The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) EUROPE AND CENTRAL ASIA | Belarus | Governance Global Practice | IBRD/IDA | Investment Project Financing | FY 2016 | Seq No: 11 | ARCHIVED on 28-Mar-2021 | ISR46034 | Implementing Agencies: Ministry of Finance, MoF's IT Center Key Dates Key Project Dates Bank Approval Date: 28-Mar-2016 Effectiveness Date: 27-Jul-2016 Planned Mid Term Review Date: 13-Jul-2018 Actual Mid-Term Review Date: 13-Jul-2018 Original Closing Date: 30-Sep-2019 Revised Closing Date: 30-Jul-2021 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) To improve policy alignment of the budget, consolidate cash balances, improve budget transparency and lay foundations for implementation of an Integrated Financial Management Information System (FMIS) Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Budget management regulations and procedures:(Cost $3.06 M) PFM IT solutions:(Cost $5.73 M) Change management:(Cost $1.18 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Unsatisfactory Overall Risk Rating Moderate Moderate Implementation Status and Key Decisions Project implementation progress remains steady and most of the key project ratings continue to be Moderately Satisfactory and above. To date, three out of four project development objectives (PDO) indicators (“Policy alignment of the budget”, “Budget transparency”, and “Consolidation of cash balances”) have been fully achieved and exceeded. It is expected that the fourth indicator “Foundations for Financial Management Information System (FMIS)” will be partially achieved given the failure to contract the FMIS design consultant (which would have been responsible for development of bidding documents for the new system). However, the MoF confirmed its commitment to continue the gradual development of the new FMIS, using modular approach and their own resources. This would allow to partially achieve the above mention indicator. 3/28/2021 Page 1 of 9 The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) To date, total commitments under the project reached US$7.5 million and a total amount of US$5.8 million (58% of a total approved amount of US$10.0 million) has been disbursed in strict compliance with: (i) project development objectives (PDO); and (ii) the World Bank fiduciary framework, including financial management and procurement rules and procedures. It is expected that, by closing date (July 30, 2021), the project would disburse slightly above US$9.0 million (around 90% of the loan), the remaining amount represents project savings generated throughout project’s life. The results achieved under Component 1 “Budget Management Regulations and Procedures” include: (i) launch of the public sector accounting (PSA) reform through development of: (a) Concept for modernization of the national PSA and reporting system; (b) initial plan for its implementation; (c) new Unified Chart of Accounts; and (d) drafts of the first five new national PSA standards, which, in turn, are aligned with the International Public Sector Accounting Standards (IPSAS)); (ii) development of a Concept for Modernization of the Internal Financial Control and Audit in the Public Sector; (iii) procurement and implementation of the fiscal transparency portal that provides to general public access to the data and analytical reports on budget execution, which is also available via mobile devices and in English. Under Component 2 “PFM IT Solutions” the results include: (i) procurement and installation of numerous IT solutions that allowed to: (a) strengthen sustainability, reliability, stability, and security of current MoF’s information systems; (b) improve its ongoing operation; and (c) establish a new technological platform required for implementation of a new FMIS; (ii) procurement of software and hardware to enable remote work and business continuity during emergency situations, such as COVID-19 pandemic. Component 3 “Change Management” enabled to strengthen the institutional capacity and infrastructure of MoF’s Training Center, including: (i) classrooms’ furniture; (ii) videoconferencing and simultaneous interpretation system; (iii) interactive boards; (iv) presentation projectors; (v) equipment for digital printing office; (vi) local area networks; (vii) desktop and portable computers; and (viii) air conditioning systems, among other. The modernized facilities of the Training Center allowed to improve the quality of the educational process and provide students with comfortable learning conditions. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Moderate Substantial Substantial Macroeconomic Substantial Substantial Substantial Sector Strategies and Policies Substantial Moderate Moderate Technical Design of Project or Program Moderate Moderate Moderate Institutional Capacity for Implementation and Substantial Moderate Moderate Sustainability Fiduciary Moderate Moderate Moderate Environment and Social Low Low Low Stakeholders Moderate Moderate Moderate Other -- -- -- Overall Substantial Moderate Moderate Results PDO Indicators by Objectives / Outcomes Improve policy alignment of the budget IN00971625 3/28/2021 Page 2 of 9 The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) ►Improved alignment of policies and budgets (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 16.00 63.50 69.00 50.00 Date 01-Jan-2015 30-Sep-2020 15-Mar-2021 30-Jul-2021 The end target value has been achieved and exceeded, and is expected to be sustained by the project’s closing date. The Government revised program budgeting methodology in 2016, which already resulted in a technical increase of the budget expenditures covered by programs in 2017, reaching 61 percent of consolidated budget expenditures. In 2018 this share constituted 59.9 percent, and 63 percent in 2019. In Comments: 2020 following the approval of the state program for Public Finance Management and Financial Market Regulation the share of budget expenditures covered by programs reached 69 percent of the consolidated budget. Consolidate cash balances IN00971626 ►Increase the level of consolidation of cash balances (by reducing balances outside of TSA) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 11.00 6.90 6.03 7.00 Date 31-Dec-2014 30-Sep-2020 15-Mar-2021 30-Jul-2021 The end target value has been achieved and exceeded, and is expected to be sustained by the project’s closing date. The adopted mechanism of consolidation of public funds on TSA involves inclusion in the annual budget laws of the lists of organizations and accounts to be transferred to TSA during the Comments: respective year. The actual share of extrabudgetary spending managed outside the TSA decreased by October 1, 2020 to 6.03 percent of the republican budget expenditures. Data for the CY20 will be available in March 2021. Improve budget transparency IN00971627 ►Improved budget transparency (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Citizens’ budgets Since 2017, citizens Citizens budget is (approved budgets) budgets have been published online on are published online developed and published annual basis and on the MoF’s webpage on the MoF’s webpage, includes information on starting with the 2018 including dis-aggregated budget execution budget and include information on the disaggregated at the disaggregated approved budget. Oblast level of approved information on the level subnational budget;information on Citizens budget has not approved budget. Value governments started medium term financial been prepared. Information on publishing their versions program; and analysis financial and results of citizens budgets in of links between indicators of the state 2018. Information on financing and results. programs was also financial and results Citizens’ questions and included in the indicators of state feedback are citizens’ budget for programs was included in published on 2020. Fiscal data the citizens budget for the website along with portal went live in 2020. responses of the MoF January 2018 3/28/2021 Page 3 of 9 The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) providing general to frequently asked public with access to questions. interactive fiscal data on budget execution. Exceeding the requirements of the indicator, the MoF produces and publishes quarterly bulletins on the execution of the consolidated budget, as well as republican and local budgets. English and smartphones/tablets versions of the fiscal data portal are available. Date 31-Dec-2015 30-Sep-2020 15-Mar-2021 30-Jul-2021 Achieved and expected to be sustained by the Project’s closing date. The fiscal data portal went live in January 2018 providing the general public with access to interactive fiscal data on budget execution. Exceeding the requirements of the indicator, the MoF produces and publishes quarterly bulletins on the execution of the consolidated budget, as well as republican and local budgets. English and smartphones / Comments: tablets versions of the fiscal data portal are also available. Information on the performance of individual state programs is published by the line ministries, consolidated information is available on the Ministry of Economy’s website (implemented without support from the Project). Lay foundations for implementation of FMIS IN00971628 ►Foundations for FMIS (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The tender for the FMIS design consultancy has been cancelled in September 2020 as per the PIU’s request. The PIU and MoF The tender for the FMIS Bidding documents for confirmed their design consultancy has FMIS are prepared commitment to been cancelled as per based on approved continue working the PIU’s request. The revised business toward laying down PIU and MoF confirmed processes and Unified Future business foundations for the their commitment to Chart of Accounts and processes to be new FMIS, using Value continue working toward cover the following supported by IFMIS are mainly their own laying foundations for the functionality including not fully defined. resources and new FMIS, using mainly planning, execution, individual consultants their own resources and financial control, to be financed by the individual consultants to accounting and project. Hence, the be financed by the reporting, debt bidding documents, project. management. considered in the original end target of this indicator, will not be required anymore. It is expected that by project closing, the indicator is partially 3/28/2021 Page 4 of 9 The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) achieved, taking into consideration the following: (i) the new Unified Chart of Accounts has been already developed and approved; (ii) business processes for some of the relevant modules of the new system are revised; (ii) key technical specifications for the first module(s) of the new system are prepared. Date 31-Dec-2015 30-Sep-2020 15-Mar-2021 30-Jul-2021 Progress towards achievement of this indicator will be closely monitored by the Bank team. Comments: Intermediate Results Indicators by Components Budget management regulations and procedures IN00971629 ►Conceptual framework for public sector accounting reform (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Public sector accounting (PSA) reform implementation has been launched by: (i) approval by the Government in The MoF prepared the February 2019 of the Public sector drafts of the first five concept for accounting reform Public sector accounting public sector accounting modernization of implementation reform is defined as a standards, which are national PSA and launched by finalizing Value priority in PFM Strategy, being reviewed and reporting system and development of first 3- but the reform direction is commented by the the initial plan for its 4 accounting not defined. consulting firm to ensure implementation; (ii) the standards compliant their compliance with drafts of the first five with IPSAS IPSAS. new national PSA standards, aligned with the International Public Sector Accounting Standards (IPSAS), were developed. Date 31-Dec-2015 30-Sep-2020 15-Mar-2021 30-Jul-2021 On track to be achieved. Comments: IN00971631 ►Program budgeting methodology (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target 3/28/2021 Page 5 of 9 The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) Selected amendments to the current methodology for development, financing, and execution of state programs were Program budgeting prepared by the MoE methodology is independently of the Program budgeting approved, allows Project and were methodology does not Work on revising the looking at different Value expected to be clearly link objectives methodology is ongoing. social dimensions, approved in 2020 and resources. including gender, in (pending). Further selected relevant improvements of the programs. program budgeting methodology are expected to be introduced in the new cycle of state programs covering CY21-25. Date 31-Dec-2015 30-Sep-2020 15-Mar-2021 30-Jul-2021 Partial achievement is expected. Comments: PFM IT solutions IN00971630 ►Integration of budget and financial reporting based on international standards (Text, Custom) (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Unified Chart of The Unified Chart of The Unified Chart of Methodological basis for Accounts integrated Accounts (UCoA) and the Accounts (UCoA) and public sector financial with the budget methodology for its the methodology for its and budget reporting has classification and Value piloting were approved piloting were approved not been integrated and guidelines for its by Order of the MoF by Order of the MoF deviates from applicable application are N392 dated November N392 dated November international standards. approved. 29, 2019. 29, 2019. Date 31-Dec-2015 30-Sep-2020 15-Mar-2021 30-Jul-2021 Achieved. The approved UCoA informed the requirements for the public sector accounting IT solution that Comments: is expected to be developed during 2020 to pilot the UCoA in 2021 in several spending units. IN00971632 ►Modernization of business processes (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The tender for the FMIS Following the design consultancy, cancelation of the which was the key FMIS design Future business activity for this indicator, consultancy in processes to be has been cancelled as September 2020, the Revised business Value supported by FMIS are per the PIU’s request. MoF and the IT Center processes approved not fully defined. The PIU and MoF confirmed their confirmed their commitment to commitment to continue continue with gradual working toward laying development of the 3/28/2021 Page 6 of 9 The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) foundations for the new new system, using FMIS using their own their own resources resources. and a modular approach. It is expected that by project closing, the MoF would be able to develop the revised business processes for some of the relevant modules of the new system. Date 31-Dec-2015 30-Sep-2020 15-Mar-2021 30-Jul-2021 Partial achievement is expected. Comments: IN00971633 ►Reliability and fault tolerance of the ASFS (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The implementation of virtualization infrastructure management software A uniform distribution and Active-active hard- of the load on the The ASFS at the and software have ASFS and efficient republican level operates been completed in data processing and at two geographically Contract for the November and backup through distant sites. There is no acquisition of the Active- December 2020 "Active-Active" full-fledged backup active hardware-software respectively. It is geographically system; there is a high signed on May 5, 2020. expected that by the distributed cluster. probability of data loss in Contract for acquisition of closing date: Modern IT the event of an accident. the virtualization 1. A geographically infrastructure with Domain and postal infrastructure distributed cluster server virtualization structures of the ASFS management software Value (hereinafter referred to software and are scattered. The IT (licenses) signed on as the Cluster) has virtualization infrastructure at the August 13, 2020. been built in the management centers Oblast level is outdated. Implementation of the central office of the is established at the It is not possible to contracts is ongoing. The MoF, operating in the republican and oblast deploy a fault-tolerant results will only be seen "Active-Active" mode; levels (12 sites) cluster (FTC) allowing for after the new ICT 2. Conditions are including virtual control of computing equipment is installed created to ensure the machines control resources using the new and functional. ASFS operation with a center and capabilities equipment high level of fault to deploy a fault- tolerance and tolerant cluster (FTC) reliability, with an even distribution of the ASFS load, at the republican level. Date 27-May-2019 30-Sep-2020 15-Mar-2021 30-Jul-2021 On track to be achieved. Comments: IN00971634 ►ASFS centralized storage capacity (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value There is no centralized Bidding process for the The contract for Centralized storage of storage of the ASFS portable data storage portable DSS was databases of MoF databases for planning system was launched on signed in December territorial bodies and 3/28/2021 Page 7 of 9 The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) and execution of local September 28, 2020. The 2020, and it is local finance bodies at budgets. It is not possible results will only be seen expected that the MoF is ensured to operate the ASFS after the new IT hardware is through high-speed segment in emergency equipment is procured, commissioned by mid and reliable data (abnormal) mode using installed and functional. April 2021. It is also storage system. The the backup equipment expected that by the capability to operate closing date: the ASFS in 1. This high-speed and emergency (abnormal) highly reliable data mode using the storage system backup equipment is ensures the safety of ensured databases and the operability of the main ASFS modules in the event of a failure of any part of the current ASFS soft- or hardware infrastructure. 2. Collection and centralized storage of databases of MoF’s territorial and local financial bodies is organized after the data storage system is commissioned. Date 27-May-2019 30-Sep-2020 15-Mar-2021 30-Jul-2021 On track to be achieved. Comments: Performance-Based Conditions Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P146997 IBRD-86060 Effective USD 10.00 10.00 0.00 6.52 3.48 65% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P146997 IBRD-86060 Effective 28-Mar-2016 01-Apr-2016 27-Jul-2016 30-Sep-2019 30-Jul-2021 Cumulative Disbursements 3/28/2021 Page 8 of 9 The World Bank Implementation Status & Results Report BELARUS PUBLIC FINANCIAL MANAGEMENT MODERNIZATION PROJECT (P146997) PBC Disbursement Achievement Disbursed amount in Disbursement % PBC ID PBC Type Description Coc PBC Amount Status Coc for PBC Restructuring History Level 2 Approved on 19-Jul-2019 Related Project(s) There are no related projects. 3/28/2021 Page 9 of 9