Document of The World Bank FOR OFFICIAL USE ONLY Report No: 67344-MG PROJECT PAPER ON A PROPOSED ADDITIONAL CREDIT IN THE AMOUNT OF SDR 3.9 MILLION (US$6 MILLION EQUIVALENT) TO THE REPUBLIC OF MADAGASCAR FOR A SECOND MULTISECTORAL STI/HIV/AIDS PREVENTION PROJECT MAY 17, 2012 Africa Health Nutrition and Population (AFTHE) Africa Region This document is being made publicly available prior to Board consideration. This does not imply a presumed outcome. This document may be updated following Board consideration and the updated document will be made publicly available in accordance with the Bank‘s policy on Access to Information. CURRENCY EQUIVALENTS (Exchange Rate Effective March 31, 2012) Currency Unit = Malagasy Ariary (MGA) Malagasy Ariary 2,121.25 = US$1 US$1 = SDR 0.6455 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS AF Additional Financing AFD Agence Française de Développement AIDS Acquired Immuno Deficiency Syndrome ARV Anti-retroviral drugs BCC Behavior Change Communication CAS Country Assistance Strategy CBO Community-based Organization CLLS Local Committee to Fight Against AIDS CMU Country Management Unit CNLS National Committee to Fight Against AIDS CRESAN The Health Project DHS Demographic and Health Survey DO Development Objective ES Executive Secretariat (National AIDS Secretariat) EU European Union FM Financial Management FMA Financial Management Agency GFATM Global Fund to Fight AIDS, TB and Malaria GoM Government of Madagascar HIV Human Immunodeficiency Virus IBRD International Bank of Reconstruction and Development IC Individual counseling IDA International Development Association IFR Interim Financial Reports IHP+ International Health Partnership IMCI Integrated Management of Childhood Diseases IP Implementation Progress ISDS Integrated Safeguards Data Sheet ISN Interim Strategy Note JHSSP Joint Health Sector Support Project M&E Monitoring and Evaluation MCH Mother and Child Health MDG Millennium Development Goals MICS Multiple Indicator Cluster Survey MoH Ministry of Health MSPP II Second Multisectoral STI/HIV/AIDS Prevention Project MTEF Medium-term Expenditure Framework MTR Mid-term Review MWMP Medical Waste Management Plan MS Moderately Satisfactory MU Moderately Unsatisfactory NGO Non-governmental Organizations NHA National Health Account OF Facilitation Organism ONN National Nutrition Office OP/BP Operation Policy/Bank Policy OPCS Operations Policy and Country Services ORAF Operational Risk Assessment Framework PAD Project Appraisal Document PDO Project Development Objective PHRD Policy and Human Resources Development Fund PIU Project Implementation Unit PIM Project Implementation Manual PLLS Provincial Committee to Fight Against AIDS PLWHA People Living with HIV/AIDS PMPS II Second Multisectoral STI/HIV/AIDS Prevention Project PNLS National Program to Fight Against HIV/AIDS PNNC National Community-based Nutrition Program RBF Results-based Financing RF Results Framework SALAMA National Drug Procurement Agency for Standard Drugs and Medical Supplies SDR Special Drawing Rights SE Executive Secretariat SHSDP The Sustainable Health Sector Development Project STI Sexually Transmitted Infections SW Sex Workers TORs Terms of Reference UNAIDS United Nations Aids Organization UNICEF United Nations Children‘s Fund US$ United States Dollars VP Vice President WDR World Development Report WHO World Health Organization Vice President: Makhtar Diop Country Director: Haleh Z. Bridi Sector Director: Ritva S. Reinikka Acting Sector Manager: Jean-Jacques de St. Antoine Task Team Leader: Jumana Qamruddin REPUBLIC OF MADAGASCAR SECOND MULTISECTORAL STI/HIV/AIDS PREVENTION PROJECT TABLE OF CONTENTS Data Sheet ........................................................................................................................................ i Introduction ..................................................................................................................................... 1 Background and Rationale for Seeking Additional Financing ....................................................... 1 Proposed Changes ........................................................................................................................... 9 Appraisal Summary ...................................................................................................................... 15 Annex 1: Revised Results Framework and Monitoring ................................................................ 21 Annex 2: Operational Risk Assessment Framework (ORAF) ...................................................... 35 Annex 3: Detailed Description of Modified Project Activities .................................................... 39 Annex 4: Revised Implementation Arrangements and Support ................................................... 41 Annex 5: Procurement Plan .......................................................................................................... 46 Annex 6: Target Regions, Catchment Populations, and Key Indicators....................................... 50 MAP .............................................................................................................................................. 53 MADAGASCAR SECOND MULTISECTORAL STI/HIV/AIDS PREVENTION PROJECT ADDITIONAL FINANCING DATA SHEET Basic Information - Additional Financing (AF) Country Director: Haleh Z. Bridi Sectors: Health Acting Sector Manager/Director: Jean J. de Themes: Population and St. Antoine/ Ritva Reinikka Reproductive Health (25%); Team Leader: Jumana Qamruddin Nutrition and Food Security Project ID: 128169 (25%); HIV/AIDS (25%); Child Expected Effectiveness Date: Aug 31, 2012 Health (25%) Lending Instrument: Specific Investment Lending Environmental category: ―B, Partial Additional Financing Type: Scale-up and Assessment‖ Restructuring Expected Closing Date: Sept 30, 2014 Joint IFC: n/a Joint Level: n/a Basic Information - Original Project Project ID: P090615 Environmental category: ―B, Partial Assessment‖ Project Name: Second Multisectoral Expected Closing Date: Dec 31, 2012 STI/HIV/AIDS Prevention Project Lending Instrument: Specific Investment Joint IFC: n/a Loan Joint Level: n/a AF Project Financing Data [ ] Loan [X] Credit [ ] Grant [ ] Guarantee [ ] Other: Proposed terms: Standard IDA Terms, 40 years maturity including a grace period of 10 years. AF Financing Plan (US$m) Source Total Amount (US$m) Total Project Cost: 6.00 Total Bank Financing: IDA Recommitted 6.00 i Client Information Recipient: Republic of Madagascar Présidence de la République Comité National de Lutte contre le VIH/SIDA Nouvel Immeuble ARO Ampefilola, Porte B - 2ème Etage Antananarivo 101 - Madagascar Tel: 261 20 22 382 86 Fax: n/a Secrétariat Exécutif du CNLS : secnls@moov.mg Responsible Agency: Contact Person: Dr. RAKOTOMALALA Rémi - Coordonnateur National - Tél:(261) 320581028 Unité de Gestion des Projets d'appui au secteur Santé Immeuble Lot III M 39 Bloc 2, Anosy - Boîte Postale 8555 Antananarivo 101 - Madagascar Tel: 261 20 22 553 23 / Fax: 261 20 22 569 76 / Email: cnugp@ugpsante.mg AF Estimated Disbursements (Bank FY/US$m) FY 13 14 15 Annual 1.0 4.0 1.0 Cumulative 1.0 5.0 6.0 ii Project Development Objective and Description Original project development objective: ―to support the Government of Madagascar‘s efforts to promote a multisectoral response to the HIV/AIDS crisis and to contain the spread of HIV/AIDS on its territory.‖ The revised project development objective ―to increase utilization of STI/HIV/AIDS, maternal and child health and nutrition services in the project area.‖ The proposed AF will support the implementation of activities that intensify the Project‘s impact and equity focus by reaching a number of vulnerable and at-risk groups in the context of a limited budget envelope. Specifically, the AF will finance the following activities: Component 2: Health, Nutrition, and HIV/AIDS Services (US$5.18 million). This component will continue to finance HIV and STI-related interventions inclusive of goods and technical assistance, focusing on testing, treatment and Behavior Change and Communication (BCC) for at-risk populations (sex workers, military and youth). In addition, the AF will finance the delivery of goods and technical assistance to health service providers to strengthen their capacity for the provision of mother and child health services and nutrition services to the population. Delivery of these key MCH services will maximize impact in the context of constrained resources, as they are carefully selected on the basis of cost-effectiveness, with the greatest impact on health outcomes. The Project will also support nutrition interventions at the community level, namely through support to the operational costs of community nutrition sites in selected districts and to the associated local NGOs that play a monitoring and supervision role. Support to the delivery of health and nutrition services will expand the types of services that will be provided through contracted NGOs. In addition, a pilot-based scheme for performance-based incentive payments to health facility teams and community health workers will be introduced. Some of the resources under the AF will support the development of the technical design of the model within the first six months after effectiveness, to be implemented in a selected number of intervention districts. An NGO will be recruited to provide implementation support to health centers and communities for this scheme. Component 4: Monitoring and Evaluation (US$0.42 million): This component will continue to fund activities based on the following objectives: (i) ensure that the national M&E system is operational; (ii) develop a functional monitoring system to measure and manage the performance of MSPP II; and (iii) track progress of project performance to ensure that the intended results of the Project are met. Component 5: Project Management and Capacity Building (US$0.40 million): This component will continue to provide support for technical supervision by the PIU and relevant functions within the MoH related to project activities, including SE and the National HIV/AIDS Council. iii Safeguard and Exception to Policies Safeguard policies triggered: Environmental Assessment (OP/BP 4.01) [X] Yes [ ] No Natural Habitats (OP/BP 4.04) [ ] Yes [X] No Forests (OP/BP 4.36) [ ] Yes [X] No Pest Management (OP 4.09) [ ] Yes [X] No Physical Cultural Resources (OP/BP 4.11) [ ] Yes [X] No Indigenous Peoples (OP/BP 4.10) [ ] Yes [X] No Involuntary Resettlement (OP/BP 4.12) [ ] Yes [X] No Safety of Dams (OP/BP 4.37) [ ] Yes [X] No Projects on International Waterways (OP/BP7.50) [ ] Yes [X] No Projects in Disputed Areas (OP/BP 7.60) [ ] Yes [X] No Does the project require any waivers of Bank policies? [X] Yes [ ] No Have these been endorsed or approved by Bank management? [X] Yes [ ] No Conditions and Legal Covenants: Financing Agreement Reference Description of Date Due Condition/Covenant Section 4.01(a) of the FA Amended the PIM Effectiveness Section 4.01(b) of the FA Revision of the composition Effectiveness of the Conseil du PMPS to include a representative of the nutrition sector. Section I.A.3 of Schedule 2 to the FA Recruitment of consultant for Effectiveness + 3 months the design of the PBF pilot under Part 1(b)(i) of the Project Section I.B.2 of Schedule 2 to the FA Proposed annual work Effectiveness + 30 days program and budget for the period between effectiveness and December 31, 2013 submitted to the Association for review and approval. Section I.B.4 of Schedule 2 to the FA Recruitment of independent Effectiveness + 2 months agency for data collection and monitoring indicators for the Project Section I.B.5 of Schedule 2 to the FA Compliance with the schedule On-going according to of repayment of the ineligible plan expenditures incurred under the original financing Section II.B.4 of Schedule 2 to the FA Recruitment of independent Effectiveness + 2 months auditors iv Section IV.B.1(b) of Schedule 2 to the IDA‘s agreement on the pilot Disbursement of the FA designed for the PBF and funds allocated to the adoption of a revised PIM to PBF financing reflect provisions for the implementation of the PBF pilot. v INTRODUCTION 1. This Project Paper seeks the approval of the Executive Directors to provide an additional credit in the amount of SDR 3.9 million (US$6 million equivalent) to the Republic of Madagascar for the Second Multisectoral STI/HIV/AIDS Prevention Project (Original Financing: P090615, Cr. 4104-MAG). 2. The Additional Financing (AF) Instrument complies with OP 13.20 (Additional Financing for Investment Lending) and will finance modified Project activities included as part of the restructuring of the Project that cannot be financed from the proceeds of the original financing and activities that scale up the Project‘s impact and development effectiveness. The proposed AF will expand the scope of the Project to deliver a low-cost, high-impact package of health, nutrition and HIV/AIDS interventions to vulnerable groups, including pregnant women and children under five, as well as to the most-at-risk1 populations for HIV/AIDS, thus helping to mitigate some of the negative impacts of the country‘s current political crisis on the well - being of the population. Moreover, the Project will develop and introduce a results-based financing (RBF) pilot to improve the quality of health and nutrition services. The AF will also continue to strengthen Monitoring and Evaluation (M&E) by reinforcing existing verification and accountability mechanisms in response to the overall governance issues in the country. 3. In order to reflect the expanded focus of the Project under the AF, the Project Development Objective (PDO) and the related PDO indicators have been revised. Changes have also been made to the project component descriptions, especially to include the new project activities on maternal and child health, and nutrition. 4. The proposed closing date of the AF is September 30, 2014. This will provide adequate time for implementation of the activities and falls within the three-year maximum timeframe allowed from the closing date of the original financing, which is December 31, 2012. BACKGROUND AND RATIONALE FOR SEEKING ADDITIONAL FINANCING (i) Country& Sector Context 5. Over the past 15 years, the World Bank has developed a progressively stronger engagement with the health and nutrition sectors in Madagascar and is a leader in this sectors‘ dialogue. Prior to the crisis, the Bank supported the Government in starting the transition in the health sector to a pooled financing and sector-wide approach culminating the signature of the International Health Partnership (IHP+) Compact between the Government and twenty-two 1 Targeted groups defined as youth aged 15-24 (by gender), military and sex workers in project areas. 1 development partners. The Bank also supported a number of high-quality sector analyses2 illustrating sector trends in Madagascar and gains achieved in health outcomes. 6. In January 2009, political tensions erupted in Madagascar and led to a military-backed transfer of power and to the establishment of an interim de facto government. On March 17, 2009, disbursements under the Madagascar portfolio were put on hold in accordance with OP/BP 7.30, Dealing with De Facto Governments. In November 2009, disbursements for certain key projects in Madagascar were exceptionally allowed to resume on humanitarian grounds, including three components under the Second Multisectoral STI/HIV/AIDS Prevention Project (MSPP II). These were: Component 2: Strengthening Health Sector Response; Component 4: M&E; and Component 5: Program Management. 7. The negotiated Joint Health Sector Support Project (JHSSP) in the amount of US$63 million slated for approval in January 2009 was pulled from the Board as a result of the political crisis. The JHSSP was a pooled financing effort with Agence Française de Développement (AFD), which has provided interim funding to Madagascar to move forward on key activities as a stop-gap measure until the Bank is able to provide new financing. 8. The Bank has also supported nutrition activities for more than a decade through a series of nutrition projects focused on community-based growth monitoring and behavior change activities, which are flagship for the region. This support has benefitted from a nationally representative multi-round impact evaluation series, which shows that the community nutrition model in Madagascar works. However, the Second Community Nutrition Project closed in July 2011 after 12 years of implementation. The Government had planned to assume the full cost of the Program after the Bank project closed; given the crisis, however, it is unable to take on these costs due to growing budgetary constraints. In response to significantly reduced funding from public resources, the National Nutrition Program has formally requested greater support for the sector through the preparation of a follow-up Bank-financed Project, which is to be the main source of complementary funding to the national program. (ii) Current Health, Nutrition, & HIV/AIDS Situation 9. While there has been significant progress in health over the past decade, Madagascar has lagged behind with respect to certain key health indicators, namely concerning pregnant women and children under five. Maternal mortality is estimated at 498 per 100,000 live births,3 far from the Millennium Development Goal (MDG) of 149 per 100,000. This is partly attributable to inadequate access to skilled staff at delivery, the poor quality of antenatal care, a lack of emergency obstetric care services, a lack of adequate post-natal follow-up, and a persistently high unmet need for contraception. In addition, 27 percent of pregnant women are severely underweight and anemic. Child health outcomes had greatly improved prior to the crisis, showing a sharp decrease in child mortality. However, children under five continue to face a high morbidity risk due to poor nutrition status, with 50 percent of children in this age group 2 Setting Priorities in the Health Sector to be More Efficient, June 2010; Health, Nutrition and Population Outcomes in Madagascar 2000-2009, June 2011. 3 Data in this paragraph from DHS 2008/2009 unless otherwise stated. 2 being stunted, severely underweight, and anemic. There is also an increased rate of acute malnutrition, which climbed from 4.7 percent in 2008 to 7.4 percent in 2011 in some areas.4 10. While the prevalence of HIV/AIDS is low among the general population, at approximately 0.2 percent for adults aged 15 to 49 years5, it is high among certain at-risk populations. The HIV prevalence rate among sex workers in 2010 was estimated at 12.9 percent.6 In addition, rates of STIs are significant,7 the prevalence of syphilis being particularly high among sex workers at 15.6 percent, pregnant women at 3.4 percent,8 and the military at 16.7 percent.9 11. Poverty levels increased by more than nine percentage points between 2005 and 2010, with 77 percent of households currently below the poverty line—one of the highest rates in Africa.10 While studies are underway to assess the full impact of the current political situation on health outcomes, program data from the Bank and partners suggest a rapidly declining situation, especially in poorer regions. This is mainly due to a drastic reduction in both external and internal financing of the health sector since the crisis, as well as increased fragmentation of resources and use of parallel systems for service delivery. For example, the commitment of external funding has decreased from 16.3 percent prior to the crisis in 2009 to 3.1 percent in 2010. In addition, the government budget for operational costs to health centers at the district level was reduced by approximately 30 percent in 2010 compared to the 2008 budget, thus resulting in the closure of approximately 10 percent of existing primary health care facilities. External consultations declined from 37.6 percent in 2008 to 30.3 percent in 2010, and antenatal care coverage decreased from 73.4 percent (2008) to 62.10 percent (2010) as a result of the closure of health facilities and the lack of access to quality services, including access to basic technical equipment and trained human resources. (iii) Project Status 12. The Second Multisectoral STI/HIV/AIDS Prevention Project (MSPP II) is financed with a US$30 million equivalent credit (original financing), which was approved on June 13, 2005. The financing agreement for the original financing became effective on January 6, 2006. The closing date of the original financing account was December 31, 2009, but it was extended twice to the current closing date of December 31, 2012.11 The PDO for the original financing is to support the Government of Madagascar’s efforts to promote a multisectoral response to the HIV/AIDS crisis and to contain the spread of HIV/AIDS on its territory. The Project aims to strengthen capacity to carry out the national response to HIV/AIDS and sexually transmitted infections (STIs), a key risk factor for and contributor to the spread of HIV/AIDS, and seeks to improve the quality of life of persons living with HIV/AIDS through increased access to quality 4 SMART UNICEF nutrition survey, March-April 2011 in Ampanihy, Betioky and Toliara II. 5 both sexes combined, UNAIDS estimate from 2010 Global HIV/AIDS report 6 Biological surveillance survey for syphilis and HIV infection, 2010. 7 There is substantial biological evidence demonstrating that the presence of other STIs increases the likelihood of both transmitting and acquiring HIV. 8 Biological Surveillance Survey, 2010. 9 Ministry of Defense Survey, 2006. 10 World Development Indicators, 2011 and Madagascar ISN 2012. 11 The project was initially extended by two years from the original closing date of December 31, 2009 to December 31, 2011, then extended again by one year to December 31, 2012, which is the current closing date. 3 medical care and non-medical support services. There is a strong focus on at-risk and vulnerable groups. 13. As of March 31, 2012, approximately SDR 17.6 million (US$27.6 million equivalent) has been disbursed, representing 87 percent of the credit. The Project is currently rated Satisfactory (S) on achievement of its PDO. The Development Objective (DO) rating for the Project was upgraded to Moderately Satisfactory (MS) from Moderately Unsatisfactory (MU) in July 2011. This does not comply with the requirement to maintain a 12-month consistent rating of Satisfactory or MS. Therefore, the team obtained an endorsement from Bank management on May 8, 2012, for a policy waiver to OP 13.20 Additional Financing for Investment Lending.12 The Project‘s failure to maintain a minimum rating of MS for 12 consecutive months is a direct result of the hold placed on all disbursements under the Madagascar portfolio in the wake of the political crisis, which erupted in January 2009. In accordance with the Bank‘s policy on dealings with de facto governments, project funds were frozen between March and November 2009, severely curtailing activities. It was decided at that time to downgrade progress toward the PDO, given the uncertainty of the situation. Since the April 2011 supervision mission13 and spanning the recent ISRs14, the DO rating of the Project has been gradually upgraded given the steady improvement in performance as reflected in progress on key indicators (e.g. improvements in knowledge and behavioral indicators). 14. The Government and the Bank teams have agreed on key actions to ensure that implementation stays on track and progress is sustained. These actions are closely monitored by the task team and updated as milestones are achieved. New milestones are added during every supervision mission and reflected in mission Aide-Memoires to ensure a commitment to the action plan being implemented in an acceptable and timely manner. Moreover, Implementation Progress (IP) has remained at MS or better throughout the majority of the project, indicating that the project has been implemented in a generally satisfactory manner despite a challenging country context. 15. Given disappointing progress in some of the major indicators due to the crisis and the subsequent hold on disbursements, contracts with NGOs15 were put in place to accelerate progress and reach at-risk groups with critical interventions.16 While an updated assessment of PDO outcome indicators is awaiting the results of the next combined Biological and Behavior Study scheduled to go into the field in December 2012, all of the intermediate indicators have already been achieved or are on track to being achieved. This significant progress on key intermediate indicators is a positive sign towards achieving the PDO. 12 The policy exception is with regard to OP 13.20, which states that ―the Bank provides additional financing only when it is satisfied that implementation of the project is satisfactory,‖ which is measured against whether the parent project‘s ratings, including those for overall implementation progress (IP) and progress towards achievement of the project development objectives (PDOs), are rated “Moderately Satisfactory (MS)” or better for the last 12 months as per the Implementation Status and Results Report (ISR). 13 The archived ISR in the system, dated July 2011, reflects decisions agreed to with the Government during the April 2011 virtual supervision mission (please refer to April 2011 Aide Memoire). 14 July and November 2011 and April 2012 15 As indicated in the report of External Verification Agency and program data. Five NGOs were contracted. 16 At-risk groups include sex workers, military and youth aged 15-24. 4 16. Safeguards continue to be rated Satisfactory based on adequate implementation of the medical waste management actions. Procurement and M&E are rated Satisfactory as well. 17. Ineligible expenditures under Component 3 of the original credit (Fund for STI/HIV/AIDS Prevention and Care-Taking Activities) have been addressed with a repayment plan acceptable to the Association under which payments are current17. The ineligible expenditures were the result of an inadequate understanding of the difference between eligible and ineligible expenditures, as well as poor bookkeeping and accounting practices on the part of community-based organizations. In addition, there was poor supervision on the part of the Financial Management Agency (FMA), recruited to manage this Component. When these ineligible expenses were identified at the end of 2008, Component 3 was immediately suspended and appropriate mitigation measures were put in place to prevent future recurrences18. In order to enable a one-year extension of the Project‘s closing date despite the outstanding ineligible expenditures, a policy exception was approved by the VP OPCS and the VP and Controller CTRLD on December 22, 2011 with respect to BP 10.02 Annex A, Actions that the Bank Takes in Respect to Noncompliance with Financial Management Requirements. Until all payments have been made by the Government, Financial Management will continue to be rated MS. In all other areas of Financial Management, the Project has been rated Satisfactory. There are no outstanding audits. 18. In December 2011,19 a Level 2 restructuring of the original Project was approved to enhance project effectiveness.20 Specifically, the restructuring resulted in the following changes: (i) formally closing component 3 on STI/HIV/AIDS Prevention and Care-Taking, which had been suspended since 2008; (ii) increasing the health sector response through scaling-up Component 2 for delivery of services; (iii) revising the results framework, including strengthening linkages between project activities and intermediate and outcome indicators; and (iv) extending the closing date from December 31, 2011 to December 31, 2012, in order to consolidate achievements and measure the results and impact of project activities. (iv) Rationale for Bank Financing 19. In the current country context, the cost of inaction in the health and nutrition sectors is high and is already disproportionately affecting the poorest and most vulnerable quintiles of the population. Given the deteriorating situation and the long-term partnership and support to the country, the rationale for Bank engagement is strong. As noted in the Interim Strategy Note (ISN), Madagascar is at an increased risk of falling into a fragility trap of low growth, weak human capital, low capacity and poor governance, from which it would take substantial effort and time to emerge. The ISN proposes that the Bank intervene in a few areas in which it is 17 The Government has made three payments of reimbursement tranches totaling US$151,762 out of US$745,569 to be repaid. The outstanding ineligible expenditures are expected to be reimbursed before the current closing date of the original financing on December 31, 2012 as agreed under the repayment plan. 18 Eligible and ineligible expenditures were clarified in the PIM and the component was closed. For the Additional Financing, transaction-based disbursements will continue to be used which is considered the best method to indentify ineligible expenditures early on and address them. 19 Restated DCA was signed by the Government in February 2012. 20 Decisions on the larger Madagascar portfolio restructuring and the preparation of the country‘s ISN took longer than expected . As a result, a Level 2 restructuring needed to be processed as a first step toward ensuring that the project had sufficient time to complete key activities and did not close before the AF became available. 5 demonstrated that the failure of Government and other partners to get involved is exacerbating the already fragile state of human capital. In this context, health and nutrition have been identified as priority sectors for the country‘s short-and long-term objectives. As indicated in the ISN, the proposed AF in the amount of US$6 million is being financed by resources that have been reallocated from existing funds that cannot be used by other operations as part of an extensive restructuring exercise of the Madagascar portfolio. 20. Building on the Bank‘s longstanding involvement in these sectors, the proposed AF will be instrumental in mitigating some of the negative impacts of the crisis on the population. To achieve this, the AF will increase the impact of the Project by providing focused support through the delivery of a low-cost, high-impact package of health, nutrition and STI/HIV/AIDS services directly to key target populations. The additional interventions that will be supported under the AF have proven successful in prior IDA-financed health and nutrition operations in Madagascar. The design of this AF has drawn on a strong analytic base, it builds on lessons learned from previous health and nutrition operations, and will use modes of service delivery that have proven effective (Box 1). 21. The proposed AF will also pilot RBF to improve the quantity and quality of basic services and to strengthen accountability.21 Given the country‘s strong interest in using an RBF approach to improve health service delivery by addressing constraints in the system through motivating the existing human resource base, this AF is expected to play an important role in laying the preliminary groundwork on RBF in the health sector. It will also potentially leverage future additional resources22 to complement new IDA lending operations in the medium term. In addition, the AF will allow for the implementation of key governance measures to improve health service delivery that have been lacking in the health system since the start of the crisis. Measures such as periodic audits on the supply chain system at facility level to ensure that drugs are getting down to primary health center level with minimum delays are critical interventions that will be implemented in project intervention areas, while the capacity built will benefit the system overall. 22. The proposed AF is the most viable option to continue providing IDA support to deliver urgent interventions in the health and nutrition sectors. In the short term, the operation serves as an entry point for delivering a cost-effective package of health, nutrition and HIV/AIDS services to mitigate the negative impacts of the country‘s current political crisis on the well -being of the most vulnerable and at-risk segments of the population. The AF also serves as a bridge to a new operation envisioned under the ISN for FY13 while protecting valuable and well established implementation and program management capacity in a partnership arrangement23 with other key donors in the sector. Furthermore, the MSPP II allows the Bank to remain engaged in the sectoral policy dialogue as a lead donor during this critical time. 21 The original project supports a form of RBF in the context of performance-based contracting of the implementing NGOs; the AF will additionally develop a new pilot for incentive payments to health facilities and communities. 22 Through other existing funding mechanisms, such as the World Bank-administered Health Results Innovation Trust Fund 23 World Bank Project provides full support of the salaries and 70% of the operational budget of the Health PIU which now manages donor financing from other sources including Agence Française de Développement, The Global Fund, and the Government of Monaco. These partners contribute the remaining 30% in operational costs of the PIU. 6 23. The proposed AF will also leverage resources from AFD, which is currently funding regional- and district-level budgets in line with the activities envisioned under the JHSSP (planned as a pooled financing effort with AFD prior to the crisis). In addition, the Bank is working closely with the EU24 to ensure that resources are complimentary with respect to geographic scope and interventions. Activities proposed under the AF will benefit from the well- functioning implementation and fiduciary mechanisms already in place. The recipient has sufficient capacity and a strong commitment to implementing the AF package, as evidenced by the significant improvement in progress toward the PDO and the satisfactory implementation of the original credit. 24. Additional Financing is the preferred mechanism. Alternative options to this additional financing arrangement were not possible because of the current country context and the nature of the Madagascar portfolio restructuring. The current political situation in Madagascar is not conducive to the use of other tools such as a new lending at this time. As previously discussed, the Madagascar portfolio is operating under OP 7.30 and the Madagascar portfolio restructuring aims to reallocate existing resources to operations that can support direct service delivery to the beneficiaries. 24 The EU has allocated approximately 30 million Euros to support the health sector at community levels through NGOs and will cover the regions where the Bank is not implementing this AF. Their funding will not be available until the end of the year; as such, the AF will be responding much sooner in delivering critical interventions. In addition, Madagascar is a recipient of financing from the Global Fund to Fight AIDS, TB, and Malaria (GFATM); due to the global financial crisis, however, the GFATM is facing a severe shortfall for current and future rounds of funding. This has significant implications for Madagascar, given that GFATM is the primary provider of commodities for those diseases. 7 Box 1: The MSPP II Additional Financing- Building on a Strong Analytical Base and Past Sector Operations The World Bank’s support to the health sector has historically included a strong analytic base for developing the operational portfolio and guiding policies. The Bank has prioritized rigorous analyses as a central part of the policy dialogue through support and use of nationally representative surveys (e.g. Demographic Health Survey and facility level survey), impact evaluations, and other operational evaluations. Prior to the crisis, the World Bank had been supporting an evolution in the health sector in Madagascar; this led to a shift toward a pooled financing effort in the sector, which was derailed as a result of the crisis. Since 2009, the analytic work portfolio has expanded significantly to include the Country Status Report (2000-2009) and the Joint Health Sector Policy Note (2010), the results of which are now used by all partners and the Government to inform sector policies and decisions. In addition, the analytic portfolio now includes the Health PHRD Grant, and the Results Based Financing (RBF) Knowledge and Learning Grant, which is providing support for key analyses that the RBF model will integrate in its design. During implementation, the AF will also benefit from two important surveys funded by the World Bank that are currently taking place: 1) the Multiple Indicator Cluster Survey (MICS), a joint effort with the United Children’s Fund (UNICEF) which will provide current information on health, nutrition, and education status of the population; and 2) the 3rd round of the nationally representative health facility survey which will provide up-to-date information on the status of health facilities in the country. The design of the AF builds on this rich portfolio of analytic work. The financing will continue to support community-based nutrition interventions with a focus on children under three, provide a package of low- cost, high-impact mother and child interventions at the health center, exploit mobile technology to address health needs, and address the human resource constraints to service delivery at primary care and community levels by encouraging improved performance of health service providers through RBF mechanisms. Some of the key operations that the AF builds on include: The Sustainable Health Sector Development Project (SHSDP), a US$10 million credit (September 2007 - December 2009) was the third in the series of World Bank sector support following Supplemental Credit for First and Second Health Project (CRESAN I and II) over a period of almost 10 years. SHSDP built on lessons learned and was a building block for the planned JHSSP, which was unable to go forward as a result of the crisis. The Project focused on addressing key system and institutional capacity issues, well as supported delivery of key health interventions and tested innovative solutions to address challenges that were disproportionately affecting the poor in rural and remote areas of the country. The Second Community Nutrition Project (1999-2011), a US$47.6 million credit, focused on community- based nutrition interventions to reduce malnutrition and benefitted from the lessons under the initial IDA-supported nutrition project (SECALINE 1993-1998). The support of the Bank was critical in the institutionalization of nutrition priorities in Madagascar, which resulted in the creation of the National Office for Nutrition and the National Nutrition Council, as well as in the establishment of the Regional Nutrition Offices in 22 regions. In total, there are now 5,550 sites in the country covering the target population nationwide, resulting in just over 750,000 children less than three years of age enrolled in the community nutrition program. The results from the multi-round impact evaluation (1999, 2003, 2007, and 2011) have shown these sites to have a significant impact when it comes to improving nutrition outcomes for the target population. This nationally representative evaluation included one component that followed the same cohort of children from 1999 to 2011 and showed both the short-term achievements and long-term impact of these interventions on the general well-being and cognitive development of the children. The proposed AF will support the functioning of these community nutrition sites in targeted project areas. In addition, the AF will support the operationalization of a national nutrition surveillance system at lower levels of the health system, through the expanded use of mobile phones for the collection of data on health and nutrition interventions in the targeted regions. This model was piloted with very positive results. 8 PROPOSED CHANGES 25. PDO and PDO indicators: The PDO will be revised under the AF to read as follows: to increase utilization of STI/HIV/AIDS, maternal and child health and nutrition services in the project area. The Results Framework (RF) was revised during the restructuring of the Project. Some of the targets will be further revised to take into account the proposed closing date of the AF and new indicators will be introduced to reflect the expanded objective of utilization of maternal and child health and nutrition services (please refer to Annex 2 for the full revised RF). Table 1 below shows current and revised (proposed under the AF) project outcome indicators. Table 1: Revisions to the Results Framework For the Original Financing25 (Current, Proposed for the AF26 (Expected Closing Closing Date: December 31, 2012) Date: September 30, 2014) Project Development Objectives Support GOM efforts to promote a Increase utilization of STI/ HIV/AIDS, and multisectoral response to the HIV/AIDS maternal and child health and nutrition crisis and to contain the spread of HIV/AIDS services in project areas. on its territory. PDO Indicators 1. Decrease in syphilis prevalence among sex workers (SW) (%) New: Pregnant women tested positive and treated for syphilis during prenatal consultations in project areas (number) 2. Percentage of targeted groups who can cite three methods of HIV/AIDS prevention (%) Percentage of targeted groups27 who can cite three methods of HIV/AIDS prevention in project areas (%) 3. Percentage of men and women aged 15-49 who report having sex with a non-regular partner in the last 12 months 4. Percentage of target population reporting the use of a condom in their last act of sexual intercourse with a non-regular sexual partner in the last 12 months (%) 25 In this column empty cell denotes that indicator is not part of original financing under the Project. 26 In this column empty cell denotes the indicator not measured after December 31, 2012. 27 Defined as youth aged 15-24 (by gender), military, and sex workers in project areas 9 Percentage of target28 population reporting the use of a condom in their last act of sexual intercourse with a non-regular sexual partner in the last 12 months in project areas (%) 5. Percentage of SW reporting the use of a condom in their last act of sexual intercourse with a client (%) 6. Percentage of youth aged 15-24 that have received an HIV test in the last 12 months and who know their results (by gender) 7. Percentage of SW that have received an HIV test in the last 12 months and who know their results New: Pregnant women receiving antenatal care during a visit to a health provider (number) New: Children 0-24 months obtaining monthly adequate minimum weight in project areas (number) New: Children immunized (number)29 8. Direct Project Beneficiaries (number), of Changed to: which female (%) Direct Project Beneficiaries (number), of which female (%): 1. For HIV interventions in project areas 2. For Health and nutrition interventions in project areas New: People with access to a basic package of health, nutrition, or population services (percent increase based on number of people) 26. Project Closing Date: The closing date of the AF phase will be September 30, 2014 to allow time for implementation of the activities, whose completion is expected to take approximately 24 months. This is a sufficient time period given that the AF resources will be 28 Defined as youth aged 15-24 (by gender), military, and sex workers in project areas 29 Core indicator. In the project, this is defined as full immunization of children under 1 year of age (refer to RF Annex 2). 10 channeled through existing, well-functioning mechanisms to ensure efficient implementation and service delivery. As the current closing date for the original credit is December 31, 2012, the closing date of the AF phase is within the three-year limit. 27. Reallocation by Component: The original project components are: (1) Harmonization, donor coordination, and strategies; (2) Support for health sector response; (3) Fund for STI/HIV/AIDS Prevention and Care-Taking Activities (closed); (4) Monitoring and Evaluation; and (5) Project management and capacity building. Component 2 will be expanded to include delivery of health and nutrition interventions and will be renamed ―Health, Nutrition and HIV/AIDS Services.‖ As a result of the recent restructuring, funds from the original Component 3 were reallocated to Components 2, 4 and 5. Some funds were also allocated to Component 1 to cover cost overruns of implemented activities. Table 2 presents the revised project costs by component, taking into account the proposed AF resources. The AF will mainly focus on Component 2 (Support to Health Sector Response), Component 4 (M&E), and Component 5 (Project Management and Capacity Building). Table 2: Revised Project Costs by Component with Additional Financing (in US$ millions)30 Component Current Additional Revised total Amount31 Financing Allocation 1 Harmonization, Donor Coordination and 2.9 0.0 2.9 Strategies 2 Support to Health Sector Response 12.5 5.2 17.7 3 Fund for STI/HIV/AIDS Prevention and Care- 7.4 0.0 7.4 Taking Activities 4 Monitoring and Evaluation 4.3 0.4 4.7 5 Project Management and Capacity Building 4.0 0.4 4.4 TOTAL 31.132 6.0 37.1 28. Proposed AF Activities: The proposed AF will support the implementation of activities that intensify the Project‘s impact and equity focus by reaching a number of vulnerable and at- risk groups in the context of a limited budget envelope. Specifically, the AF will finance the following activities: Component 2: Health, Nutrition, and HIV/AIDS Services  Continued financing of HIV and STI-related interventions inclusive of goods and technical assistance, focusing on testing, treatment and Behavior Change and Communication (BCC) for at-risk populations (sex workers, military and youth). In addition, the AF will finance the delivery of goods and technical assistance to health service providers to strengthen their capacity for the provision of mother and child health (MCH) services and nutrition services to the population. Delivery of these key MCH services will maximize impact in the context of constrained resources, as they are carefully selected on the basis of cost-effectiveness, with the greatest impact on health 30 Amounts are rounded to the nearest whole number 31 Amount as of Project restructuring 32 Difference in total US$ amount due to exchange rate fluctuation. 11 outcomes. The full package of interventions for maternal and child health and nutrition can be found in Annex 3. The Project will also support nutrition interventions at the community level, namely through support to the operational costs of community nutrition sites in selected districts and to the associated local NGOs that play a monitoring and supervision role. A detailed description of component activities is also presented in Annex 3. Support to the delivery of health and nutrition services will expand the types of services that will be provided through contracted NGOs.  Design and implementation of a pilot for performance-based payments to health facility teams and community health workers in a few of the targeted districts. A key feature of the design will be a transfer of resources to health and nutrition service providers to deliver services on the basis of results. More specifically, based on carrying out a program of specific activities to deliver Packages of Health Services with a focus on maternal and child health, through the provision of quantity- and quality-adjusted output- based grants. Some of the financing under the AF will fund an NGO consultant contract to support the implementation of the pilot, which will be carried out in a selected number of intervention districts to be identified during the pilot‘s design phase.33  Support to the operations of the centers and associations engaged in the medical and psychosocial treatment of persons living with HIV/AIDS, through the financing of operating costs.  Support to the implementation of the Medical Waste Management Plan. Component 4: Monitoring and Evaluation  Provision of goods and technical assistance for the establishment of an information system to monitor Project activities and distribution of mobile phones to Health Service Providers and Nutrition Service Providers involved in the implementation of the Project.  Carrying out: (i) independent verifications of the implementation of Project activities by the NGOs, Health Service Providers and Nutrition Service Providers, through independent entities; (ii) a second biological and behavioral surveillance study after completion of the Original Project; iii) periodic surveys to assess progress; and iv) a final evaluation of the activities included in the AF and the Original Credit and their performance. Component 5: Project Management and Capacity Building  Provision of support to Project management and to capacity building of the entities involved in the management, supervision and implementation of the Project, at the central, regional, district and local levels. 29. Geographic scope and Target Population: Given the limited amount of resources, the geographic scope under the AF will be limited to have a greater impact on regions with high 33 The design phase of the project is expected to conclude by January 31, 2013. 12 poverty and low health outcomes, as determined by the 2011 poverty map and the latest Demographic and Health Survey (DHS) in 2008/09. Specifically, activities will primarily be focused in a subset of the poorest 26 districts in the regions of Androy, Atsimo Atsinanana, Vatovavy Fitovinany, Haute Matsiatra and Amoron‘i Mania.34 Due to the nature of the interventions, the following selection criteria were used to ensure that there is sufficient implementation capacity for the additional interventions: i) availability of functioning health facility; and ii) functioning community nutrition sites referring up to the facility. The estimated direct beneficiaries represent about 20 percent of the total population in the intervention zones for the integrated services, out of which approximately half will benefit from only nutrition and health services, whereas the rest will receive an integrated package including health, nutrition and HIV/AIDS and STI interventions. The Project will also target the most-at-risk populations for HIV/AIDS and STIs with a package of specific interventions. The total beneficiaries under the Project (original financing and AF) are approximately 2,500,000 people of which the proposed AF is targeting approximately 560,000 people. Per capita unit cost is estimated at approximately US$9.75, which includes all costs related to delivering a full package of interventions to various target populations. 30. Implementation arrangements: The implementation arrangements will be further strengthened to ensure the successful implementation of new activities. At the central level, the Executive Secretary (SE) of the National AIDS Council (CNLS) will continue to assume a national role of coordination, monitoring and evaluation and resource mobilization. The central level of Government will play a policy coordination role but will not have direct oversight over project activities. As illustrated in Annex 4, these implementation arrangements have three levels: a. Coordination, management, oversight, and verification: As with the parent project, resources under the AF will flow directly to the health Project Implementation Unit (PIU), operating at technical levels of the Government (in line with Bank‘s current guidance to staff for sectoral engagement under OP 7.30). The PIU is responsible for the day-to-day management of the Project and is subject to World Bank IDA guidelines. World Bank funds support the majority of the operating costs of the PIU, as well as support all salaries of the PIU staff. PIU staff are hired under consultant contracts consistent with Bank procurement guidelines. The annual work plan of the Project is approved by the Conseil du PMPSII, which consists of technical specialists of the Government and representatives from NGOs and private community associations. The Conseil du PMPSII will add a nutrition specialist to ensure expertise on the Conseil for new activities envisaged under the AF. Finally, the external verification agency plays an essential 3rd-party verification role in ensuring that services are delivered efficiently through periodic operational audits. b. Implementation: Implementation of AF activities will utilize mechanisms that are existing and well-functioning and will be further enhanced to ensure effective delivery of 34 Out of 26 districts, eight will focus specifically on HIV/AIDS intervention, whereas the rest will be on all integrated interventions, including health and nutrition. This is translated into 147 communes of intervention covering 143 basic health centers. Selection of the districts was done with the MoH in consideration of other partners involved and poverty levels. See Annex 6 for more details on poverty levels. 13 key interventions to beneficiary populations. Given the inclusion of nutrition activities under the AF, the Project cost will include expenditures for the National and Regional Nutrition Offices to assist in the supervision of community nutrition sites in project areas. Technical assistants will be hired to augment capacity at the district level for supervision and implementation support to health facilities and community nutrition agents in project areas. In addition to HIV/AIDs-related services, NGOs will be contracted directly by the Project to support delivery of maternal and child health and nutrition services at facility and community levels based on well-defined terms of references (ToRs). To address gaps and scale-up impact, they will be involved in the direct delivery of interventions as well as in providing support to health facilities and community nutrition agents to ensure the quality of service delivery. c. Beneficiaries: Beneficiaries will continue to play an essential role in demanding quality services for themselves, their families, and their communities. The AF will support the implementation of community scorecards, which have proven effective in previous Bank operations as an important feedback mechanism from this perspective for improving accountability in service delivery. 31. Fiduciary Arrangements: The financial management and procurement arrangements will remain the same as under the original Project: a. Financial Management functions will continue to be undertaken by the current PIU, which has considerable experience and a good track record in the implementation of Bank financial management procedures. The Project is up to date with its reporting and external audit obligations. There are no outstanding interim financial reports (IFRs) and external audit reports. b. Procurement will be carried out in accordance with the World Bank‘s ―Guidelines: Procurement under IBRD Loans and IDA Credits‖ dated January 2011 and ―Guidelines: Selection and Employment of Consultants by the World Bank Borrowers‖ dated January 2011, and in accordance with provisions stipulated in the Legal Agreement. An assessment was conducted to confirm that the PIU has the capacity to carry out procurement activities. The provision for a Procurement Agent to obtain medical goods will be included to reflect the use of SALAMA, the national drug procurement agency for standard drugs and medical supplies. Competitive selection of NGOs will continue to be based on quality and cost selection and performance-based contracts will be signed with the selected NGOs. In consideration of the application of OP.7.30, procurement thresholds for the Bank's prior review will be maintained as under the original financing. The procurement section of the Project Implementation Manual will be reviewed to reflect changes related to applicable Guidelines, as well as new activities to be supported under the AF. A consolidated procurement plan for the AF has been prepared and approved by the Bank (Annex 5). The plan will be updated at least annually to reflect the most up-to-date circumstances. 32. Disbursement Arrangements: Upon effectiveness of the AF, transaction-based disbursements will be used (as is the case for the ongoing Project), as this disbursement method 14 is considered to be the most stringent approach to facilitating the timely identification of potentially ineligible expenditures. A new Designated Account denominated in US dollars on terms and conditions acceptable to IDA will be created for the AF. The ceiling of the account will be up to US$1.0 million, consistent with the original financing, to avoid issues related to payment delays. These delays were due to insufficient balances in the Account that were adversely affecting implementation. The Designated Account A under the original financing will remain in effect until December 31, 2012, which is the current closing date of the original Project. Alignment with Country Assistance Strategy (CAS) 33. The previous CAS (2007-2011) expired in July 2011. The country is not in a position to justify preparation of a full new CAS given the absence of a normal dialogue with an internationally recognized Government and limitations on the Bank‘s lending capacity. Considering the continued fragile environment in Madagascar, an ISN has been discussed with the Board on February 21, 2012. The ISN (FY12-FY13) focuses on the most pressing short-term issues affecting the country, while keeping a medium-term view on governance, employment and vulnerability—key objectives of the Africa Region Strategy. It identifies the health and nutrition sectors as the priority areas for protecting, to the extent possible, progress made for the general well-being of the population, both in the short- and medium-term. 34. In addition, as highlighted in the World Development Report (WDR) 2012, ―Gender Equality and Development‖ improvements in maternal and reproductive health are also clearly linked to gender equality and women‘s empowerment, which in turn have a direct impact on the economic well-being of a nation. Investments in health (and education)—human capital endowment—shape the ability of men and women to reach their full potential. Health gender inequalities in Africa are focused on the growing problem of women dying in their reproductive years mainly due to issues related to maternal and reproductive health. Greater human capital for women will not translate into greater reproductive choice if women lack access to reproductive health services. It is thus important to ensure that the health system is able to provide a basic package of reproductive health services, including family planning. In this context, the AF is fully aligned with the objectives of the ISN, the Africa Strategy, and the WDR 2012. APPRAISAL SUMMARY Technical 35. The overall technical design of the Project is aligned with the country‘s health sector priorities and is based on lessons learned from past interventions financed by IDA, such as the Community Nutrition Project, the Health Sector Development Project, and the first phase of MSPP, as well as a wide array of high-quality sector analyses conducted in recent years. The Project aims to implement cost-effective interventions of proven value and provide related commodities to reach vulnerable and high-risk populations, while at the same time strengthening the health system through support to M&E, project management, and capacity building. The integration of key services will maximize impact in the context of constrained resources and the 15 selected health, nutrition, and HIV interventions are proven to have the greatest impact on health outcomes. 36. The Project will target six out of the eleven regions in Madagascar for HIV-related interventions; five regions will benefit from integrated services—comprised of HIV/AIDS, health, and nutrition—that will reach approximately 20 percent of the total population in the intervention areas. The geographic areas of focus have been selected in light of their high poverty and low health outcomes, as indicated in routinely collected project data, nationally representative surveys, and the country‘s most recent Poverty Map.35 Recent data show a higher poverty ratio in these regions, ranging from 84.7 percent to 94.5 percent in both urban and rural areas combined, while Madagascar‘s national average is at approximately 77.0 percent. This disparity is more evident in rural than in urban areas. The poverty intensity level has a similar result: it ranges from 37.6 percent to as high as 60.9 percent in these regions, while the national average is at 34.9 percent. Details of the poverty levels in these regions compared to the national average are presented in Annex 6. 37. The AF will also pilot an innovative mechanism for addressing some of the critical supply-side and demand-side constraints to health service delivery using an RBF approach.36 Human resource constraints and demand-side barriers to access have been further exacerbated by the ongoing political crisis. RBF approaches have the potential to motivate and empower providers and enhance accountability. External technical assistance will need to be recruited to support the PIU and the Bank team in developing the design of the pilot and supporting its implementation. Successful implementation will require mitigating certain risks associated with the approach, including monitoring of indicators, payments by a third-party fund holder, and periodic audits of data by an Independent Verification Agency. Fiduciary 38. Financial Management: The FM system and performance of the PIU under the existing Project are assessed as acceptable to IDA. The overall FM risk rating is Substantial. Based on the current overall residual financial management risk, the Project will be supervised twice a year. At the time this AF was prepared, no audit report was overdue, either for the Project or for the sector. The audit report of the Project, which accounts for the year that ended on December 31, 2011, was submitted on time and the auditors issued a qualified audit opinion. The qualification issues relate to the un-reconciled differences between accounting records and physical inventory figures as well as to an understatement of the creditors‘ balance. The Project has taken measures to address these issues in close collaboration with the Bank through an agreed upon action plan. 39. The PIU will be responsible for management of project finances, preparation of the budget, preparation of the Project‘s quarterly IFR and annual financial statements, submission of annual audit reports, management of disbursements, and preparation of withdrawal applications. The AF accounts will be audited on an annual basis and the external audit report will be submitted to IDA within six months after the end of each calendar year. An external auditing 35 2011. 36 The original project supports a form of RBF in the context of performance-based contracting of the implementing NGOs; the AF will additionally develop a new pilot for incentive payments to health facilities and communities. 16 firm will be recruited and their ToRs will be updated to reflect AF requirements. The AF will comply with the Bank disclosure policy on audit reports. 40. The current assessment conducted by the FM specialist of the World Bank confirms that the accounting system in place meets the requirements under OP 10.02 and will not pose additional fiduciary risk. An initial advance up to the ceiling of the Designated Account for the IDA credit (representing four months‘ forecasted project expenditures) will be made into the Designated Account and subsequent disbursements will be made on a monthly basis against submission of Statements of Expenditures and other supporting documents, as specified in the Disbursement Letter. The contracts with NGOs are paid on a quarterly basis after the submission and review done by the external verification agency every quarter. Given the intensity of the verification as well as the number of services provided, a monthly verification is not possible. Therefore, the balance in the Designated Account for the AF needs to be higher in order to ensure there are no delays with implementation. 41. The PIU will open a new Designated Account denominated in US dollars on terms and conditions acceptable to IDA. Interest income received from the Designated Accounts will be removed from the Designated Account as soon as it accumulates and will be accounted for in a separate project account, in accordance with Madagascar‗s accounting regulations. Based on the current overall residual financial management risk, the Project will be supervised twice a year, in addition to routine desk-based reviews, to ensure that project financial management arrangements operate as intended and that funds are used efficiently for the intended purposes. 42. Procurement: The procurement aspects of the original Project are well implemented and, as stated above, the PIU has a satisfactory track record in this area. The overall risk rating for procurement is Low. As part of this AF, the procurement of essential and generic drugs, such as iron, folic acid, vitamin A and anthelmintic, will be made with SALAMA, the semi-autonomous central drug procurement agency,37 at the same wholesale price. This will facilitate the Project‘s gradual integration of health inputs through one supply chain. The expenditures financed from the output-based grants for the provision of RBF as described above will have to be incurred in accordance with the Bank‘s anticorruption guidelines, procurement guidelines, and consultant guidelines, as further outlined in the forthcoming RBF manual to be developed within the first six months of program implementation. The procurement plan for the AF was approved by the World Bank on April 2, 2012 and is attached in Annex 5. 43. Governance Strengthening: Governance continues to be a challenge in Madagascar, with the political crisis deepening existing issues. In the context of MSPP II, governance and accountability issues have been addressed proactively by the Government with: (i) strengthened internal controls and verification mechanisms through intensified project supervision and project monitoring; (ii) strengthened external verification mechanisms through the recruitment of an external verification firm; (iii) contracting NGOs to support delivery of services; and (iv) collaboration with the Bank-financed Governance and Institutional Development Project on implementing social accountability mechanisms at the community and health facility levels. Project preparation had a strong focus on ensuring that the resources under the AF benefit from and build on these mechanisms already in place. 37 SALAMA is governed by a board of directors that is independent from the Government. 17 44. Anti-Corruption Guidelines: ―Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants,‖ dated October 15, 2006 and updated in January 2011, shall apply to the Project. 45. All key legal covenants have been complied with under the original Project. The Bank will take actions to ensure that the Financing Agreement is valid, binding and enforceable, and will require the Recipient to provide a legal opinion from legal counsel in Madagascar confirming the same. 46. Safeguards: The original credit is classified as Category ―B‖ for environmental screening purposes, given the risks associated with the handling and disposal of medical waste. These risks can potentially affect personnel in hospitals, health centers and municipalities who handle waste, families whose income derive from the triage of waste, and also the general public, to the extent that waste is not disposed of on-site nor safely contained in protected areas. The national policy on medical waste management, which includes a Medical Waste Management Plan (MWMP), was developed and received by the World Bank on March 5, 2005, disclosed in-country and published in Infoshop the same day. This policy primarily relates to solid waste, with a summary description of liquid waste, and contains the following elements: (i) global and specific objectives regarding medical waste management; (ii) the legal framework and law; (iii) waste characteristics with prescribed elimination modes; (iv) norms, safety standards and measures to be adopted, as well as critical equipment to be used; and (v) a description of the monitoring system and an action plan with impact and results indicators. The policy includes an implementation plan. 47. The only safeguard triggered for the AF is the environmental assessment, as no civil works will be undertaken; thus there are no negative environmental impacts envisaged in the proposed program. The MWMP was updated on the indicators and implementation plans and re- disclosed on November 17, 2010 during project restructuring and remains valid. There are no changes to the safeguard classification; safeguard implementation, for its part, is rated Satisfactory. Therefore, the MWMP for the original Project remains applicable for the proposed activities under the AF. Since this document does not require any modifications, re-disclosure is not necessary during the preparation of this proposed AF. The Integrated Safeguard Data Sheet (ISDS) has been updated based on the MWMP‘s implementation progress and was re-disclosed in Infoshop on February 23, 2012. 48. The AF will continue to support the implementation of the MWMP, in particular by ensuring maintenance of incinerators installed under the original Project and supervision of related activities. 49. Updated Economic and Financial Analysis: The on-going political crisis that began in early 2009 has dramatically reduced the budgetary allocations to health, raising concerns over the ability of facilities to deliver urgently needed health services. Moreover, out-of-pocket spending remains high at about 68 percent of private spending, placing an undue burden on poor people, given their limited ability to pay and lack of participation in risk-pooling mechanisms. The Project aims to cover approximately 20 percent of the total population in target regions with 18 a per capita cost of US$9.75 for the full package of services. While this remains far below the international standard as recommended by the World Health Organization, it is nonetheless a significant contribution, especially in light of the current country context. 50. The proposed intervention will also strengthen the equity and efficiency of public spending in Madagascar by focusing on vulnerable groups and introducing accountability mechanisms. With respect to the composition of the budget, the non-salary recurrent budget continues to be insufficient, affecting quality of service delivery and sustainability. In addition, despite the Government‘s shift towards a decentralized policy in an effort to render the health system more efficient, in practice the country remains highly centralized, with limited resources being attributed to isolated rural areas. In this respect, the AF supports interventions that can be delivered at the household, community and health center levels where resources remain scarce, thereby improving access to health services by these underserved populations in geographic areas with the highest poverty rates. 51. Benefits and Risks: The most recent fiduciary assessment38 to date, taking into account the OP 7.30 context, concludes that MoH meets the Bank‘s OP/BP 10.02 minimum requirements, as confirmed by FM. Given that this proposed financing will be processed in a circumstance in which the country portfolio is functioning under OP 7.30, there remain certain risks associated with the ongoing political situation. In order to ensure that project resources continue to be protected in the current country context, measures to strengthen governance and accountability mechanisms as described above39 have been proactively enhanced by the Government. Detailed risks and mitigation measures are summarized in the table below, as well as in greater detail in Annex 2, under the Operational Risk Assessment Framework (ORAF). Given that implementation of the AF will be undertaken in a complex country context, the implementation risk is rated as Substantial. Table 3: Summary Risk Ratings Table Stakeholder Risk Moderate Implementing Agency Risk - Capacity Moderate Project Risk - Design Moderate - Social and Environmental Low - Program and Donor Substantial - Delivery Monitoring and Sustainability Moderate Overall Implementation Risk Substantial 38 Conducted in November 2011 and January 2012. 39 paragraph 43 19 52. Financial Terms and Conditions: The financial terms and conditions of the credit are standard IDA terms. Table 4: Conditions and Legal Covenants Financing Agreement Reference Description of Date Due Condition/Covenant Section 4.01(a) of the FA Amended the PIM Effectiveness Section 4.01(b) of the FA Revision of the composition of Effectiveness the Conseil du PMPS to include a representative of the nutrition sector. Section I.A.3 of Schedule 2 to the FA Recruitment of consultant for Effectiveness + 3 months the design of the PBF pilot under Part 1(b)(i) of the Project Section I.B.2 of Schedule 2 to the FA Proposed annual work program Effectiveness + 30 days and budget for the period between effectiveness and December 31, 2013 submitted to the Association for review and approval. Section I.B.4 of Schedule 2 to the FA Recruitment of independent Effectiveness + 2 months agency for data collection and monitoring indicators for the Project Section I.B.5 of Schedule 2 to the FA Compliance with the schedule On-going according to of repayment of the ineligible plan expenditures incurred under the original financing Section II.B.4 of Schedule 2 to the FA Recruitment of independent Effectiveness + 2 months auditors Section IV.B.1(b) of Schedule 2 to the IDA‘s agreement on the pilot Disbursement of the funds FA designed for the PBF and allocated to the PBF adoption of a revised PIM to financing reflect provisions for the implementation of the PBF pilot 20 Annex 1: Revised Results Framework and Monitoring MADAGASCAR: Second Multisectoral STI/HIV/AIDS Prevention Project Additional Financing Revisions to the Results Framework Comments/ Rationale for Change PDO Current) Proposed Support GOM efforts to promote Increase utilization of STI/HIV/AIDS, and The PDO is revised to reflect the focus a multisectoral response to the maternal and child health and nutrition services of the Project on increasing utilization HIV/AIDS crisis and to contain in project areas. of services both for HIV/AIDS the spread of HIV/AIDS on its prevention, as per the original scope, territory. as well as the focus on maternal and child health and nutrition services as part of the additional financing. PDO indicators Current Proposed change* 1. Decrease in syphilis prevalence To be measured under original among SW (%) financing (until December 31, 2012) New: To better reflect the service delivery Pregnant women tested positive and treated for aspect of the PDO under AF syphilis during prenatal consultations in project areas (number) 2. Percentage of targeted groups To be measured under original who can cite three methods of financing (until December 31, 2012) HIV/AIDS prevention40 (%) Percentage of targeted41 groups who can cite The target group has been redefined as three methods of HIV/AIDS prevention in per the focus of the Project under the project areas (%) AF 3. Percentage of men and women To be measured under original aged 15-49 who report having sex financing (until December 31, 2012) with a non-regular partner in the last 12 months 4. Percentage of target To be measured under original population reporting the use of a financing (until December 31, 2012) condom in their last act of sexual intercourse with a non-regular sexual partner in the last 12 months (%) Percentage of target42 population reporting The target group has been redefined as the use of a condom in their last act of sexual per the focus of the AF Project intercourse with a non-regular sexual partner in the last 12 months in project areas (%) 5. Percentage of SW reporting the To be measured under original use of a condom in their last act of financing as PDO indicator (until sexual intercourse with a client December 31, 2012) (%) This will be monitored as an intermediate indicator for the AF 6. Percentage of youth aged 15-24 To be measured under original 40 Percentage of respondents who can both correctly identify ways of preventing the sexual transmission of HIV and reject major misconceptions about both HIV transmission and prevention; Percentage of youth aged 15-24 exposed to STI/HIV/AIDS communication activities/products in the previous six months (by source of information); Percentage of population aged 15-49 who do not express discriminatory attitudes towards PLWHA (by age and gender). 41 Defined as youth aged 15-24 (by gender), military and sex workers in project areas. 42 Same as footnote 40. 21 Revisions to the Results Framework Comments/ Rationale for Change that have received an HIV test in financing as PDO indicator (until the last 12 months and who know December 31, 2012) their results (by gender) This will be monitored as an intermediate indicator for the AF Current Proposed change* 7. Percentage of SW that have To be measured under original received an HIV test in the last 12 financing as PDO indicator (until months and who know their December 31, 2012) results This will be monitored as an intermediate indicator for the AF New: Core indicator Pregnant women receiving antenatal care during a visit to a health provider (number) To evaluate the inclusion of maternal health interventions in the design New: To evaluate the inclusion of nutrition Children 0-24 months obtaining monthly interventions in the design adequate minimum weight in project areas (number) To better reflect and evaluate children‘s growth New: Core indicator Children immunized (number) To evaluate the inclusion of child health interventions in the design 8. Direct Project Beneficiaries Mandatory core indicator (number), of which female (%) To be measured under original financing (until December 31, 2012) Changed to: Mandatory core indicator for AF Direct Project Beneficiaries (number), of MEASURED BY: which female (%): 1. Project data 1. For HIV interventions in project areas 2. Project data 2. For Health and nutrition interventions in project areas New: Core indicator People with access to a basic package of health, nutrition, or population services (percent increase based on number of people) Intermediate Results (Component One) Current Proposed change* Coordination of partners for the As monitored under original financing implementation of the national as PDO indicator (until December 31, STI/HIV/AIDS strategy is 2012) improved Intermediate Results indicator Current Proposed change* The National Strategic Plan for To be measured under original HIV/AIDS is revised and financing (until December 31, 2012) disseminated by the end of 2006 (number) Annual Reporting allows To be measured under original identifying each donor financing (until December 31,2012) contribution to the program in a coherent manner (number) 22 Revisions to the Results Framework Comments/ Rationale for Change The national communication plan To be measured under original is updated according to financing (until December 31, 2012) recommendations of midterm evaluation (number) Intermediate Results (Component Two) Current Proposed change* Quality and availability of As under original financing (until STI/HIV/AIDS prevention December 31, 2012) services and treatment is improved Quality and availability of basic health and To reflect the design of the AF Project nutrition services for pregnant women and children under five and STI/HIV/AIDS prevention and treatment services for most-at- risk populations is improved in project areas Intermediate Results indicators Current Proposed change* Number of STI treatment kits sold To be measured under original in public & private sectors financing (until December 31, 2012) (number). Changed to: To accurately quantify the number of Syphilis treatment distributed in public health treatment kits sold and distributed center in project areas (number) through private and public sectors under AF ARV Treatment Guidelines are To be measured under original adequate and implemented financing (until December 31, 2012) (number) Number of condoms distributed To be measured under original and sold through the public sector financing (until December 31, 2012) and NGO programs per year (number) Number and percentage of To be measured under original pregnant women tested for financing (until December 31, 2012) syphilis during prenatal consultations Changed to: To reflect the design of the AF Project Number of condoms distributed through the public sector and NGO programs per year in project areas (number) New: To evaluate availability of HIV testing SW, Youth and Military tested for HIV in the services and use by the targeted last 12 months and received their test results in population of the Project project areas (number) New: To evaluate access to maternal health Pregnant women receiving iron and folic acid in supplementation project areas (number) New: Core indicator (for children) Children receiving a dose of vitamin A in project areas (number) New: To evaluate access to maternal health Pregnant women attended their first antenatal services visit before the end of the first quarter (<4months) of pregnancy in project areas (number) New: To evaluate access to quality delivery Births attended by skilled personnel in project care areas (number) 23 Revisions to the Results Framework Comments/ Rationale for Change New: To evaluate access to child health Children under five treated for diarrhea in services project areas (number) New: To evaluate the coverage of the growth Children under five enrolled in the growth monitoring and the efficacy of project monitoring and promotion program in project nutrition sites promotion activities areas (number) New: Core indicator Health personnel receiving training (number) To ensure quality services in the health and nutrition sites New: To evaluate the coverage of the growth Women involved in growth monitoring and monitoring and the efficacy of project promotion activities in project areas (number) nutrition sites promotion activities Intermediate Results (Component Three): Closed under Restructuring43 Intermediate Results (Component Four) Current) Proposed change* Monitoring capacity is improved As monitored under original financing and real-time data is used to make and AF program-level changes Intermediate Results indicators Current Proposed change* Annual Operation Plan reflects To be measured under original recommendations of Consolidated financing (until December 31, 2012) Annual Report Number of national surveys and To be measured under original studies undertaken in accordance financing (until December 31, 2012) with agreed timetable Number of health personnel Continued To be measured under original trained in monitoring and financing (until December 31, 2012) evaluation and AF Percentage of PLWHA reference Continued To be measured under original centers having submitted monthly financing (until December 31, 2012) reports within 15 days of the end and AF of the month Quarterly Independent Continued To be measured under original Verification Agency reports financing (until December 31, 2012) submitted within 45 days of the and AF end of the quarter Monitoring committee meetings Continued To be measured under original held within two weeks of financing (until December 31, 2012) submission of quarterly and AF Independent Verification Agency report Intermediate Results (Component Five) Current Proposed change* The Project is implemented in Continued As monitored under original financing conformity with norms and and AF procedures as outlined in the Operational Manual Intermediate Results indicators 43 All indicators under Component 3 were dropped in the RF of the restructured project. 24 Revisions to the Results Framework Comments/ Rationale for Change Current Proposed change* Percentage of capacity-building To be measured under original plan implemented by year financing (until December 31, 2012) Percentage of PIU audits without Continued To be measured under original reserves financing (until December 31, 2012) and AF Percentage of IFRs submitted by To be measured under original deadline financing (until December 31, 2012) 25 REVISED PROJECT M&E ARRANGEMENTS Project Development Objective (PDO): Support GOM efforts to promote a multisectoral response to the HIV/AIDS crisis and to contain the spread of HIV/AIDS on its territory. Enter the revised PDO of your operation: Increase utilization of STI/HIV/AIDS, and maternal and child health and nutrition services in project areas. Cumulative Target Values45 Baseline Original Progress Unit of Data Source/ Responsibility for PDO Level Results Indicators Project To Date Frequency Comments Measurement End End Sept 30, Methodology Data Collection Core 44 Start (2010) 2012 2013 2014 (2006) Original Decrease in syphilis prevalence among Every two Biological % 16.6% 15.6% n.a. n.a. ES and PIU Financing SW (%) 15% years surveillance survey Ending 2012 Pregnant women tested positive and treated for syphilis during prenatal Number n.a. 179 (2010) 1,367 1,640 1,913 Yearly MoH reports ES and PIU AF consultations in project areas (number) M: M: 66.8% M: 66.3% 68% n.a. n.a. F: 65.8% F: 62.6% F: 67% Independent Percentage of targeted46 groups who Every two Original % Verification Agency ES and PIU can cite three methods of HIV/AIDS SW: years Financing SW: 60% SW: 58.9% reports prevention 61% Ending 2012 Military: Military: n.a. n.a. M: 53% 55.2% 57% 44 For new indicators introduced as part of the additional financing, the ―Progress To Date‖ column is used to reflect the basel ine value. 45 In this column n.a. means that the indicator is not being measured after 2012 as also indicated in the comments column. 46 Defined as youth aged 15-24 (by gender), military, and sex workers in project areas. 26 Cumulative Target Values Baseline Original Progress Unit of Data Source/ Responsibility for PDO Level Results Indicators Project To Date Frequency Comments Measurement End End Methodology Data Collection Start (2010) Sept 30, Core 2012 2013 (2006) 2014 M: M: M: 48.3% 49% M: 54% n.a. 51% 47 F: 49.8% F: 50% F: 56% Independent Percentage of targeted groups who F: 53% % Quarterly Verification Agency ES and PIU can cite three methods of HIV/AIDS SW: SW: AF SW: 63.6% SW: reports prevention in project areas (%) 64% 65% n.a. Military: 67% Militar Militar 74.6% M: 78% y: 75% y: 76% Percentage of men and women aged 15-49 who report having sex with a non-regular partner in the last 12 M: Original months (%) 38.1% M: 15.5% M: Every Five DHS INSTAT n.a. n.a. Financing F: F: 2.1% 20% Years % Ending 2012 16.8% F: 9% M: M: M: 35% M: 28.3% 30% n.a. 33% F: 30% F: 25% F: F: 28% Percentage of target48 population 26.5% Independent reporting the use of a condom in their Verification Agency ES and PIU last act of sexual intercourse with a % Quarterly AF reports non-regular sexual partner in the last Military: Militar Military: 12 months in project areas (%) n.a. 61.2% Militar y: 65% 70% y: 63% 47 Defined as youth aged 15-24 (by gender), military, and sex workers in project areas. 48 Defined as youth aged 15-24 by gender and military in project areas. 27 Cumulative Target Values Baseline Original Progress Unit of Data Source/ Responsibility for PDO Level Results Indicators Project To Date Frequency Comments Measurement End End Methodology Data Collection Start (2010) Sept 30, Core 2012 2013 (2006) 2014 Percentage of SW reporting the use of Original Every two Combined Survey a condom in their last act of sexual % 79.4% 84.8% 86% n.a. n.a. ES and PIU Financing years 2011-2012 intercourse with a client (%) Ending 2012 Percentage of youth aged 15-24 that Original have received an HIV test in the last M: 7.7% M: 18% M: Every two Combined Survey % n.a. n.a. ES and PIU Financing 12 months and who know their results F: 8.7% F: 21.2% 20% years 2011-2012 Ending 2012 (by gender) (%) F: 22% Percentage of SW that have received Original an HIV test in the last 12 months and Every two Combined Survey % 49.1% 59.6% 64% n.a. n.a. ES and PIU Financing who know their results (by gender) years 2011-2012 Ending 2012 (%) Pregnant women receiving antenatal 60,381 109,32 care during a visit to a health provider Number 0 91,106 127,547 Yearly MoH reports PIU AF (2010) 6 (number) Children 0-24 months obtaining 47,704 NGOs and Nutrition monthly adequate minimum weight in Number n.a. 48,200 48,541 50,215 Yearly ONN/PNNC AF (July 2011) sites reports project areas (number) 28 Cumulative Target Values Baseline Original Progress Unit of Project- Frequenc Data Source/ Responsibility for PDO Level Results Indicators To Date Comments Measurement Project End End y Methodology Data Collection (2010) Sept 30, Core Start 2012 2013 2014 (2006) Children 0-11 months immunized Children immunized (number) 52,810 Number 0 64,810 97,663 113,941 Yearly MoH reports PIU against (2010) DTCHepHib 3 (number) AF Beneficiaries49 1,929,77 Original Direct Project Beneficiaries (number), Number 234,069 1,417,515 4 n.a. n.a. Yearly Project data ES and PIU Financing of which female (%) % 63% 66% 64% Ending 2012 HIV intervention 12,000 SW, 135,210 135,210 135,210 s: 9,550 Militaries 51% (of 51% (of 51% (of 0 58,061 Yearly Project reports PIU and 113,660 which which which 50% (of youth (50.5%) female) female) female) which AF female) Direct Project Beneficiaries (number), Number of which female (%) Health and 420,584 420,584 420,584 Pregnant women Nutrition 61% (of 61% (of 61% (of and children 0 intervention Yearly Project reports PIU which which which under five s: female) female) female) AF 0 People with access to a basic package Pregnant women of health, nutrition, or population Number 395, 349 395, 349 395,349 and children 0 0 Yearly Project reports PIU services (percent increase based on 94% 94% 94% under five number of people) AF 49 All projects are encouraged to identify and measure the number of project beneficiaries. The adoption and reporting on this indicator is required for IDA-supported investment projects that have an approval date of July 1, 2009 or later. 29 Intermediate Results and Indicators Baseline Cumulative Target Values Data Source/ Responsibility for Frequency Comments Original Methodology Data Collection Progress Unit of Project - Sept Intermediate Results Indicators To Date Measurement Project End End 30, Core (2010) Start 2012 2013 2014 (2006) Intermediate Result 1: Coordination among donors and partners on contribution to the national HIV/AIDS strategy. NSP update Original The National Strategic Plan for NSP d/ Financing HIV/AIDS is revised and NSP 2001- Reports from ES/ Number revised by dissemi n.a. n.a. Midterm Ending 2012 disseminated by the end of 2006 2006 ES/CNLS CNLS end 2006 nated by end 2010 Annual Reporting allows identifying each donor contribution to the Reports from ES/ Original Number n.a. 4 6 n.a. n.a. Annually program in a coherent manner ES/CNLS CNLS Financing Ending 2012 Nation The national communication plan is al updated according to Comm Original recommendations of midterm National National unicati Financing evaluation Communic Communic Revised National on Ending 2012 ation ation Communication ES/ Number Strateg n.a. n.a. Midterm Strategy Strategy strategy from CNLS y developed updated for ES/CNLS update in 2004 2009-2012 d for 2009- 2012 30 Intermediate Result 2: Quality and availability of basic health and nutrition services for pregnant women and children under five and STI/HIV/AIDS prevention and treatment services for most-at-risk populations is improved in project areas. Baseline Cumulative Target Values Original Progress Unit of Project - Sept Data Source/ Responsibility for Intermediate Results Indicators To Date End Frequency Comments Measurement Project End 30, Methodology Data Collection Core (2010) 2012 Start 2013 2014 (2006) Original Number of STI treatment kits sold in 2,493,5 Number 817,500 1,742,500 n.a. n.a. Annually Project reports UGP Financing public and private sectors (number) 00 Ending 2012 ARV Original ARV Treatment Guidelines are protocol n.a. n.a. n.a. n.a. Quarterly PNLS reports PNLS Financing adequate and implemented revised in Ending 2012 2008 Number of condoms distributed and Original 25 sold through the public sector and Number 5 million 20 million n.a. n.a. Quarterly Project reports PIU Financing million NGO programs per year Ending 2012 54,806 500,00 Number and percentage of pregnant 268,320 Original Number 0 women tested for syphilis during n.a. n.a. Quarterly PNLS reports PNLS Financing % % n.a. prenatal consultations 75% Ending 2012 (2007 80% reports) Number of syphilis treatments distributed in public health centers in Number n.a. 3,280 4,100 4,920 5,740 Annually Project reports UGP AF project areas (number) Number of condoms distributed 8,500,0 10,00 through the public sector and NGO Number n.a. 0 1,500,0 Quarterly Project reports PIU AF 00 0,000 programs per year in project areas 00 31 Baseline Cumulative Original Target Values Progress Unit of Project - Sept Data Source/ Responsibility for Intermediate Results Indicators To Date Frequency Comments Measurement Project End End 30, Methodology Data Collection Core (2010) Start 2012 2013 2014 (2006) SW: SW: SW: n.a. SW: 0 SW: 18,48 15,840 13,200 0 M: M: Number of SW, Youth aged 15-24 (by Independent 15,600 M: 21,90 gender) and Military tested for HIV in Verification Agency Number M: n.a. M: 0 F: 18,750 0 Quarterly PIU AF the last 12 months and received their reports F: n.a. F: 0 15,900 F: F: test results in project areas 19,050 22,20 0 Milita Militar Militar Military: Military: ry: y: y: n.a. 0 14,18 10,120 12,150 0 Number of pregnant women receiving iron folic acid in project areas 59,430 81,994 114,7 Number n.a. 98,393 Quarterly MoH reports PIU AF (2010) 92 Number of children under five 419,83 503,80 587,7 receiving Vitamin A supplementation Number 0 332,808 8 Quarterly MoH reports PIU AF 6 74 in project areas Number of pregnant women attended their first antenatal visit before the end 22,776 63,77 Number n.a. 13,925 54,663 Quarterly MoH reports PIU AF of the first quarter (<4months)of 4 pregnancy in project areas Number of births attended by skilled 17,020 47,65 Number n.a. 14,348 40,847 Quarterly MoH reports PIU AF personnel in project areas 4 Number of children under five treated 28,00 with Zinc/SRO for diarrhea in project Number n.a. 12,374 16,500 24,000 Quarterly MoH reports PIU AF 0 areas Number of children under five 189,71 189,71 189,7 enrolled in the growth monitoring and Number and % n.a. 189,717 Quarterly Nutrition sites reports ONN/PNNC AF 7 7 17 promotion program in project areas Health personnel receiving training in Number 0 0 282 282 282 Quarterly Project reports PIU AF project areas (number) 32 Baseline Cumulative Original Target Values Progress Unit of Project - Sept Data Source/ Responsibility for Intermediate Results Indicators To Date Frequency Comments Measurement Project End End 30, Methodology Data Collection Core (2010) Start 2012 2013 2014 (2006) Number of women involved in growth 103,47 103,79 104,4 monitoring and promotion activities in Number n.a. 103,146 Quarterly PNNC sites reports ONN/PNNC AF 0 7 51 project areas Intermediate Result 3: Sub-projects promote behavior change and implement support and care activities mainly in at-risk areas. Eliminated Intermediate Result 4: Monitoring capacity is improved and real-time data is used to make program-level changes. Baseline Cumulative Original Target Values Progress Unit of Project - Sept Data Source/ Responsibility for Intermediate Results Indicators To Date Frequency Comments Measurement Project End End 30, Methodology Data Collection Core (2010) Start 2012 2013 2014 (2006) Annual Operation Plan reflects Original recommendations of Consolidated Number n.a. 4 6 n.a. n.a. Annually UGP reports PIU M&E team Financing Annual Report Ending 2012 Number of national surveys and Original studies undertaken in accordance with Number 4 8 13 n.a. n.a. Annually Project reports PIU Financing agreed timetable Ending 2012 Original Number of health personnel trained in Number 0 186 (2010) 100 100 100 Annually Project reports PIU Financing monitoring and evaluation Ending 2012 Percentage of PLWHA reference centers having submitted monthly % n.a. 96% (2011) 97% 97% 98% Quarterly PNLS reports PNLS AF reports within 15 days of the end of the month Quarterly Independent Verification Independent 7 quarters Agency reports submitted within 45 Number n.a. n.a. 5 5 7 Quarterly Verification Agency PIU concerned days of the end of the quarter reports AF Monitoring committee meetings held within 2 weeks of submission of quarterly Independent Verification 7 quarters Agency report Number n.a. n.a. 5 5 7 Quarterly Project reports PIU concerned AF 33 Intermediate Result 5: The Project is implemented in conformity with norms and procedures as outlined in the Operational Manual. Cumulative Baseline Target Values Original Progress Unit of Sept Data Source/ Responsibility for Intermediate Results Indicators Project To Date Frequency Comments Measurement End End 30, Methodology Data Collection Core Start (2010) 2012 2013 2014 (2006) Percentage of capacity-building plan Copy of capacity- implemented by year % 33% 100% 100% n.a. n.a. Annually building plan; Project PIU M&E team Original Project reports Percentage of PIU audits without % n.a. 100% 100% 100% 100% Annually Audit reports PIU AF reserves Original Percentage of IFRs submitted by % -- 100% 100% n.a. n.a. Annually IFR PIU Financing deadline Ending 2012 34 ANNEX 2: OPERATIONAL RISK ASSESSMENT FRAMEWORK (ORAF) MADAGASCAR: SECOND MULTISECTORAL STI/HIV/AIDS PREVENTION PROJECT ADDITIONAL FINANCING Stage: BOARD Project Stakeholder Risks Rating: Moderate Description: Misconceptions about STI/HIV/AIDS and Risk Management: Continued strengthening of social marketing, continuous dialogue with religious cultural barriers may undermine impact of project intervention, and traditional leaders will be emphasized during the AF phase. NGOs will be contracted for delivery of such as condom use. Fear of stigmatization may reduce VCT STI/HIV/AIDS knowledge and behavior change. In addition, the Project will work with formal utilization. organized associations of key at-risk populations to ensure that issues around stigmatization are minimized. Resp: Client/NGOs Stage: App/Imp Due Date : Status: In Progress Risk Management: The NGOs recruited for provision of HIV/AIDS services will ensure that Description: Specific focus on some at-risk groups (in the communication with health service providers and district/community level health authorities is ongoing case of HIV/AIDS services) may result in lack of clarity of throughout implementation to ensure that the at-risk populations are being adequately targeted. target populations and may cause dissatisfaction among some beneficiaries. Resp: NGOs Stage: Imp Due Date : Status: In Progress Implementing Agency Risks (including fiduciary) Capacity Rating: Moderate Description: The overall governance issues in the country Risk Management: The original PIU was replaced by the current PIU, which was responsible for would oblige a more stringent control in fiduciary management another Bank-financed project and has demonstrated consistently high performance. The current PIU and could have a negative impact on the implementing has considerable experience and a good track record of Bank project implementation. Fiduciary agency‘s ability to adequately carry out its fiduciary management has been rated Satisfactory, except for identified ineligible expenditures under the original responsibilities. Project, which are being repaid by the Government under a repayment plan accepted by the Bank. Resp: Client Stage : App/Imp Due Date : Status: In progress 35 Description: Potential delays in recruiting NGOs may Risk Management: Preparations for initiating the recruitment process for NGOs have started well in postpone delivery of critical health interventions and advance of expected effectiveness to ensure no delay in finding good candidates. Selection of NGOs implementation of the RBF model. will be based on quality and cost-based procurement methods and will involve performance-based contracts with tranche payments linked to receipt of key deliverables. The PIU will ensure that the process is efficient, economic and transparent. The unit is strong with regard to its procurement functions, which have consistently been rated Satisfactory. Resp: Client Stage : App/Imp Due Date : Status: Not yet due Governance Rating: Moderate Description: Ineligible expenditures were incurred in 2008 Risk Management: Component 3 in the original Project has been closed. To prevent the recurrence of under Component 3 of the original financing ―Fund for ineligible expenditures, appropriate mitigation measures such as intensified fiduciary control by the STI/HIV/AIDS Prevention and Care-Taking Activities‖ as a Independent Verification Agency as well as an evaluation committee at the PIU level to validate the result of poor bookkeeping and accounting practices on the part fiduciary reports have been put in place. A bimonthly conjoint supervision mission by the Bank and of community-based organizations and poor supervision on the PIU is organized. In addition, a repayment plan, acceptable to the Bank, has been submitted by the part of the Financial Management Agency hired to manage Ministry of Finance. Based on this plan, funds have already been partially reimbursed by the those activities. Government. The Government will ensure repayment of what has been agreed to under the repayment plan before the AF package goes to the Board. In addition, a legal covenant to comply with the agreed repayment schedule has been added in the FA, which allows the Bank to exercise its remedies under the FA in case of non-compliance (suspension, early repayment, cancellation). Resp: Client/WB Stage : App/Imp Due Date : Status: In progress Project Risks Design Rating: Moderate Description: Introduction of a Results-based Financing (RBF) Risk Management: The RBF pilot will be restricted to two districts and will build upon designs that Pilot may create additional risks associated with fund flows, as have worked in the country and in similar contexts in Africa. In addition, a rigorous verification the payment will be made against outputs rather than using the mechanism will be put in place through the Independent Verification Agency and TA. The payment of current transaction-based method. incentives will be made by a third-party fund holder to ensure adequate separation of functions within the design of the RBF. The resources under the AF reserved for output-based payments only will be made against services already delivered. This has been indicated in the disbursement table and is reflected in the Financing Agreement. Resp: Stage: App/Imp Due Date : Status: In progress Client/WB/NGO 36 Description: Weak capacity of health service providers to Risk Management: Adequate training will be provided to health personnel and communities to ensure provide quality services may hamper the project in meeting its effective delivery of services. Expansion to integrate health and nutrition services may increase objectives. efficiency to address the immediate needs of the population, despite human resource constraints. The design of the AF builds on past experiences and reflects lessons learned in past nutrition and health programs. Resp: Client/NGO Stage: Imp Due Date : Status: Not yet due Risk Management: Proposed target areas were confirmed during preparation to ensure a clear focus of resource allocation to high-risk areas. A clear set of criteria for identifying focus on communities and Description: Geographical focus of the AF on regions with health facilities was defined to ensure minimum adequate implementation capacity of AF activities. At high poverty and low health outcomes, as defined by 2011 the regional and district levels, implementation capacity is adequate thanks to support from other donors poverty map, may not have adequate capacity to implement with respect to operational costs that are complementing Government resources. The AF will also cover activities additional incremental supervision costs for the National Nutrition central and regional offices to ensure adequate monitoring of activities under the AF. Resp: Client Stage: App/Imp Due Date : Status: In progress Description: Use of national drug procurement agency may Risk Management: A cash-on-delivery arrangement will be introduced in contracting rather than on hamper efficient distribution of standard drugs and medical commitment prior to delivery with the aim of ensuring that drugs are delivered in a timely manner down supplies in the short term. to health facility levels. Resp: Client/WB Stage: Imp Due Date : Status: Not yet due Social & Environmental Rating: Low Description: Potential risks associated with medical waste Risk Management: Resources of the AF will continue to contribute to implementation of the Medical management continue to apply under the AF, given that the Waste Management Plan (MWMP) of the ongoing 2nd Multisectoral HIV/AIDs project. The activities support provision of inputs such as medical implementation to date has been rated Satisfactory by the Bank. The Integrated Safeguards Data Sheet equipment and materials. However, the risk remains low, as has been updated based on implementation progress of the MWMP and has been re-disclosed. there are no activities that would trigger new safeguard issues. Resp: Client Stage: App/Imp Due Date : Status: Completed Program & Donor Rating: Substantial Description: Current persisting political crisis discourages Risk Management: During preparation of the AF, discussion with other donors was conducted to donor participation in the health sector and active dialogue assess the degree of their involvement in the short and medium term and to ensure that interventions with the Government. There are significant cuts in donor address the utmost needs and avoid any duplication of future funding that may become available for the programs and initiatives, negatively affecting the health and sector. At the technical level, the PTF remains in place, and active coordination through this mechanism 37 nutrition status of the population, given that the country is has started to be revitalized. The Bank is a lead donor in the health sector and these resources have the approximately 70 percent dependant on external resources for potential to further catalyze other donors (AFD, EU) to support the health sector in the short and this sector. medium term. Resp: Bank Stage: App Due Date : Status: In progress Delivery Monitoring & Sustainability Rating: Moderate Description : Risk Management: The AF will continue to support strengthening internal verification and accountability mechanisms by enhancing Ministry of Health capacity, especially in the areas of Delivery Monitoring: technical supervision functions and program monitoring. Timely data collection will also be ensured through expanding mobile phone systems at the health care provider level, which has already been With the ongoing political crisis, there is a lack of clear piloted with good results in the country. Implementation of the Results-based Financing (RBF) accountability mechanisms. In particular, given the weak mechanism will also introduce more accountability in the health system by linking pay-for-performance Health Management Information Systems, reliability of data incentives to verified results, as opposed to only financing inputs. In addition, implementing NGOs will collected may become an issue. closely monitor and support the service delivery process. NGOs will also be the third-party fund holders for incentive payments to ensure the separation of functions in implementation, an important feature of good accountability in RBF models. Resp: Client Stage: App/Imp Due Date : Status: In progress Sustainability: Risk Management: The 2009 CSR and ISN help to determine sectoral priorities for Bank intervention The Government is highly dependent on external resources, in the future. Recent Madagascar portfolio restructuring also contributes to reexamining the portfolio but funding needs are unmet due to unpredictability in needs, focusing on immediate priorities for the short term given the urgent needs of the sector to which funding. While AF will help improve the situation for a small the AF is responding. The question of sustainability will be addressed in dialogue with the Government segment, sustainability cannot be guaranteed unless other on longer-term priorities as the political situation starts to normalize but should not be seen as one of the operations are resumed. objectives for this period of financing. Resp: WB Stage: App/Imp Due Date : Status: In progress Overall Risk Following Review Implementation Risk Rating: Substantial Comments: 38 ANNEX 3: DETAILED DESCRIPTION OF MODIFIED PROJECT ACTIVITIES 1. Component 1: Harmonization, donor coordination, and strategies. This Component will not be supported with AF resources. 2. Component 2: Health, Nutrition, and HIV/AIDS Services (US$5.18 million). This component has been modified from the previous ―Support for health sector response‖. This component will continue to finance HIV and STI-related interventions inclusive of goods and technical assistance, focusing on testing, treatment and Behavior Change and Communication (BCC) for at-risk populations (sex workers, military and youth). In addition, the AF will finance the delivery of goods and technical assistance to health service providers to strengthen their capacity for the provision of mother and child health services and nutrition services to the population. Delivery of these key MCH services will maximize impact in the context of constrained resources, as they are carefully selected on the basis of cost-effectiveness, with the greatest impact on health outcomes. The Project will also support nutrition interventions at the community level, namely through support to the operational costs of community nutrition sites in selected districts and to the associated local NGOs that play a monitoring and supervision role. Support to the delivery of health and nutrition services will expand the types of services that will be provided through contracted NGOs. In addition, a pilot-based scheme for performance-based incentive payments to health facility teams and community health workers will be introduced. Some of the resources under the AF will support the development of the technical design of the model within the first six months after effectiveness, to be implemented in a selected number of intervention districts. An NGO will be recruited to provide implementation support to health centers and communities for this scheme. 3. The Component will consist of the following: i. Integrated package for pregnant women at facility level (US$1.28 million): The following services, among others, will be provided during antenatal consultations: prevention of mother-to-child transmission, tracking and treatment of syphilis, supplementation of iron and folic acid, tetanus vaccinations, intermittent preventive medication against malaria, and distribution of impregnated mosquito nets. ii. Integrated package for children under five at facility level (US$0.18 million): Promotion of good practices and breastfeeding and nutrition for mothers and children, Vitamin A supplementation, vaccinations, distribution of impregnated mosquito nets, treatment of diarrhea with oral rehydration salts and zinc, prevention and treatment of malaria, and integrated treatment of childhood diseases (IMCI). iii. Support to Health and Nutrition services at community level (US$1.44 million): Provision of nutrition inputs, recruitment of NGOs to support community nutrition sites, and support to community workers for nutrition assigned to Community-based Nutrition Program sites in Fokontany, in an effort to enhance their skills in awareness raising and counseling, referrals of malnourished children, weighing, and culinary demonstrations. iv. Support for HIV/STI prevention among the most-at-risk population (US$1.42 million): Continued support to at-risk populations, including professional sex workers, military and youth between ages 15 and 24 in BCC, distribution of condoms and VCT. Syphilis test and consumables for pregnant women will also be provided. 39 v. Improving quality of treatment to PLWHA (US$0.56 million): Support for operational costs of treatment centers for PLWHAs and of associations engaged in psychosocial treatment. vi. Continued support for implementation of Medical Waste Management Plan (US$0.15 million): including supervision and maintenance of incinerators. vii. Design and implementation of a results-based financing pilot (US$0.15 million): in a few districts, to support health service delivery at health facility and community levels. 4. Component 3: Closed. 5. Component 4: Monitoring and Evaluation (US$0.42 million): This component will continue to fund activities based on the following objectives: (i) ensure that the national M&E system is operational; (ii) develop a functional monitoring system to measure and manage the performance of MSPP II; and (iii) track progress of project performance to ensure that the intended results of the Project are met. a. Monitoring and Supervision (US$0.32 million): This will include (i) putting in place an information system to rapidly collect data for monitoring of project activities; and (ii) provision of mobile phones to Health Service Providers and Nutrition Service Providers involved in the management, supervision, and implementation of project activities to facilitate reporting and communication. b. Evaluation (US$0.10 million): This will include: (i) continued support for the Independent Verification Agency to evaluate progress of implementing NGOs in health, nutrition and HIV/AIDS; (ii) execution of second biological and behavioral surveillance study; (iii) final evaluation of the Project and (iv) periodic surveys to assess progress. 6. Component 5: Project Management and Capacity Building (US$0.40 million): This component will continue to provide support for technical supervision by the PIU and relevant functions within the MoH related to project activities, including SE and the National HIV/AIDS Council. Table 1: Minimum package of high-impact, low-cost maternal and child health and nutrition interventions Pregnant Women Children 0-28 days  Insecticide-treated mosquito net  Exclusive breastfeeding  At least 3 antenatal consultations  Vaccination  Vaccination (tetanus toxoid)  Management of neonatal infections  Treatment of syphilis in pregnancy  Integrated management of childhood illnesses  De-worming in pregnancy  Comprehensive emergency obstetrical care for  Folic acid newborns (including intensive care for newborns)  Prevention of Mother-to-Child Transmission of Children 1-5 months HIV/AIDS  Exclusive breastfeeding  IEC for Hand-washing  Vaccination At birth  Oral Rehydration Solution  Assisted delivery: Basic Emergency Obstetric  Zinc for diarrhoea management Care  Management of Acute Respiratory Infections  Clean delivery and cord care  Integrated management of childhood illnesses  IEC for Hand-Washing Children 6-12 months Lactating Women  Vaccination  Family Planning  Vitamin A supplementation  Vitamin A supplementation  Complementary feeding  IEC for Hand-washing  Oral Rehydration Solution  Zinc for diarrhea management  Management of Acute Respiratory Infections  Management of malaria  Integrated management of childhood illnesses  Insecticide-treated mosquito net Children 12-59 months 40  Vitamin A supplementation  Management of Acute Respiratory Infections  Management of malaria  Integrated management of childhood illnesses ANNEX 4: REVISED IMPLEMENTATION ARRANGEMENTS AND SUPPORT 1. The implementation arrangements of the proposed AF will build on the existing, well-functioning mechanisms to take into account the additional activities, including maternal and child health and nutrition. The implementation arrangements will be further strengthened to ensure the successful implementation of new activities. At the central level, the Executive Secretary (SE) of the National AIDS Council (CNLS) will continue to assume a national role of coordination, monitoring and evaluation and resource mobilization. The central level of Government will play a policy coordination role but will not have direct oversight over project activities. As illustrated in the attached diagram, these implementation arrangements have three levels: a. Coordination, management, oversight, and verification: As with the parent project, resources under the AF will flow directly to the health PIU, operating at technical levels of the Government (in line with the Bank‘s current operational policies for sectoral engagement under OP 7.30). The PIU is responsible for the day-to-day management of the Project and is subject to World Bank IDA guidelines. World Bank funds support the overall operating costs of the PIU, as well as support all salaries of the PIU staff. PIU staff are hired under consultant contracts consistent with Bank procurement guidelines. The annual work plan of the Project is approved by the Conseil du PMPSII, which consists of technical specialists of the Government and representatives from NGOs and private community associations. The Conseil du PMPSII will add a nutrition specialist to ensure expertise on the Conseil for new activities envisaged under the AF. Finally, the external verification agency plays an essential 3rd-party verification role in ensuring that services are delivered efficiently through periodic operational audits. b. Implementation: Implementation of AF activities will utilize mechanisms that are existing and well-functioning and will be further enhanced to ensure effective delivery of key interventions to beneficiary populations. Given the inclusion of nutrition activities under the AF, the Project cost will include expenditures for the National and Regional Nutrition Offices to assist in the supervision of community nutrition sites in project areas. Technical assistants will be hired to augment capacity at the district level for supervision and implementation support to health facilities and community nutrition agents in project areas. In addition to HIV/AIDs-related services, NGOs will be contracted directly by the Project to support delivery of maternal and child health and nutrition services at facility and community levels based on well-defined terms of references (ToRs). To address gaps and scale-up impact, they will be involved in the direct delivery of interventions as well as in providing support to health facilities and community nutrition agents to ensure the quality of service delivery. c. Beneficiaries: Beneficiaries will continue to play an essential role in demanding quality services for themselves, their families, and their communities. The AF will support the implementation of community scorecards, which have proven effective in previous Bank operations as an important feedback mechanism from this perspective for improving accountability in service delivery. 2. Fiduciary Arrangements: The financial management and procurement arrangements will remain the same as under the original Project. 41 3. Financial Management functions will continue to be undertaken by the current PIU, which has considerable experience and a good track record in the implementation of Bank financial management procedures. The Project is up to date with its reporting and external audit obligations. There are no outstanding interim financial reports (IFRs) and external audit reports. 4. The FM system and performance of the PIU under the existing Project are assessed as acceptable to IDA. The overall FM risk rating is Substantial. Based on current overall residual risk, the Project will be supervised twice a year. At the time this AF was prepared, no audit report was overdue, either for the Project or for the sector. The audit report of the Project, which accounts for the year that ended on December 31, 2011, was submitted on time and the auditors issued a qualified audit opinion. The qualification issues relate to the un-reconciled differences between accounting records and physical inventory figures as well as to an understatement of the creditors‘ balance. The Project has taken measures to address these issues in close collaboration with the Bank. 5. The PIU will be responsible for management of project finances, preparation of the budget, preparation of the Project‘s quarterly IFR and annual financial statements, submission of annual audit reports, management of disbursements, and preparation of withdrawal applications. The AF accounts will be audited on an annual basis and the external audit report will be submitted to IDA within six months after the end of each calendar year. An external auditing firm will be recruited and their ToRs will be updated to reflect AF requirements. The AF will comply with the Bank disclosure policy on audit reports. 6. The current assessment conducted by the FM specialist of the World Bank confirms that the accounting system in place meets the requirements under OP 10.02 and will not pose additional fiduciary risk. An initial advance up to the ceiling of the Designated Account for the IDA credit (representing four months‘ forecasted project expenditures) will be made into the Designated Account and subsequent disbursements will be made on a monthly basis against submission of Statements of Expenditures and other supporting documents, as specified in the Disbursement Letter. The contracts with NGOs are paid on a quarterly basis after the submission and review done by the external verification agency every quarter. Given the intensity of the verification as well as the number of services provided, a monthly verification is not possible. Therefore, the balance in the Designated Account for the AF needs to be higher in order to ensure there are no delays with implementation. 7. The PIU will open a new Designated Account denominated in US dollars on terms and conditions acceptable to IDA. Interest income received from the Designated Accounts will be removed from the Designated Account as soon as it accumulates and will be accounted for in a separate project account, in accordance with Madagascar‗s accounting regulations. Based on the current overall residual financial management risk, the Project will be supervised twice a year, in addition to routine desk-based reviews, to ensure that project financial management arrangements operate as intended and that funds are used efficiently for the intended purposes. 8. Disbursement Arrangements: Upon effectiveness of the AF, transaction-based disbursements will be used (as is the case for the ongoing Project), as this disbursement method is considered to be the most stringent approach to facilitating the timely identification of potentially ineligible expenditures. A new Designated Account denominated in US dollars on terms and conditions acceptable to IDA will be created for the AF. The ceiling of the account will be up to US$1.0 million, consistent with the original financing, to avoid issues related to payment delays. These delays were due to insufficient balances in the Account that were adversely affecting 42 implementation. The Designated Account A under the original financing will remain in effect until December 31, 2012, which is the current closing date of the original Project. 9. Procurement: The procurement aspects of the original Project are well implemented and, as stated above, the PIU has a satisfactory track record in this area. The overall risk rating for Procurement is Low. As part of this AF, the procurement of essential and generic drugs, such as iron, folic acid, vitamin A and anthelmintic, will be made with SALAMA, the semi-autonomous central drug procurement agency,50 at the same wholesale price. This will facilitate the Project‘s gradual integration of health inputs through one supply chain. The expenditures financed from the output- based grants for the provision of RBF as described above will have to be incurred in accordance with the Bank‘s anticorruption guidelines, procurement guidelines, and consultant guidelines, as further outlined in the forthcoming RBF manual to be developed within the first six months of program implementation. The procurement plan for the AF was approved by the World Bank on April 2, 2012 and is attached in Annex 5. 10. Governance Strengthening: Governance continues to be a challenge in Madagascar, with the political crisis deepening existing issues. In the context of MSPP II, governance and accountability issues have been addressed proactively by the Government with: (i) strengthened internal controls and verification mechanisms through intensified project supervision and project monitoring; (ii) strengthened external verification mechanisms through the recruitment of an external verification firm; (iii) contracting NGOs to support delivery of services; and (iv) collaboration with the Bank- financed Governance and Institutional Development Project on implementing social accountability mechanisms at the community and health facility levels. Project preparation had a strong focus on ensuring that the resources under the AF benefit from and build on these mechanisms already in place. 11. Anti-Corruption Guidelines: ―Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants,‖ dated October 15, 2006 and updated in January 2011, shall apply to the Project. 12. All key legal covenants have been complied with under the original Project. The Bank will take actions to ensure that the Financing Agreement is valid, binding and enforceable, and will require the Recipient to provide a legal opinion from legal counsel in Madagascar confirming the same. 13. Safeguards: The original credit is classified as Category ―B‖ for environmental screening purposes, given the risks associated with the handling and disposal of medical waste. These risks can potentially affect personnel in hospitals, health centers and municipalities who handle waste, families whose income derive from the triage of waste, and also the general public, to the extent that waste is not disposed of on-site nor safely contained in protected areas. The national policy on medical waste management, which includes a Medical Waste Management Plan (MWMP), was developed and received by the World Bank on March 5, 2005, disclosed in-country and published in Infoshop the same day. This policy primarily relates to solid waste, with a summary description of liquid waste, and contains the following elements: (i) global and specific objectives regarding medical waste management; (ii) the legal framework and law; (iii) waste characteristics with prescribed elimination modes; (iv) norms, safety standards and measures to be adopted, as well as critical equipment to be used; and (v) a description of the monitoring system and an action plan with impact and results indicators. The policy includes an implementation plan. 50 SALAMA is governed by a board of directors that is independent from the Government. 43 14. The only safeguard triggered for the AF is the environmental assessment, as no civil works will be undertaken; thus there are no negative environmental impacts envisaged in the proposed program. The MWMP was updated on the indicators and implementation plans and re-disclosed on November 17, 2010 during project restructuring and remains valid. There are no changes to the safeguard classification; safeguard implementation, for its part, is rated Satisfactory. Therefore, the MWMP for the original Project remains applicable for the proposed activities under the AF. Since this document does not require any modifications, re-disclosure is not necessary during the preparation of this proposed AF. The Integrated Safeguard Data Sheet (ISDS) has been updated based on the MWMP‘s implementation progress and was re-disclosed in Infoshop on February 23, 2012. 15. The AF will continue to support the implementation of the MWMP, in particular by ensuring maintenance of incinerators installed under the original Project and supervision of related activities. 44 Diagram 1: Implementation Arrangements and Financing Flows IDA - BANK TEAM OVERSIGHT: TRANSITION PRESIDENCY NO OBJECTION, QUALITY GENERAL SECRETARY CONTROL, TA, SUPPORT TO UGP (SALARY/OPERATIONAL BUDGET ) NATIONAL NUTRITION MINISTER OF PUBLIC EXECUTIF SECRETARY - CNLS OFFICE HEALTH - MINSANP NATIONAL DIRECTOR MSPP II GENERAL SECRETARY NATIONAL COMMUNITY-BASED PROJECT IMPLEMENTATING NUTRITION PROGRAM – PNNC AGENCY – HEALTH – UGP MSPP II Council ADMIN OVERSIGHT for Project: ADDITION OF NUTRITION REPRESENTATIVE (AF) REGIONAL DIRECTORATE AFD GF ACTIVITIES) OF PUBLIC HEALTH FUN PMPSII D DISTRICT HEALTH AUTHORITY HEALTH TECHNICAL ASSISTANCE FOR INDEPENDENT VERIFICATION HEALTH & DISTRICT: TA support to HIV/AIDS NGOs AGENT NUTRITION NGOs health center; data collection support. HEALTH & NUTRITION BASIC HEALTH PEER EDUCATOR - PE COMMUNITY AGENT CENTER MOTHER & CHILD BENEFICIARIES Approval &Coordination Administrative Supervision Contract Fund Flow Verification Technical Assistance/Supervision Service Provision 45 ANNEX 5: PROCUREMENT PLAN Approved: April 2, 2012 I. Goods and Works and Non-Consulting Services 1. Prior Review Threshold: Procurement Decisions subject to Prior Review by the Bank as stated in Appendix 1 to the Guidelines for Procurement: [Thresholds for applicable procurement methods (not limited to the list below) have been determined by the Procurement Specialist /Procurement Accredited Staff based on the assessment of the implementing agency‘s capacity (Table 1). Table 1: Procurement Threshold Procurement Method Prior Review Comments Threshold 1. ICB and LIB (Goods) >US$250,000 2. NCB (Goods) None US$500,000 4. NCB (Works)51 None US$200,000 2. Single Source (Firms) All 3. Individual Consultant Selection >US$50,000 4. Single Source (Individual All Consultant) 2. Short list comprised entirely of national consultants: Short list of consultants for services, estimated to cost less than $100,000 equivalent per contract, may be entirely comprised of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. 3. Any Other Special Selection Arrangements: Not applicable. Table 4: Consultancy Assignments with Selection Methods and Time Schedule 1 2 3 4 5 6 7 Ref. No. Description of Estimated Selection Review Expected Comments Assignment Cost Method by Bank Proposal (Prior / Post) Submission Date RFP- Recruit a firm for the 21,560 LCS Post September ToR will be 01/2012 2013 financial audits and 2012 subject to a the closing project audit Prior review in conformity with Schedule IV, Annex 3 of Credit Agreement 4104-MAG RFP- Recruit Health and 1,250,000 QBS Prior October - 02/2012 Nutrition NGOs 2012 RFP- Recruit NGO/Firm for the 150,000 QCBS Prior December - 03/2012 implementation and 2012 evaluation of Results- based Financing ICS- Recruit 4 health Technical 96,000 ICS Post November TOR will be 01/2012 Assistants 2012 subject to a Prior Review in conformity with Schedule IV, Annex 3 of Credit Agreement 4104-MAG 48 ICS- Recruit 1 Technical 24,000 ICS Post November 02/2012 Assistant based at 2012 ONN/PNNC DC- Recruit a firm to put a 59,200 DC Prior October 01/2012 prompt data reporting 2012 system in place at UGP level DC- Recruit an Independent 400,000 DC Prior February - 01/2013 Inspection Agent to 2013 monitor progress on the relevant indicators for NGOs‘ activities DC- Recruit Associations for 27,600 DC Prior February - 02/2013 psychological and social 2013 care of PLWHAs RFP- Recruit NGOs to support 1,000,000 QBS Prior March 2013 - 01/2013 the executive partners in achieving the Project Objectives (PMPS) 49 ANNEX 6: TARGET REGIONS, CATCHMENT POPULATIONS, AND KEY INDICATORS Table A: Target Regions and Catchment Population Regions Districts # Communes # Health Targets Health / Nutrition Target HIV/AIDS Total <5km Pregnant Children under Out of Out of Youth 15-24 years Military HIV/AIDS Population women 5 which 0- Health/Nutriti which Youth Youth Both sex Health Effectives Both sex Of which 11 on female Male female combined facility Professio combined female months nal sex HIV/AIDS Androy Ambovombe Androy 12 12 178,358 107,015 8,026 28,537 7,134 36,563 22,437 8,566 8,739 17,304 - - worker- 17,304 8,739 Bekily 8 8 103,332 61,999 4,650 16,533 4,133 21,183 12,999 588 600 1,188 - - - 1,188 600 Beloha 4 4 51,130 30,678 2,301 8,181 2,045 10,482 6,432 2,965 3,025 5,989 - - - 5,989 3,025 Tsihombe 5 5 71,471 42,883 3,216 11,435 2,859 14,652 8,991 - - - - - - - - Atsimoatsinanana Farafangana 12 12 147,407 88,444 6,633 23,585 5,896 30,218 18,544 4,605 4,698 9,302 - - - 9,302 4,698 Vangaidrano 9 9 160,476 96,286 7,221 25,676 6,419 32,898 20,188 4,306 4,393 8,700 - - - 8,700 4,393 Vatovavy Fitovinany Ikongo 7 7 59,493 35,696 2,677 9,519 2,380 12,196 7,484 3,864 3,942 7,806 - - - 7,806 3,942 Ifanadiana 7 7 89,714 53,829 4,037 14,354 3,589 18,391 11,286 5,758 5,874 11,632 - - - 11,632 5,874 M anakara 3 3 74,427 44,656 3,349 11,908 2,977 15,257 9,363 4,704 4,799 9,503 - - - 9,503 4,799 Vohipeno 2 2 21,347 12,808 961 3,416 854 4,376 2,685 - - - - - - - - Haute Matsiatra Fianarantsoa I 1 5 63,393 38,036 2,853 10,143 2,536 12,995 7,975 4,707 4,802 9,509 - 1,100 900 11,509 5,702 Fianarantsoa II 22 22 364,958 218,975 16,423 58,393 14,598 74,816 45,912 1,889 1,928 3,817 - - - 3,817 1,928 Ambalavao 12 12 158,865 95,319 7,149 25,418 6,355 32,567 19,985 2,629 2,682 5,310 - - - 5,310 2,682 Ambohimahasoa 12 12 166,523 99,914 7,494 26,644 6,661 34,137 20,949 - - - - - - - - Amoron'Imania Ambositra 10 10 148,876 89,326 6,699 23,820 5,955 30,520 18,729 6,654 6,789 13,443 - 550 - 13,993 6,789 Ambatofinandrahana 3 3 44,599 26,759 2,007 7,136 1,784 9,143 5,611 3,311 3,378 6,690 - - - 6,690 3,378 M anandriana 4 4 68,200 40,920 3,069 10,912 2,728 13,981 8,579 1,716 1,751 3,466 - - - 3,466 1,751 Fandriana 6 6 79,060 47,436 3,558 12,650 3,162 16,207 9,946 - - - - - - - - Analamanga Antananarivo 1 1 5,000 8,000 13,000 8,000 Renivohitra Atsimondrano 1 1 300 - 300 - Ambohidratrimo 1 1 500 - 500 - Atsimoandrefana Toliary I 1 1 600 800 1,400 800 Alaotramangoro M oramanga 1 1 300 350 650 350 Vakinankaratra Antsirabe I 1 1 600 1,450 2,050 1,450 Menabe M orondava 1 1 - 500 500 500 Boeny M ahajanga 1 1 600 - 600 - TOTAL 147 151 2,051,629 1,230,977 92,323 328,261 82,065 420,584 258,095 56,262 57,398 113,660 - 9,550 12,000 135,210 69,398 Target beneficiaries health and nutrition 420,584 Target beneficiaries HIV/AIDS 135,210 Out of which Target beneficiaries for Health and nutrition (without HIV/AIDS) 265,525 Target beneficiaries for integrated package Health, nutrition and HIV/AIDS 155,059 50 Table B: Poverty Ratio and Intensity in Target Regions Poverty Ratio (%) Poverty Intensity (%) Target region Urban Rural Combined Urban Rural Combined Matsiatra Ambony 55.5 91.1 84.7 21.7 48.1 43.3 Amoron'i Mania 61 88.2 85.2 20.4 39.7 37.6 Vatovavy Fitovinany 71.1 92.8 90 35.4 48.1 46.4 Atsimo Atsinanana 63.1 97.5 94.5 25.7 53.7 51.2 Androy 94.4 94.3 94.4 63.8 60.3 60.9 Total Madagascar 54.2 82.2 76.5 21.3 38.3 34.9 Source: INSTAT/DSM/EPM 2010. Table C: Percentage of women with Syphilis in Target Regions Women with syphilis Effectif des femmes Target region recrutées Number % IC 95% Amoron'i Mania 503 8 1.6 0.7 – 3.2 Androy 281 26 9.3 6.1 – 13.3 Atsimo Atsinanana 550 6 1.1 0.4 – 2.5 Haute Matsiatra 853 19 2.2 1.4 – 3.5 Vatovavy Fitovinany 839 14 1.7 1.0 – 2.9 Total Madagascar 14,282 692 4.8 [4.5 – 5.2] Source: ESN 2008-2009 M/car. Table D: Percentage of STI cases registered for 2010 in Target Regions % of Nombre total Nombre total Total Ulcérations classical STI Total # of Regions d'écoulements d'ulcérations et écoulements cases among consultations génitaux génitales génitaux external consultations Region Amoron'i Mania 141,640 1,664 375 2,039 1.4% Region Androy 107,453 3,348 1,335 4,683 4.4% Region Haute Matsiatra 203,561 3,912 920 4,832 2.4% Region Atsimo Atsinanana 95,776 1,843 653 2,496 2.6% Region Vatovavy Fitovinany 158,719 2,940 1,102 4,042 2.5% Total 5 Regions 707,149 13,707 4,385 18,092 2.6% Source: GESIS MINSANP. 51 Table E: Key maternal health indicators in Target Regions (2010) % Pregnant % Pregnant # of women tested women tested pregnant % of # of for HIV for syphilis women Total # # First PNC deliveries Regions pregnancie dénominateur: dénominateur:# tested PNC PNC Coverage in health s expected # pregnant pregnant positive facilities women/first women/first for PCN) PCN) syphilis Region Amoron'i Mania 14,462 21,014 8,293 57% 45% 17% 38 20% Region Androy 16,757 45,012 13,322 80% 13% 4% 90 19% Region Haute Matsiatra 38,307 46,295 19,078 50% 33% 12% 135 18% Region Atsimo Atsinanana 13,349 24,068 9,171 69% 23% 15% 31 13% Region Vatovavy Fitovinany 9,082 26,331 10,517 116% 30% 27% 149 10% Total 5 Regions 91,957 162,720 60,381 66% 28% 14% 443 17 Source: GESIS MINSANP. Table F: Key child health indicators in Target Regions (2010) Regions Total number BCG Coverage # of # of children Number of children under 5 coverage DTCHepB children 0-11 months years of age that have diarrhea children 3 doses 0-11 who received or dysentery with/without 0-11 children months Mebendazole dehydration that have received BCG months 0-11 who Zinc and/or ORS months received 0-11 1-5 0-11 1-5 anti- Total months years months years rougeole Region Amoron'i Mania 14,462 45,621 8,114 56% 51% 10,532 42,720 56,153 71,156 127,309 Region Androy 14,153 51,390 6,119 43% 82% 14,047 62,189 65,437 94,796 160,233 Region Haute Matsiatra 32,352 115,785 18,968 59% 60% 18,365 122,166 134,150 194,392 328,542 Region Atsimo Atsinanana 15,720 44,197 6,097 39% 42% 5,727 23,727 49,924 42,931 92,855 Region Vatovavy Fitovinany 8,883 31,288 5,673 64% 88% 7,265 34,526 38,553 63,664 102,217 Total 5 Regions 85,570 288,281 44,971 53% 62% 55,936 285,328 344,217 466,939 811,156 Source: GESIS MINSANP. 52 IBRD 33439R 45°E 50°E Antsiranana Mayotte MADAGASCAR (France) Ambilobe Vohimarina Ambanja DIANA l e Maromokotro n (2,876 m) n Massif Sambava a Ts a r a t a na na SAVA h Bealanana C Antalaha Antsohihy 15°S e 15°S u iq Sofi Befandriana a Maroantsetra b Mahajanga m SOFIA a Mandritsara z Mampikony o Soalala em B ar avo M va BOÉNY iv Mananara Mahavavy M a o ol ANALANJIROFO ah Cliff of Ang g ajamba Besalampy n Bo Maevatanana Andilamena Soanierana-Ivongo BETSIBOKA ALAOTRA of MELAKY MANGORO Fenoarivo-Atsinanana ff Kandreho Andriamena Ma Cli na Lake mb B Alaotra aho Ambatondrazaka ets iboka Maintirano Ankazobe Andilanatoby Toamasina ANALAMANGA BONGOLAVA ATSINANANA Antsalova Tsiroanomandidy ITASY ANTANANARIVO Miarinarivo Moramanga Tsiafajovona INDIAN (2,642 m) Vatomandry Antanifotsy ata Belo Tsiribihina Miandrivazo OCEAN VAKINANKARATRA Mang kar oro Tsiribihina Man ia Antsirabe Mahanoro An 20°S 20°S Morondava Malaimbandy AMORON’I MANIA Ambatofinan- Ambositra MENABE drahana Varika Ambohimahasoa Mandabe HAUTE-MATSIATRA Mananjary Manja Fianarantsoa Beroroha VATOVAVY- Morombe goky Man FITOVINANY 0 40 80 120 160 200 Kilometers Ankazoabo Pic Boby Manakara Ihosy (2,658 m) ATSIMO- ANDREFANA IHOROMBE 0 40 80 120 Miles a Ma Farafangana 50°E an na na ch Sakaraha ra ere Fih Betroka Toliara Betioky Onilahy Midongy- Atsimo ATSIMO- ATSINANANA MADAGASCAR SELECTED CITIES AND TOWNS Tsivory Berakete REGION CAPITALS rave This map was produced by the Map Design Unit of The NATIONAL CAPITAL Mand World Bank. The boundaries, colors, denominations and Ampanihy ANOSY any other information shown dr lat eau RIVERS roy P a on this map do not imply, on an ar A n d Amboasary the part of The World Bank n 25°S MAIN ROADS Group, any judgment on the Androka e Ambovombe Tolanaro Beloha M legal status of any territory, or any endorsement or ANDROY RAILROADS acceptance of such boundaries. REGION BOUNDARIES 45°E MAY 2011