS met minimal national staffing norms. To improve this situation, the Ministry will continue pursuing a policy o f granting priority to health regions and health districts when assigning newly graduated health agents from the national health personnel training school. The Ministry i s currently undertaking a census o f health personnel, and a human resources development plan has been adopted and is under implementation. In terms of budget resources allocated by the State to the health sector, despite a notable increase of the past seven years (an average annual budgetary increase o f 14.5%), health expenditures per inhabitant are below the norms recommended by the Macroeconomics and Health Commission o fthe World Health Organization. In2003, total health expenditure was $20 US dollars per capita, including the contribution o f external assistance. To mobilize the additional resources needed to implement the National Health Development Plan (Plan National de De'veloppement Sanitaire (PNDS)), the government finalized in 2005 a medium-term expenditure framework (MTEF) for the health sector for the period 2005-2010, which will be updated annually. Furthermore, to improve information regarding .total health expenditures at the national level, the first National Health Accounts (NHA) were produced in 2005, which analysed public and private health sector expenditures for the years 2003 and 2004. This decision-making tool will facilitate improved distribution o f resources in the health sector and the further elaboration o f health financing policies in the next few years. The private health sector i s less developed, except for the private pharmaceutical sector. Inlight of the limited resources allocated to the health sector, liberalization o f the economy and orientation towards more freedom o f choice for citizens, the national health policy has chosen to encourage the development o f the private health sector with a focus on the two largest cities o f Ouagadougou and Bobo Dioulasso. To summarize, the health situation inBurkina Faso is characterized by an unfavorable epidemiological profile with a large number o f pathologies o f which the most dominant ones are: (i) persistent communicable diseases, (ii) epidemic outbreaks, (iii) HIV/AIDS, (iv) the emergence o f non-communicable diseases, and (v) nutritional deficiencies. Inaddition, the health system i s constrainedby an inadequate number o f health personnel and their unequal distribution among urban and rural areas; inadequate coverage o f health facilities; insufficient financial and material resources, including maintenance; continued relatively highcosts o f health care; and inadequate environmental health, including insufficient measures to improve sanitation and the supplyofdrinkable water. 99 Faced with this alarming situation, the government o f Burkina Faso decided in 1998 to develop a national health care policy [Politique Sanitaire Nationale (PSN)] as well as a national health care development plan [Plan National de De`veloppement Sanitaire (PNDS)]. Both the PSN and the PNDS were based on a multisectoral and multidisciplinary vision, with contributions o f stakeholders from all levels o f the health system: technical and financial partners working in the health sector, communities, the private sector, and civil society (non-governmental organizations, associations, humanrights organizations, trade unions, etc.). In 1999, the government sponsored a national symposium, "The State of the Health Sector" [les Etats Ge`ne`raux de la Santk (EGS)], under the title: "Working together for a better performing health care system inBurkina Faso" (Tous ensemblepour un systBme de sante` performant au Burkina Faso), with the involvement o f all various actors working inhealth.. In2000 and 2001, respectively, the government adopted the PSNandthe PNDS. The PNS seeks to contribute to the welfare o f the population. This objective i s based on a vision o f an integratednational health system, which ensures medical care for all, ina fair and ethical manner, and geographic and financial access to essential preventive and curative services with the effective and responsible participation o f all actors. Achieving the goals of the PSN depends on strong political commitment, leadership, and team work, as well as enthusiasm for helping and supporting other people. The values that underlie the objectives o f the health policy include fairness, solidarity, effectiveness, and efficiency. To implement the PSN, the PNDS (2001-2010) is organized around the following eight intermediate objectives : (i)increase geographic coverage o f health services; (ii) improve the quality and utilization o f health services; (iii) strengthen the fight against communicable and non-communicable diseases; (iv) reduce HIV transmission; (v) improve the quality and distribution o f human resources in the sector; (vi) increase financial accessibility for the population; (vii) increase health sector financing; and (viii) strengthen capacity inthe sector. The objectives o f PNDS are consistent with those o f the poverty reduction strategy plan (PRSP), the Millennium Development Goals (MDGs), as well as those o f the new Partnership for Health Development in Africa. The sector wide approach (SWAP) is the strategy recommendedfor the PNDS implementation. Mister President, Inorder to achieve the PNDS objectives, the Government of Burkina Faso seeks the support o f your institution for the implementation o f a Health Sector Support and Multisectoral AIDS Program (HSSMAP) [Projet d'Appui au Secteur Sante` et 2 la Lutte contre le SIDA (PASS)]. 100 The development objective o f the project i s to support the national programs of the health system, including the struggle against AIDS. More specifically, the project will support PNDS to: (i) improve the quality and utilization o f maternal and child health services; (ii)expand the national response to malaria prevention and treatment, at both community and health district levels; and (iii) improve quality and coverage o f treatment for HIV/AIDS and sexually transmissible infections. The project will support the National AIDS Strategy to: (i) improve knowledge o f HIV prevention and encourage adoption o f lower risk behaviors, among high-risk groups as well as the general population; (ii) mitigate the socio-economic consequences of the AIDS epidemic through improved coverage o f social safety nets for orphans and vulnerable children, and improved coverage o f community care and support. Over the five next years, the government will continue the rehabilitation and the normalization o f incomplete health facilities, construction and equipping o f new health centers (CSPS, CMA, CHR an CHU), and the strengthening o f emergency treatment inhospitals, including for urban district hospitals (CMAs). To enhance health system decentralization and to help health districts become more effective, the Government will continue the training o f doctors in essential surgery and in district management, and continue the recruitment o f health personnel. The decentralized planning process will be consolidated by further strengthening health districts' development plans -- annual plans that take into account the priorities o f the PRSP and international objectives. The process o f hospital reforms initiated in 1990 will be continued. The objective o f the reforms is to improve regional and universityhospitals' performance and to allow each health actor to better know his rights, duties and responsibilities vis-&vis the institution and his patients. In 1998, the country promulgated a national law regulating hospitals, which was followed by the adoption by Parliament in 2002 o f a major reform law granting hospitals special independent status as public sector health parastatals [Etablissement Publique de Sante' (EPS)]. The various clauses related to this law will be further developedover the nexttwo years. Yet, deficiencies persist which need to be addressed, including the lack o f a master investment and institutional plan for most o f hospitals, inadequacies in hospital management, and insufficient organization o f emergency health services. A hospital sector development plan is currently being elaborated, and will subsequently be finalized, adopted and implemented. The development o f hospitals and peripheral health centers requires continuing the establishment o f maintenance structures in all health regions, and that all be sufficiently equippedand given competent humanresources. The national pharmaceutical policy has sought to support the revival o f primary health care through the promotion o f essential and generic drugs, whose geographical and financial accessibility contributes to improved access to and quality o f medical treatment. The Central Medical Stores for Essential and Generic Drugs [Centralel d'achat des me'dicaments essentiels gkne'riques (CAMEG)] was created in 1992 and 101 given the mandate to supply the population with good quality and affordable drugs. This was accompanied by measures to rationalize medical prescriptions and to improve the quality control o f imported generic drugs. The distribution network o f the CAMEG will be completed by the creation o f several additional regional drug depots. concerning the struggle against communicable diseases, the implementation o f various programs has allowed partial or complete control o f certain epidemic diseases within the country (including guinea worm, leprosy, and polio). Inthe years to come, however, we shall have to consolidate the efforts undertaken in this domain and to optimize the results through better coordination and integration o f activities, as well as the further development o f community-based services. Given that malaria remains the primary case o f morbidity and mortality in Burkina Faso, further prevention and treatment measures will be developed and implemented. Maternal and Child Health (MCH) programs are a priority for the government. To that end, the following programs will be reinforced: (i) the national vaccination program [Programme Elargi de Vaccination (PEV], including the introduction o f new vaccines in January 2006; (ii) Safe Motherhood Program; (iii) prevention the the of mother to child transmission o f HIV (PMCT); (iv) the integrated management o f childhood illnesses (IMCI); and (v) the nationalplan for malaria control, and nutrition activities. The implementation o f these programs will contribute to the reduction of mother and child mortality. Concerning the improvement o f the population's financial access to health services, the policy o f fiee or subsidized preventive and emergency medical care, particularly in the case o f epidemics, will be continued. The cost o f AIDS treatment with antiretroviral drugs, and subsidizing obstetric and neonatal emergency care will also continue to be further reduced. The provision o f medical care for destitute people remains a priority. As part o f the PSN implementation, the Ministry o f Health will continue its reorganization process and consolidate its managerial capacities throughout the health system. In order to ensure the availability o f quality and affordable treatment for the entire population, the government will continue to support a portion o f public health centers' recurrent costs to ensure their optimal operation. Cost recovery for medical treatment will continue, while taking into account the poverty context and encouraging the development o frisk-sharingand insurance systems. 102 These are, Mister President, the major orientations o f our healthpolicy, for which we appeal for the support o f your Institution under the Health Sector Support and Multisectoral AIDS Program (HSSMAP). Yours faithfully, Bedouma Alain YODA Commandeur de I'Ordre National 103 MAP SECTION