38914 Capacity Development BRIEFS S H A R I N G K N O W L E D G E A N D L E S S O N S L E A R N E D THE TRANSPORT SECTOR: A LABORATORY FOR GOOD PRACTICES IN CAPACITY DEVELOPMENT? By Deborah Davis1 As articulated in the Paris Declaration on Aid Effectiveness (2005), country capacity is at the core of sustainable development. The concepts of capacity and capacity development (CD) are so all-encom- passing, however, that practitioners have often found it difficult to make operational sense of them. According to the Development Assistance Committee of the Organisation for Economic Development and Cooperation (OECD/DAC),2 practitioners should begin by asking "capacity for what?" and focus on the specific capacities needed to reach well-defined goals, while keeping in mind several basic principles: (a) capacity development is a long-term process and requires a long-term view, (b) it must be country led, (c) donors should coordinate their CD support activities, (d) good diagnostics should inform the program design, and (e) learning activities must be comprehensive; that is, in addition to enhancing the capacity of individuals and organizations, CD should on the institutional level also help develop the capacity for good governance. This brief looks at how three ongoing World Bank projects in the transport sector worked to put these ideas into practice. Within very different country contexts, all incorporate three or more of these core prin- ciples. All are country led and based on good diagnostics; all are being carried out in a five-year period with ample time and budget for capacity development; all focus on developing capacity simultaneously at the individual, organizational, and institutional levels; and all use local expertise, including private sector expertise, wherever possible. The three initiatives also reflect ongoing learning and the willingness of both donors and government to stay engaged with the process under difficult circumstances. When it comes to capacity development, the trans- transport sector can be seen as a laboratory for the port sector provides an interesting microcosm in creation of effective approaches to capacity develop- which good practices can be readily tested. There are ment that have measurable results. several reasons for this. First, donors are willing to This brief looks at three good practice initiatives fund capacity development in the sector, because the in the sector that are currently being implemented quality of transport has been identified as one of the and, therefore, can be studied on the ground. All are most important factors underpinning economic and being carried out in a five-year period with ample social development. Second, capacity development time for capacity development built into the design; needs in the sector are well understood, and recog- all have a comprehensive approach to developing nized standards of practice can be applied across projects, countries, and regions. Third, capacity development outputs in the transport sector--kilo- 1Deborah Davis is a social development specialist and consul- meters of roads improved and maintained--are tant for the World Bank Institute. much easier to measure than in many other sectors, 2The Challenge of Capacity Development: Working toward including public, financial, education, and health Good Practice. DAC Network on Governance, OECD/DAC, docu- and in governance reform. For these reasons, the ment number JT00200369, February 2006. OCTOBER 2006 NUMBER 18 emphasis from expanding the rural roads network to Box 1. Design Differences between RT1/RT2 deepening its impact through progressive decentral- and RT 3 ization of road network management and progressive · Implementation was handled by a stand-alone project imple- reduction in central oversight as provincial capacity mentation unit. RT3 will use existing institutional structures. · Technical design standards were insufficiently flexible to develops. To that end, the project includes a compre- accommodate different road conditions (terrain, rainfall, and hensive capacity development program that addresses traffic loading). RT3 will support the Ministry of Transport in a range of capacity issues throughout the sector and developing a wider range of technical and economically viable rural road standards and pavement designs. at all levels of government. · Maintenance focused on maintenance agreements for individ- Capacity development is a major focus of two of ual roads. RT3 will support an overall road maintenance plan the project's three components: for each province and develop the capacity of the provinces to undertake these activities effectively. · Procurement was characterized by collusion among bidders. · Component A finances the rehabilitation and RT3 will develop the capacity of the Ministry of Transport and improvement of about 3,100 km of the core provinces to ensure that bidding is more transparent, carry out integrated ex-post reviews of procurement, and increase rural road network (district, commune, and vil- community participation. lage roads) in 33 of the country's 64 provinces, · Community participation was shown by studies under the focusing on developing cost-effective, coherent earlier projects to be important for improved planning, increased transparency in procurement, monitoring the qual- networks with maximum connectivity. ity of works, and subsequent maintenance activities. RT3 will · Component B develops district-level capacity to support a consultancy to facilitate community participation in create maintenance plans and implement and local decisionmaking. manage simple systems for collection of road data. The project will support capacity develop- ment of these systems in ten pilot provinces that are already using decentralized implementation capacity simultaneously at the institutional, orga- of transport projects. The Ministry of Transport nizational, and individual levels; and all devote a will use lessons from the pilots to compile significant portion of their budget to this purpose. national guidelines for managing the mainte- The Vietnam Third Rural Transport Project focuses nance of rural roads. on progressive decentralization of road network · Component C is a comprehensive capacity devel- management and devotes $14 million of its $173 opment framework designed to support institu- budget (8.3 percent) to capacity development. The tion strengthening, organizational effectiveness, Ghana Road Sector Development Program empha- and individual skills development in the sector. sizes comprehensive training of all sector actors, including private contractors, and has spent $115.4 million of its $1,191 million budget (10.3 percent) The project recognizes that some provinces require on capacity development. And the Lao PDR Road little oversight, while others still rely heavily on Maintenance Program, which uses an integrated guidance and support from the center. Provinces are framework to address simultaneously the individual, judged to have the capacity for decentralized imple- organizational, and institutional issues that affect mentation based on their performance in planning national transport capacity, is devoting $10.1 million and management, rehabilitation of works, and main- of its $70 million budget (14.3 percent) to capacity tenance planning and management. Those wishing to development. progress toward decentralized implementation must The capacity development aspects of each project score at least 65 of a possible 100 points on their or program are described briefly below. annual performance evaluations and must also show satisfactory performance in procurement, as judged by Vietnam: Third Rural Transport Project World Bank ex post reviews, and in financial manage- (2006­10) ment, as judged by a separate capacity assessment. Provinces that show progress in their evaluations Vietnam's first and second rural transport projects are also rewarded, at mid-term review, with additional (RT1 and RT2) contributed to poverty alleviation in allocations of civil works funds. Provinces that show remote rural areas by increasing access of the rural no improvement are not eligible for these allocations. poor to schools, clinics, and markets; however, they did little to develop government's capacity to manage Constraints to Fully Decentralized the road network. The lessons from these projects Implementation (box 1) led to a redesign for the Third Rural Transport Project (RT3), to be carried out in the next five years. The capacity development program will also sup- The new design reflects the Government's shift in port progress toward full decentralization, includ- OCTOBER 2006 NUMBER 18 ing (a) mingling of funds from the International ment budget was overloaded with large projects with Development Association (IDA) and other donors, undefined targets. As a result, HIP failed to improve such as the United Kingdom's Department for a large percentage of the road network and left a International Development (DFID), with the state backlog of unfinished road maintenance. budget and (b) use of government systems for pro- RSDP is intended to increase the credibility of road curement, social safeguards, and all elements of sector programs by (a) clearing the backlog on road financial management. The program will do so by maintenance, which will halt further deterioration developing the capacity of government systems for and bring more roads up to usable standard, and procurement, financial management, and environ- (b) improving the capacity of the public and private mental and social safeguards, as well as provincial sectors for effective, efficient, and sustainable man- reporting requirements and a prioritized medium- agement of the network. To this end, the program term expenditure framework for the sector. As the addresses capacity development needs in virtually all project progresses, annual assessments will be aspects of sector operations. undertaken to determine whether local circumstances are appropriate for the better-performing provinces to · In institutional development, RSDP includes move to the use of government systems. The number extensive capacity development for a number of provinces judged capable of using government of relevant agencies, including the Ministry of systems for procurement, financial management, and Roads and Transport, Department of Feeder safeguards will be an indicator of successful capacity Roads, Department of Urban Roads, and Ghana building. Highway Authority. · In organizational development, the program puts Ghana: Road Sector Development Program in place structures and systems that will be sus- (2002­07) tainable, dynamic, and more responsive to the Following a study that identified the road sec- mission and objectives of the sector. tor in Ghana as the single most important catalyst · In human resource development, the program is for economic growth and social development, the implementing training programs geared toward Government formulated a comprehensive set of poli- helping individuals develop needed skills. cies and objectives for the sector through a country- · In private sector contracting, RSDP addresses the led process (box 2). As the key vehicle for achiev- generally low capacity of local contractors by pro- ing these objectives, the Road Sector Development viding continuous training for contractors' person- Programme (RSDP), funded by multiple donors, is nel in contract management and professional and taking an integrated approach to road maintenance, technical skills. To date, 413 individuals in 380 construction, and management. firms have benefited from the training. RSDP's design reflects the lessons of the earlier · In expenditure control, cabinet-level government Highway Investment Project (HIP) (1998­2003), officials received technical assistance in reviewing including lack of capacity to link available resources the performance of contractors and, where neces- with Government priorities or assess the affordability sary, negotiating the termination of contracts. of certain sectoral objectives. HIP also placed undue emphasis on input control, rather than improving Future Work under RSDP the performance of the sector, even while the invest- In preparation for a follow-up program, the trans- port sector agencies with the support of development partners are now carrying out the following studies: Box 2. Ghana's Policies and Objectives for the preparation of a national transport policy, review of Road Sector the local construction industry, institutional reform of · Develop in-country capacity for government institutions and the transport sector, with a focus on the road subsec- the private sector to coordinate and manage the road network tor, and baseline studies to enable monitoring of the effectively. impact of RSDP roads on poverty reduction. · Ensure that investment decisions are based on sound socio- economic and environmental principles. · Increase operational efficiency to create an enabling environ- Lao People's Democratic Republic: Road ment for economic growth and social service provision. Maintenance Program (2004­09) · Integrate the road network with other modes of transport to achieve an efficient and pro-poor transport system. The Road Maintenance Program (RMP) is work- · Mitigate the negative impacts, both environmental and social, of road-related activities. ing with the Ministry of Communications, Transport, Post, and Construction (MCTPC) to establish an integrated road management system that covers all aspects of the road planning process; develops the Box 3. Donor Coordination for Capacity skills of staff to manage project preparation, execu- Development tion, and monitoring; and elaborates a strategy The Lao Transport Development Partnership is intended to to improve the performance of the local contract- improve overall capacity development outcomes by providing ing and consulting industry. In addition, because a mechanism for donors to coordinate their capacity develop- ment efforts in the sector. When one donor's intervention the three main donors in the sector--the Swedish targets capacity development exclusively at a particular level International Development Cooperation Agency (individual, organizational, or sectoral/institutional), that (SIDA), Asian Development Bank (ADB), and IDA-- donor confers with the other development partners to find support for related capacity development interventions at the consider capacity building to be essential for the other levels. Donors are coordinating in the areas of supervi- success of the program, these donors have formed sion, procurement, financial and technical audit, evaluation of a partnership, the Lao Transport Development state-owned enterprises, development of the environmental and social division of the Department of Roads, and creation Partnership (LTDP) to harmonize their approach of an integrated planning and reporting system. through an integrated framework that simultane- ously addresses the individual, organizational, and institutional/sectoral issues that affect national environments. The partnership aims to develop transport capacity. an optimal mix of technology, skills upgrading, The key elements of the capacity development and reorganization of the ministry at the central framework highlight the interlinked nature of the and provincial levels to improve decisionmaking three levels of national transport capacity. The and implementation capacity. SIDA is reviewing framework provides for the following: the sector's rural transport policy under its Rural Roads Improvement Project, and ADB is help- · Individual skills development. Skills and compe- ing to develop capacity pertaining to road safety tencies of individual sector participants in state improvements under its road safety projects. and non-state entities are low in terms of both · Creation of an enabling environment at the insti- core technical skills and critical corporate skills tutional and sectoral levels. The lack of an inte- such as financial management, procurement, grated transport policy and the inability of agency and basic functional communication. Donors are staff to formulate policy is a key problem. LTDP in the process of developing a harmonized mul- will address these gaps and seek to reduce depen- tiyear integrated human resource training plan dence on expatriates. To this end, consultancies for the sector. Substantial work is still needed, are being procured in the areas of macro policy, however, regarding establishing baseline data on sector policy, and laws and regulations. core and support competencies to measure the progress of skills development. · Organizational capacity development. Lao trans- Peer reviewed by Maria Margarita Nunez, port entities are not equipped with the modern senior transport specialist in the World Bank's business processes, applications, hardware, or East Asia and Pacific Region, and by Natalia technical capacity required to enhance productiv- Agapitova, program officer in the Capacity ity and decisionmaking in state and non-state Development Unit of the World Bank Institute. About World Bank Institute (WBI): Unleashing the Power of Knowledge to Enable a World Free of Poverty WBI helps people, institutions, and countries to diagnose problems that keep communities poor, to make informed choices to solve those problems, and to share what they learn with others. Through traditional and distance learn- ing methods, WBI and its partners in many countries deliver knowledge-based options to policymakers, technical experts, business and community leaders, and civil society stakeholders; fostering analytical and networking skills to help them make sound decisions, design effective socioeconomic policies and programs, and unleash the produc- tive potential of their societies. WBI Contact: Mark Nelson; Program Manager, Capacity Development Resource Center Tel: 202-458-8041, Email: mnelson1@worldbank.org Visit our website for more information and download the electronic copies of all Capacity Development Briefs: http://www.worldbank.org/capacity OCTOBER 2006 NUMBER 18