103705 THE WORLD BANK OPERATIONS EVALUATION DEPARTMENT The Post Conflict Fund Addressing Challenges of Globalization: An Independent Evaluation of the World Bank’s Approach to Global Programs Case Study Caroline Bahnson and Jozefina Cutura Director-General, Operations Evaluation: Gregory K. Ingram Director: Ajay Chhibber Task Team Leader: Uma Lele 2004 This paper is available upon request from OED. The World Bank Washington, D.C. ENHANCING DEVELOPMENT EFFECTIVENESS THROUGH EXCELLENCE AND INDEPENDENCE IN EVALUATION The Operations Evaluation Department (OED) is an independent unit within the World Bank; it reports directly to the Bank’s Board of Executive Directors. OED assesses what works, and what does not; how a borrower plans to run and maintain a project; and the lasting contribution of the Bank to a country’s overall development. The goals of evaluation are to learn from experience, to provide an objective basis for assessing the results of the Bank’s work, and to provide accountability in the achievement of its objectives. It also improves Bank work by identifying and disseminating the lessons learned from experience and by framing recommendations drawn from evaluation findings. OED Working Papers are an informal series to disseminate the findings of work in progress to encourage the exchange of ideas about development effectiveness through evaluation. The findings, interpretations, and conclusions expressed here are those of the author(s) and do not necessarily reflect the views of the Board of Executive Directors of the World Bank or the governments they represent. The World Bank cannot guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply on the part of the World Bank any judgment of the legal status of any territory or the endorsement or acceptance of such boundaries. Contact: Operations Evaluation Department Partnerships & Knowledge Programs (OEDPK) e-mail: eline@worldbank.org Telephone: 202-458-4497 Facsimile: 202-522-3125 http:/www.worldbank.org/oed Abbreviations and Acronyms BP Bank Procedures CAS Country Assistance Strategy CDD Community Driven Development CECI Canadian Centre for International Studies & Cooperation CEPF Critical Ecosystem Partnership Fund CODE Committee on Development Effectiveness CPR Conflict Prevention and Reconstruction Unit (World Bank) DAI Development Alternatives Inc. DGF Development Grant Facility (World Bank) DPKO Department of Peacekeeping Operations (UN) DRC Democratic Republic of the Congo ECHO European Commission’s Humanitarian Aid Office ESMAP Energy Sector Management Assistance Program ESSD Environmentally & Socially Sustainable Development Network (World Bank) EU European Union FAO Food and Agriculture Organization of the United Nations FY Fiscal year GAVI Global Alliance for Vaccines and Immunization IBRD International Bank for Reconstruction and Development ICMH International Centre for Migration and Health ICRC International Committee of the Red Cross IDA International Development Association IDP Internally displaced person IFRC International Federation of the Red Cross ILO International Labor Organization IMF International Monetary Fund IOM International Organization for Migration JPCF Japanese Post-Conflict Fund LEG Legal Vice Presidency LICUS Low Income Countries Under Stress MDG Millennium Development Goal NATO North Atlantic Treaty Organization NGO Nongovernmental Organization ODA Official development assistance OED Operations Evaluation Department (World Bank) OP Operational Policy PAHO Pan American Health Organization PATS Partnership Approval and Tracking System (World Bank) PCF Post-Conflict Fund (World Bank) PCU Post-Conflict Unit (Former name of the CPR) PHRD Japan Policy and Human Resources Development Fund PRSP Poverty Reduction Strategy Papers SDV Social Development Department (World Bank) SRSG Special Representative of the Secretary General TF Trust Fund TOR Terms of Reference TSS Transitional Support Strategy UN United Nations UNAIDS The Joint United Nations Programme on HIV/AIDS UNDP United Nations Development Programme UNHCR United Nations High Commissioner for Refugees UNICEF United Nations Children’s Fund UNMIK United Nations Interim Administration Mission in Kosovo UNOPS United Nations Office for Project Services USAID United States Agency for International Development VP Vice-Presidency (World Bank) WFP World Food Programme WHO World Health Organization i Contents Acknowledgments ............................................................................................................ iii Preface............................................................................................................................... iv List of Case Study Programs .......................................................................................... vi Executive Summary ........................................................................................................ vii 1. Introduction and Context: Global Challenges in the Sector....................................1 2. Program Alignment with Global Challenges and Bank Priorities..........................2 3. Outcomes, Impacts, and Sustainability....................................................................12 4. Program Governance, Partnerships, Management and Financing ......................17 5. Role of the World Bank.............................................................................................23 6. Findings and Lessons.................................................................................................28 References.........................................................................................................................29 Annex A. Evaluation Framework for Phase 2 Report and 26 Case Studies ..............32 Annex B. People Consulted .............................................................................................40 Annex C. The Post-Conflict Fund Grant Application Process Step-by-Step .............43 Annex D. PCF Grant Implementing Agencies ..............................................................45 iii Acknowledgments This report was prepared by Caroline Bahnson and Jozefina Cutura under the leadership of Uma Lele, Senior Adviser, OED. OED is thankful for the inputs and perspectives of Steen Jorgenson, chairman of the PCF Steering Committee, Ian Bannon of the Conflict Prevention and Reconstruction Unit housing the PCF, Colin Scott, administrator of the PCF, Natalia Tassoni Estense, Operations Analyst of the PCF, and Ana Paula Lopes, Knowledge Monitoring Specialist of the PCF. The team also thanks Lisa Campeau, Paul Collier, Steve Holtzman, Paul Hubbard, Barbara Kafka, Barbry Keller, Kazuhide Kuroda, Oey Meesook, Peter Miovic, and Randall Purcell. OED is thankful to the staff members of the World Bank host country offices in Bujumbura, Skopje, especially Pamphile Kantabaze, Rajna Cemerska-Krtova, and in Geneva, Alfredo Sfeir Younis who facilitated a variety of meetings with UN partners during the research, and Joseph Ingram. The team appreciates the comments received on earlier drafts by Ian Bannon, John Eriksson, Natalia Tassoni Estense, Roy Gilbert, Kazuhide Kuroda, Ana Paula Lopes, Colin Scott, and Christopher Gerrard of the OED global review team. iv Preface This report on the Post-Conflict Fund (PCF) is one of 26 case studies (see list on page vi) that have been prepared as source material for the second phase of OED’s independent evaluation of the Bank’s involvement in global programs. The Phase 1 Report, The World Bank’s Approach to Global Programs, which was presented to CODE in June 2002, focused on the strategic and programmatic management of the Bank’s global portfolio of 70 programs in five Bank Networks (a cluster of closely related sectors). The Phase 2 Report is based on case studies of 26 global programs and derives additional lessons for the Bank’s strategic and programmatic management of global programs as well as lessons for the design and management of individual programs. The first and largest case study – for the Consultative Group on International Agricultural Research (CGIAR) – was completed in April 2003. OED reports typically contain recommendations only in those reports presented to the Bank’s Board or its committees such as the Committee on Development Effectiveness (CODE). While the case studies that underlie OED’s Phase 2 Report were not presented to CODE individually, they were distributed in draft to program partners to obtain their feedback, which was taken into account in the final versions of each report before being disclosed to the public. Each case study follows a common outline and addresses four major evaluation issues, which correspond to the four major sections of each report: • The overarching global relevance of the program • Outcomes and impacts of the program and their sustainability • Organization, management, and financing of the program • The World Bank’s performance as a partner in the program These four issues correspond roughly to OED’s evaluation criteria of relevance, efficacy, efficiency, and Bank performance, appropriately adapted for global programs. Each case study addresses 20 evaluation questions related to these four evaluation issues (Annex A, Table A.1) that have been derived from OED’s standard evaluation criteria (Table A.2), the 14 eligibility and approval criteria for global programs that have been endorsed by the Development Committee and established by Bank Management (Table A.3), and the 8 eligibility criteria for grant support from the Bank’s Development Grant Facility (Table A.4). Twenty out of the 26 case study programs and about two-thirds of the Bank’s total portfolio of 70 global programs have received DGF grants. Global programs are defined as “partnerships and related initiatives whose benefits are intended to cut across more than one region of the world and in which the partners (1) reach explicit agreements on objectives, (2) agree to establish a new (formal or informal) organization, (3) generate new products or services, and (4) contribute dedicated resources to the program.” (OED, The World Bank’s Approach to Global Programs: Phase 1 Report, p. 3). v Since November 2000, all new global and regional programs have had to be approved at the initial concept stage, based upon the six approval criteria in Table A.3, by the managing director responsible for the Network or Regional Vice Presidential Unit advocating the Bank’s involvement. Such approval authorizes the respective VPU to enter into agreements with partners and to mobilize resources for the program – whether from the DGF, trust funds, or the Bank’s administrative budget. Both before and after November 2000, the Bank’s participation in some high-profile programs – such as the Global Environment Facility, the Multilateral Fund for the Implementation of the Montreal Protocol, the Prototype Carbon Fund, and the Global Fund to Fight AIDS, TB, and Malaria – has been considered and approved by the Bank’s Executive Board. Once a program has been approved at the initial concept stage, the Network vice presidencies are responsible for oversight, management, and quality assurance of their respective portfolios of global programs. This includes establishing priorities among programs in their Networks, ensuring their coherence with the Bank’s strategy for each sector, sponsoring applications for DGF grants, managing programs that are housed inside the Bank, fostering links to the Bank’s country operations, and promoting synergy among programs within the Network, with the rest of the Bank, and externally with partners. Regional vice presidents oversee and manage the portfolio of regional programs and partnerships in their respective Regions. While regional programs are not covered in this OED evaluation, many global programs have strong regional dimensions, which are addressed in the case studies, in addition to their links to the Bank’s country-level economic and sector work, policy advice, and lending. Case study evaluation methodology. The standard OED evaluation criterion for Bank investments attributes the outcome of the investment to the relevance of its objectives to the goal to be achieved, how efficaciously these objectives were translated into actions and results, and how efficiently the process worked. Underlying these main evaluation criteria and supporting them, OED also assesses institutional development impact, outcome, Bank performance, and borrower performance. These criteria are elaborated in Annex A, Table A.2. To apply OED’s standard criteria appropriately to global programs these criteria have been expanded and modified. The “legitimacy” of a program at the global and the country level is an important and necessary condition for developing country ownership of a program’s objectives, although by no means sufficient. “Relevance” is concerned not only with client countries’ and the Bank’s priorities but also global challenges and concerns in the sector. “Efficiency” is specifically concerned with the benefits of a multi-country and a partnership approach to addressing the global challenges and concerns in the sector by learning cross- country lessons compared to a country-by-country and donor-by-donor approach. vi List of Case Study Programs Size Acronym/ Operational Full Name (US$ Short Form Start Date 1 millions) Environment & Agriculture 1. CGIAR Consultative Group on International Agricultural Research 1972 395.0 2. GEF Global Environment Facility 1991 387.53 Multilateral Fund for the Implementation of the Montreal 3. MLF 1991 158.6 Protocol 4. ProCarbFund Prototype Carbon Fund 2000 6.5 5. CEPF Critical Ecosystem Partnership Fund 2000 20.19 6. GWP Global Water Partnership 1997 10.25 7. GIF Global Integrated Pest Management Facility 1996 1.3 Health, Nutrition & Population Special Programme for Research and Training in Tropical 8. TDR Dec 1975 47.5 Diseases 9. Global Forum Global Forum for Health Research Jan 1997 3.07 10. UNAIDS Joint United Nations Programme on HIV/AIDS Jan 1996 95.0 11. RBM Roll Back Malaria Nov 1998 11.4 12. Stop TB Stop TB July 1999 20.8 13. GAVI Global Alliance for Vaccines and Immunization Oct 1999 124.1 Infrastructure & Private Sector Development 14. WSP Water and Sanitation Program March 1978 12.4 15. ESMAP Energy Sector Management Assistance Programme Jan 1982 7.58 16. CGAP Consultative Group to Assist the Poorest August 1995 12.67 17. infoDev The Information for Development Program Sept 1995 6.07 18. PPIAF Public-Private Infrastructure Advisory Facility Dec 1999 15.61 19. CA Cities Alliance Dec 1999 13.25 Social Development & Protection 20. PostConFund Post-Conflict Fund 1998 10.60 21. UCW Understanding Children’s Work 2000 0.56 Trade & Finance Integrated Framework for Trade-Related Technical 22. IF 1997 2.71 Assistance 23. FSAP Financial Sector Assessment Program May 1999 10.46 24. FIRST Financial Sector Reform & Strengthening Initiative July 2002 4.64 Information & Knowledge 25. GDN Global Development Network Dec 1999 8.67 26. World Links World Links for Development 1998 6.5 /1 FY04/CY03 expenditures. For the following cases updated, audited data was not readily available so the previous fiscal or calendar year expenditures were used: Global Integrated Pest Management Facility, Water & Sanitation Program, Integrated Framework for Trade-related Technical Assistance. vii Executive Summary GENESIS, OBJECTIVES, AND ACTIVITIES Portrait of a Global Program: Post-Conflict Fund 1. The World Bank was established Established: July 1997 (FY98) at the end of World War II with the mandate to support reconstruction and Objective: Position the Bank through constructive engagement in conflict-affected areas development activities in its member countries. The Bank initially Key Activities: Grants from $25,000 to more than $4 concentrated on providing financial million for small-scale reconstruction activities, transitional support strategies, capital and rebuilding physical watching briefs, and research infrastructure. Yet, the increase in intrastate and regional conflicts in the FY03 $13,676,700 expenditures: 1980s and early 1990s highlighted the need for the Bank to rethink its role and FY03 DGF $9,323,500 shift away from rebuilding physical allocation: infrastructure to rehabilitating social FY04 DGF capital and institutions of conflict- allocation: $9,223,500 affected countries. After a vigorous Participants: Grants to international organizations, debate in the Bank’s Executive Board governments, academia, and NGOs about the Bank’s appropriate role in post- conflict reconstruction and development Governance Standard multi-donor trust fund; Model: Governed by Steering Committee and the need to distinguish the Bank’s consisting of Bank operational staff, work from that of its UN partners, the managed by the Secretariat consisting of Post-Conflict Fund (PCF) was created in three Bank staff July 1997. Its purpose has been to Location: World Bank, Washington, D.C. increase knowledge and improve available instruments within the Bank to Governing partners: None enable early engagement and ensure an appropriate role for the Bank in the Implementing crucial transition from relief to Agency: World Bank rehabilitation, and reconstruction Latest program activities. The program objective is to level evaluation: External by DAI, 2002. position the Bank through constructive engagement in conflict-affected countries where normal instruments and budget provisions cannot apply. 2. The PCF provides grants to a range of partners, financing socio-economic analyses, watching briefs, transitional support strategies, small-scale pilot reconstruction activities, and policy studies and forums. Reconstruction activities relate to the following themes: conflict mitigation, internally displaced persons and refugees, rehabilitation of social sectors, start-up support for landmine clearance and demobilization, economic recovery and the private sector, governance, and capacity building. Since 1997 the PCF has received an accumulated amount of $57.5 million from the Bank’s Development Grant Facility and an additional $5.8 million from bilateral and multilateral donors. viii DESIGN AND IMPLEMENTATION 3. The PCF is managed within overall Bank policy guidelines, which together with the Bank’s operational activities have been evolving over time, in response to at least two factors: an improved appreciation of the need for a changing Bank role in a far more pluralistic global scene institutionally and the improved understanding of the sources, causes and consequences of conflict. The PCF is housed in the Social Development Department as part of the Conflict Prevention and Reconstruction Unit. In 2004 the PCF secretariat also took on the administration of the $25 million Low Income Countries Under Stress (LICUS) Implementation Trust Fund, established by the Bank to help the LICUS countries with the most severe conflict and institutional problems to implement the necessary reforms for re- engagement with the international community. The bringing of the two under the same umbrella is in part a Bank response to this changing understanding of the global challenge in the conflict affected client countries of the Bank. The PCF Steering Committee, which now also steers the LICUS Trust Fund, represents the regions, the legal department, and the DGF and is headed by the Director of the Social Development Department. The Bank has also become operationally more active in wider issues of governance, corruption, extractive industries and natural resource exploitation, all of which have been identified to be sources of conflict. The PCF was established before the DGF existed and prior to this evolution of Bank activities. When the DGF was established in 1998, all the grant-receiving programs were brought under this single umbrella. Existing programs were grandfathered into the DGF, with the expectation that the programs which did not meet all of the eight DGF eligibility criteria would comply with these criteria over the next few years. But the time frame for complying was not well specified, and some of the DGF criteria, including partnerships, subsidiarity, and multi-country benefits, still remain unclear. Since April 2000, when Bank management made two presentations to the Board on partnerships and global programs, it has been expected that the DGF would primarily finance global and regional programs based on partnerships with key stakeholders. 4. The PCF remains unique among the 26 programs OED reviewed for its evaluation of global programs in two respects. First, it is administered by an internal Bank Steering Committee, and has no external partners in its governance structure, as promoted by DGF. The PCF, however, has a variety of partners at the activity level in specific countries. Second, and unlike other programs that mobilize donor funding to pursue objectives at the programmatic level, PCF relies primarily on DGF funding to achieve the Bank’s operational objectives. 5. As of August 2004, the Steering Committee had approved 136 sub-grants, covering thirty-four countries/jurisdictions. The guidelines suggest that sub-grants should range from $25,000 to $1 million, with multi-year projects eligible to exceed $1 million. In practice, sub- grants have ranged from $10,000 to nearly $5 million, with the community-based social sector representing the most commonly funded activities. Around 43.3 percent of funds since PCF’s inception have gone to activities in the Africa region, 26 percent to Europe and Central Asia, 10.4 percent to East Asia and the Pacific, 9.3 percent to South Asia, 7.1 percent to Latin America and the Caribbean, 3 percent to global activities, and 0.7 percent to the Middle East and North Africa. ix 6. The fund’s secretariat is responsible for raising donor contributions, reviewing and processing applications, authorizing sub-grants, managing disbursements, monitoring sub- grants, responding to written inquiries and disseminating information, and reporting to the Steering Committee and the DGF. An administrator, a knowledge management specialist, an operations analyst, and an assistant make up the secretariat. A task manager from the unit sponsoring each approved activity handles supervision and monitoring of activity implementation, with their time being paid from the Bank’s regular budget. The PCF’s Steering Committee plays a dual role in the program’s governance and management by being in charge of both overall policy direction and decision-making over the individual grants. Being embedded in the Bank structures diminishes confusion regarding the division of labor and responsibilities, but, as the external evaluation pointed out, it offers fewer incentives to improve transparency. OED FINDINGS Relevance: Are the Program’s Objectives Right? 7. Although there is a strong international consensus that international action to combat the destructive effects of conflict is needed, there is no consensus within the Bank or among its potential partners on what kind of action is most effective and on the most appropriate role for the Bank. Moreover, there is currently little coordination among the key UN actors involved at the global level. The period since 1990 has been marked by a proliferation of violent conflicts, with nearly all of them located in the developing and transition countries, and many in the poorest countries. The character of these conflicts has been changing. While the incidence of interstate conflicts has not increased, the incidence of intrastate conflicts, including armed civil conflicts reached a peak in the early 1990s, with over one third of the world’s countries affected by serious warfare at some point during the 1990s. 8. A PCF funded research project carried out in the Bank’s Development Economics Department concluded that economic factors such as entrenched poverty and heavy dependence on natural resource exports are the primary sources of civil wars. The study found that the growing incidence of civil wars reflects not just a problem for development but also a failure of development, a finding that is central to the Bank’s mission of poverty alleviation. The transition from relief and rehabilitation to reconstruction is difficult to bridge operationally. The transitional stage is often long, with the funds drying up after initial enthusiastic support. Conflict-prone countries tend to move in and out of conflict. Local conflicts increasingly spawn and are spawned by international terrorism, making it difficult to maintain the distinction between national and international public goods, or between national economic and political development. This emerging evidence stresses the importance of applying cross-country lessons to operational strategies and assessing the comparative advantage of the Bank. It raises the question as to whether as currently designed and operated, a demand-driven PCF that relies on relatively small grants for activities in specific countries, rather than strategically working in partnership at the governance level to learn cross-country lessons, is well placed to address one of the key threats to the Bank’s poverty alleviation mission. The analysis of the PCF also raises the question as to whether its objectives and the business model are appropriate. x 9. Yet, the PCF is fully consistent with the Bank’s most recent social development sector strategy, which lists innovative work in post-conflict settings as one of its priority areas, and the program’s design and policies are based on the Bank’s framework for involvement in post-conflict reconstruction. OED has classified the PCF as a program that supports international advocacy for reform that delivers a national, or at best a regional, rather than a global public good. The PCF is in line with the corporate advocacy priority of empowerment, security, and social inclusion, and the sub-category of social risk management. While global peace and security is considered as a global public good, the World Bank has not classified peace and security as one of its global public goods priorities. 10. Two thirds of all PCF sub-grants are awarded for projects costing $500,000 or less. Over half go to 8 high profile conflict-affected countries. Research funded by the PCF on the economic causes of civil war has influenced the way the Bank views conflicts, as well as Bank operations in extractive industries, natural resource management and policy and academic debates. Following the external evaluation that highlighted the need to strengthen knowledge generation, the PCF has taken several steps to improve its knowledge generating capacity and to disseminate lessons learned. However, the magnitude, planned time period, and the scope of most PCF activities is small and there is no systematic tracking across funded projects as to whether they have served a catalytic function, mobilized additional resources or resulted in more lasting outcomes. Consistent with its resources and scope, most of the funded activities are small, demand-driven and country-specific, without an overarching framework intended to achieve strategic impacts on peace and security on a global or a regional scale. 11. The PCF adds value mainly by filling two sets of gaps. The first is the institutional gap in dealing with the transition from relief to development assistance. The second is the internal gap to provide instruments within the Bank for remaining active or becoming active in conflict-affected regions using a fast and flexible instrument. While PCF grants have been designed to be catalytic and support a larger international response in post-conflict situations, lack of information about exactly how many individual projects attracted follow-up financing and proved sustainable makes it difficult to assess the program’s impact. The knowledge- generating activities have the potential of larger applicability, but their benefits depend on transferring the findings into activity implementation. There is plenty of evidence to support the filling of the second gap. Systematic evidence on gap filling in transitioning from relief to reconstruction and development assistance is mixed, although there are some important success cases, including East Timor and Afghanistan. 12. Assessment of the extent to which the PCF meets some of the DGF criteria is challenging. The program’s 1998 DGF review noted that issues arose with respect to the following DGF criteria: multi-country benefits, record of achievement and financial probity, disengagement strategy, and leverage. The 1998 review reasoned with justification that leveraging donor funding is often not practical when jumpstarting recovery efforts, and that weak capacity of state and civil institutions of post-conflict countries makes it difficult to find institutions with a record of achievement and financial probity. The DGF eligibility criteria state that the target for the Bank grant not to exceed 15 percent of total expected funding will be pursued after allowing for an initial start-up phase (maximum 3 years). Yet, even though six years have passed since PCF’s inception, the DGF has not enforced this xi requirement. PCF indicated that the DGF participates regularly in its Committee meetings, scrutinizes its annual DGF funding applications, and has conducted portfolio reviews of some of PCF funded activities. The latest DGF annual review notes that the program has continued a three-year strategy to maintain DGF support while the potential for donor support is being tested. The PCF meets the arm’s length criterion for in-house secretariats as stated in 1990, since most of its grants are awarded to outside agencies and regional operations have to supervise the activities from their own resources. DGF indicated that they would reconsider the question of the in-house secretariat after 3 years, but without committing to change it. The DGF partnership criterion is vague and does not specify if partnerships are necessary at the governance or the activity level, making it difficult to ascertain a program’s compliance with this criterion. The PCF meets this criterion at the activity level but not at the governance level. Efficacy: Has the Program Achieved Its Stated Objectives? 13. The program is achieving its stated objectives. The PCF’s objective of positioning the Bank in countries where normal instruments and budget provisions cannot apply includes countries that have just emerged from conflict, have no functioning government, have arrears on previous loans and credits, or have just become new members, although these criteria have not been written up in any PCF documents OED had access to. The Bank’s senior management has endorsed the PCF, and the Sector Board has given the program its highest ranking. The program has helped increase and strengthen cooperation between the Bank and the various UN agencies, NGOs and national governments receiving the grants at the activity level. 14. But two of the three performance indicators on its PATS form, namely, disbursement of sub-grants, and co-financing, relate to processes and outputs rather than outcomes and are less useful for evaluating impact. The third criterion - creating the enabling conditions for implementation of broader reconstruction activity - is more useful for evaluating outcomes. However, this indicator does not specify if the enabling conditions are meant to apply to the environment in the country or to create a more conducive environment for Bank lending. Although the two are related, one may not result in the other and neither may result in the containment of conflict. PCF general guidelines do not specify the division of labor with the Bank, which the Steering Committee assesses with each proposal. 15. The program’s external evaluation found that in many cases the watching briefs and transitional support strategies established an effective basis for follow-on financing. Yet, the evaluation was cautious about concluding authoritatively on the performance of individual projects. Individual project-level evaluations noted varying progress with respect to the sustainability of the funded activities. Apart from citing anecdotal evidence, the PCF has not tracked exactly how many of the funded projects managed to attract additional financing or proved sustainable. A review of project-level evaluations indicates that grants may have greater success in positioning the Bank in a particular country than in ensuring sustainability of the particular project’s benefits. Twelve of the 34 PCF recipient countries/jurisdictions did not have lending operations at the time of receiving their first PCF sub-grant. Eight of these 12 countries now receive either Bank lending, grants, or have trust funds, indicating that the program may have helped establish a base for future Bank operations in approximately 24 xii percent of the recipient countries. Yet, a more thorough evaluation of individual grants is needed to establish this causal relationship. 16. The awarding of nearly $37 million or over half of all PCF funds since its inception to eight of the currently most urgent conflict areas (Somalia, Kosovo, Afghanistan, Democratic Republic of the Congo, Burundi, Haiti, Sudan, and East Timor) reflects the political realities. While effective in what it was designed to do, the program may at times have been compensating for the Bank’s internal budgetary procedures and insufficient incentives to accommodate the needs of conflict-affected countries. The inception of the LICUS Trust Fund has the potential to improve this situation. 17. In FY04, the DGF contributed $9,223,500 to the fund, or 96.5 percent of its funds. Switzerland provided the remaining funds. The PCF is funded through DGF Window I with programs receiving long-term DGF support. The limited degree of donor support does not imply a lack of interest in the topic, as shown by the increasing share of the ODA going to peace and security issues. While many PCF grants brought in parallel financing at the sub- grant level, it is unclear why the PCF has not mobilized more funds from interested donors at the program level. DGF guidelines on resource mobilization are ambiguous and are not enforced. PCF is perceived as core Bank business. Donors do not see the need to contribute to the program. PCF management believes that mobilizing substantial funding would require senior management action. IDA replenishments, the grant share in those replenishments, and their allocation to post-conflict issues has taken on higher priority according to PCF. PCF has not sought to involve either UN organizations or bilateral donors as partners at the governance level. The program has argued that involving UN organizations (such as UNDP, UNICEF, and UNHCR) would create a potential conflict of interest since these organizations receive a large share of PCF grants. In OED’s opinion, this would not necessarily lead to a conflict of interest such as self-dealing as long as the governance of the program is separate from the day-to-day allocation decisions. This is in the nature of a partnership. The Cities Alliance, for example, is a partnership among the Bank, UN-Habitat, bilateral donors, a developing country (Brazil), and four umbrella associations of urban and rural municipalities. All are involved at the governance level; the Bank and UN-Habitat are the principal implementing agencies. The real issue is whether the benefit of partners at the governance level would outweigh the transaction and other costs of an expanded partnership. Efficiency: 18. The external evaluation found that PCF’s rating for project outcomes was of the same order as the Bank’s 1990s norm, but it stressed the need for the program to: i) improve implementation monitoring, ii) strengthen knowledge generation and management, iii) attract greater donor support, and iv) become more proactive about funding projects. The PCF is acting on these fronts. 19. PCF’s PATS form stresses that all Bank post-conflict activity is high risk. Most grants are awarded to implementing agencies other than the World Bank due to the arm’s length principle. This principle highlights the importance of selecting implementation partners that can adequately manage reputational and non-performance risks when implementing the projects. PCF funds activities in areas that have weak institutional capacity xiii and governance, and there is a risk that the investments may not result in the expected return. Since the Bank finances a significant share of PCF’s budget, this risk is not effectively spread out among the donors. An evaluation of how these risks are managed could offer lessons for handling similar risks in future projects. Bank Performance 20. Unlike many other programs the OED has reviewed (and given PCF’s Bank-centered nature), the PCF has used the Bank’s comparative advantage more at the country level than at the global level. The PCF has allocated 96 percent of its funds to country-specific grants. Only 4 percent of its funds have been allocated to multi-country programs, including for research activities. The program’s linkages to country operations have been strong, with most grants financing particular country operations. The requirement that incoming proposals need to be sponsored by a Bank task manager tends to ensure that the projects fit within the overall country strategy and form a part of it. 21. There is room for a conflict-focused grant giving mechanism, even though the establishment of the LICUS Trust Fund and the post-conflict window within IDA-13 has increased the risk of the PCF overlapping with other Bank instruments and being inconsistent with the subsidiarity principle. IDA-13 grants are subject to the same conditions as general Bank support. Thus, PCF could continue to give grants to countries where the Bank’s lending instruments do not apply in the form of early arrival assistance while a larger assistance program is being worked out. The PCF could also provide broader cross-country lessons to improve country strategies by working strategically at the governance level with the UN, NGOs, and national governments to take advantage of the activities being carried out by a diverse set of organizations with different strengths and perspectives. 22. The Steering Committee provides oversight of the PCF. To exercise independent oversight, organizational independence of the persons responsible for oversight of the program from the management chain responsible for implementing the program is a necessary but not a sufficient condition. Elsewhere OED lists three aspects for assessing independence including behavioral independence, protection from external influence and avoidance of conflicts of interest. Ten out of 12 members of the Steering Committee that exercises oversight of the PCF operations are independent of the management chain responsible for implementing the program, and the SDV Director chairs the Steering Committee. To avoid conflicts of interest, it is a convention of the Committee that the representative of the region proposing the grant does not have a vote when consensus cannot be met. PCF staff indicated that there is rarely lack of consensus about approving specific grant applications. The spread of the Committee is meant to ensure that no proposal enjoys an ‘inside track.’ Full DGF and LEG representation on the Committee is meant to ensure application of DGF criteria or their flexible adaptation. This is a common law approach that develops rules and procedures as the need arises, rather than a codified approach. xiv Key Issues and Lessons 23. A flexible instrument such as the PCF serves the needs that the Bank’s numerous instruments do not fulfill in conflict-affected countries. PCF grants have contributed to activities at key junctures in a number of countries and have helped position the Bank in the reconstruction process by providing quick and flexible funding. Since 77 percent of all PCF funds have been awarded to transitional support strategies and watching briefs, the grants have proved to be valuable tools for preparing the ground in conflict-affected regions, resulting in follow-on financing in countries such as Afghanistan, East Timor, Kosovo, and Iraq. 24. Yet if the policy guidelines under which it operates are too flexible, and the DGF criteria are ambiguous and insufficiently enforced, the instrument can be less than fully effective. One reason for setting up the PCF was that the Bank’s internal procedures and incentive structures could not accommodate the needs of conflict-affected countries. PCF was designed to fill a gap and provide intermediate financing before IDA credits or grants are available. However, the newly established LICUS Implementation Trust Fund and limitations of DGF funding provide an opportunity to reexamine the role of the PCF within the Bank’s overall conflict framework. 25. Programs can continue over several years without a results-based framework and strong monitoring and evaluation, highlighting the need for designing appropriate monitoring and evaluation mechanisms at the program’s inception to measure impact of the individual sub-grants. Measuring impact is difficult, since two-thirds of PCF-approved sub- grants fund projects that are too small to have a readily measurable impact on the needs of conflict-affected areas. A more thorough and consistent evaluation and review of the sub- grants across projects may provide a clearer sense of the projects’ impact and lessons learned. 26. As currently designed, the country-by-country approach of the program does not sufficiently generate broader cross-country lessons and does not exploit the program’s full potential to serve the Bank and its partners strategically. Making a larger share of its analytical work publicly available may help the PCF better focus on learning strategic lessons and disseminate the findings and lessons of funded projects. 27. A global partnership program on conflict-affected countries with partners at the governance level might help the Bank, UN agencies, and other stakeholders to better respond to the transition from relief, to rehabilitation and reconstruction and development. Given the complexity and the multi-sectoral nature of conflict work and the problem of multi-donor coordination and cooperation, the program’s lack of partnering at the governance level has been questioned by organizations such as the UNHCR. 1 1. Introduction and Context: Global Challenges in the Sector GLOBAL CHALLENGES FACING THE SECTOR 1.1 The end of the Cold War coincided with the proliferation of intrastate conflicts, with nearly all of them located in developing and transition countries. Over one third of the world’s countries suffered from armed conflict at some point during the 1990s, and nearly two-thirds of these countries (34) experienced conflict for more than seven years.1 While interstate wars became uncommon, armed civil conflicts proliferated in the 1980s and early 1990s. In the early 21st century, armed conflict has been concentrated mainly in Africa (Sudan, Democratic Republic of the Congo, Burundi) and south-central Asia (Sri Lanka, Afghanistan, India-Kashmiri Muslims). 1.2 Sustained peace is essential for sustained development. There are many hypotheses on what causes conflicts. A major study funded by PCF and carried out in the Development Economics Department of the World Bank concluded that economic characteristics are significant predictors of civil war.2 The study found that civil war reflects not just a problem for development but also a failure of development, and that stimulating development in low- income countries is a critical intervention to reduce the global incidence of conflict. Other explanations for what causes conflict include political instability, lack of political accountability and transparency, degradation of natural resources, and socio-cultural factors. Fifteen of the world’s 20 poorest countries have experienced significant periods of conflict since the 1980s. Post-conflict reconstruction and conflict prevention thus address one of the key threats to the Bank’s mission of sustainable poverty alleviation. 1.3 It is difficult to measure the damage of conflicts due to the lack of reliable data. Estimates from the civil war in Lebanon have been as high as $25 billion; the past two decades of conflict in Afghanistan in terms of lost growth, humanitarian assistance and military expenditure have cost around $240 billion;3 and the First Gulf War has cost around $60 billion. In Bosnia and Herzegovina postwar incomes were about one-fourth of 1990 incomes.4 The World Bank estimates that the Iraqi economy contracted by a third after Saddam Hussein was toppled in 2003. INTERNATIONAL CONSENSUS FOR ACTION 1.4 The extent and impact of conflict highlight the need for global collective action in post-conflict reconstruction. Post-conflict reconstruction is too big a challenge for any single actor to carry out, but there has been a lack of a unified approach among the various military, political, and economic actors. 1 Gurr, p. 21. 2 Collier 2003. 3 World Bank 2004a. 4 OED, p.15. 2 1.5 The two major issues facing the donors are funding and coordination. Post-conflict activities have suffered from a two-track funding mechanism, with one funding relief and the other long-term development. In the immediate post-conflict period international attention is high and donors tend to allocate large amounts of aid to a conflict-ridden country. Yet, aid dramatically decreases after the first few years, as new conflicts arise and divert the donors’ attention. Operating between war and peace necessitates combining the elements of emergency relief with those of long-term development aid. Activities that are specific to the transition period require instruments with characteristics that are less prevalent in either relief or development assistance, such as financial flexibility, contingency planning and conflict resolution techniques.5 There is still a division of labor between the agencies that provide emergency relief aid (UNHCR, UNICEF, WFP, ECHO), and the actors involved in reconstruction and development aid (UNDP, ILO, multilateral development banks). But the transition from relief to rehabilitation, reconstruction, and development poses complex challenges. One of the challenges for the international community is thus to facilitate the different aspects of peace-building and broad-based development. An important question raised by the emerging understanding of causes and consequences of conflict is the extent to which the PCF, as currently designed and implemented, addresses the needs of conflict affected countries. 2. Program Alignment with Global Challenges and Bank Priorities PROGRAM GENESIS AND OBJECTIVES 2.1 Since its initiation, the World Bank has been involved in post-conflict reconstruction. The Bank initially concentrated on providing financial capital and rebuilding physical infrastructure through country assistance programs. The increase in intrastate and regional conflicts in the 1980s and early 1990s highlighted the need for the Bank to rethink its role and shift away from providing physical capital to rehabilitating social capital and institutions of conflict-affected countries. This approach now includes initiatives to promote good governance and transparency, demobilization and reintegration of ex-combatants, and reintegration of displaced populations. Between 1980 and 1997, Bank lending to post- conflict countries increased by 800 percent, to $6.2 billion, accounting for approximately sixteen percent of the World Bank’s lending.6 The World Bank is currently playing a major role in Afghanistan, East Timor, Sierra Leone, Iraq, the Balkans, the West Bank and Gaza, and other conflict-affected areas. 2.2 A memorandum from the President to the Executive Directors in December 1995 advocated the establishment of a post-conflict fund, noting that the rationale for setting up a fund was based on the limitations of existing financing instruments. These included (i) the ineligibility of countries that were non-members or in non-accrual status to use existing loan and guarantee instruments; (ii) the limitation on the use of these instruments if there was no 5 Ball 1996. 6 The 800 percent is based on the lending volume by fiscal year of the 157 identified post-conflict reconstruction operations. Source: OED, p.12. 3 established central authority that could enter into an agreement with the Bank; (iii) the frequent lack of capacity in post-conflict countries to prepare and implement conventional Bank projects; and (iv) the inability to use social funds and IDF grants early, quickly and flexibly enough. The Board did not accept this proposed initiative. 2.3 Developing a more pro-active approach to post-conflict reconstruction proved controversial. The Bank’s mandate, defined in its Articles of Agreement, is to finance and facilitate reconstruction and development in its member countries. The World Bank’s Executive Board stressed that the Bank should not interfere in domestic political affairs of its members and is not in charge of peacemaking or peacekeeping. The Board noted that the Bank’s mandate does not include relief assistance, where other agencies have a comparative advantage (see Table 1). The debate over the Bank’s role included the concern that such activities would trespass into the political domain of the UN. Table 1: External Actors’ Roles in Conflict Countries Actors Political & Diplomatic Security Emergency Relief Reconstruction Donor states Bilaterally and Peacekeeping Agents (NGOs, UN), Bilaterally and multilaterally forces some military through agents UN Security Council, DPKO/SRSG, UN agencies UN agencies DPA/SRSG Peacekeeping forces European Union European Council, Observers ECHO, UN, NGOs European Commission, Parliament commission, UN agencies, NGOs NATO Secretariat Peacekeeping forces NGOs Human rights, conflict Independent, as Independent or as prevention agents of agents governments, UN, EU IMF Macroeconomic assistance World Bank Assessing economic No relief. Role in Flexible range of impact of peace monitoring during lending and non- proposals conflict and non- lending services lending services working toward normalization Source: OED 1998, p. 60-61. 2.4 World Bank President James D. Wolfensohn helped ensure progress by addressing reconstruction in his speeches.7 At the time, the Bank had a policy on emergency recovery assistance, formulated in August 1995 in Operational Policy 8.50 (OP/BP 8.50).8 Yet, OP 8.50 addresses reconstruction following natural disasters, with guidelines to finance 7 See, for example, Wolfensohn’s address to the 1997 World Bank Annual Meetings, Hong Kong, September 23, 1997. 8 O.P. 8.50 was derived from Operational Directive 8.50 (O.D. 8.50), “Emergency Recovery Assistance,” of 1989, which focused on emergency recovery assistance after natural disasters. 4 investment and productive activities rather than relief or consumption. OP 8.50 was thus not appropriate to address some of the political problems often faced by post-conflict countries. 2.5 In consultation with UN agencies, NGOs, and a range of international actors, the World Bank developed A Framework for World Bank Involvement in Situations of Conflict. The framework, presented to the Executive Directors in January 1997, recommended policy guidelines for post-conflict situations. The proposal raised debate regarding the emphasis on conflict as opposed to post-conflict situations. The concern was that a focus on relief, as opposed to reconstruction and development, could compromise Bank neutrality and its distinctive role. In April 1997 the Board endorsed a revised version of the framework. In addition to outlining a process for Bank involvement and posing operational recommendations, the framework recommended the creation of a post-conflict unit to consolidate the learning on reconstruction issues and to provide assistance to staff in developing and implementing reconstruction strategies. The Board endorsed the establishment of such a unit, which started operations in July 1997. 2.6 The framework relied on regular Bank funding. In August 1997, the Bank’s executive directors approved the establishment of the Development Grant Facility and $8 million for a post-conflict program to finance investment projects and research. The Executive Directors agreed to a trust fund status for the program in June 1999 to allow for donor contributions and enable greater flexibility in the use of funds. 2.7 The objective of the program is to position the Bank through constructive engagement in countries where normal instruments and budget provisions cannot apply. Sub-grants focus on the restoration of the lives of war-affected populations, with a premium on innovation, partnership, and leveraging resources. The PCF is an instrument of the Bank’s OP 2.30, which consists of three parts: • In countries that are vulnerable to conflict the Bank should use its usual instruments (such as the CAS) to promote economic growth and poverty reduction through development assistance that minimizes potential causes of conflict. • In countries in conflict it should (a) continue efforts at poverty reduction and maintenance of socioeconomic assets where possible; (b) provide (where requested by its partners) information on the socioeconomic impacts of emergency assistance; (c) analyze the impact of conflict on economic and social development; and (d) prepare for Bank assistance as opportunities arise. • In countries in transition from conflict the Bank should support economic and social recovery and sustainable development through investment and development policy advice, with particular attention to the needs of war-affected groups who are especially vulnerable by reasons of gender, age, or disability.9 9 OP 2.30, January 2001. 5 2.8 Although the initial focus of the PCF was on post-conflict, the boundaries between the different stages of conflict are often blurry and many countries fall in and out of conflict. Therefore, the program has taken on a broader mandate to also cover conflict prevention. ORGANIZATION AND KEY ACTIVITIES 2.9 The PCF is housed in the World Bank’s Social Development Department as a part of the Conflict Prevention and Reconstruction Unit.10 A secretariat, comprised of three regular Bank staff, is responsible for raising donor contributions, reviewing and processing grant proposals, disseminating information, and reporting to the Steering Committee and the DGF. The Steering Committee represents the concerned departments of the Bank, including the relevant regions, the legal department, and the DGF, and is headed by the Director of the Social Development Department. 2.10 The Bank Operational Policy on Trust Funds (OP 14.40) stipulates technical guidelines regarding the PCF, and OP 8.45 on grants, issued in October 1999, applies to the PCF where it varies from OP 14.40. At the operational level, the Steering Committee approved in January 2003 a strategy paper covering FY03 to FY05, which provides the direction and guidance for approving sub-grants. Prior to this document, the Steering Committee determined policy and priorities at an annual meeting. A brochure, entitled “Post- Conflict Fund – Guidelines and Procedures,” provides guidelines and procedures for grant applicants. 2.11 As of August 2004, the PCF had approved 136 grants. The approved grants total over US $66 million and have been awarded to thirty-four countries/jurisdictions. The exact percentage of proposals that are approved is difficult to establish. According to PCF management, proposals can drop out at many stages, before or after an initial review by the Country Team, or due to changed circumstances. A formal proposal does not exist until a Country Director signs and sends it to the committee. The PCF team indicated that a majority of proposals do not reach the committee due to the lack of sponsorship by country teams, and thus do not get formally rejected. A PCF team member estimated that approximately one out of ten proposals reach the committee and are formally rejected, with the rest being dropped along the way. If a proposal is circulated electronically, a stream of email correspondence usually contains comments on the reasons for rejection or approval. Documenting more fully the reasons for the rejection of completed proposals in its database (which contains over 100 rejected proposals) may make it easier for outsiders to discern how the program decides whether to sponsor certain activities. Updating and clarifying this information in the PCF database would give a better sense of the program’s activities and would help maintain consistency and transparency. 10 The Unit’s name changed from Post Conflict to Conflict Prevention and Reconstruction. 6 Figure 1: Grants Categorized by Amount Approved, FY98-05 50 40 250,000-499,999 30 100,000-249,999 1,000,000 + 20 500,000-999,999 10 <100,000 0 Grant Size Source: PCF grant database. 2.12 The PCF provides relatively small grants, $25,000 to $1 million, to a diverse group of implementing partners, ranging from UN agencies to governments, academia, and NGOs. Projects spanning over one year may exceed $1 million in total. Figure 1 shows that more than one third of approved grants (50) is for projects costing less than $100,000. Twenty-two projects cost $1 million or more. Two thirds of the grants have been awarded for projects costing $500,000 or less. Since most projects are below $1,000,000, their impact on the reconstruction needs of the recipient countries (which are often in the billions of dollars) is likely to be small. Table 2: Grants Approved by Country Status, FY98-05 Status Amount Spent % of Spending Watching Brief $13,460,676 20.18% TSS $37,971,163 56.92% CAS $12,339,855 18.50% Global/Regional $2,939,559 4.41% Total $66,711,253 100% Source: PCF grant database. 2.13 Based on the country’s status, grants are classified under one of the following four sections: 1. Watching briefs, 2. Transitional support strategies (TSS), 3. Country assistance strategies (CAS), or 4. Global/regional. Table 2 shows that 56.9 percent of grants have been awarded for transitional support strategies. Watching briefs make up the second largest category (20.2 percent), followed by country assistance strategies (18.5 percent). Only 4.4 percent of funds are allocated for global/regional grants, indicating the program’s focus on country-level projects. The allocation of 77 percent of funds to transitional support strategies and watching briefs is in line with PCF’s objective to give higher priority to areas that have fewer funding opportunities as opposed to countries that have a CAS and broader access to finance. 2.14 PCF has identified the following priority themes for its grants: 7 • Conflict analysis and development initiatives that minimize potential causes of conflict • Resettlement and reintegration of war-displaced populations, including refugees and internally displaced persons • Social sectors, with priority given to regenerating education and health services • Start-up support for land-mine clearance, demobilization and re-integration of ex- combatants • Economic recovery, with priority given to economic analysis and recovery measures • Generic policy studies and forums on topics relevant to the Bank's knowledge of conflict analysis and post-conflict reconstruction, and with operational relevance for the Bank or its partners. Priority is given to proposals building local capacity. 2.15 PCF has awarded the largest number of grants to activities in the social sector. Table 3 gives an overview of a typical activity funded in each sector. While the program also awards grants to fund research, these grants tend to be small in size and account for a smaller share of overall funding. Table 3: PCF Grant Themes and Select Examples, FY98-05 PCF Grant Themes Example of Grant Conflict analysis and Support for Post-Conflict Transition in Macedonia. In 2001 the Government of development initiatives Macedonia received $1,000,000 for a project to reduce the risk of conflict, improve understanding of the potential for conflict, and establish a basis for the CDD project. Resettlement and Self-Reliance Fund for IDPs in Georgia. The government of Georgia received $ reintegration of war- 244,211 in 2002 for community-level capacity building, IDP accommodations, displaced populations training and micro-credit initiatives for IDPs. Social sectors Social Expenditure. UNMIK – UN Interim Administration in Kosovo received in 1999 $1,000,000 to finance part of the recurrent education and health expenditures for the local budget. Start up support for land- mine clearance, Burundi Ex-Combatants Assistance Program. Grant of $400,000 to Burundi’s demobilization and re- Ministry of Finance in 2000 to finance preparatory activities for a demobilization integration of ex- project. combatants Economic recovery Empowering Women: Socioeconomic Development in Post-Conflict Tajikistan. Counterpoint International in Tajikistan received $692,383 for 2002 and 2003 to initiate, in cooperation with the World Bank, a project to create employment for women and act as an institution-building channel to reduce poverty. Generic policy studies TV Documentary. European Television B.V. received $25,000 in 1999 to develop a and forums 15-20 minute documentary video about the conflict in Liberia, for presentation to the Board of the World Bank, a planned donor conference, and to donors and agencies. Source: PCF grant database. 2.16 Given the PCF’s objective of positioning the Bank, the program needs a more strategic approach to grant making to ensure that the grants awarded help position the Bank in the conflict-affected countries themselves. Most PCF grants fund operational work. However, the PCF funded in 1999 a number of studies connected to the World Bank’s larger 8 research program on “The Economics of Civil War, Crime and Violence.” The PCF secretariat had concerns regarding (i) the arm’s length principle, (ii) if the research would be operationally applicable for the PCF, and (iii) the strong participation of Western institutions with limited potential of enhancing national capabilities.11 Ultimately the PCF supported the proposal. The research contributed to the academic and policy debate on civil war, and itt shaped the Bank’s own thinking. Table 4: Regions Supported by the Post-Conflict Fund, FY98-05 Region # of Grants Amount (US$ Percentage, US$ Million) Global/Generic 25 2,121,343 3.18 Africa 45 28,881,710 43.29 East Asia and the Pacific 19 6,932,901 10.39 South Asia 10 6,230,138 9.34 Europe and Central Asia 23 17,304,624 25.94 Middle-East and North Africa 6 494,360 0.74 Latin America and the Caribbean 8 4,746,177 7.11 Total 136 66,711,253 100 Source: PCF grant database. 2.17 PCF grants can be country-specific or multi-country. Projects can be funded in any of the Bank’s regions and countries, including those that do not have an active Bank portfolio and non-sovereign jurisdictions such as Kosovo and the West Bank/Gaza. The regions that received the most funding, as shown in Table 4, are Sub-Saharan Africa (43.3 percent) and Europe and Central Asia (25.9 percent). Table 5 indicates that the countries with the most financing approved have been Somalia ($6.607 million), Kosovo ($5.782 million), Afghanistan ($5.175 million), the Democratic Republic of the Congo ($4.855 million), Burundi ($3.993 million), Haiti ($3.714 million), Sudan ($3.398 million), and East Timor ($3.275 million). The funding for these eight countries/jurisdictions has accounted for $36.801 million, or more than half of all PCF funding since the program’s inception. 2.18 The PCF does not have country/regional allocation criteria, giving the program flexibility to respond to specific crises and needs. Yet, certain regions or countries may be overlooked while others receive disproportionately high amounts of aid. The external evaluation suggested that the high amount of aid allocated to countries such as Afghanistan, East Timor, and Kosovo indicates the fund’s preference for funding projects in regions with ongoing conflicts during the fund’s lifetime. This allocation is not due to the lack of grant applications from under-represented countries, as the category of rejected grants applications in the PCF database contains 12 grant applications from 11 countries that have received no funding from the PCF.12 Some of these countries are not considered conflict-affected or post- conflict and they therefore may not warrant a grant. Yet the rejected category also contains 11 PCF Management Information System. 12 The following countries applied for PCF grants but their applications were rejected or put on hold: Azerbaijan, Chad, Ethiopia, Guinea, Guinea Bissau, Kenya, Mexico, Russia, Suriname, Tanzania, and Vietnam. 9 applications from a number of conflict-affected countries that have received little or no PCF funding. PCF indicated that this grant allocation reflects the demand-driven nature of the program. The decision to award much higher amounts to countries/jurisdictions such as Kosovo and Afghanistan while awarding smaller amounts for countries such as Rwanda or Guatemala seems to reflect the global political reality in which donors and clients move to respond to those issues they perceive as most pressing at the time. Table 5: Fund Allocation by Country/Jurisdiction, FY98-05 Country/ Amount Country/ Amount RELEVANCE TO Jurisdiction (US $) Jurisdiction (US $) GLOBAL CHALLENGES AND BANK PRIORITIES Afghanistan 5,175,000 Mozambique 50,000 Albania 2,050,467 Nigeria 278,000 2.19 OED uses four Bosnia and Herzegovina 1,613,174 Phillipines 1,973,200 major criteria for Burundi 3,993,524 Rwanda 510,000 assessing the relevance Cambodia 1,179,540 Serbia and 1,193,900 of the Bank’s global Montenegro programs: i) Central African Republic 1,055,000 Sierra Leone 555,000 international consensus, Colombia 809,658 Somalia 6,607,156 ii) strategic focus, iii) Comoros 1,088,000 South Africa 1,309,158 subsidiarity, and iv) Republic of the Congo 2,915,000 Sri Lanka 1,055,138 consistency with sector Cote d’Ivoire 886,540 Sudan 3,398,160 strategies. Croatia 1,899,988 Tajikistan 857,383 Democratic Republic of the 4,855,000 Timor-Leste 3,275,483 International Congo Consensus Eritrea 973,000 West Bank and 114,000 Gaza 2.20 As the 1998 Georgia 1,186,554 Multi- country/global OED evaluation report Guatemala 77,000 Africa 260,000 on the Bank’s Haiti 3,714,519 East Asia/Pacific 208,526 experience with post- conflict reconstruction Indonesia 296,152 Europe/Central Asia 224,690 pointed out, the Bank Iraq 380,360 Latin 145,000 America/Caribbean has a role to play in Kosovo 5,782,587 Global 2,121,343 fragile circumstances of Liberia 148,172 Total 66,711,253 conflict, a role that Macedonia 2,495,881 includes quick and flexible approaches combined with the organization’s traditional instruments.13 The operational policy on development cooperation and conflict (OP 2.30) recognizes that economic and social stability and human security are pre-conditions for sustainable development and issues relating to conflict are within the Bank’s mandate. 13 OED, p: xvi-xvii. 10 Consistency with the Bank’s Strategic Focus 2.21 Among the Bank’s ten global public goods and corporate advocacy priorities, the PCF is a corporate advocacy program under the category of “empowerment, security, and social inclusion” and the sub-category of “social risk management.” These topics are covered by the Bank’s Social Development Sector, whose work extends to conflict prevention and reconstruction and social safeguards. Although the Bank is now actively promoting conflict prevention and reconstruction, its mandate does not contain “peace and security.” While global peace and security is considered as a global public good, the World Bank has not classified peace and security as one of its global public goods priorities. While the Bank does not have an operation role in contributing to peace and security, it does have an indirect role through its developmental mandate. OED has classified the PCF as a program that supports international advocacy for reform. The classification of the PCF as a program that provides national rather than global public goods reflects the fact that the PCF provides mainly country-level investments and delivers national public goods. It can be argued that successful investments can contribute to national peace and thereby contribute to increasing peace regionally and globally. In addition, since a small percentage of PCF grants funds regional and global projects and since national projects may result in positive regional spillovers, the PCF may contribute to increasing global peace and security. Yet, most PCF grants are too small for the vast needs of reconstruction, and the effects of PCF funded projects are difficult to separate from a number of confounding factors contributing to peace. The Subsidiarity Principle 2.22 To what extent do PCF activities compete with or substitute for regular Bank instruments? What is the PCF’s value added beyond what the Bank can do through its regular country operations? 2.23 Given PCF’s objective of operating in areas where normal Bank instruments and budget provisions do not apply, the program is less likely to compete with or substitute for regular Bank operations. Twelve of the 34 PCF recipient countries/jurisdictions did not have Bank lending operations while 22 had existing operations when they received their first PCF grant. If the number of recipient countries is considered, then nearly 65 percent of recipients had existing Bank lending operations. Yet if the amount of funding awarded is considered, then the majority of funds have indeed been spent in areas in which the Bank could not operate, though some of the 12 countries without lending operations were already recipients of grants or had established trust funds. PCF support to the countries/jurisdictions without existing lending operations has amounted to $37.420 million or more than half of overall funds since the program’s inception. The allocation of the remaining funds to 22 countries that have Bank lending activities raises some danger of overlap with regular country operations. According to PCF, whether other Bank money, including loans and grants, could or should be used for the proposed activity is often a judgment call for the Committee. 2.24 Eight of the twelve countries/jurisdictions that did not have a lending portfolio when they received their first PCF grant now receive Bank funding through either loans, grants, or trust funds. PCF grants in these eight countries/jurisdictions supported transitional support strategies and watching briefs, indicating that the program may have helped establish the 11 ground for Bank operations in about 24 percent of PCF recipient countries (see Table 6). The Bank’s Executive Directors authorized a trust fund for Iraq in 2004. Sudan, Somalia, and Liberia are in significant arrears on past debt servicing obligations and can therefore have no active lending programs. The West Bank/Gaza and Kosovo are not sovereign entities and cannot apply for regular World Bank loans, and they receive instead funding through trust funds and/or IDA grants. A number of projects for Haiti are under preparation or under review. Table 6: Current Status of Countries/Jurisdictions that had No Active Lending Portfolio When Receiving their First PCF Grant PCF Recipient Country Year First PCF Grant Current Status Received Afghanistan FY99 Active, IDA grants/credits, Trust Fund Democratic Republic of Congo FY98 Active, IDA grants/credits, Trust Fund Kosovo FY00 Active, IDA grants, Trust Fund Republic of the Congo FY98 Active, IDA grants/credits Timor-Leste FY00 Active, Trust Fund West Bank FY99 Active, Trust Fund Central African Republic FY98 Non-accrual, IDA credits Iraq FY03 Non-accrual, Trust Fund Haiti FY01 Non-accrual, operations under review Liberia FY98 Non-accrual, in arrears Somalia FY00 Non-accrual, in arrears Sudan FY00 Non-accrual, in arrears Source: PCF grant database, Business Warehouse, and CPR documentation. Consistency with the Bank’s Sector Strategy 2.25 PCF’s objectives and strategies are consistent with the Bank’s most recent social development sector strategy. The Social Development Sector strategy, outlined in Social Development in World Bank Operations: Results and Way Forward,14 lists innovative work in post-conflict settings as one if its three priority areas. According to the strategy paper, the Bank’s emphasis on social development in recent years has meant focusing explicitly on conflict in Bank financed projects. The Bank has begun to examine the sources of conflict and has sought to promote cohesion responsive to local social contexts, areas which the PCF funded projects directly address.15 2.26 PCF’s design and policies are based on the Bank’s framework for its involvement in post-conflict reconstruction, described in Post-Conflict Reconstruction: The Role of the World Bank. The framework outlined a five-stage process through which the Bank can establish programs in conflict-affected countries, consisting of i) a watching brief in conflict countries, ii) a transitional support strategy, iii) early reconstruction activities, iv) post- 14 World Bank 2004b. 15 Ibid., p. 2. 12 conflict reconstruction, and v) return to normal operations. The framework stressed the “need for flexibility and speed in assisting countries emerging from conflict, in the period before traditional lending can be made available.”16 The PCF provides early funding as part of operations, laid out in the O.P. 2.30, “Development Cooperation and Conflict.” In providing resources to start up Bank-supported activities in conflict-affected regions through the five stages outlined in the framework, the PCF was designed to address some of the key challenges in the Bank’s commitment to facilitating the transition from war to peace. 3. Outcomes, Impacts, and Sustainability MONITORING AND EVALUATION External Program Evaluation 3.1 An overall evaluation of the PCF was conducted in 2002 at the request of the DGF. The Steering Committee approved the TOR, and a panel of World Bank staff, which included the program administrator, recommended Development Alternatives Inc. from among the proposals submitted through a competitive request. Ideally, external evaluations should be commissioned, paid for, and managed entirely by the governing body, not the management of the program. PCF’s management oversaw the process in terms of TOR, ensuring competitive selection, and helping the evaluators arrange field visits and find data, of necessity, because the Steering Committee had no independent capacity to manage the evaluation process. OED rates this evaluation as substantially independent since the PCF management respected the independence of the evaluators, given the above noted constraints. 3.2 With a budget of $140,000, the evaluation’s aims were to: (i) evaluate the strategic use of resources, including prioritization, timing, and flexibility of fund usage, (ii) examine the impact of grants on beneficiaries and local institutional development and capacity, (iii) assess the achievement of DGF objectives, (iv) evaluate the program’s management and administrative arrangements, and (v) evaluate linkages and partnerships with donors and other post-conflict agencies.17 3.3 Given the high risk circumstances and innovative character of many of the funded projects, the external evaluation expected to find an overall rate of “satisfactory” project outcomes that is lower than that of normal Bank/IDA operations. Yet the evaluation found that the PCF satisfactory rate was of the same order as the Bank’s 1990s norm. 3.4 The evaluation recommended that the PCF: i) strengthen implementation monitoring, not relying solely on monitoring from task managers located at headquarters, ii) adopt a more proactive approach to increase the share of funding going to under-funded countries through a prioritized agenda, iii) strengthen knowledge generation and management, iv) attract additional donor financing, v) strengthen the management information system, and vi) develop credible ratings of project performance and impact. 16 OED, p. 51. 17 Terms of Reference for the external evaluation of the Post-Conflict Fund. 13 3.5 The PCF has followed up on the recommendation of strengthening the knowledge generation and monitoring by appointing a knowledge management specialist and preparing a knowledge management and learning strategy. This strategy includes four steps to promote the monitoring of grant performance by improving the grant application form, an electronic tracking and reporting system of reporting and the management information system.18 The strategy aims to set an annual learning agenda to determine the planning and implementation of specific evaluations. However, the PCF has not yet followed-up on the recommendation to attract additional donor financing, develop credible ratings of project impact, and adopt a more proactive approach to funding projects. 3.6 OED used the following five criteria to assess monitoring and evaluation: i) clear and coherent program objectives and strategies, ii) use of a results-based framework, iii) systematic and regular processes for data collection and management, iv) independence of program level evaluations, and v) effective feedback mechanisms. OED agrees with the recommendations of the external evaluation, and it offers additional suggestions for strengthening monitoring and evaluation. Evaluating Objectives, Strategies and the Use of a Results-Based Framework 3.7 The program’s objective of positioning the Bank seems to include countries that have just emerged from conflict, have no functioning government, have arrears on previous loans and credits, or have just become new members, although this is not explicitly stated. In its FY03-FY05 strategy, the PCF presented its objectives in a stakeholder matrix that includes demands or expectations from its external and internal stakeholders. The explicit objectives of external stakeholders, including donors, recipients and beneficiaries, are to get development support for peace-building and partnership, while the implicit objectives are to get an instrument for donors to influence the Bank’s agenda, to generate knowledge and to experiment with new approaches. For the internal stakeholders, the explicit objectives are to start up or position the Bank’s in-country activities, knowledge generation, and to test new approaches and partnerships. The implicit objectives are to leverage donor funds in line with Bank strategies and to push the CPR/corporate agenda. According to the external evaluation, the fund is highly popular among the Bank and external users, and the Secretariat has fulfilled the intention to fund high-risk innovative projects. The Sector Board has given the program its highest ranking. 3.8 However, the external evaluation pointed out that assessing the efficacy and impact of the individual grants was difficult since the PCF lacked a results-based framework. Since 2002 PCF grant proposals have a logframe to assist in the evaluation of results. According to PCF staff, since the funded projects are innovative and of short duration, Task Managers often have difficulty in filling out the lograme to make it concrete and relevant. The PCF lists three performance indicators on its PATS form: (1) the disbursement of sub-grants, (2) the creation of enabling conditions for implementation of broader reconstruction activity, and (3) co-financing. The first two indicators, the disbursement of sub-grants and co-financing relate 18 Task managers are now asked to rate grant performance bi-annually in a similar way as for regular Bank operations. 14 to processes and outputs rather than outcomes and are less useful for evaluating impact. The indicator measuring the enabling conditions is more useful for evaluating outcomes, but it does not specify if the enabling conditions are meant to enable the Bank to function in a country or to create a more conducive environment in the grant-receiving country itself. 3.9 As of August 2004, the PCF had committed 88 percent of its approved grants, and it had disbursed 84 percent of the approved grant amounts. As the Steering Committee approves new grants on a continuous basis, these percentages vary depending on whether big grants have been approved recently. The PCF changed its procedures regarding the possibility of rescinding grants un-disbursed six months after approval. The need for this clause became apparent when an approved $2 million grant to the Democratic Republic of the Congo for a transitional support strategy was never utilized because the country relapsed into war. The program untied this money and gave it to a similar project in the DRC but to a different implementer. Data Collection and Management Box 2. Sample PCF Grant Evaluations 3.10 The PCF’s data collection and The following is a list of PCF grant evaluations available on the PCF website. monitoring processes have improved in response to the external program 1. Bosnia and Herzegovina: Community-Based evaluation. Regarding monitoring of the Mental Health Services. ICMH. PCF as a program, the PCF Secretariat 2. Burundi: Prevention of Conflicts in Burundi. CECI, Canada. prepares a yearly performance and 3. Burundi: Community Rehabilitation Project. strategy review, presented to its Steering Channel Research, Ltd. Committee. This report lays out the 4. Comoros: the Reintegration of Anjouanese Ex- incomes and expenditures of the year, Militia Program. CARE France. statistics on the distribution of the grants, 5. Congo: Community Action for Reintegration and Recovery of Youth and Women. Independent administrative issues, priority themes, Consultant. and strategic directions. According to 6. Croatia: Refugee Return and Regional PCF, the program provides on-going Development Program. The QED Group, LLC. reporting and information exchange on 7. East Timor: Falintil Reinsertion Assistance the overall portfolio and specific grants to Program. IOM. 8. Philippines: The Mindanao Social Assessment. various audiences, including Bank Independent Consultant. internal and external clients, donors, 9. Serbia and Montenegro: Southern Serbia Municipal NGOs/CSOs, UN and other international Improvement and Recovery Program. Independent agencies. The program has engaged in Consultant. efforts to share results with partners and Source: PCF website, Learning from the Field section. conducted joint evaluation exercises, such as a workshop in Geneva on experimenting with new methodology to evaluate grants. The program also provides reports on the portfolio status to the Committee, DGF, Executive Board and Senior Management through Semi-Annual Reports to the Board. 3.11 With respect to project-level monitoring and evaluation, the PCF Procedures and Guidelines stipulate that the grant recipient is to submit progress and financial reports twice a year to the Bank task manager and the PCF Secretariat. According to PCF guidelines, task managers are required to prepare grant progress and financial reports for individual grants on 15 a continuous basis. After the termination of the project, the recipient prepares financial statements with the external auditor’s opinions and sends them to the PCF Secretariat with the Bank task manager’s project completion report. Since 2002 all grants over $250,000 are required to have an independent evaluation. Evaluating the Grants 3.12 PCF arrangements for the supervision of funded projects are flexible, and this may have had a negative impact on monitoring and evaluation of individual grants. PCF requires applications to detail supervision time and travel costs, and it requests assurances that the Country Unit will allocate adequate Bank Budget funds and Staff Weeks for supervision. The PCF internal guidelines note that “arrangements may vary from region to region, but at a minimum the task managers should make their budget officers aware of the grant approval and requirement to record supervision costs.” On the positive side, PCF processing is relatively simple and enables quick approval and disbursement of funds. The PCF team indicated that the need to place certain constraints on implementing agencies conflicts with the program’s desire to be light on obligations and its function of providing flexible funding. Although PCF indicated that it chose not to be prescriptive and second-guess the country units, the program might benefit from following the example of Energy Sector Management Assistance Program (ESMAP), which requires that all proposals for ESMAP funding "focused on a particular country are expected to include a contribution of at least 10-25 percent from the relevant World Bank Group regional team, including staff time, to ensure that the results are integrated into the country program and/or dialogue."19 3.13 A number of project evaluations found monitoring and evaluation to be among the weakest aspects of the funded projects. For example, the external midterm review of the PCF funded Childhood Education and Women’s Literacy Program in Kosovo (# 201) described monitoring and evaluation as the weakest area of the program. According to the evaluator, the implementing agency did not provide standard indicators and test formats to assess learning progress, and it made no effort to systemize the information and allow for drawing conclusions on the quality of courses and their impact on women. 3.14 In response to the external evaluation, the PCF has put greater emphasis on capturing and disseminating knowledge generated by PCF grants. To date, the PCF has made 17 reports available on its “Learning from the Field” web page, and the posted material includes PCF Occasional Notes, Independent Evaluations, and Special Reports. PCF Occasional Notes are a practice that the program recently started to disseminate lessons learned and information about a particular grant in a brief report. The Occasional Notes are not evaluative but intended to disseminate information to a broader audience about individual grants that PCF staff consider particularly successful, relevant, or innovative. Four such reports are available, written by World Bank staff in the country offices, PCF staff, or staff implementing the particular project. 19 See ESMAP web-site: http://wbln0018.worldbank.org/esmap/site.nsf/pages/proposals. 16 3.15 Box 2 shows the nine project-level evaluations that are currently available on the PCF website. The formats, quality, and evaluation criteria used in the program evaluations vary significantly. PCF team noted that the variety of PCF grants argues against a standardized approach, but a more standardized approach to evaluating the projects would help ensure consistency. One of the reports uses similar ratings to OED’s. Two reports assess the institutional performance of the implementing agencies. Some of the evaluations are written by outside consultants, while one is conducted by the implementing agency itself. While PCF staff indicated that it used the project evaluations as a learning source within the program and disseminated the more interesting ones outside the organization, it is unclear how well the lessons from these reports are captured or disseminated both within and outside the program. Sixty-seven grants have been approved for $250,000 or more, and PCF staff indicated that all of these grants have had independent program evaluations. Making these evaluations and other products such as special reports that emerge from the individual projects available on the program’s website would provide a useful source of information about the funded projects and a good source of lessons learned. 3.16 PCF indicates that its archives contain a variety of reports or other data for the remaining sub-grants. OED has not reviewed these. Grants under $100,000 are required only to submit a grant completion report. Since 50 of the approved grants fall under this category, assessing their impact is particularly difficult, since they do not have a project evaluation and are less likely to produce special reports. 3.17 On the positive side, the evaluations emphasize the high relevance of the activities, that they have learned by experience, and been flexible enough to adjust components, increasing relevance to the beneficiaries. The evaluations indicate that PCF grants have contributed to activities at key junctures in a number of countries and have helped position the Bank in the reconstruction process. The evaluation of PCF activities in Afghanistan, for example, noted that the first PCF grant in 1998 enhanced World Bank’s knowledge on Afghanistan on issues such as de-mining, trade, and other socio-economic topics, and that it positioned well the World Bank to later launch a full-scale engagement in the country. One project was deemed to have had significant impact on the care of people with mental problems in Travnik, Bosnia-Herzegovina, by rationalizing the system and demonstrating the importance of a bottom-up approach. Another project managed in the face of severe problems of instability to assist youth and women in overcoming war-trauma and increasing access to basic social services. 20 A more thorough and consistent evaluation and review of these grants across projects may provide a clearer sense of the projects’ impact and lessons learned. SUSTAINABILITY 3.18 Three different sustainability aspects are relevant in relation to the PCF: (1) the sustainability of the PCF itself, (2) the sustainability of the funded projects, and (3) the sustainability of the projects’ benefits. Because of its status within the Bank, the sustainability of the PCF is mainly dependent on the need and the extent of operational 20 Carballo 2003, and Biabo 2003. 17 support within the institution. With continued financial and management support, the program proved to be sustainable at least in the medium term. 3.19 With regards to the sustainability of the funded projects and their benefits, the external evaluation noted that some of the funded activities have resulted in follow-on financing, indicating continuity of activities. PCF grants were intended to be catalytic and support a larger international response in post-conflict situations, and PCF staff indicated that many grants seek parallel contributions by other organizations. Yet the program does not keep track of exactly how many of the projects managed to secure additional funds beyond PCF support. Better monitoring of whether this take place would help to assess the effectiveness and sustainability of the funded projects. The resumption of Bank lending, and the establishment of grants or trust funds in countries that had no lending operations when they received their first PCF grant may also indicate sustainability of results. 3.20 The PCF team noted that the sustainability of PCF projects should also be evaluated in the projects’ catalytic contribution to sustaining peace, yet this evaluation found no evidence of the extent to which individual PCF funded projects helped sustain peace. Individual project evaluations have noted varied performance with respect to sustainability of the projects and their benefits. The evaluation of PCF grants to refugees and IDP’s noted that assessing long-term impact of PCF grants is difficult, since most grants tend to only run from one to four years.21 The evaluation of grant #240 for Nigeria noted that the sustainability of the funded activity was uncertain or not fully ensured. Similarly, the evaluation of the PCF grants in the Democratic Republic of Congo found that the grants had clear benefits to the beneficiaries but noted that sustainability and duration of the projects’ outcome was an issue. The evaluation of PCF’s performance in East Timor noted that PCF grants have made it possible for the Bank to become quickly a “player” in the country, as they allowed for rapid engagement, were instrumental in establishing trust with Timor’s future leadership, and pointed the way for subsequent interventions by the Bank and others.22 Overall, a review of project-level evaluations indicates that grants may have greater success in positing the Bank in a particular country than in ensuring sustainability of the particular project’s benefits. 4. Program Governance, Partnerships, Management and Financing GOVERNANCE AND MANAGEMENT 4.1 The Steering Committee determines overall priority setting for the PCF. The committee meets annually to discuss performance and arising policy issues, and approximately every six weeks to approve applications. The committee decides which proposals to support based on the endorsement by the regional/country office and the recommendations from the Secretariat and two to three reviewers (one from outside the Bank, one from inside the Bank without vested interest in the project, and one from the Conflict Prevention and Reconstruction Unit). 21 Rajagopalan, p.14. 22 Purcell, p.2. 18 Committee members decide whether to fund a particular project based on the grant proposal, comments from the reviewers and a technical summary report prepared by the PCF Secretariat. If the grant will receive funding from any of the earmarked donor contributions, the donor also needs to approve the proposal. 4.2 The program is fully integrated into the Bank’s management and oversight structure. The program manager is responsible through the Social Development Director to the ESSD Vice President, who is in turn accountable to the President and the Executive Board. By assuming responsibility for both the overall policy direction and the decision-making regarding individual grants, the Steering Committee is performing both governance and management functions. Committee members are appointed by VPU’s. The selection process, the terms of reference, and the period for which members serve on the Committee seem to be flexible. OED could not find any definition of these issues. Table 7: PCF Steering Committee Membership, as of August 2004 Name Title Vice Presidential Sector Mapping Unit Steen Lau Director, Social Development Department ESSD SDV Jorgensen Ian Bannon Manager of the CPR Team ESSD SDV Emmanuel Mbi Country Director for Burundi, DRC, Republic AFR None of Congo, and Rwanda Nils O. Tcheyan Director for Strategy and Operations AFR None Klaus Rohland Country Director for Vietnam EAP PREM Natasha Country Program Coordinator for Papua New EAP PREM, PSD Beschorner Guinea and Pacific Islands D-M Dowsett- Country Director for Armenia, Azerbaijan, ECA None Coirolo Georgia Alexandre Marc Sector Manager for the ESSD ECA SDV Daniela Gressani Director for Strategy and Operations LAC PREM Letitia A. Obeng Sector Director for Rural Development, MNA ENV Water and Environment Barbara Kafka Director for the Operations Quality Unit SAR None Paul N. Hubbard Manager of the DGF CFP None Vikram Raghavan Counsel for the Legal Department for the LEG None Middle East, North Africa, and South Asia 4.3 Table 7 indicates the membership composition of the Steering Committee and their positions as of August 2004. The backgrounds and positions of the members involved in PCF’s decision-making structure are closely tied to issues of conflict and to the regions that benefit from PCF funds, which ensures that those most affected by the program’s work are represented and consulted. While those members of the Steering Committee located in the ESSD Vice Presidency are not independent of the management chain responsible for implementing the program, those from other vice-presidential units are independent. The 19 spread of the Committee, most of whose members are appointed at the director level, has been designed to ensure that no proposal enjoys an 'inside track.' To avoid conflicts of interest, it is a convention that the representative of the Region proposing a grant does not vote when consensus cannot be met. PCF staff indicates that there is rarely lack of consensus when deciding whether to fund particular grant applications. Full DGF and LEG representation on the Committee is meant to ensure application of DGF criteria or their flexible adaptation. 4.4 The PCF’s secretariat is located in-house. As the program’s DGF application notes, this is an advantage because “at a relatively low cost, as part of the post-conflict fund’s work program, the in-house Secretariat aligns grant proposals with Bank and partner policies and objectives through detailed brokering between the Bank country teams and external actors. This requires a detailed understanding of both Bank and external partner operations.” DGF indicated that they would reconsider the question of the in-house secretariat after 3 years, but without committing to change it. PARTNERSHIPS AND PARTICIPATION 4.5 The PCF has a large number of implementing partners at the activity level, and a PCF grant can help build a long-term partnership between the Bank and various implementing agencies.23 The PCF has assumed higher risks regarding its implementing partners, as exemplified by the exemption from the DGF requirement regarding the record of achievement and financial probity of the recipient institution. The program, however, works with a number of reputable partners, including international organizations, NGOs, and universities. Cooperation between the Bank and the implementing agencies generally works well. Table 8: Grants Approved by Recipient Type, FY98-05 Recipient Type % of Spending Total Amount, US$ International Organizations 46.23 30,840,850 NGOs, CSOs, and Foundations 23.74 15,838,304 Developing Countries’ Governments 15.67 10,455,021 Universities, Think-Tanks 5.51 3,676,789 World Bank-executed 4.93 3,289,793 Donor Development Agencies 3.91 2,610,495 Total 100 66,711,252 Source: PCF grant database. 4.6 Table 8 indicates that international organizations have received the largest share of PCF funds ($30.840 million), followed by NGOs, CSOs, and foundations ($15.838 million), and developing country governments ($10.455 million). In cases where the weakened 23 For example, the Bank and the UNHCR agreed to explore the possibility of more regular collaboration. The PCF gave a grant to a UNHCR-implemented project as a pilot to test the foundation for such cooperation. 20 capacity of the post-conflict state and civil institutions makes it difficult to identify agencies with adequate competence, funds have been given to Bank-executed PCF grants. To date, the PCF has awarded $3.289 million for nine World Bank executed PCF grants, with two such grants in Afghanistan (# 210 and #232), three in East Timor (#108B, 171, and 183), two in Mindanao, Philippines (#159B and 278), one in Sudan (#35B), and one in Kosovo (#103A). PCF staff noted that the program rejects most proposals for Bank executed PCF grants, and it requires compelling evidence from the task team that no local or international organizations could implement the grant. PCF awards these grants at the discretion of the PCF Committee, including at the request of the government or when no other agency is able to execute the grant. For example, the government of the Philippines requested that the grant to Mindanao be executed by the World Bank, and it wished the project to be seen as a government initiative. 4.7 The program’s large number of partners at the activity level is in strong contrast to the lack of partners in its governance. According to PCF, neither donors nor UN agencies have desired such a partnership, and they have only asked for grants or to collaborate in lessons learned exercises. However, in OED’s interviews UNHCR questioned the program’s lack of partnering at the governance level. PCF has not sought to involve either UN organizations or bilateral donors as partners at the governance level. The program has argued that involving UN organizations (such as UNDP, UNICEF, and UNHCR) would create a potential conflict of interest since these organizations receive a large share of PCF grants. In OED’s opinion, this would not necessarily lead to a conflict of interest such as self-dealing as long as the governance of the program is separate from the day-to-day allocation decisions. This is in the nature of a partnership. The Cities Alliance, for example, is a partnership among the Bank, UN-Habitat, bilateral donors, a developing country (Brazil), and four umbrella associations of urban and rural municipalities. All are involved at the governance level; the Bank and UN-Habitat are the principal implementing agencies. The real issue is whether the benefit of partners at the governance level would outweigh the transaction and other costs of an expanded partnership. FINANCING OF THE PROGRAM Source of Funds 4.8 Table 9 indicates that external donor funding would not be able to keep the program alive if the DGF were to withhold further funding. If the Japanese Post-Conflict Fund is considered a separate trust fund and not part of the PCF income, there was no donor financing at all in FY98 and FY99, 7 percent in FY00, increasing substantially to almost 30 percent in FY01 with some $4 million contributed by Switzerland, Netherlands, Belgium, UNHCR and UNDP, to less than 5 percent in FY02, 3 percent in FY03, and 5 percent in FY04. Only Switzerland contributed to the PCF recently, pledging $ 266,667 in FY03 and $333,333 in FY04. 4.9 The limited degree of external donor support does not imply a lack of interest in the topic, as evidenced by the increasing amount of ODA that goes to peace and security issues. The external evaluation compares the PCF with a similar trust fund set up under UNDP 21 auspices, in which $20 million provided by the UNDP has leveraged donor contributions of about $100 million. Table 9. PCF Income and Expenditures PCF income FY98/1 FY99 FY00 FY01 FY02 FY03 Total (actual) DGF 8,000,000 6,000,000 6,991,989 10,000,000 8,000,000 9,323,500 48,315,489 contribution Donor 603,428 4,204,268 300,000 266,667 5,374,363 Contributions Investment 10,041 513,209 1,069,586 1,234,230 700,523 3,471,695 income Total income 8,000,000 6,010,041 8,108,626 15,273,854 9,534,230 10,290,690 57,161,547 PCF expenditures (actual) DGF 200,000 363,864 355,965 422,246 613,900 1,955,975 administration allocation Grant 5,937,890 6,187,584 7,945,141 11,079,269 13,062,800 54,319,528 disbursements Total 6,137,890 6,551,448 8,301,106 11,501,515 13,676,700 56,275,503 expenditures Source: SAP and PCF Manual Records 1/ There are no exact figures from the time before the PCF became a trust fund. Expenditures for this period are calculated by subtracting the amount put into the trust fund at initiation from the DGF FY98 and FY99 grants. 4.10 It is unclear why donors have not supported the PCF. Some donors have indicated that they see the geographical coverage of the PCF as too broad, preferring more focused programs such as the Multi-Country Demobilization and Reintegration Program. Some potential donors have questioned why bilateral donors – who have already provided substantial funding to NGOs – should channel even more money to them through the World Bank. PCF management suggested that donors may not support the PCF because they see it as core Bank business, and therefore see no need to contribute financially to the program. In addition, this is an area with strong competition for funding. According to PCF management, mobilizing substantial funding would require senior management action, which has not been thought timely because greater priority has been given to the funding of IDA, its post-conflict allocations and the discussions on the share of grants in IDA replenishments. The PCF’s inability to leverage its resources, especially if contrasted with the more successful UNDP trust fund, may have to do with conflict’s low profile in the Bank and lower donor confidence that the World Bank has a comparative advantage in the field, suggesting that the PCF may have to do more to emphasize its comparative advantage. As noted by CPR management, the establishment of the LICUS TF and the possibility that it may ask for donor funds may throw more light on this issue. 4.11 The PCF Secretariat has concentrated on individual, targeted approaches to attract potential donors. Most contacts between interested donors and the PCF occur in the field, which has led donors to provide earmarked contributions for projects such as the Kosovo 22 Community Fund or Georgia Self-reliance Fund. PCF staff noted that many PCF grants brought in parallel financing at the sub-grant level, but the program has not consistently tracked the exact amounts or the source of these funds. Project-level evaluations that address this issue note varied success. For instance, the review of PCF work in East Timor observed that PCF grants have catalyzed some donor financing, but noted that burden sharing had not been a sufficiently strict criteria for grant approval and that a project is facing challenges to raise additional funding.24 The PCF presented the findings of the external evaluation at a meeting in June 2002 in the OECD/DAC conflict network in an attempt to attract further donor financing. Although donors showed interest, they did not make any additional pledges. The Steering Committee is contemplating a wider and more aggressive fundraising strategy. The PCF Secretariat is also exploring the use of the Conflict Prevention and Reconstruction Network, a cooperation mechanism among donor conflict units, for funding collaboration. Financial Management 4.12 The two main issues relating to financial management are fiduciary and budgetary management and oversight. The external evaluation was satisfied with the financial management of the program, but found several critical points needing improvement. On the positive side, the external evaluation emphasized PCF’s simple bureaucratic procedures. The evaluation cites flexibility in procurement, disbursement, and project budget adjustment as being among the major strengths. A flexible arrangement for the administration of the PCF was necessary because of the volatile and unpredictable situation in many of the recipient countries, and the delays in approval, commitment and disbursement of funds. 4.13 On the negative side, the auditors found insufficient oversight of the fund’s expenditures. This problem is exacerbated by PCF’s exemption from DGF’s requirement of addressing the recipient partners’ record of achievement and demonstrated financial probity.25 The auditors also found that the policy and procedural framework applicable to PCF grants is not clear, exemplified by incidents of staff time and travel being charged to the grant. PCF indicated that it corrected these shortfalls in follow-up action to the audit. 4.14 A number of additional costs to the Bank are not included in PCF’s overview of expenditures. A part of the DGF grant is currently allocated to the PCF Secretariat and to fees paying the reviewers of the proposals. The SDV makes a substantial contribution from its own administrative budget for items such as the time for preparation and participation in PCF Steering Committee meetings by the Director and Manager of the SDV, the CPR, office space, communications, and translation. While this is an additional cost to the Bank, it results in a more effective exercise of oversight. RISKS AND RISK MANAGEMENT 4.15 Reputational and non-performance risks. As the framework for Bank’s involvement in post-conflict situations noted, Bank operations in countries emerging from conflict are not 24 Purcell, p.1. 25 See chapter 5 on the PCF and the DGF for further details. 23 “business as usual,” as the probability of project failure is much higher in countries emerging from conflict than for normal Bank operations. Because of the political polarization in conflict-affected countries, Bank involvement also runs the reputational risk of real or perceived bias towards one of the involved parties, of not achieving its stated objectives, or of jeopardizing reconciliation.26 The fact that most grants are awarded to implementing agencies other than the World Bank due to the arm’s length principle highlights the importance of selecting implementation partners that can manage risks when implementing the projects. PCF’s approach to minimizing this risk has been to rely on prior review, endorsement by country teams, supervision, and participation by staff from the legal department in approving sub-grants and tranching disbursements. 4.16 Financial risk. The financial risk is not effectively spread out among the donors as envisioned by DGF’s 15 percent criterion. Since the PCF funds activities in areas that have weak institutional capacity, political instability, and coordination problems, there is a high risk that the funded investments will not result in the expected return. 5. Role of the World Bank 5.1 OED has developed the following criteria to evaluate the World Bank’s performance (see Annex A): • Comparative advantage: Whether the Bank is employing its comparative advantages in relation to other partners in the programs. • Global-country linkages: Whether the global program has effective operational linkages to the Bank’s country operational work, where appropriate. • Oversight: Whether the Bank is exercising effective and independent oversight of its involvement for in-house and externally managed programs. • Exit strategy: Whether the Bank is facilitating effective, flexible, and transparent disengagement strategies, as appropriate. COMPARATIVE ADVANTAGE OF THE WORLD BANK 5.2 The grant allocation of PCF funds indicates that the PCF has used its comparative advantage more at the country level than at the global level. The PCF has allocated 96 percent of its funds to country-specific grants, while allocating 4 percent of its total funds to multi-country programs (see Figure 2). While the percentage of grants allocated to multi- country programs is higher at 23.5 percent of all grants, these grants tend to be smaller in size and they therefore make up only 4 percent of the overall PCF funds. 26 OED, p.56. 24 Figure 2: Grant Allocation: Country-Specific And Multi-Country Grants, FY98-05 Grant Allocation, by Amount Spent Grant Allocation, by # of Grants 100% Country specific 100% 50% Multi country 50% 0% Fund Allocation 0% Percentage of grants Source: PCF grant database. GLOBAL-COUNTRY LINKAGES Linkages with the Bank’s Country Operations 5.3 There are substantial linkages between the country operations and the PCF. The requirement that incoming proposals be sponsored by a Bank task manager and endorsed by the country manager is meant to ensure that the project fits within the overall country strategy and forms part of it, enhancing the effectiveness of the Bank’s country operations. Yet, several Steering Committee members note that funded activities are inadequately grounded in the CASs. Since Task Managers are responsible for ensuring that applications do not duplicate other Bank activities, they bear a large share of responsibility for ensuring that funds are well spent. The extent to which the task managers do this varies, possibly reducing the quality of project implementation. As DGF prohibits the use of its resources to pay Bank staff, those staff may not always devote sufficient time to supervise the relatively small PCF grants. Bank staff note that a lot of time is spent by country staff in preparation and supervision of the grants, and that the related costs are high compared to the small-scale nature of the grants. One staff member assessed that the country team contributed what amounted to about 10 percent of the total grants given to East Timor in staff costs, which would amount to $327,548. Nonetheless, the 2004 portfolio review of PCF’s work in East Timor noted that the Leadership and Capacity Building project (grant #255) lacked sufficient preparation and supervision funds for the activity. The review stressed the need to ensure adequate resources for supervision, taking into account the higher costs of these activities in post-conflict environments.27 While this is an additional cost to the Bank, it results in a more effective exercise of oversight. IDA-13, LICUS, and Multi Donor Trust Funds 5.4 In addition to the PCF, the World Bank finances activities in conflict-affected countries through multi-donor trust funds and the LICUS Trust Fund. The Bank has also approved a post-conflict IDA window to allocate resources for early recovery efforts. LICUS 27 Purcell, p. 8-9. 25 TF, IDA-13 and the multi donor trust funds have been designed to fund related and complementary activities, raising some risk of overlap or competition with the PCF. 5.5 Under IDA-13, up to 40 percent of the IDA allocation can be used as grants to establish the main functions of governance and to rebuild basic infrastructure in vulnerable countries recovering from conflict for a limited period once arrears have been cleared. Traditionally, the Bank has only dealt with recognized national governments, but IDA Deputies also recommended that grants could be made available, in special cases, to territories within member countries that are under UN administration on an interim basis. Post-conflict countries with large and protracted arrears are also eligible for limited grant financing prior to arrears clearance. As recent research suggested that it may be better to have lower earlier allocations and phase post-conflict assistance over a longer period of time, IDA Deputies supported modifications to reduce initial allocations and stretch out the post- conflict allocation over seven years. 5.6 LICUS was set up in 2002 to address the needs of poor countries that are characterized by especially weak policies, institutions, and governance. In June 2004, the Board of Governors approved the transfer of $25 million to the LICUS Implementation Trust Fund, which finances transition activities in countries that are not yet eligible for IDA post- conflict grants. Since IDA-13 includes provisions for pre-arrears clearance to post-conflict countries, and since devising an agreed arrears clearance plan may take a long time in countries with complex and large arrears, the LICUS Trust Fund has been designed to fill this gap. Once a country meets the requirements for IDA post-conflict grants, it would no longer be eligible for support from the LICUS Trust Fund. LICUS TF uses the same operational procedures as the PCF and is governed by an expanded PCF Committee. LICUS TF and PCF have been designed to complement each other, with PCF funding discrete interventions and LICUS TF funding more intensive and integrated programs. Many LICUS countries have experienced violent conflicts, and there is a significant overlap between the geographical focus of LICUS TF and the PCF, with all of the initial pilot LICUS countries being either post-conflict or currently affected by conflict.28 PCF countries that qualify have moved into the LICUS window. Eight of the initial 13 LICUS countries have received PCF grants, with LICUS recipients such as Burundi and Sudan being among the largest PCF grant recipients.40 The DGF took into account the availability of funds under LICUS TF for an overlapping set of countries when it approved only $8 million for PCF for FY05 instead of the requested $12 million. Further qualifications with LICUS TF would help country teams on the difference between LICUS TF and the PCF. 5.7 A number of country-specific multi-donor trust funds also finance some of the reconstruction needs. The World Bank has set up trust funds for, among others, the West Bank and Gaza, Bosnia, Kosovo, East Timor, Sierra Leone, the Great Lakes region, 28 FY03 pilot countries were: Angola, Central African Republic, Haiti, Papua New Guinea, Somalia, Sudan, and Tajikistan. FY04 LICUS focus countries were: Burundi, Comoros, Guinea-Bissau, Liberia, Togo, and Zimbabwe. 40 Only five of the 13 LICUS recipients - Angola, Papua New Guinea, Togo, Guinea-Bissau, and Zimbabwe - are not PCF grant recipients. 26 Afghanistan, and Iraq. The countries financed by the trust funds include some of the largest recipients of PCF grants. The original division of labor between the PCF, the trust funds, and the regular Bank operations was conceived to be complementary in a temporal sense. The Japanese Post-Conflict Fund 5.8 The Japanese Post-Conflict Fund (JPCF), set up in 1999, is administered by the Japan Policy and Human Resources Development Fund (PHRD) and co-administered by the PCF Secretariat. This arrangement facilitates cooperation during the approval process. The JPCF operates under the same guidelines as the PCF, with two additional conditions. First, the grant recipient has to be a government or the grant has to be channeled through the government. Second, all grants must fall within the post-conflict phase. Requiring endorsement from Tokyo, grants respond to specific Japanese priorities. 5.9 The JPCF and the PCF have been designed to work closely together, with the PCF providing smaller grants to a wider variety of recipients and the JPCF providing a broader range of reconstruction support.29 The partnership was meant to provide dual grants, which succeeded in the cases of grants to Cambodia in the beginning of 1999, and to East Timor in the beginning of 2000, but failed in Burundi, the DRC and Kosovo. In the first case, the Steering Committee rejected JPCF components due to insufficient quality of program design. The second and the third cases failed due to the Japanese view that other funding sources were available and due to differing Japanese priorities. According to the PCF administrator, Japan does not plan on continuing the JPCF after the disbursement of the initial commitment. DGF and the PCF Table 10: Comparison of DGF and PCF Criteria 5.10 The Board PCF Eligibility Criteria DGF Eligibility Criteria Current PCF/DGF (established 1997) (established 1998) Incompatibilities established and approved the PCF before Addresses World Bank Does not compete or Multi-country benefits priority themes substitute for regular Bank the DGF. When criteria instruments Consistent with OP 2.30 Leverage were established for the Distinct comparative Includes provisions for DGF in 1998, the PCF monitoring and advantage Record of achievement and was grandfathered into evaluation Multi-country benefits and financial probity the DGF, with the Conforms with DGF capacity-building activities proviso that it would eligibility criteria Significant leverage Disengagement eventually comply with Record of achievement strategy and financial probity DGF eligibility criteria. The program’s 1998 Arm’s length DGF review noted that Disengagement strategy issues arose with respect Promotes and reinforces partnerships to the following DGF criteria (see Table 10): 29. CPR Unit 1999b. 27 ● Multi-country benefits. Although some PCF grants have multi-country impacts, over 90 percent of the grants support country-specific activities. ● Leverage: When jump-starting recovery activities, it is impossible to know how much donors will provide in the ensuing reconstruction programs. ● Record of achievement and financial probity of the recipient institution. The weak capacity in state and civil institutions of post-conflict countries makes it difficult to find counterparts with the requisite experience and history of financial probity among local institutions. ● Disengagement strategy. Funds are often deployed to facilitate the Bank’s re-engagement with countries where it may have been absent for some time. However, activities are only covered on a time-limited basis to lay the foundations for a longer-term partnership with governments and other agencies or allow larger-scale Bank assistance to take over. 5.11 According to the DGF eligibility criteria, the target for the Bank grant not to exceed 15 percent of total expected funding will be pursued after allowing for an initial start-up phase (maximum 3 years). Six years have passed since PCF’s inception, but the DGF still has not enforced this requirement. PCF indicated that the DGF participates regularly in its Committee meetings, scrutinizes its annual DGF funding applications, and has conducted portfolio review of some of PCF funded activities. The DGF’s most recent annual review notes that the program has continued a three-year strategy to maintain DGF support while the potential for donor support is tested. The PCF meets the arm’s length criterion for in-house secretariats as stated in 1990, since most of its grants are awarded to outside agencies and regional operations have to supervise the activities from their own resources. DGF indicated that they would reconsider the question of the in-house secretariat after 3 years, but without committing to change it. The DGF partnership criterion is vague and does not specify if partnerships are necessary at the governance or the activity level, making it difficult to ascertain a program’s compliance with this criterion. The PCF engages in partnerships with donors and recipients at the project level, but not at the governance level. Bank Management Criteria for approval by implication indicate that partnerships should take place in governance and financing and not just at the activity level. These need to be applied first before a program goes for DGF funding. Because the criteria were developed at different times and are vague, management has considerable flexibility to engage or not engage in partnerships. EXIT STRATEGY 5.12 The PCF is funded through DGF’s Window 1, with programs receiving long-term assistance. Although the DGF has expressed that the program’s long-term survival would depend on its ability to attract further donor contributions, the DGF chose to increase the grant for FY03 in spite of the lack of increasing donor backing. According to the latest DGF annual review, the program continues a three-year strategy to maintain DGF support while the potential for external donor support is tested. 28 6. Findings and Lessons 6.1 A flexible instrument such as the PCF serves the needs that the Bank’s numerous instruments do not fulfill in conflict-affected countries. PCF grants have contributed to activities at key junctures in a number of countries and have helped position the Bank in the reconstruction process by providing quick and flexible funding. Since 77 percent of all PCF funds have been awarded to transitional support strategies and watching briefs, the grants have proved to be valuable tools for preparing the ground in conflict- affected regions, resulting in follow-on financing in countries such as Afghanistan, East Timor, Kosovo, and Iraq. 6.2 Yet if the policy guidelines under which it operates are too flexible, and the DGF criteria are ambiguous and insufficiently enforced, the instrument can be less than fully effective. One reason for setting up the PCF was that the Bank’s internal procedures and incentive structures could not accommodate the needs of conflict-affected countries. PCF was designed to fill a gap and provide intermediate financing before IDA credits or grants are available. However, the newly established LICUS TF and limitations of DGF funding provide an opportunity to reexamine the role of the PCF within the Bank’s overall conflict framework. 6.3 Programs can continue over several years without a results-based framework and strong monitoring and evaluation, highlighting the need for designing appropriate monitoring and evaluation mechanisms to measure impact of the individual sub-grants. Measuring impact is difficult, since two-thirds of PCF-approved sub-grants fund projects that are too small to have a readily measurable impact on the needs of conflict-affected areas. A more thorough and consistent evaluation and review of the sub-grants across projects may provide a clearer sense of the projects’ impact and lessons learned. 6.4 As currently designed, the country-by-country approach of the program does not sufficiently generate broader cross-country lessons and does not exploit the program’s full potential to serve the Bank and its partners strategically. Making a larger share of its analytical work publicly available may help the PCF better focus on learning strategic lessons and disseminate the findings and lessons of funded projects. 6.5 A global partnership program on conflict-affected countries with partners at the governance level might help the Bank, UN agencies, and other stakeholders to better respond to the transition from relief, to rehabilitation and reconstruction and development. Given the complexity and the multi-sectoral nature of conflict work and the problem of multi-donor coordination and cooperation, the program’s lack of partnering at the governance level has been questioned by organizations such as the UNHCR. 29 References Anderson, Mary. 1996. “Humanitarian NGO’s in Conflict Intervention,” in Crocker, Chester, Fen Osler Hampson and Pamela Aall (eds.), Managing Global Chaos: Sources of and Responses to International Conflict. U.S. Institute of Peace Press, Washington, D.C. Ball, Nicole. 1996. Making Peace Work: The Role of the International Development Community. The Johns Hopkins University Press, Baltimore, MD. Biabo, Prosper. 2003. “Community Action for Reintegration and Recovery for Youth and Women Project, Republic of Congo: Grant Evaluation Report.” CPR Unit. Bugnion, Christian. 2004. “External Evaluation of the CAAC-CAVF Process in Timor- Leste” (Final Report). CPR Unit. World Bank, Washington, D.C. Carballo, Manuel. 2003. “Report of an Evaluation of a Harvard Trauma Project funded by the World Bank Post Conflict Unit in the Canton of Travnik, Bosnia Herzegovina.” International Centre for Migration and Health, Geneva. Channel Research Ltd. 2002. “Evaluation of the Burundi Community Rehabilitation Project 1999-2002.” Collier, Paul. 2000. “Economic Causes of Civil Conflict and their Implications for Policy,” in Turbulent Peace: The Challenges of Managing International Conflict, Chester A. Crocker, Fen Osler Hampson, and Pamela Aall, eds. United States Institute of Peace Press, Washington, D.C. ______2003. Breaking the Conflict Trap: Civil War and Development Policy. World Bank, Washington, D.C. CPR Unit. 1999a. Post Conflict Fund: Guidelines and Procedures. World Bank, Washington, D.C. ______1999b. PCF Annual Report. World Bank, Washington, D.C ______2002a. PCF Annual Review. World Bank, Washington, D.C 30 ______2002c. “Conflict, Peacebuilding and Development Cooperation: The World Bank Agenda.” (Background Note). World Bank, Washington, D.C ______2003. “PCF Grants in the Democratic Republic of the Congo Review Report.” (Manuscript). World Bank, Washington, D.C ______2004. PCF Annual Report. World Bank, Washington, D.C Development Alternatives Inc. 2002. “Covering New Ground: Evaluation of the Post- Conflict Fund.” CPR Unit. World Bank, Washington, D.C. Gurr, Tedd Robert and Monty G. Marshall. 2003. Peace and Conflict 2003: A Global Survey of Armed Conflicts, Self-Determination Movements, and Democracy. Center for International Development and Conflict Management, College Park, MD. Kimberly Maynard. 1997. “Rebuilding Community: Psychological Healing, Reintegration, and Reconciliation at the Grassroots Level,” in Krishna Kumar Rebuilding Societies After Civil War. L. Rienner, Boulder, CO. OED (Operations Evaluation Department). 1998. The World Bank’s Experience with Post- Conflict Reconstruction. World Bank, Washington, D.C. Purcell, Randall. 2004. “The Post-Conflict Fund in East Timor: Portfolio Performance and Review of Experience” (Manuscript). Development Grant Facility. World Bank, Washington, D.C. Rajagopalan, Swarna. 2004. “Within and Beyond Borders: An Independent Review of Post- Conflict Fund Support to Refugees and the Internally Displaced” (Manuscript). CPR Unit. World Bank, Washington, D.C. Stroux, Daniel. 2004. “Final Evaluation of PCF #240 – Conflict Analysis and Reduction in Nigeria” (Manuscript). Bureau for Institutional Reform and Democracy, Munich, Germany. Uvin, Peter and Susanna P. Campbell. 2004. “The Burundi Leadership Training Program: A Prospective Assessment” (Manuscript). CPR Unit. World Bank, Washington, D.C. World Bank. 2002a. “Additions to IDA Resources: Thirteenth Replenishment.” Final Text, IDA/SecM2002-0488. Washington, D.C. ______2002b. “World Bank Group Work in Low-Income Countries Under Stress: A Task Force Report.” Washington, D.C. 31 ______2004a. News Release No: 2004/294/SAR. Two Decades of Conflict Cost US $240 billion. Now Afghanistan Will Need US $27.5 Billion to Recover.” Washington, D.C. ______2004b. Social Development in World Bank Operations: Results and Way Forward (Draft Paper). Washington, D.C. 32 Annex A Annex A. Evaluation Framework for Phase 2 Report and 26 Case Studies The Phase 2 Report and each case study follows a common outline and addresses 20 evaluation questions (Table A.1) that have been derived from OED’s standard evaluation criteria (Table A.2), the 14 eligibility and approval criteria for global programs (Table A.3), and the 8 eligibility criteria for grant support from the Development Grant Facility (Table A.4). The sheer number of these criteria, some of which overlap, can be daunting even to an evaluator. Hence the OED evaluation team has reorganized these criteria into four major evaluation issues, which correspond to the four major sections of each report (Table A.1): The overarching global relevance of the program Outcomes and impacts of the program and their sustainability Governance, management, and financing of the program The World Bank’s performance as a partner in the program These four issues correspond roughly to OED’s evaluation criteria of relevance, efficacy, efficiency, and Bank performance, appropriately interpreted and expanded for the case of global programs. In the case of global programs, relevance must be measured not only against individual borrowing countries’ priorities and Bank priorities, but also in terms of the interplay between global challenges and concerns on the one hand and country needs and priorities on the other. The former are typically articulated by the “global community” by a variety of different stakeholders and are reflected in a variety of ways such as formal international conventions to which developing countries are signatories; less formal international agreements reached at major international meetings and conferences; formal and informal international standards and protocols promoted by international organizations, NGOs, etc.; the Millennium Development Goals; and the Bank’s and the Development Committee’ eligibility criteria for global programs. While sponsorship of a program by significant international organizations may enhance “legitimacy” of a global program in the Bank’s client countries, it is by no means a sufficient condition for developing country ownership, nor for ensuring its development effectiveness. “Relevance” and ownership by the Bank’s client countries is more assured if the program is demanded by them. On other hand some “supply-led” programs may also acquire ownership over time by demonstrating substantial impacts, as in the case of the internet. Assessing relevance is by far the most challenging task in global programs since global and country resources, comparative advantages, benefit, costs, and priorities do not always coincide. Indeed the divergence of benefits and costs between the global level and the country level is often a fundamental reason for the provision of global public goods. Evaluating the relevance of global action to the Bank’s client countries is however important because the global development agenda is becoming highly crowded and resources to finance it have remained relatively stagnant, therefore highlighting issues of selectivity. For the global programs that have been operating for some time, efficacy can be assessed not only in terms of program outcomes but more crucially in terms of impacts on the ground in developing countries. Outcomes and impacts in turn depend on the clarity and evaluability of each program’s objectives, the quality of the monitoring and evaluation of results and, where appropriate, the effectiveness of the links of global program activities to the country level. Since global programs are partnerships, efficiency must include an assessment of the extent to which the benefit-cost calculus in collective organizational, management and financing arrangements is 33 Annex A superior to achieving the same results by the individual partners acting alone. The institutional development impact and the sustainability of the program itself (as opposed to that of the outcomes and impacts of the program’s activities) are also addressed in this section of each report. Finally, this being an OED evaluation, it focuses primarily on the Bank’s strategic role and performance in playing up to its comparative advantage relative to other partners in each program. The Bank plays varied roles in global programs as a convener, trustee, donor to global programs, and lender to developing countries. The Bank’s financial support to global programs – including oversight and liaison activities and linkages to the Bank’s regional operations – comes from a combination of the Bank’s net income (for DGF grants), the Bank’s administrative budget, and Bank-administered trust funds. In the case of the Global Environmental Facility (GEF) the Bank is a trustee and in the case of the Global Fund to Fight HIV/AIDS, Tuberculosis, and Malaria (GFATM), a “limited” trustee. In the case of GEF and MLF the Bank is also an implementing agency. Thus, the assessment of Bank performance includes the use of the Bank’s convening power, the Bank’s trusteeship, Bank financing and implementation of global programs, and, where appropriate and necessary, linkages to the Bank’s country operations. Bank oversight of this entire set of activities is an important aspect of the Bank’s strategic and programmatic management of its portfolio of global programs. The first column in Table A.1 indicates how the four sections and 20 evaluation questions addressed in the Phase 2 Report and case studies relates to the eight evaluation issues that were raised by the Bank’s Executive Board in the various Board discussions of global programs during the design phase of OED’s global evaluation and identified in the OED’s Evaluation Strategy paper:1 Selectivity Monitoring and evaluation Governance and management Partnerships and participation Financing Risks and risk management Linkages to country operations The third column in Table A.1 indicates how the four sections and 20 evaluation questions relate to OED’s standard evaluation criteria for investment projects (Table A.2), the 14 criteria endorsed by the Development Committee and established by Bank management for approving the Bank’s involvement in global programs (Table A.3), and the 8 criteria for grant support from the Development Grant Facility (Table A.4). The 14 eligibility and approval criteria for the Bank’s involvement in global programs have evolved since April 2000 when Bank management first proposed a strategy to the Bank’s Executive Board for the Bank’s involvement in global programs and include the four overarching criteria endorsed by the Development Committee, and the four eligibility criteria and six approval criteria presented by Bank management to the Bank’s Executive Board. Each global program must meet at least one of the four relatively more substantive eligibility criteria and all six of the relatively more process-oriented approval criteria. The first two eligibility criteria relate directly to the Bank’s global public goods and corporate advocacy priorities (Table A.3). Although the six approval criteria 1 OED, The World Bank and Global Public Policies and Programs: An Evaluation Strategy, July 16, 2001, page 21. “Partnerships and participation” were originally listed as two separate evaluation issues in the evaluation strategy document. “Monitoring and evaluation” is now interpreted more broadly to include not only an assessment of the monitoring and evaluation procedures of each program but also the findings of previous evaluations with respect to the outcomes and impacts of each program, and their sustainability. 34 Annex A resemble the topics covered in a project concept or appraisal document for Bank lending operations, unlike for Bank lending operations, there is currently only a one-step approval process for new global programs – at the concept stage and not at the appraisal stage. And new global programs only have to be approved by the Bank managing director responsible for the Network proposing a new program, not by the Bank’s Executive Board. While the approval of new global programs is logically separate from and prior to their financing (whether from the DGF, trust funds, or other sources), the eight DGF eligibility criteria for grant support from the DGF (Table A.4) were actually established in 1998. Twenty out of the 26 case study programs and about two-thirds of the Bank’s total portfolio of 70 global programs have received DGF grants. Table A.1. Key Evaluation Issues and Questions Evaluation Evaluation Questions Reference Issues Section I. Overarching Global Relevance of the Program Relevance. To what extent are the programs: A modification of OED’s • Addressing global challenges and concerns in the relevance criterion (Table sector A.2) for the purpose of global programs. • Consistent with client countries’ current development priorities The third bullet also relates • Consistent with the Bank’s mission, corporate to managing director (MD) priorities, and sectoral and country assistance approval criterion #1 strategies? regarding a “clear linkage to the Bank’s core institutional objectives” (Table A.3). International consensus. To what extent did the Development Committee programs arise out of an international consensus, (DC) criterion #4 (Table formal or informal: A.3). Selectivity • Concerning the main global challenges and concerns in the sector • That global collective action is required to address these challenges and concerns? Strategic focus. To what extent are the programs: The four bullets • Providing global and regional public goods correspond to the four MD eligibility criteria (Table • Supporting international advocacy to improve A.3). policies at the national level • Producing and delivering cross-country lessons of relevance to client countries • Mobilizing substantial incremental resources? Subsidiarity. To what extent do the activities of the DGF eligibility criterion #1 programs complement, substitute for, or compete (Table A.4). with regular Bank instruments? Section II. Outcomes, Impacts, and their Sustainability Efficacy. To what extent have the programs achieved, or OED’s efficacy criterion are expected to achieve, their stated objectives, (Table A.2). taking into account their relative importance? 35 Annex A Evaluation Evaluation Questions Reference Issues Value added. To what extent are the programs adding The first bullet corresponds value to: to DC criterion #1 (Table A.3). • What the Bank is doing in the sector to achieve its core mission of poverty alleviation and sustainable development • What developing and transition countries are doing in the sector in accordance with their own priorities? Monitoring and evaluation. To what extent do the MD approval criterion #6 programs have effective monitoring and evaluation: (Table A.3), since effective Monitoring • Clear program and component objectives verifiable communications with key and stakeholders, including the by indicators evaluati Bank’s Executive • A structured set of quantitative or qualitative Directors, requires good on indicators monitoring and evaluation • Systematic and regular processes for data collection practices. and management • Independence of program-level evaluations • Effective feedback from monitoring and evaluation to program objectives, governance, management , and financing? Sustainability of outcomes and impacts. To what OED’s sustainability extent are the outcomes and impacts of the criterion (Table A.2). programs resilient to risk over time? Section III. Organization, Management, and Financing of the Program Efficiency. To what extent have the programs achieved, A modification of OED’s or are expected to achieve: efficacy criterion for the purpose of global • Benefits more cost-effectively than providing the programs (Table A.2). same service on a country-by-country basis The first bullet also relates • Benefits more cost-effectively than if the individual to MD eligibility criterion #3 contributors to the program acted alone? (Table A.3) and DGF eligibility criterion #3 (Table A.4). Legitimacy. To what extent is the authorizing A modification of OED’s Governance environment for the programs effectively derived evaluation criteria (Table and from those with a legitimate interest in the program A.2) for the purpose of manage (including donors, developing and transition global programs. ment countries, clients, and other stakeholders), taking into account their relative importance. Governance and management. To what extent are the MD approval criterion #5 governance and management of the programs: (Tables B.3) and DGF • Transparent in providing information about the eligibility criterion #5 programs (Table A.4). • Clear with respect to roles & responsibilities • Fair to immediate clients • Accountable to donors, developing and transition countries, scientists/professionals, and other stakeholders? 36 Annex A Evaluation Evaluation Questions Reference Issues Partnerships and participation. To what extent do DGF eligibility criterion #8 developing and transition country partners, clients, (Table A.4). and beneficiaries participate and exercise effective Partnerships voice in the various aspects of the programs: and • Design participation • Governance • Implementation • Monitoring and evaluation? Financing. To what extent are the sources of funding for MD approval criterion #4. the programs affecting, positively or negatively: (Table A.3). • The strategic focus of the program The third bullet also relates • The governance and management of the program to OED’s sustainability • The sustainability of the program? criterion (Table A.2). Bank action to catalyze. To what extent has the Bank’s DC criterion #2 (Table A.3) Financing presence as a partner in the programs catalyzed, or and DGF eligibility criterion is catalyzing non-Bank resources for the programs? #4 (Table A.4). Institutional development impact. To what extent has A modification of OED’s the program established effective institutional institutional development arrangements to make efficient, equitable, and impact criterion (Table A.2) sustainable use of the collective financial, human, for the purpose of global and other resources contributed to the program. programs. Risks and risk management. To what extent have the MD approval criterion #3 Risks and risk risks associated with the programs been identified (Table A.3). management and are being effectively managed? Section IV. World Bank’s Performance Comparative advantage. To what extent is the Bank DC criterion #3 (Table playing up to its comparative advantages in relation A.3), MD approval criterion to other partners in the programs: #2 (Table A.3), and DGF eligibility criterion #2 • At the global level (global mandate and reach, (Table A.4). convening power, mobilizing resources) • At the country level (multi-sector capacity, analytical expertise, country-level knowledge)? Linkages to country operations. To what extent are MD approval criterion #1 there effective and complementary linkages, where (Table A.3) regarding Linkages to needed, between global program activities and the “linkages to the Bank’s country Bank’s country operations, to the mutual benefit of country operational work.” each? operatio ns Oversight. To what extent is the Bank exercising This relates to DGF effective and independent oversight of its eligibility criterion #6 on involvement in the programs, as appropriate, for in- “arm’s length relationship” house and externally managed programs, (Table A.4). respectively. Both questions 17 and 18 together relate to OED’s Bank performance criterion (Table A.2). Disengagement strategy. To what extent is the Bank DGF eligibility criterion #7 facilitating effective, flexible, and transparent (Table A.4). disengagement strategies, as appropriate? 37 Annex A Table A.2. Standard OED Evaluation Criteria Criterion Standard Definitions for Lending Operations Possible Ratings The extent to which the project’s objectives are consistent (1) with High, substantial, modest, the country’s current development priorities and (2) with current negligible. Bank country and sectoral assistance strategies and corporate Relevance goals (expressed in Poverty Reduction Strategy Papers, Country Assistance Strategies, Sector Strategy Papers, Operational Policies). The extent to which the project’s objectives were achieved, or High, substantial, modest, Efficacy expected to be achieved, taking into account their relative negligible. importance. The extent to which the project achieved, or is expected to High, substantial, modest, Efficiency achieve, a return higher than the opportunity cost of capital and negligible. benefits at least cost compared to alternatives. The extent to which the authority exercised by the program is High, substantial, modest, effectively derived from those with a legitimate interest in the negligible. Legitimacy /1 program (including donors, developing and transition countries, clients, and other stakeholders), taking into account their relative importance. The extent to which a project improves the ability of a country or High, substantial, region to make more efficient, equitable and sustainable use of its negligible, modest. human, financial, and natural resources through: (a) better Institutional definition, stability, transparency, enforceability, and predictability development of institutional arrangements and/or (b) better alignment of the impact mission and capacity of an organization with its mandate, which derives from these institutional arrangements. IDI includes both intended and unintended effects of a project. Highly likely, likely, Sustainability The resilience to risk of net benefits flows over time. unlikely, highly unlikely. Highly satisfactory, satisfactory, moderately The extent to which the project’s major relevant objectives were satisfactory, moderately Outcome achieved, or are expected to be achieved, efficiently. unsatisfactory, unsatisfactory, highly unsatisfactory The extent to which services provided by the Bank ensured quality Highly satisfactory, Bank at entry and supported implementation through appropriate satisfactory, unsatisfactory, performance supervision (including ensuring adequate transition arrangements highly unsatisfactory. for regular operation of the project). The extent to which the borrower assumed ownership and Highly satisfactory, Borrower responsibility to ensure quality of preparation and implementation, satisfactory, unsatisfactory, performance and complied with covenants and agreements, toward the highly unsatisfactory. achievement of development objectives and sustainability. /1 This represents an addition to OED’s standard evaluation criteria in the case of global programs, since effective governance of global programs is concerned with legitimacy in the exercise of authority in addition to efficiency in the use of resources. 38 Annex A Table A.3. Selectivity and Oversight of Global Programs Selectivity Criteria for Bank Involvement in Global Public Goods: Endorsed by Development Committee (September 2000) /1 An emerging international consensus that global action is required A clear value added to the Bank’s development objectives The need for Bank action to catalyze other resources and partnerships A significant comparative advantage for the Bank. Approval Criteria for Bank Involvement in Partnership Initiatives Beyond the Country Level: Established by Bank Management (November 2000) /2 A clear linkage to the Bank’s core institutional objectives and, above all, to the Bank’s country operational work A strong case for Bank participation based on comparative advantage A clear assessment of the financial and reputational risks to the Bank and how these will be managed A thorough analysis of the expected level of Bank resources required, both money and time, as well as the contribution of other partners A clear delineation of how the new commitment will be implemented, managed, and assessed A clear plan for communicating with and involving key stakeholders, and for informing and consulting the Executive Directors. Global Public Goods Priorities /3 Corporate Advocacy Priorities /3 Strategic Focus for Oversight Empowerment, security, and social Communicable diseases HIV/AIDS, tuberculosis, malaria and of Global Programs: inclusion childhood communicable diseases, Established by Bank Gender mainstreaming including the relevant link to education Management (March 2003) /4 Civic engagement and participation Vaccines and drug development for major Social risk management (including communicable diseases in developing disaster mitigation) countries Provide global public Investment climate Environmental commons goods Support to both urban and rural Climate change development Water Infrastructure services to support private Forests sector development Biodiversity, ozone depletion and land Support international advocacy Regulatory reform and competition policy degradation for reform agendas which in Financial sector reform Promoting agricultural research a significant way Public sector governance Information and knowledge address policy framework Rule of law (including anti-corruption) Redressing the Digital Divide and conditions relevant for Public administration and civil service equipping countries with the capacity reform (incl. public expenditure developing countries to access knowledge accountability) Understanding development and poverty Access to and administration of justice reduction Are multi-country programs (judicial reform) Trade and integration which crucially depend on Education Market access highly coordinated Education for all, with emphasis on girls’ Intellectual property rights and standards approaches education International financial architecture Building human capacity for the Development of international standards knowledge economy Financial stability (incl. sound public debt Mobilize substantial incremental Health management) resources that can be Access to potable water, clean air and International accounting and legal effectively used for sanitation framework development. Maternal and child health /1 From the Development Committee Communiqué issued on September 25, 2000. Both the Development Committee and Bank Management envisaged global programs as being the principal instrument for Bank involvement in providing global public goods. /2 The Initiating Concept Memorandum in the Partnership Approval and Tracking System (PATS) was initially organized according to these six criteria. /3 These are the five corporate advocacy priorities and the five global public goods priorities (and bulleted sub-categories) from the Strategic Directions Paper for FY02-04, March 28, 2001. Within the Partnership Approval and Tracking System (PATS), global programs are expected to identify, for tracking purposes, their alignment with at least one of these ten corporate priorities. 39 Annex A Table A.4. Eligibility Criteria for Grant Support from the Development Grant Facility Subsidiarity The program contributes to furthering the Bank’s development and resource mobilization objectives in fields basic to its operations, but it does not compete with or substitute for regular Bank instruments. Grants should address new or critical development problems, and should be clearly distinguishable from the Bank’s regular programs. Comparative The Bank has a distinct comparative advantage in being associated with the program; it does not advantage replicate the role of other donors. The relevant operational strengths of the Bank are in economic, policy, sector and project analysis, and management of development activities. In administering grants, the Bank has expertise in donor coordination, fund raising, and fund management. Multi-country The program encompasses multi-country benefits or activities which it would not be efficient, practical benefits or appropriate to undertake at the country level. For example, informational economies of scale are important for research and technology work, and operations to control diseases or address environmental concerns (such as protect fragile ecosystems) might require a regional or global scope to be effective. In the case of grants directed to a single country, the program will encompass capacity-building activities where this is a significant part of the Country Assistance Strategy and cannot be supported by other Bank instruments or by other donors. This will include, in particular, programs funded under the Institutional Development Fund, and programs related to initial post- conflict reconstruction efforts (e.g., in countries or territories emerging from internal strife or instability). Leverage The Bank’s presence provides significant leverage for generating financial support from other donors. Bank involvement should provide assurance to other donors of program effectiveness, as well as sound financial management and administration. Grants should generally not exceed 15 percent of expected funding over the life of Bank funding to a given program, or over the rolling 3-year plan period, whichever is shorter. Where grant programs belong to new areas of activities (involving, e.g., innovations, pilot projects, or seed-capital) some flexibility is allowed for the Bank’s financial leverage to build over time, and the target for the Bank grant not to exceed 15 percent of total expected funding will be pursued after allowing for an initial start-up phase (maximum 3 years). Managerial The grant is normally given to an institution with a record of achievement in the program area and competence financial probity. A new institution may have to be created where no suitable institution exists. The quality of the activities implemented by the recipient institution (existing or new) and the competence of its management are important considerations. Arm’s length The management of the recipient institution is independent of the Bank Group. While quality an arm’s relationship length relationship with the Bank’s regular programs is essential, the Bank may have a role in the governance of the institution through membership in its governing board or oversight committee. In cases of highly innovative or experimental programs, Bank involvement in supporting the recipient to execute the program will be allowed. This will provide the Bank with an opportunity to benefit from the learning experience, and to build operational links to increase its capacity to deliver more efficient services to client countries. Disengage- Programs are expected to have an explicit disengagement strategy. In the proposal, monitorable ment action steps should be outlined indicating milestones and targets for disengagement. The Bank’s strategy withdrawal should cause minimal disruption to an ongoing program or activity. Promoting Programs and activities should promote and reinforce partnerships with key players in the partnerships development arena, e.g., multilateral development banks, UN agencies, foundations, bilateral donors, professional associations, research institutions, private sector corporations, NGOs, and civil society organizations. Source: World Bank, Development Grant Facility documentation. 40 Annex B Annex B. People Consulted World Bank Colin Scott: Sr. Social Development Specialist; Task Manager and Administrator of the PCF Natalia Tassoni Estense: Operations Analyst, PCF Ana Paula Lopes: Knowledge and Monitoring Specialist, PCF Ian Bannon: Manager of the Conflict Prevention and Reconstruction Unit Steve Holtzman: Sr. Social Scientist, one of the initiators of the PCF Paul Hubbard: Manager of the DGF Randall Purcell: Sr. Partnership Specialist, DGF Kazuhide Kuroda: Sr. Knowledge Management Officer, Administrator of the Japanese Post- Conflict Fund Barbara Kafka: Senior Manager, South Asia Region, Member of the Steering Committee Lisa Campeau: Consultant, East Timor team Paul Collier: Director, Development Research Group Steen Jorgensen: Director of Social Development; Head of the PCF Steering Committee Pamphile Kantabaze: Sr. Operations Officer, Bujumbura office Rajna Cemerska-Krtova: Operations Officer, Skopje office Barbry Keller: Operations Analyst, OPCS (LICUS) Peter Miovic: Consultant working on Sudan Joseph Ingram: World Bank Special Representative to Geneva Bilateral Donors Belgium Gino Alzetta: Alternate Executive Director for Austria, Belarus, Belgium, Czech Republic, Hungary, Kazakhstan, Luxembourg, Slovakia, Slovenia, and Turkey Peter M.Y.E. Van der Stoelen: Advisor to Executive Director for Austria, Belarus, Belgium, Czech Republic, Hungary, Kazakhstan, Luxembourg, Slovakia, Slovenia, and Turkey Paul A. Cartier: Attaché Development Cooperation, Embassy of Belgium to the United States Netherlands Gerard P.M.H. Steeghs: Acting Director UN and IFI’s Department, Netherlands Ministry of Foreign Affairs Burundi United National High Commissioner for Refugees (UNHCR) Stefano Severe: Representative Bernard Lambrette: Program Officer Arnaud Royer: Reintegration Officer Marie-Goreth Nahimana: Project Officer Twitezimbere (Social Fund, BURSAP) 41 Annex B Pontien Bikebako: Director of Management Unit Judith Nahayo: Deputy Director Ministry of Reinstallation and Resettlement of Returnees Salvatore Bijojote: General Director Others Jacqueline Kankindi: Ministry of Social Action, Muyinga Karekezi Lazare: Governor of Muyinga Gratien Nzayanga: Advisor to the Governor of Ruyigi Dr. Deogratias Manirakiza: Provincial Health Director, Ruyiga Dieudonne Ntamahangarizo: Communal Administrator, Ruyiga Bernard Civye: Provincial Education Director, Ruyiga Salvator Nkurunziza: Program Coordinator Action Aid, Ruyiga Macedonia Government of Macedonia Kristina Pavlovska: Assistant Head of Department, Ministry of Finance Balsko Smilevski and Renata Burvi: Agency for Sports and Youth Macedonian Organizations Spomenka Lazarevska: Program Coordinator, Open Society Institute Xhane Kreshova: President, Forum of Albanian Women Martha Strackova: Babylon Center in Veles Biljana Stojanovska: Babylon Center in Stip Principals and teachers in two grant-supported primary schools: “26 Juli” and “Braka Ramiz i Hamid” International Organizations Sally Broughton: formerly with Search for Common Ground (now Media Officer with IOM) Elana Misic: Project Officer, UNICEF William Tall: Field Coordinator, UNHCR Aldo Biondi: Correspondent, ECHO (EU) Geneva UNHCR Ruud Lubbers: High Commissioner for Refugees Kolude Doherty: Special Adviser of the High Commissioner Jeff Crisp: Senior Policy Research Officer, Evaluation and Policy Analysis Unit Dominik Bartsch: Senior Policy Officer, Evaluation and Policy Analysis Unit Niels Harild: Chief, Reintegration and Local Settlement Section Arslanbaatar Delgermaa: Associate Economist/Planner, Reintegration, and Local Settlement Section 42 Annex B International Labour Organization (ILO) Eugenia Date-Bah: Director, InFocus Programme on Crisis Response and Reconstruction J. Krishnamurty: Senior Economist, InFocus Programme on Crisis Response and Reconstruction Irma Specht: Socio-economic Reintegration Specialist, InFocus Programme on Crisis Response and Reconstruction 43 Annex C Annex C. The Post-Conflict Fund Grant Application Process Step-by-Step2 1. Bank task manager, with approval of department director and potential recipient, agrees to pursue PCF funding. Task manager contacts PCF secretariat and Bank Legal Department (relevant country or regional lawyer) early in conceptual stage to discuss all aspects of the proposal, from viability to timing and eligibility. 2. Bank task manager, in partnership with proposed recipient, completes grant proposal form with CPRU technical and administrative input. 3. Department director signs grant proposal, confirming that alternative Bank funds are not available, proposal is consistent with Bank's country assistance strategy, and Bank resources will be committed for grant supervision and reporting. If a proposal involves countries in different Bank country management units, regional management approval is needed. This does not apply to global programs, such as applied research programs which are sponsored by relevant Bank thematic departments. 4. Department director forwards proposal to PCF secretariat for technical assessment by PCF secretariat, which may consult other Bank units and independent reviewers. 5. Positively evaluated proposals go for final review to PCF committee chair and/or full committee, which includes representatives of CPRU, Social Development Department, regional vice presidencies, DGF, Legal Department, and other staff and external officials as appropriate. The PCF committee chair or full committee reviews proposal, ensuring that it is consistent with PCF and DGF policies, objectives, guidelines and priorities. It then makes one of three decisions: approval with little or no revision; revision and resubmission; or rejection. 6. Following a grant approval and discussion between Bank task manager and recipient, Bank lawyers draft formal letter of agreement (LOA). After clearance, the LOA is sent to recipient organization for signature. 7. Once Bank receives the signed letter, funds are committed and disbursement is arranged according to the provisions of the LOA. 8. Bank task manager, assisted by recipient, prepares progress and financial reports . in accordance with the provisions in a grant legal agreement. The reports are submitted to the Bank task manager and the PCF Secretariat. 9. Recipient prepares audited financial statements with external auditor's opinion and 2 For more information, see PCF’s website: http://lnweb18.worldbank.org/ESSD/sdvext.nsf/67ByDocName/TheProcessStep-by-Step. 44 Annex C submits them to the Bank in accordance with the provisions in the grant legal agreement. 10. Upon completion of the grant activities, the recipient prepares a grant completion report outlining the achievements of the grant vis-à-vis originally stated objectives, implementation and financial arrangements including any issues or deviations from the original plans/budgets, and submits it to the Bank task manager and the PCF Secretariat. If required in the grant legal agreement, the recipient commissions, after consultations with the Bank and shortly after the completion of the grant activities, an independent grant evaluation which reviews grant's achievements, implementation and financial probity, and elicits lessons learned. Independent grant evaluations are shared among the Bank, grant implementing agency, and a broader audience as appropriate. 45 Annex D Annex D. PCF Grant Implementing Agencies Developing Country Governments International Organizations Afghanistan Interim Authority/ Afghan Assistance Asian Development Bank Coordination Authority International Committee of the Red Cross (ICRC) Commission for Real Property Claims of Displaced International Federation of Red Cross (IFRC) Persons and Refugees, Bosnia & Herzegovina International Labor Organization (ILO) International Organization for Migration (IOM) Commission for National Reconciliation, Tajikistan Food and Agriculture Organization (FAO) East Timor Transitional Administration Organization of American States (OAS) Government of Albania Pan-American Health Organization (PAHO) Government of Burundi UNICEF Government of Cambodia UNFPA Government of Côte d’Ivoire UNDP Government of Democratic Republic of Congo UNDPKO Government of Eritrea UNHCR Government of Indonesia UNMIK - UN Interim Administration in Kosovo Government of Liberia UNOPS Government of Macedonia United Nations Mission in Congo (MONUC) Government of Philippines UN Economic and Social Commission for Western Asia Government of Republic of Congo (ESCWA) Government of Republic of Georgia World Links Organization Government of Sierra Leone Government of South Africa Government of Timor Leste Peru-Ecuador: Binational Commission for the Development of the Frontier 46 Annex D Universities and Think-Tanks NGOs, CSOs and Foundations Brookdale Institute ACTIONAID Cambodia Development Resource Institute (CDRI) Action Contre La Faim Harvard Program Refugee Trauma Aceh NGO Forum, Indonesia Kenya Institute of Public Policy Research and Analysis Atlas Logistique Notre Dame University Arias Foundation for Peace and Human Progress NYU Center for International Cooperation Arch Diocese of Las Verapaces, Guatemala Oxford University (Center for the Study of African Australian Volunteers International Economies) African Women Alliance for Mobilizing Action Peace Research Institute of Norway (PRIO) BHB Assist. Foundation (Soros Kosovo Foundation for Princeton University Open Society) Stanford University Bonn International Center for Conversion University of California at San Diego Catholic Relief Services (CRS) University of Dallas CARE Yale University Center for Conflict Resolution, South Africa Woodrow Wilson Center Center for Liberal-Democratic Studies, FR Yugoslavia Centro de Estudios Internacionales, Nicaragua Donor Development Agencies AWEPA- European Parliamentarians for Africa Collaborative for Development Action Deutsche Gesellschaft fur Technische Zuzammenarbeit Comunità di Sant'Egidio, Italy (GTZ) Community and Family Services International (CFSI) Agence Française de Développement (AFD) Counterpart International Canadian Centre for International Studies & Curriculum Corporation Cooperation (CECI) Economic Cooperation Foundation Swiss Development Cooperation (SDC) Friends of Bosnia Fondation pour l’Unité, la Paix et la Démocratie, Burundi Gisplan, Croatia Groupe de Recherches et d’Echanges Technologiques (GRET) Humanitarian Affairs Review Journal Indonesian National Commission on Violence Against Women Institut d'Economie Industrielle (IDEI) Iraqi Widows Organization Knitting Together Nations, Sarajevo Media Action International Oxfam Panos Institute, Washington DC Pan American Development Foundation (PADF) Red de Solidaridad Social (RSS), Colombia Save the Children Self Reliance Fund, Republic of Georgia Swedish Committee for Afghanistan (SCA) Synergies Africa Transcultural Psychosocial Organisation