The World Bank Serbia - Public Sector Rightsizing and Restructuring (P158875) REPORT NO.: RES33101 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF SERBIA - PUBLIC SECTOR RIGHTSIZING AND RESTRUCTURING APPROVED ON APRIL 21, 2016 TO REPUBLIC OF SERBIA GOVERNANCE EUROPE AND CENTRAL ASIA Regional Vice President: Cyril E Muller Country Director: Linda Van Gelder Senior Global Practice Director: Deborah L. Wetzel Practice Manager/Manager: Roberto Adrian Senderowitsch Task Team Leader: Srdjan Svircev The World Bank Serbia - Public Sector Rightsizing and Restructuring (P158875) ABBREVIATIONS AND ACRONYMS AA Administrative Agreement CMST Change Management Support Team EUD European Union Delegation GoS Government of Serbia MPALSG Ministry of Public Administration and Local Self-Government RETF Recipient Executed Trust Fund The World Bank Serbia - Public Sector Rightsizing and Restructuring (P158875) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P158875 Investment Project Financing Original EA Category Current EA Category Not Required (C) Not Required (C) Approval Date Current Closing Date 21-Apr-2016 30-Jun-2018 Organizations Borrower Responsible Agency Ministry for Public Administration and Local Self- Ministry of Finance Government Project Development Objective (PDO) Original PDO The objective of the Trust Fund is to assist the Republic of Serbia in improving the organizational and functional structures of its public administration system in accordance with the Strategy for Public Administration Reform. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing Net TF Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed TF-A2475 20-Sep-2016 22-Sep-2016 22-Sep-2016 30-Jun-2018 .67 .39 .25 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Serbia - Public Sector Rightsizing and Restructuring (P158875) Note to Task Teams: End of system generated content, document is editable from here. I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING 1. This Recipient Executed Trust Fund (RETF) is part of the Serbia Rightsizing and Restructuring Project, funded by the EU Delegation (EUD) in Belgrade. The Administrative Agreement (AA) for the Project was signed on December 29, 2015 and the project was effective immediately following signing of the Administrative Agreement. The World Bank (WB) and the EUD in Serbia created a Single Donor Trust Fund to respond to the Government of Serbia (GoS) priorities for rightsizing and restructuring of public sector. The purpose of the Trust Fund is twofold: 1) through the Bank Executed Trust Fund, for which the World Bank is responsible, to inform policy decisions for targeted rightsizing through a series of functional reviews, and 2) through Recipient Executed Trust Fund, for which the Ministry of Public Administration and Local Self Government (MPALSG) is responsible, creation of the Change Management Support Team (CMST) within the MPALSG tasked to support implementation of recommendations from functional reviews. 2. The Grant Agreement with the GoS was signed on September 20, 2016. Due to the parliamentary elections in Serbia, signing of the GA and effectiveness of the RETF was delayed for more than 9 months. 3. Following the signing of the GA, the MPALSG established a CMST which is funded by the project and is tasked to support implementation of recommendations coming from the Bank’s analytical work on rightsizing and restructuring of public sector in Serbia. 4. Performance with the project activities has been mixed. After a slow start with the implementation of activities envisaged under the RETF, project implementation is progressing well and is on track. The CMST at the MPALSG has been established, 2 Action Plans have been developed and 2 strategy documents (Communication Strategy and Change Management Strategy) are in the final draft. The engagement with implementation of recommendations from functional reviews in education and health sectors has accelerated and CMST is finalizing Action Plans for implementation of recommendations. Given that it will take more time to finalize these documents, and to support implementation of a selected set of recommendations, the MPALSG has requested a no-cost extension of the RETF. 5. Financial management is adequate and there are no overdue and qualified audit reports. No cancelation of funds in envisaged. The current disbursement is USD $ 0.39 m and undisbursed balance is USD $ 0.25 m. 6. Following an extension of the project all project activities are expected to be completed by new end of the project date, June 30. 2019. The Bank team will provide additional support if needed to further support project implementation. II. DESCRIPTION OF PROPOSED CHANGES The World Bank Serbia - Public Sector Rightsizing and Restructuring (P158875) 1. The proposed restructuring is based on a request from the GoS and MPALSG for a no-cost extension of the project. In line with proposed restructuring overall cost structure and components of the project will not change. 2. The restructuring includes the following: a. Extension of the project closing date The new project closing date is June 30, 2019. This extension will ensure that all measures from the Action Plans are implemented and will also ensure continuous support of the CMST to the MPALSG and other participating departments in areas where such assistance has been identified as necessary. b. Modification to the implementation schedule Modifications to the implementation schedule will allow for completion of planned activities and envisaged measures. No additional funds are required for completion of the project activities. c. Modification to the result framework There is no change to the previously agreed project indicators and proposed modification relate to end target dates. Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. III. SUMMARY OF CHANGES Changed Not Changed Change in Results Framework ✔ Change in Loan Closing Date(s) ✔ Change in Implementation Schedule ✔ Change in Implementing Agency ✔ Change in Project's Development Objectives ✔ Change in Components and Cost ✔ Cancellations Proposed ✔ Additional Financing Proposed ✔ Reallocation between Disbursement Categories ✔ Change in Disbursements Arrangements ✔ The World Bank Serbia - Public Sector Rightsizing and Restructuring (P158875) Change in Disbursement Estimates ✔ Change in Overall Risk Rating ✔ Change in Safeguard Policies Triggered ✔ Change of EA category ✔ Change in Legal Covenants ✔ Change in Institutional Arrangements ✔ Change in Financial Management ✔ Change in Procurement ✔ Other Change(s) ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_RESULTS_TABLE RESULTS FRAMEWORK Project Development Objective Indicators PDO_IND_TABLE Change Management Support team established at the MPALSG Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Value No Yes Yes No Change Date 15-May-2016 14-Jun-2017 02-May-2018 Change Management and Communication Strategy developed and implemented Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Value No No Yes Revised Date 01-Jun-2016 14-Jun-2017 17-Dec-2018 Develop Roadmaps for implementation of recommendations form functional reviews Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action The World Bank Serbia - Public Sector Rightsizing and Restructuring (P158875) Value 0.00 0.00 4.00 Revised Date 01-Jun-2016 14-Jun-2017 31-May-2019 Intermediate Indicators IO_IND_TABLE Number of training for participation in functional reviews Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 0.00 9.00 No Change Date 03-May-2016 14-Jun-2017 02-May-2018 OPS_DETAILEDCHANGES_LOANCLOSING_TABLE LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline TF Status Closing Closing(s) Closing for Withdrawal Applications TF-A2475 Effective 30-Jun-2018 30-Jun-2019 30-Oct-2019 Note to Task Teams: End of system generated content, document is editable from here.