The World Bank Health System Performance Strengthening Project (P172504) REPORT NO.: RES48972 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF HEALTH SYSTEM PERFORMANCE STRENGTHENING PROJECT APPROVED ON AUGUST 6, 2021 TO REPUBLIC OF CHAD HEALTH, NUTRITION & POPULATION WESTERN AND CENTRAL AFRICA Regional Vice President: Ousmane Diagana Country Director: Clara Ana Coutinho De Sousa Regional Director: Dena Ringold Practice Manager/Manager: Magnus Lindelow Task Team Leader(s): Jean Claude Taptue Fotso, Andy Chi Tembon, Nicolas Rosemberg The World Bank Health System Performance Strengthening Project (P172504) ABBREVIATIONS AND ACRONYMS CD Country Director CMU Country Management Unit E&S Environmental and Social FA financing agreement ( CDVA Contract Development and Verification Agency GFF Global Financing Facility GoC Government of Chad IDA International Development Association INSEED Institut National de la Statistique, des Etudes Economiques et Démographiques (National Institute of Statistics, Economic and Demographic Studies) MPHNS Ministry of Public Health and National Solidarity MoU Memorandum of Understanding PBF Performance-based Financing PDO Project Development Objective PIM Project Implementation Manual PIU Project Implementation Unit PPA Project Preparation Advance SDR Standard Drawing Rights US$ US Dollar The World Bank Health System Performance Strengthening Project (P172504) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P172504 Investment Project Financing Environmental and Social Risk Classification (ESRC) Moderate Approval Date Current Closing Date 06-Aug-2021 31-Dec-2026 Organizations Borrower Responsible Agency Republic of Chad Ministry of Health and National Solidarity Project Development Objective (PDO) Original PDO The Project Development Objective is to improve the utilization and quality of service delivery of essential health services with a particular focus on reproductive, maternal, child and adolescent health, and nutrition services for the population of Chad in project-supported areas OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-D8070 06-Aug-2021 31-Dec-2026 90.00 0 89.16 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Health System Performance Strengthening Project (P172504) Note to Task Teams: End of system generated content, document is editable from here. I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING Note: Formatting instructions for this document. A. Header 1. [All sub-sections must have a continuous paragraph numbering for the entire main text or for each annex per institutional standard.] (a) This is the sub-para numbering for this level. This is the sub-para numbering for this level. This is the sub-para numbering for this level. (i) This is the sub-para numbering for this level. This is the sub-para numbering for this level. (ii) This is the sub-para numbering for this level. This is the sub-para numbering for this level. (iii) This is the sub-para numbering for this level. This is the sub-para numbering for this level. A. PROJECT STATUS The Health System Performance Strengthening Project (Project) was approved by the World Bank Board of Directors on August 6, 2021 and the Financing Agreement (FA) was signed by the Government of Chad (GoC) and the World Bank on September 21, 2021. The total budget of the Project is US$106.5 million (IDA grant: US$90 million and GFF TF: US$16.5 million). The Project is not yet effective, and the effectiveness deadline is 90 days after the signing of the FA. The conditions of effectiveness are: (i) the Project Implementation Manual (PIM) has been adopted in accordance with Section I.B of Schedule 2 of the FA; and (ii) the co-financing agreement has been executed and delivered and all conditions precedent to its effectiveness or to the right of the GoC to make withdrawals under it (other than the effectiveness of the FA) have been fulfilled. The draft PIM was prepared by the GoC and shared with the World Bank team, which has reviewed it and provided comments which was integrated by the government. The revised version received at the Bank on November 12, 2021 is under reviewed. In terms of the co-financing agreement, it was signed by the GoC and the World Bank on September 21, 2021. In addition, the legal opinion was issued by the Supreme Court on October 5, 2021 and it was reviewed and cleared by the legal team. Based on the above, it is expected that the Project will be declared effective prior to the effectiveness deadline. Governance structures The Minister of Public Health and National Solidarity (MPHNS) issued on October 14, 2021 an "arrete" establishing the steering committee of the Project. The committee is co-chaired by the General Secretary of the MPHNS, and it includes representatives of relevant ministries and development partners, as stated in the FA. The World Bank Health System Performance Strengthening Project (P172504) Project Preparation Advance (PPA) The GoC requested a PPA in March 2020 to launch important activities that would help ensure a smooth implementation of the Project. The implementation of most activities was initially delayed by the COVID-19 pandemic and then by the launch of OP7.30 in Chad following the political events of March 2021. As a result, and in order to enable the completion of these activities during the Project preparation phase, the closing date of the PPA was extended twice and the current closing date is November 30, 2021. The implementation of PPA activities was mixed. Out of 13 activities planned, 7 were completed and most of the remaining activities are ongoing. The activities that have been completed include: (i) the elaboration of safeguard documents, (ii) the elaboration of a strategic procurement plan, (iii) the development of the Performance Based Financing (PBF) manual, (iv) the costing of the project’s PBF mechanism, (v) the organization of planning workshops to reinforce Civil Registration and Vital Statistic, (vi) the organization of a workshop to elaborate the GFF investment Case, and (vii) the procurement of equipment for the GFF team's office. The six activities that are partially completed include: (i) the establishment of a PBF portal for which the recruitment process of a consultant has started; (ii) the collection of baseline data, which is ongoing; (iii) the establishment of regional Contract Development and Verification Agencies (CDVA) for PBF; (iv) the preparation of a Memorandum of Understanding (MoU) between the MPHNS and the Institut National de la Statistique, des Etudes Economiques et Démographiques (INSEED) (National Institute of Statistics, Economic and Demographic Studies) to host CDVAs, for which a first draft has already been prepared by the GoC and reviewed by the World Bank team; (v) the training of key stakeholders on PBF1 ; and (vi) the procurement of Project vehicles. The Project Implementation Unit (PIU) has launched the procurement process of 8 vehicle for the Project. This contract will probably be signed after effectiveness. Out of the US$2 million PPA, US$0.4 million has been disbursed. Environmental and Social (E&S) safeguard: All the tools required for the Project have been developed and cleared within the World Bank. The Project is not yet effective so only activities financed by the PPA have taken place, hence the E&S assessments remain the same as at appraisal stage. The team will continue to follow-up closely during Project implementation to ensure E&S compliance. B. RATIONALE FOR RESTRUCTURING The GoC sent a request dated November 10, 2021 to the World Bank requesting the restructuring of the Project and amendment of the FA to include the PPA refund category to absorb the refinancing of the withdrawn amount of the Advance, which had not been included earlier. This issue was discussed with LEGAM, WFA and the CMU, and it was agreed to do a level two restructuring to amend the FA. II. DESCRIPTION OF PROPOSED CHANGES 1The GoC planned 5 training sessions for around 175 staff from the central, regional and district level of the health system who will be involved in the implementation of the Project. The first session took place in September 2021 where 33 staff were trained; the next training sessions are planned for November and December 2021 and January 2022. The World Bank Health System Performance Strengthening Project (P172504) Note: Formatting instructions for this document. B. Header 1. [All sub-sections must have a continuous paragraph numbering for the entire main text or for each annex per institutional standard.] (b) This is the sub-para numbering for this level. This is the sub-para numbering for this level. This is the sub-para numbering for this level. (iv) This is the sub-para numbering for this level. This is the sub-para numbering for this level. (v) This is the sub-para numbering for this level. This is the sub-para numbering for this level. (vi) This is the sub-para numbering for this level. This is the sub-para numbering for this level. The proposed restructuring would introduce a new disbursement category (category 4) called “Refund of Preparation Advance” in the FA to allow the GoC to refinance the PPA from the Project IDA resources upon effectiveness of the Project. The detailed changes are presented in Table 1 below. TABLE 1 - DISBURSEMENT CATEGORIES Category Amount of the Revised Percentage of Grant Allocated Amount of the Grant Expenditures to be (expressed in SDR) Allocated (expressed Financed in SDR) (inclusive of Taxes) (1) Goods, works, non-consulting services, and consulting services, Training and Operating Costs for Parts 2 14,600,000 14,000,000 75% (except Part 2.1(b), Part 3 of the Project (2) PBF Payments under Part 1 and Part 48,000,000 48,000,000 87.9% 2.1(b) of the Project (3) Emergency Expenditures for Part 4 of 0 0 100% the Project (4) Refund of Preparation Advance 600,000 100% TOTAL AMOUNT 62,600,000 62,600,000 ES NOTE TABLE The World Bank Health System Performance Strengthening Project (P172504) Note: The Summary of Performance of E&S Risk Compliance is populated from the ESMS and is editable. It flows to the Restructuring paper once. Please remember to update the paper if there are changes to the Summary from the ESMS.” Please delete this note when finalizing the document. Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. III. SUMMARY OF CHANGES Changed Not Changed Reallocation between Disbursement Categories ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ Results Framework ✔ Components and Cost ✔ Loan Closing Date(s) ✔ Cancellations Proposed ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ Overall Risk Rating ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Implementation Schedule ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ The World Bank Health System Performance Strengthening Project (P172504) IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_REALLOCATION _TABLE REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Financing % Current Allocation Actuals + Committed Proposed Allocation (Type Total) Current Proposed . Note to Task Teams: End of system generated content, document is editable from here. Please delete this note when finalizing the document