42687 Japan Social Development Fund Annual Report Fiscal Year 2006 Cover photo by Michael Foley. CONCESSIONAL FINANCE AND GLOBAL PARTNERSHIPS THE WORLD BANK THE GOVERNMENT OF JAPAN Washington, DC THE WORLD BANK Concessional Finance and Global Partnerships THE GOVERNMENT OF JAPAN Japan Social Development Fund Annual Report Fiscal Year 2006 THE WORLD BANK Concessional Finance and Global Partnerships THE GOVERNMENT OF JAPAN Message from the Chair of the JSDF Steering Committee Photo by Michael Foley. T he Japan Social Development Fund (JSDF) has been in operation for six years. Over this period the Government of Japan has generously contributed $320 million to the Fund. Over 200 grants have been approved using the Fund’s resources. JSDF is now building an enviable reputation as one of the most effective investments available to the World Bank in supporting innovative approaches to delivering direct benefits to disadvantaged groups in developing countries. The core of the JSDF is its “regular program”, which supports both project and capacity-building grants, working wherever possible with local governments, non-government organizations (NGOs) or civil society organizations (CSOs). Many of these grants support highly innovative approaches to social development, ranging from support to groups of widows in Indonesia to promotion of hand-washing with soap in Senegal and from early childhood development initia- tives in Mali to promoting educational access to handicapped children in Cambodia.This pro- gram offers development professionals who come across innovative ideas to pilot these outside the framework of conventional World Bank-financed operations. The first generation JSDF projects are now complete, and this report, for the first time, includes reports on the projects that reached completion in FY06. It is impressive to see that, of the grants reviewed, 90 percent were ranked as “Successful” or “Highly Successful” and that in 14 out of 16 grants sustainability was ranked as “Probable”, “Very likely” or “Certain”. One of the great strengths of JSDF is its flexibility. Since its inception in 2000 JSDF has added four additional components.The creation of seed fund grants was agreed in 2002, and these are now frequently used to facilitate consultation with isolated or marginalized groups of potential beneficiaries. Also in 2002, a special JSDF Afghanistan window was created, and this is now a major feature of JSDF, with nine approved grants and $52 million allocated to the window. In December 2004, following the disastrous tsunami in the Indian Ocean, the Government of Japan approved an allocation from JSDF for post-tsunami reconstruction projects. Twelve grants benefiting five of the countries hit by the tsunami have been approved, and I myself had an opportunity to see the impact that two of these grants are having when I visited Aceh in June 2006. One was assisting young people in the town of Aceh to re-establish a community com- mitment through development of community radio stations, while another had assisted widows in a fishing village in reconstruction of their devastated homes and enterprises. During FY06 the Government of Japan approved a further innovative use of JSDF resources, to help those disabled following the Pakistan earthquake of October 8, 2005. Four grants have been approved, totaling over $6.5 million. iii The four Pakistan earthquake grants all involve implementation by NGOs.The substantial use of NGOs as implementing agencies is one of the distinguishing features of JSDF. Of the 21 grants approved in FY06, 13 involved NGOs or CSOs as implementing agencies. There is now a substantial body of experience from JSDF projects, and it is appropriate to look at experience and lessons learned from experience to date. With support from the Govern- ment of Japan an independent program evaluation has been commissioned, and during FY07 the results of this evaluation and other evidence of progress to date, including the material in this annual report, will be used as the basis to review the program. It is already widely recognized that the Japan Social Development Fund is making a unique contribution to the welfare of marginalized and disadvantaged groups. On behalf of the World Bank, I and the JSDF Steering Committee members are most grateful to the Government of Japan for their continued strong support to the program. Arif Zulfiqar Director,Trust Fund Operations, and Chair, JSDF Steering Committee iv Contents Message from the Chair of the JSDF Steering Committee ii Abbreviations vii Chapter 1: Introduction and Overview 1 JSDF Origins and Objectives 1 The Five JSDF Programs 2 FY06 Program Highlights 3 Chapter 2: JSDF, FY01 to FY06 4 The Overall JSDF Program 4 The JSDF Regular Program 5 The JSDF Seed Fund 8 The Pakistan Earthquake Grants 9 The Special Program for Afghanistan 12 The Post-Tsunami Recovery Grants 12 Chapter 3: The JSDF Simplification Process 13 Chapter 4: JSDF Program Progress and Impact 15 Grant Quality Review and Approval Process 15 Grant Implementation and Reporting 15 JSDF Grants in Action 16 Impact of the JSDF Seed Fund 28 Working with Civil Society 29 Chapter 5: Review of JSDF Completed Grants 31 Chapter 6: JSDF Administration and Communication 34 Communication Processes 34 Further Information on JSDF 34 Annex 1: JSDF Project and Capacity Building Grants Approved in FY06 35 Annex 2: FY01–FY06 Regional Distribution of JSDF Grants 37 Annex 3: JSDF Seed Grants Approved in FY06 38 Annex 4: Special Program for Pakistan Earthquake Approved in FY06 39 v Annex 5: Special Window for Afghanistan Approved in FY06 40 Annex 6: JSDF Post-Tsunami Recovery Grants Approved in FY06 41 Annex 7: List of Grants Completed in FY06 42 Annex 8: FY07 Annual Policy Document 45 LIST OF FIGURES Figure 1: Contributions, Allocations and Disbursements, FY01 to FY06 2 Figure 2: Number of JSDF Grants by Year and Type, FY01 to FY06 4 Figure 3: JSDF Grants by Value and Type, FY01 to FY06 5 Figure 4: Number of Regular Program Grants by Type, FY01 to FY06 6 Figure 5: FY06 Regional Distribution of Regular Program Grants, by Value 6 Figure 6: FY06 Sectoral Distribution of Regular Program Grants, by Value 7 Figure 7: Afghanistan Rural Infrastructure Sub-Projects 18 LIST OF BOXES Box 1: Expected Features of JSDF Projects 1 Box 2: Pakistan: Promoting Independent Living Among Persons with Disabilities 10 Box 3: Pakistan: Community-Based Rehabilitation (CBR) of Persons with Disabilities 11 Box 4: Afghanistan: National Solidarity Project 16 Box 5: Ecuador: Law and Justice for the Poor 21 Box 6: Local Governance and Civic Engagement in Rural Russia 23 LIST OF TABLES Table 1: List of Featured Projects 16 Table 2: Implementation Progress in JSDF Target Areas as of August 2006 18 Table 3: FY06 Approved Grant Proposals by Recipient 29 Table 4: FY06 Approved Grant Proposals by Implementing Agency 30 vi Abbreviations ADR Alternative Dispute Resolution AFR Africa Region CBOs Community Based Organizations CBR Community-Based Rehabilitation CDCs Community Development Councils CDD Community Driven Development CN Concept Note CSOs Civil Society Organizations EAP East Asia and the Pacific ECA Eastern Europe and Central Asia ERR Economic Rates of Return FY Financial Year GRM Grant Reporting and Monitoring ILCs Independent Living Centers ILP Independent Living Program GoJ Government of Japan JSDF Japan Social Development Fund LAC Latin America and Caribbean Region MNA Middle East and North Africa MICs Middle-income Countries NGOs Non Governmental Organizations NSP National Solidarity Program PCP Peer Counseling Program PHC Primary Health Care SAR South Asia Region SC Steering Committee TFO Trust Fund Operations TTLs Task Team Leaders vii Chapter 1 Introduction and Overview JSDF ORIGINS AND OBJECTIVES The JSDF was established in June 2000 by the Government of Japan and the World Bank. The Fund was initially estab- lished in response to the devastating impact of the East Asian financial crisis in the late 1990s. It has subsequently expanded to become a leading source of support for innova- tive approaches to providing direct support to the most disadvantaged groups in Developing Countries. The agreed objective of the JSDF is: to provide grants in support of innovative social programs to help alleviate poverty in eligible client countries of the World Bank Group In order to achieve this objective, JSDF supports Developing Country central and local governments, NGOs and CSOs in a wide variety of projects. All these projects are expected to meet certain fundamental criteria (see Box 1). Box 1 Expected Features of JSDF Projects JSDF projects are expected to: • Be innovative – introducing new approaches or ideas to development. Some may be entirely new innovations, others may involve introducing ideas that are new to the country in question, but have had success elsewhere; • Directly respond to the needs of marginalized, vulnerable or disadvantaged groups. Marginalization may be a function of location, gender, age, ethnicity, physical fitness . . .; • Provide reasonably rapid, demonstrable and sustainable benefits. JSDF will not support projects that will take many years to deliver benefits to the target population; • Build capacity of local governments, NGOs and CSOs, empower the members of disadvantaged groups, and promote stakeholder participation in project activities. 1 Figure 1: Contributions, Allocations and Disbursements, FY01 to FY06 100,000 Contributions Allocations Disbursements 90,000 80,000 70,000 60,000 US$ ’000 50,000 40,000 30,000 20,000 10,000 0 FY01 FY02 FY03 FY04 FY05 FY06 The Government of Japan had provided $320m to the JSDF Fund by the end of FY06. Since the start of the program 215 grants have been approved, with a total value of $227m. As Fig- ure 1 shows, the overall JSDF program has expanded slowly but steadily over the past six years. Disbursements were slow in the early years, but exceeded $35m in FY06. However, new pro- gram allocations were close to the FY03 levels at $34m. In FY06, following the earthquake in Pakistan, the Government of Japan generously provided grants through JSDF to assist the country in its reconstruction efforts. Furthermore, it continued to provide assistance to the countries recovering from the 2004 tsunami and also provided additional funding for capacity building in Afghanistan. THE FIVE JSDF PROGRAMS There are five different categories of JSDF grants: • Regular program grants, which finance either project or capacity building grants aimed at introducing innovative programs which provide direct benefits to disadvantaged communities; • Seed fund grants.These are small grants provided to help in preparation of proposals for reg- ular program grants, and particularly to provide resources to permit consultations to take place with proposed beneficiary groups, who may be remotely located or widely dispersed; • Special grants to support a range of development and capacity building activities in Afghanistan; 2 • Special grants to support recovery measures following the tsunami which struck on 26th December 2004; and • Special grants for rehabilitating and revitalizing areas affected by the earthquake which hit Pakistan in October 2005. FY06 PROGRAM HIGHLIGHTS In FY06, 11 projects totaling $15.2m were approved under the regular program, of which seven were for projects and four for capacity building. Also, Pakistan was granted $6.5m to assist the earthquake victims in reconstruction activities (a total of four projects). In addition,Afghanistan received $15m in support of activities of the National Solidarity Program. Furthermore, the tsunami victims received an additional $6m largely to support four projects in the context of the rehabilitation of their fisheries sectors. With the closure of a large number of grants awarded during the period of 2000–2002, an evaluation of the JSDF program was initiated. Broadly, its objectives were to: • Review the progress and development impact to date of the JSDF; • Assess the achievements of the JSDF as a whole and of selected grants, in the light of the Fund’s objectives; and • Make recommendations on ways in which the Fund might better achieve its objectives in the future. The evaluation team is due to report on its conclusions in December 2006. 3 Chapter 2 JSDF, FY01 to FY06 THE OVERALL JSDF PROGRAM Figures 2 and 3 show how the JSDF program has expanded steadily since FY01, in scale and in scope. Figure 2 shows that the number of approved JSDF grants was between 26 and 31 in FY01 and FY02, increased to 40 a year in FY03 and FY04, exceeded 50 in FY05, but decreased to 26 in FY06. The fall in FY06 is attributable to a combination of decrease in the submission of regular proposals and reduced demand for seed funding. Figure 3 shows that when the grants are viewed from a “value” perspective the picture changes.1 Regular program grants started at a level of over $30m in FY01, fell signifi- cantly in FY02 and FY03, recovered their FY01 level Figure 2: Number of JSDF Grants by Year and Type, FY01 to FY06 60 Pakistan Seed Fund Post-Tsunami Afghanistan 50 Regular Program 40 Number of grants 30 20 10 0 FY01 FY02 FY03 FY04 FY05 FY06 1 It will be noted that the data on grants approved in Figure 3 differs slightly from the data on “allocations” in Figure 1. Grants approved (Figure 3) are recorded in the year in which approval is received from Japan. Allocations are recorded subsequently by Accounts and sometimes a grant approved in June is not recorded as an allocation until July – in the following financial year. 4 Figure 3: JSDF Grants by Value and Type, FY01 to FY06 70,000 Pakistan Seed Fund Post-Tsunami Afghanistan 60,000 Regular Program 50,000 40,000 US$ ’000 30,000 20,000 10,000 0 FY01 FY02 FY03 FY04 FY05 FY06 in FY04 and increased sharply in FY05, to over $40m.The special grants to Afghanistan, while small in number, are very significant in value terms, accounting for much of the increase in FY04 and remaining significant in FY05 and FY06. The post-tsunami grants were half their FY05 levels in FY06, but together with the emergency grants in support of the reconstruction program in Pakistan reached the FY05 level. THE JSDF REGULAR PROGRAM There are two main types of JSDF regular program grants: • Project grants that support either activities providing direct relief measures to poorer popu- lation groups or innovation and testing of new approaches, particularly in the social sectors. Project grants often use the Community Driven Development (CDD) approach which fos- ters local participation in the community’s development. A JSDF grant may finance a stand- alone project, or pilot activities which may be replicated on a larger scale with World Bank Group or other financing. • Capacity building grants which finance capacity strengthening and building activities, espe- cially for NGOs, CSOs and local governments. The grants may be used to strengthen local communities, local governments, local institutions and/or NGOs, promote collaboration between local governments and communities and improve decision-making and accountabil- ity of local communities. Both project and capacity building grants are available to low and lower middle-income coun- tries as defined in the 2005 World Development Report. 5 Figure 4: Number of Regular Program Grants by Type, FY01 to FY06 30 Project Capacity building 25 20 15 10 5 0 FY01 FY02 FY03 FY04 FY05 FY06 Figure 4 shows the distribution of grants between the two categories since FY01. FY06 has seen a sharp decrease in both project and capacity building grants, with a sharper decrease in project grants. The JSDF agreement specifies that “approximately 50 percent of total JSDF funds should go to eligible countries in East, South and Central Asia” (see Annex 8). Figure 5 and Annex 1 show Figure 5: FY06 Regional Distribution of Regular Program Grants, by Value SAR $1.4m, 9% AFR $4.1m, 27% LAC $2.9m, 19% ECA $3.8m, EAP $3.0m, 25% 20% 6 Figure 6: FY06 Sectoral Distribution of Regular Program Grants, by Value Multi-sector: Social Protection Agriculture, Fishing and Forestry, and Risk Management, 21% 23% Education, 9% Health and other Services, 4% Multi-sector: Social Development, Gender and Inclusion, 43% that in FY06 JSDF fell short of this target, with only about 40% of funds going to East Asia, South and Central Asia. However over the FY01 to FY06 period the target has been comfort- ably achieved, with over 50% of grants ($93m) going to South and East Asia alone. Annex 2 shows the regional distribution of JSDF grants. Figure 6 presents the sectoral distribution of FY06 regular program grants. Given the social development emphasis of JSDF it is not surprising that practically two-thirds of the grants are classified as “social multi-sector”, covering such areas as gender, social inclusion, social pro- tection and risk management. Other major sectors are agriculture, fishing and forestry, and education. Some features of the projects approved in FY06 are noteworthy: • Of the 11 projects approved by Japan, four of them focused on children and youth.The proj- ect supporting education for very poor children in Indonesia will improve primary and jun- ior secondary school enrollment and performance in very poor communities that had been affected by a combination of economic crisis and widespread rural violence which had caused many schools to suspend or cease operation.The children and youth innovation fund in Honduras will finance NGOs, community-based organizations, and other community- supporting organizations that are implementing innovative projects targeting vulnerable and at-risk children and youth, particularly those that have been affected by HIV/AIDS and those living with a disability under extreme poverty. In Kenya, a grant will strengthen inclusion, participation and empowerment of young people in development processes. It will address issues of economic self-reliance, life skills and well-being, empower youth and include them in leadership positions; and design programs that target underserved, disadvantaged youth and are gender-inclusive.The children and youth innovation fund in Turkey will improve the 7 situation of vulnerable and at-risk children and youth, with particular attention to children and youth affected by HIV/AIDS and those living with disability under extreme poverty. • A number of programs focused on the development of sustainable models for the improve- ment of the livelihoods of rural communities. For example, in Indonesia the project will help the rural populations access knowledge, information and means of communication that will improve their livelihoods. Other projects will help them build capacity and improve their income. In the case of Guatemala, capacity will be built through expert assistance and train- ing of local indigenous communities to create better job opportunities, improved income, increased access to infrastructure and a lower degree of marginalization.These activities will strengthen the capacity of the indigenous people to improve their livelihoods and their abil- ity to plan in a participatory manner. In Orissa, India, a pilot project to improve the incomes of the poor informal workers and reduce poverty will be implemented. It will facilitate the development of sustainable livelihood systems centering on handlooms, sericulture and medicinal plants for vulnerable sections of society. A community based Aral Sea Fisheries Management Project in Kazakhstan will improve living conditions of fishing communities and communications among them and reduce environmental degradation. It will also sup- port pilot work in both improving fish-smoking technology and establishing marketing asso- ciations to improve the income and the livelihoods of women traders. • Reproductive health is another recurrent theme. In Ethiopia, a new JSDF project seeks to increase knowledge about reproductive health and risk issues and identify and implement local transport solutions aimed at improving access to health care and other basic social ser- vices. In Guinea, a project was approved which will pilot an initiative to use the existing Onchocerciasis community facilitators network to distribute family planning and HIV/AIDS interventions. This will contribute to improved access to reproductive health information and services in rural communities. • Capacity building activities in the Philippines will enhance the accountability and efficiency of NGOs in delivering basic services to regions with high poverty incidence. The JSDF places particular emphasis on innovation, and the new grants in FY06 show that this remains a major feature. For example the Guinea project mentioned above is very innovative in that it will integrate reproductive health with the Onchocerciasis program thereby resulting in the acceleration of access to reproductive health information.The innovative features of the Kenya Youth Development project include a grant-making program to provide funds to youth- serving organizations in support of a variety of activities including those that improve the liveli- hood of marginalized youth. It will also test the use of Community Driven Development approaches focused on youth which will help facilitate participation and inclusion of youth in community development. THE JSDF SEED FUND JSDF projects are intended to assist marginalized or disadvantaged communities, and when proj- ect proposals are reviewed it must be evident that the intended beneficiaries have been consulted and involved in project design.The process of participative consultation with communities who 8 are sometimes distant from capital cities requires special resource allocations. In this context, in March 2002, the Government of Japan agreed to the establishment of a special fund to facilitate this process. Grants not exceeding $50,000 are provided to Bank teams who are preparing pos- sible JSDF applications and need resources to organize participatory activities. Seed fund grants are expected to be utilized within 12 months of grant approval and therefore to lead to a full JSDF proposal about a year after the seed fund is approved. Fifty-three seed fund grants have been approved since FY02. By far the largest number, 22, have been used in Africa, where 16 countries have benefited from seed fund grants. Other regions which have made substantial use of Seed Fund grants are East Asia and the Pacific (EAP), and Eastern Europe and Central Asia (ECA). Only one country, Indonesia, has used more than three seed fund grants. Annex 3 lists the seed fund grants approved in FY06. There were five seed fund grants approved during that year. It is clear that the geographical and disciplinary range of these grants is wide. Every World Bank region except the Middle East and North Africa (MNA) is repre- sented. No country benefited from more than one grant. A range of subjects were covered, from story telling as a tool to promote accountability in the health sector in Malawi, to civil and community engagement in Armenia and Vietnam, community disaster management in Haiti and the Dominican Republic and strengthening social accountability and transparency of the judiciary in Russia. THE PAKISTAN EARTHQUAKE GRANTS On the morning of October 8, 2005, a 7.6 magnitude earthquake hit Pakistan and left great devastation in one of the most remote mountainous parts of the world and one of the poorest parts of Pakistan. It brought widespread destruction to the districts of Abbottabad, Manshera, Batagram, Shangla, Balakot and Kohistan in the North West Frontier Province and Muzaf- farabad, Bagh and Poonch (Rawalakot) in Azad Jammu Kashmir and Islamabad. The worst affected parts of four Districts including Manshera, Bisham, Muzzafarabad and Bagh were com- pletely flattened. According to the Government of Pakistan figures, over 73,000 people died and more than 70,000 had been severely injured or disabled. Over 2.8 million persons have been left without shelter. Eighty-five percent of the damage was in rural areas. The earthquake hit at 8:55 a.m. on Saturday morning, when children were in school. A very large number of deaths and injuries occurred among school children.An estimated 15,000 peo- ple injured had their limbs amputated and severe spinal cord injuries that left them paralyzed, unable to move. Fifteen thousand people were estimated to have been injured by paralysis/ amputation. In addition, there were numerous people with head and spinal injuries and those suffering from trauma. Along with the high proportion of newly disabled from the earthquake, individuals already disabled lost many of their support systems, including family members on 9 whom they were reliant for economic support.The absence of pre-existing safety nets coupled with the impact of the earthquake meant that disabled persons in particular needed external assistance geared towards long-term rehabilitation. The World Bank, along with the Asian Development Bank carried out a “Damage and Needs Assessment” which focused on the lost infrastructure and its $3.8b replacement cost. It also assessed the social damage. On November 19, 2005, there was a Donor’s Conference in Islamabad that pledged $6 billion for relief and reconstruction.Almost all of this was for emer- gency relief and longer-term reconstruction of physical infrastructure. At this conference, the Japanese Government announced that its $5m JSDF program would focus on disability. The Japanese Government exceeded its pledge and has contributed so far about $6.5m through the JSDF program.To date, four grants have been approved (see Annex 4).Two of the projects financed under the JSDF program are described in Boxes 2 and 3. Box 2 Pakistan: Promoting Independent Living Among Persons with Disabilities Component A. Establishment of Independent Living Centers • Establishment of nonresidential Independent Living Centers (ILCs) staffed and organized by persons with disabilities for persons with disabilities, in administrative centers of the areas most affected by the earthquake, including Manshera, Bisham, Muzzafarabad and Bagh. These will provide training in Independent Living Program (ILP), Peer Counseling Program (PCP) and Attendant Service Training, for persons with disabilities to be integrated into the communities they live in and develop skills they need to lead full and productive lives. • Carrying out of small works, including installation of ramps and building toilets that are disabled- friendly in ILCs. • Recruitment of staff for ILCs, mostly consisting of persons with disabilities and emphasizing on gender balance and those who became disabled as a result of the earthquake. Component B. Implementation of ILP; PCP; and Attendant Service Training • Provision of training to persons with disabilities, including recently disabled ones, in ILP and PCP to help them acquire independent living skills specifically aimed at ensuring integration in the communities in which they live. • Provision of training and attendant services to persons with severe disabilities. Component C. Outreach Program for Independent Living and Barrier Free Environment • Undertake a civic engagement campaign and seminars in and around ILCs to promote independent living among persons with disabilities and barrier free environment in communities. Component D. Project Facilitation Office • Establishment of a project facilitation office through strengthening the existing Milestone Society for Special Persons office, to coordinate, document and disseminate Project activities. • Provision of Project management and support activities, including cost of supervision and hiring of staff. 10 Box 3 Pakistan: Community-Based Rehabilitation (CBR) of Persons with Disabilities Component A. Establishment of CBR Resource Centers. • Establishment of a network of CBR Resource Centers equipped to accommodate training sessions for persons with disabilities and related organizations, to serve as focal points to develop, strengthen and enhance services for persons with disabilities in areas most affected by the earthquake. This includes ensuring that persons with disabilities have access to services and information; facilitating their inclusion in their communities through the development of knowledge about disability, including identifying their individual needs and methods for them to participate in mainstream activities; supporting them to access post-earthquake compensation; providing technical assistance to earthquake-affected persons in the construction of accessible houses and necessary adaptations; and providing livelihood skills training for them. Component B. Identification and Capacity Building of CBR Workers; Provision of CBR Services and Solutions to persons with disabilities. • Identification of community workers to be part of a network of trained individuals able to provide rehabilitation support to persons with disabilities, their families and caretakers; find appropriate solutions to remove barriers to independence and inclusion of persons with disabilities in their communities; and train other local community workers to have basic knowledge of primary rehabilitation, psycho-social support techniques and accessibility. • Recruitment of liaison officers as knowledge banks to disseminate information on post-earthquake compensation initiatives, government policies and other related information relevant to persons with disabilities. • Provision of training to community workers to act as “inclusion vectors” and to identify and work with persons with disabilities, define individual needs and priorities, liaise and refer them to best- practice services, and train other local stakeholders and raise awareness about their inclusion in communities. • Development of disabilities awareness materials and training sessions through CBR Resource Centers with the participation of persons with disabilities, including the development of culturally and linguistically appropriate manuals which focus on inclusion and participation of persons with disabilities in the reconstruction process. Component C. Strengthening CBR Services Through Technical Assistance and Sub-Grants to Community-based Organizations (CBOs). • Provision of technical assistance for CBOs, including utilization of CBR Resource Center experts, literature and training to strengthen the existing CBOs network and to support CBOs network partners to further the reach and quality of activities and services provided to persons with disabilities. • Provision of sub-grants to selected CBOs to carry out sub-projects involving rehabilitation and reconstruction activities through a facilitated participatory planning process. These activities shall focus on, among other things, removing both physical and attitudinal barriers towards disability and promoting inclusion of persons with disabilities in community activities, including economic, political, social and cultural activities. Other activities will include developing and implementing inclusive approaches into CBOs existing reconstruction activities and rehabilitation of persons with disabilities. 11 THE SPECIAL PROGRAM FOR AFGHANISTAN Since 2002, JSDF has been an active development partner of the Government of Afghanistan by supporting the enormous challenge of political, social and economic rebuilding. Through the special assistance window created for Afghanistan in March 2002, JSDF grant funding has supplemented and complemented the Government’s national reconstruction and development efforts supported by the World Bank. Two new grants for Afghanistan were approved during FY06 under the JSDF Special Program (Annex 5). The two grants totaling $15m will supplement the original grant to the National Solidarity Program (NSP) which aims at laying down the foundations for strengthening com- munity level governance. It supports community-managed sub-projects to allow 300 villages to improve their communities’ access to social and productive infrastructure. One of the addi- tional grants will increase the coverage from 300 villages in 7 districts to 1,118 villages in 14 districts.The second supplemental grant will finance selected communities in Afghanistan that successfully completed the disarmament of illegal armed groups. These two grants bring the total number of grants financed under the Afghanistan Special Pro- gram to nine and the total amount allocated to the program to about $52m. THE POST-TSUNAMI RECOVERY GRANTS On 26th December 2004 a powerful undersea earthquake resulted in a tsunami which led to horrific impacts along the coasts of many Indian Ocean countries.There was an unprecedented response to the disaster from all over the world, and Japan, itself familiar with tsunamis, was one of the leading providers of immediate and longer term recovery assistance. One channel of their assistance was the JSDF. The Government of Japan agreed that JSDF grants might be used to finance activities directly providing reconstruction measures and improvement of services and facilities for poorer pop- ulation groups in tsunami-affected countries. In order to facilitate the use of JSDF grants in these exceptional circumstances, the Government of Japan agreed that some of the usual lim- its on the use of JSDF grants could be relaxed. Grant applications could be considered from any country affected by the tsunami, proposals could be for additions to existing grants or for new grants, and did not necessarily need to complement existing Bank operations nor did they need to wait for the usual “rounds” of JSDF applications. By the end of FY06, 12 post-tsunami recovery grants had been approved by the Government of Japan.These grants benefit five of the countries hit by the tsunami, Indonesia, the Maldives, Sri Lanka,Thailand and Somalia. Details of the grants provided in FY06 are shown in Annex 6. 12 Chapter 3 The JSDF Simplification Process A major initiative to simplify JSDF processes was com- pleted during FY06.The objective was to streamline proce- dures so that World Bank task teams and recipient countries can access funds in a more effective way. The intended impacts of the process were to: • expedite provision of grant funds to recipient countries for projects and capacity building; • reduce the burden on Bank staff engaged in processing the grants; • reduce delays in grant signing and activation; and • increase the focus on grant outcome rather than outputs. The key outputs were: • the process now starts with a concept note (CN) which provides critical information about the proposed grant. The task team leader (TTL) seeks clearance of draft CN from Trust Fund Operations (TFO). If cleared by TFO, theTTL submits a grant proposal, using a simplified grant application form with increased focus on strategic con- text rather than technical assistance activities; • a standard grant agreement which is automatically gener- ated from the funding application, thus greatly reducing the workload of the Legal team; • simplified expenditure categories to avoid frequent amendments to the grant agreement; • a standardized disbursement letter available at the time of grant agreement signing; the funding proposal includes an entry addressing the proposed audit approach; 13 • cost tables in the different parts of the proposal document are linked, so that when a change is made to one of the components, it is automatically updated in all the cost tables; • the detailed cost table now includes a column for the procurement plan; • all procedures for the whole life of a project are found in one place, “Procedures for Pro- cessing JSDF Grant Documents”; • processing period is normally 12 weeks from the call for proposals to submission to Japan; • providing a basis for broader standardization of grant proposals; and • TFO no longer clears requests for reallocations, as long as there is no change in the grant development objectives. The simplified processing procedures were received with widespread enthusiasm.The recom- mended length of the proposal is now 10 pages (including the one-page grant proposal as well as the grant supplementary information). 14 Chapter 4 JSDF Program Progress and Impact GRANT QUALITY REVIEW AND APPROVAL PROCESS Proposals for JSDF grants are first vetted by technical reviewers and endorsed by the country lawyer, the country finance officer, respective World Bank Country Director and Sector Manager and the regional trust fund coordinator.The World Bank JSDF Steering Committee (SC) then reviews the proposals, which are either cleared, with minimal revi- sions, for submission to Japan, returned to task teams for revision and resubmission, or rejected.The SC recommends proposals that meet the JSDF criteria for approval by the Government of Japan (GOJ).The Ministry of Finance of the GOJ approves, rejects or requests more information on project proposals. Once approved by the Government of Japan, the legal counsel begins preparation of the Grant Agreement. GRANT IMPLEMENTATION AND REPORTING JSDF grant implementation requires compliance with the World Bank’s Procurement and Financial Management Guidelines.These guidelines are the same as those required for World Bank loans and credits. The grant implementa- tion period is a maximum of four years from the date of countersignature of the Grant Agreement. Grants can be implemented by local governments, NGOs, CSOs and/or community groups.World Bank Task Teams are required to submit grant progress reports on a yearly basis, excerpts of which are available on the JSDF website. A new process of review of completed JSDF grants has now been introduced. Chapter 5 presents the results of this first review, which covers all grants that completed activities in FY06. 15 JSDF GRANTS IN ACTION Projects that are selected for submission to Japan go through a rigorous process. Hence, they substantially meet the basic tenets of the JSDF program in terms of innovation and participa- tion of the beneficiaries in grant preparation; addressing the needs of the poorest and/or most vulnerable groups; building the capacity of local governments, NGOs or community groups. Each year, a sample of JSDF projects is featured in the Annual Report to show the breadth of JSDF activities and to reflect the diversity of the portfolio.The following projects are featured in this report: Table 1: List of Featured Projects Grant Amount Approval Expected (US$) Date Completion Date Afghanistan: National Solidarity Project Original Grant 11,000,000 09/23/2004 03/31/2007 Ist Supplemental Grant 10,011,842 11/01/2005 03/31/2007 2nd Supplemental Grant 5,000,000 06/06/2006 03/31/2007 TOTAL 26,011,842 Ecuador: Law & Justice for the Poor 1,780,000 06/06/2002 05/30/2006 Russia: Local Governance and Civic Engagement 1,252,700 01/02/2003 04/30/2007 Afghanistan: National Solidarity Project Amount of Grant: $26m (TF054367: $11m, 1st supplement: $10m, 2nd supplement: $5m). Grant Recipient/Executing Agency: Ministry of Rehabilitation and Rural Development Grant Objective: To lay the foundations for strengthening community level governance and support community-managed sub-projects comprising reconstruction and develop- ment that improve the access of rural communities to social and productive infrastructure and services. Grant components appear in Box 4. Box 4 Afghanistan: National Solidarity Project Component I: Community Rehabilitation and Development Program Block Grants are provided to communities to enable them to plan and implement sub-projects involving reconstruction and development activities identified through a facilitated participatory process at the community level. Component II: Implementation Support and Capacity Building This component is meant for technical and facilitation support at the central, district and community levels by the team of consultants and the facilitating NGO partners. Component III: Project Implementation and Management Project Implementation & Management Costs comprise the incremental expenses of project management. 16 As a result of a quarter-century of devastating civil strife and half a decade of serious drought, Afghanistan has some of the poorest social, economic and health indicators in the world. Rural Afghanistan is home to nearly 80 percent of the population. Most village roads are in need of culverts and bridges to make them passable throughout the year, the large majority of children do not have access to education or are taught under the open sky, there is almost no access to electricity in rural areas, and the majority of the country’s population does not have access to safe drinking water. To address state building, local governance, warlordism, and to urgently provide basic rural infrastructure for irrigation, drinking water, electrification, rural roads and schools, the gov- ernment has promoted a massive outreach effort to rural communities through the NSP since 2003.The program has been supported by IDA and several donors, including Japan through the JSDF program, under the leadership of the World Bank. The NSP builds on lessons learned from the JSDF funded NGO Support Program of $2m, which for the first time ever in Afghanistan established an operational partnership between NGOs and the Government.There have been three JSDF contributions to NSP I over the past three years, totaling $26m. This amount was earmarked for four provinces, namely Balkh, Bamiyan, Kandahar and Nangarhar. Photo by Mio Takada 17 Results to Date Although it is difficult to account for the impact of the JSDF contribution alone, the following table (Table 2 below) shows the implementation progress in the JSDF target areas. NSP has thus far rolled out to 13 out of 16 districts (81%) in Balkh, in all 7 districts in Bamiyan (100%), 7 out of 18 districts (39%) in Kandahar, and 13 out of 22 districts (59%) in Nangarhar. Progress in Kandahar has unfortunately been hindered by a steadily worsening security situa- tion, but other areas have made significant progress, benefiting a total of over 315,000 families or about 1.9 million people. Table 2: Implementation Progress in JSDF Target Areas as of August 2006 Activity Balkh Bamiyan Kandahar Nangarhar No. of communities mobilized 521 520 459 615 No. of CDCs elected 334 513 427 594 No. of Sub-projects financed 530 829 673 788 No. of Sub-projects completed 208 417 367 370 Total block grant disbursements US$8.1m US$8.3m US$7.9m US$7.7m Economic Impact and Returns Communities have consistently prioritized rural infrastructure sub-projects. They include: water supply and sanitation, transport (roads, bridges etc.), irrigation, rural energy, liveli- hoods, education, and others. More than 80 percent of all labor generated by these sub-projects has been absorbed within the communities. NSP has already created over 16.6 million labor days, giving the poor some income generating activities. Community implemented sub-projects have also proven to be more cost effective, often costing 50 percent or less than the cheapest commercial provider. Figure 7: Afghanistan Rural Infrastructure Sub-Projects Others, Education, 2% 7% Water Supply and Sanitation, 26% Livelihoods, 10% Rural Energy, 15% Transport (Roads, bridges etc.) Irrigation, 21% 19% 18 Returns on NSP outputs are immediate, and the evidence suggests that benefits to villagers are high. A sample of 22 selected sub-projects showed economic rates of return (ERR) averaging 26.3 percent to 60.8 percent, with an overall ERR weighted average of 38.2 percent. Social Impact and Community Perception Although quantifiable data is unavailable, external qualitative surveys and findings from the World Bank supervision missions suggest that NSP has brought some important social benefits. Key impacts include increased trust in government, empowerment of the people including women, strengthened democratic governance at the community level, and improvement in social cohesion within the community as well as between communities. First, NSP has helped increase community’s trust toward the government. NSP already reaches out to over 70 percent of the villages across the country.This unprecedented level of outreach has not only boosted the government’s visibility but also strengthened their legitimacy vis-à-vis the communities. For the first time in history, communities saw tangible benefits delivered by the government, which in turn led to the people’s perception that “the government was inter- ested in their community.”2 The villagers’ perception contrasts sharply in non-NSP villages, where they feel the government neglects them completely. Photo by Mio Takada 2 Post-war Reconstruction & Development Unit,The University of York. (2006) Mid-term Evaluation of the NSP 19 Second, NSP has contributed to people’s empowerment. Creation of Community Develop- ment Councils (CDCs) has greatly increased villagers’ participation in collective decision- making and project implementation. By introducing democratic elections, ordinary villagers who otherwise wouldn’t have played a significant role in village governance are being selected as CDC members and playing a proactive role. By putting the problems into the hands of the community, NSP has nurtured their ownership and responsibility to solve their problems. Women’s empowerment is mixed at best, but the inclusion of women in CDCs has, in some instances, opened up space for them to discuss ideas and potentially influence the decision- making process.3 In conservative areas such as Nangarhar and Kandahar, women’s substantial involvement is virtually impossible. Even in more liberal areas such as Bamiyan and Balkh, women participate but have yet to influence the decision-making process. But encouraging their participation has certainly helped the women become more sensitized to broader issues in the community.There are cultural barriers that still hinder women’s participation, and this issue will continue to be addressed in the NSP II through more intensive facilitation as well as training for both men and women. Japan’s continued support and engagement through JSDF is considered important for the NSP for two key reasons. One is to ensure the scale up of the NSP I to cover the entire country. It is crucial to roll out especially to volatile regions for equity, security, and political purposes. The other is to enable the NSP II to address key policy issues which have broader impacts on the overall governance in Afghanistan. Ecuador: Law and Justice for the Poor Amount of Grant: $1.78m Grant Recipient/Executing Agency: Projusticia Grant Objective: To improve access to alternative dispute resolution and qualified legal representation for poor rural and urban communities, indigenous people, and women and children. Grant components appear in Box 5. It is now increasingly accepted that countries will be unable to make sustainable progress in reducing poverty in the absence of equality before the law and legal empowerment of the poor. Without such equality and empowerment, the poor will remain without basic legal rights and opportunities and will be unable to protect themselves against arbitrary treatment. Even under the best of legal systems, the poor face numerous obstacles accessing justice sector services. For this reason, reducing the barriers that the poor face with regard to formal systems, pro- viding access to alternative dispute resolution mechanisms, and developing techniques to offer qualified legal representation for the poor are important ways in which international develop- ment assistance can promote law and justice for the poor and, in so doing, advance efforts to reduce poverty. 3 Kakar, Palwasha (2005). “Fine-Tuning the NSP: Discussions of Problems and Solutions with Facilitating Partners” Afghanistan Research and Evaluation Unit,Working Paper 20 Box 5 Ecuador: Law and Justice for the Poor Component 1: Indigenous Justice • Comprehensive national study on customary indigenous law practice • Inter-cultural consultative dialogue between civil, judicial and indigenous leaders established in 139 indigenous communities • 2,881 community members trained on formal and informal customary legal processes through 22 regional and national workshops Component 2: Peace Culture • Peace culture projects designed and implemented in 57 elementary and high schools • 3,822 children trained as mediators in peaceful resolution of conflict techniques • 362 teachers trained as peace culture trainers and facilitators • Ministry of Education and Culture and Sports certified Human Rights diploma for participating high school students Component 3: Alternative Dispute Resolution (ADR) Services • New ADR centers established and nationally certified for 12 poor rural communities • 159 new mediators trained and certified • National ADR network and clearinghouse established Component 4: Public Defense Services • The Bar Associations of Quito and Guayaquil establish two legal service centers • 150 lawyers trained and certified by a new fourth level national degree program certified by the CONESUP, the national education authority • A total of 3,712 client cases attended to in Quito and over 11,000 cases and consultations attended to in Guayaquil by legal service centers. Building upon the International Development Association Judicial Reform Project (1996–2002) and complementing the Afro-Ecuadorian Peoples Development Project and Poverty Reduction and Local Development Project, the Law and Justice for the Poor Project leveraged the growing expertise of the Ecuadorian non-governmental sector to empower poor people through legal services.Working through twelve Ecuadorian non-governmental organi- zations in 21 of Ecuador’s 22 provinces, the project developed a series of activities to empower indigenous communities, provide alternative dispute resolution mechanisms in rural areas, address growing youth violence, and support efforts to provide free legal assistance for the poor. The project’s four inter-related components worked to embody all of the JSDF program’s key objectives by responding directly to the needs of the poor, by facilitating capacity building and community empowerment as well as by supporting NGOs in their capacity to address needs that are not served by the formal justice sector. Results to Date Through a combination of research, training and pilot activities, NGOs implemented a series of sustainable activities to improve access to justice. 21 To support the ongoing government dialogue on how best to implement Article 191 of the Ecuadorian Constitution, consultations were held in 139 indigenous communities to establish an inter-cultural dialogue between civil, judicial and indigenous leaders. In so doing, teams produced a global review of indigenous customary law practices and identified those areas where additional training was required. Following the participatory development of training materials, specialized workshops and training activities were implemented throughout Ecuador for poor and rural indigenous communities. In support of these activities, cooperation agreements were signed with several additional indigenous organizations and community movements allowing the training materials developed to be used during replication activities. Photo by Projusticia Ecuador’s Law on Arbitration and Mediation of 1997 encouraged the use of alternative dis- pute resolution mechanisms to provide access to legal services to both poor urban and rural communities.Whereas local providers have developed the means to meet some of the needs of the urban poor, both the formal justice sector and the majority of alternative dispute providers have been unable to meet the needs of the rural poor. By focusing on rural and dif- ficult access areas, the grant provided the means to train new cadres of mediators and open 12 new and sustainable centers through agreements with local hosting municipalities. Addi- tionally, the grant supported the creation of a national clearinghouse to bring together in for- mal meetings both rural and urban alternative dispute resolution practitioners in an effort to create a formal mechanism to exchange experiences and information and to begin to develop national standards for these services. Crime and violence affect the poor disproportionately and have become increasingly recognized as a development issue given that they are obstacles to sustainable economic development. In 22 Photo by Projusticia order to contribute to the development of techniques to address growing child and teen violence throughout Ecuador, activities designed to facilitate a culture of peace were developed and implemented in cooperation with local schools and municipalities under the guidance of national education authorities. Through a variety of educational methodologies and tech- niques, young people throughout Ecuador designed and directed a host of activities to create a new awareness on ways to address crime and violence and promote national human rights standards. 23 Despite constitutional guarantees for legal services and a right to defense, there are only 32 public defenders for a population that exceeds thirteen million inhabitants and extremely lim- ited free legal services offered by NGOs and university clinics. By supporting the efforts of the Bar Associations of Guayaquil and Quito, the grant assisted with the development and formal- ization of a free and sustainable legal services model and provider network. In so doing, the model offered free legal representation to the poor on a wide array of legal matters. The project is now completed. It was among the projects evaluated by the independent con- sultant team and it was found to be very relevant to the context of weak legal systems, long waiting periods, less than adequate record on human rights and the needs of the target audi- ence. It was also complementary to the Government strategy. Local Governance and Civic Engagement in Rural Russia Amount of grant: $1.2m Grant recipient/Executing Agency: Ministry of Economic Development and Trade and the Ministry of Regional Development of the Russian Federation Grant objective: To promote more effective and equitable socio-economic develop- ment in rural communities through building the capacity of formal and informal local governance institutions and increasing community participation and empowerment via civic engagement. Grant components are in Box 6. Box 6 Local Governance and Civic Engagement in Rural Russia Component 1: Planning Process and Selection to develop a detailed project implementation plan, select pilot territories, sub-contracted firms, rural municipal consultants, and legal advisors Component 2: Planning and Budgeting for Municipal Development to build capacity for municipal development; allocate resources more effectively; improve service provision; and plan for local development Component 3: Expanding Demand-driven Service Provision to foster mobilization of resources, private donations, public support for new models of service provision and community initiatives such as public/private service provision and social partnerships Component 4: Dissemination, Monitoring & Evaluation, Audit to disseminate via media, publications, Best Practices Toolkit on Self-Government, study tours and regional workshops, monitoring & evaluation and audit of project components Importance of the Grant in Post-Soviet Russia The specific challenges of socio-economic development in rural Russia include higher poverty and more restricted access to social services such as education and health. According to the 2004 Poverty Assessment, the incidence of poverty in rural areas is twice as high as in urban areas (30% vs. 15%). Rural poverty is also compounded by disempowerment since many rural 24 communities lack control over public resources and therefore have little incentive to promote economic growth or improve social service delivery. Moreover, access to public services such as education, health, and transport is limited as infrastructure deteriorates and service quality declines. Recent local government legislation passed by the federal government, much of which took effect in January 2006, provides the potential to empower rural communities in taking greater control over their lives and local resources and calling for greater budget autonomy and long- term development planning. However, in rural areas, decentralization alone may not be enough to guarantee an increase in the efficiency of governance. Low revenues in local budg- ets, little experience in delivering client-oriented services and participation mechanisms are significant impediments.Additional efforts are needed to improve the managerial skills of rural leaders, foster new concepts of mechanisms of participation in decision-making processes, and to provide social services that match the demands of rural communities. If municipalities do not have the capacity in skills, tools and processes to take advantage of this opportunity, the new legislation specifies that these newly-created entities fall under the provision of state administration.This would limit the chance of making government more responsive and citi- zens more engaged in local development, causing the cycle of apathy and disempowerment to continue. So in the context of local governance reform efforts and the need to strengthen the capacity of rural local governments in the post-socialist environment, the agenda of this pilot project is undeniably important. Photo by Lubov Ovchintseva 25 Description of the Pilot Grant The JSDF grant of $1.2m to the Government of Russia aimed to address some of these chal- lenges. Conceived as a vehicle to achieve substantial and measurable progress towards improv- ing public sector management and mitigating social risks (two of the three objectives in the World Bank’s Country Assistance Strategy for Russia 2003–2006), the pilot project sought to achieve these aims by (1) delivering targeted technical assistance for the most critical problems facing Russia’s local governments; (2) a decentralized mode of operation to maintain an active field presence in the targeted pilot territories; and (3) proven approaches to cost-effective training/technical assistance delivery, dissemination, replication, and parallel efforts to empower local expertise and build sustainable capacity in local partners. Results to date The JSDF grant has produced some significant and innovative results, including: i) Pro bono legal work with citizens on issues of public significance that fills a legal vacuum in rural areas and provides poor rural citizens with access to formal legal space and equal opportunities; Providing training by leading experts for rural leaders and communities on budgeting, service provision and community participation methods in local governance is part of the Local Governance and Civic Engagement in Rural Russia grant. Photo by Lubov Ovchintseva 26 ii) Legal advice to local governments on how to make laws on local government operational; iii) Analysis of legal environment conducted for pilot territories and recommendations made to improve the legal framework of local governments; iv) Creation of an inter-regional network of 18 Rural Municipal Consultants and Legal Advi- sors providing ongoing assistance to local governments and communities and building skills for future opportunities; v) Training for rural leaders and communities in budgeting, service provision and participa- tory methods for engaging the community in decision-making processes; vi) Supporting rural local governments to determine priorities and solutions for the next budget cycle with community participation via Service Improvement Action Plans; vii) Creating social funds and attracting non-budgetary resources to accomplish the identified priorities; viii) Analysis of services in health, education and public improvements and recommendations on monitoring and improving these services; and ix) Locality card (for investigating communities’ needs) developed and piloted in Perm and the Republic of Adygeya. In addition, the pilot project has inspired further innovational developments in mecha- nisms of local governance and funding not part of the original agenda. For example, the project supported and developed community foundations and resource centers for social initiatives in the pilot regions. The key role that young people play as agents of social change and actors in governing and improving village life has also begun to be explored by local and regional governments participating in the JSDF pilot grant. Building sustain- able and innovative partnerships with civil society, local communities and NGOs and strengthening institutional capacity has been possible thanks to the specificities of the grant mechanism. The format of the JSDF grant offers several comparative advantages. Firstly, it facilitates institutional innovation and experimentation. It allows work to be carried out at settlement level to strengthen the capacity of formal and informal government. In addition, in middle- income countries (MICs) it endorses original programs that specifically target the neediest poor. It also represents an important contribution to the institutional dialogue with these countries by allowing innovative, pilot projects that can illustrate successful institutional practices.These can be scaled up in larger reform programs, combining Bank resources with national budgetary and other public resources as well as private funds. MICs can afford to incorporate the innovations into the national budgetary allocations, for example via publicly- funded social development funds. This approach reduces the risk associated with extensive reform and leads to a more active and varied engagement with both governments and the population. 27 Playground in Republic of Adygeya: the result of a small community-based grant designed and built by residents of the village in partnership with a local community foundation. Photo by Lubov Ovchintseva The Government’s commitment and engagement to discussion of local government reforms has intensified over the last few years. The strong commitment and active involvement of regional, district and settlement local government officials and consultants in the pilot territo- ries largely explain the project’s successes. Overall, in a country that abandoned socialism less than a quarter of a century ago, the Local Governance and Civic Engagement project has facil- itated an important step along the long road to effective and efficient local governance carried out by elected officials with dynamic civic engagement. IMPACT OF THE JSDF SEED FUND In March 2002, the Government of Japan agreed to the establishment of the JSDF Seed Fund to support the additional costs inherent in the preparation of JSDF grant proposals. Since JSDF grants are intended to finance demand-driven activities, there is a need to carry out intensive consultations with stakeholders to ensure that a participatory approach is followed in the design of grant activities. Hence, the program finances seed grants of up to US$50,000 to enable task teams to elicit directly the input of beneficiary communities, civil society groups, NGOs and local government counterparts. JSDF Seed Fund grants can disburse for up to 28 12 months, at the end of which the task team would in principle submit a well-developed JSDF grant proposal. There is no expectation that every seed fund proposal would lead to a JSDF proposal, or that every proposal that was prepared using a seed fund grant would be approved by the JSDF Steering Committee.The objective of consultation is to compare the originally conceived proj- ect with the needs and expectations of the target communities, and it is to be expected that at times there may be a disconnect, or the discovery that other projects are in fact addressing the communities’ needs. Nevertheless, seed fund proposals are reviewed carefully and critically to increase the likelihood of development of a successful proposal. It is worth noting that while in the first two years of the seed fund operation, few of the seed fund grants resulted in proposals approved by the Steering Committee. From FY02–FY06, 53 seed fund requests were approved, resulting in 27 proposals which were approved by Japan. In FY06 in particular, there was only one proposal submitted to and approved by the Steering Committee out of the 5 seed grants approved. Hence, over 50% of the seed funds have resulted so far in a proposal over the FY02–FY06 period. WORKING WITH CIVIL SOCIETY The JSDF encourages the participation of NGOs and CSOs in the planning, preparation and implementation of grants. Experience suggests that high quality NGOs can reach the poor in ways that government projects cannot. Under the JSDF, an NGO/CSO can be both the recip- ient and the implementing agency, although sometimes, depending on a country’s laws or the government’s preference, a government agency is the recipient and the NGO/CSO, the imple- menting agency. Implementation may also be jointly carried out between the NGO/CSO and the government. The following tables give the breakdown of grant proposals approved in FY06.Table 3 shows that the government is the recipient in 14 of JSDF grants. Table 3: FY06 Approved Grant Proposals by Recipient Number of Grants Percentage Government 14 67 NGO/CSO 7 33 TOTAL 21 100 29 Table 4 shows that the benefit of using an NGO/CSO as implementing agency is recognized. Fifty-two percent of the grants approved in FY06 are implemented by NGO/CSOs and an additional 10% are jointly implemented by an NGO/CSO with a government agency. Table 4: FY06 Approved Grant Proposals by Implementing Agency Number of Grants Percentage Government 8 38 NGO/CSO 11 52 Joint Govt/NGO/CSO 2 10 TOTAL 21 100 A JSDF grant can empower NGOs and CSOs that may be working on a small scale to expand very much needed interventions. By supporting NGO/CSOs, JSDF is able to contribute to capacity building and sustainability of activities that will assist the most vulnerable populations. 30 Chapter 5 Review of JSDF Completed Grants The purpose of the review of completed grants was to learn from the experiences of grant implementation and particu- larly to provide feedback that could lead to program improvements. The review was carried out on 18 grants which closed in FY06, with end disbursement dates on or before October 31, 2006. The list of completed grants is shown in Annex 7. Of the 18 grants reported on, capacity building grants account for over 60% of the grants and are distributed throughout the Bank’s six regions. However, in terms of amount provided, most of the grants went for project activ- ities (54%). The closed projects were in all Bank regions, with 6 of the 18 projects in South Asia, 5 in East Asia and the Pacific, two each in Africa, Europe and Central Asia and Latin America, and one in the Middle East and North Africa Region. The grants addressed issues in 14 different coun- tries, with Afghanistan, Indonesia, the Philippines, and India all receiving two grants. The review methodology was based on grant completion reports prepared by TTLs in the Grant Reporting and Monitoring (GRM) System and the data from SAP and Trust Fund Accounting Department. Performance of the grants was rated on a six point rating scale: Highly Satisfac- tory, Satisfactory, Moderately Satisfactory, Moderately Unsatisfac- tory, Unsatisfactory, and Highly Unsatisfactory. In this report, the ratings have been aggregated as Highly Satisfactory, Satis- factory and Moderately Satisfactory. In addition to the above assessments, the GRM reports also provide information on other key aspects of the JSDF program objectives, e.g. par- ticipation of communities/civil society organizations; sus- tainability of implemented activities after closure of the 31 grant; and lessons learned under the grant that can be used in other Bank projects and in scal- ing up grant activities. Of the 18 grants reviewed, two were clearly unsuccessful (the Jharkand Participatory Forest Management Project in India, abandoned after 10% of the grant was disbursed, and the proj- ect in Sindh, Pakistan, which was dropped without any disbursement). In terms of the achieve- ment of development objectives, three of the projects were rated as highly successful (one in Afghanistan, one in India and one in the Philippines). However, only one project was rated as “marginally successful” (in Jordan), so out of the full 18 projects close to 90% were successful or highly successful, an impressive achievement in a program which supports innovative proj- ects targeted at exceptionally disadvantaged groups. As regards grant implementation performance, again excluding the two fully unsuccessful projects, one project was recorded as highly successful (the same urban poor renewal project in the Philippines). Four projects were only marginally successful. Two-thirds of the projects were successful or highly successful. The reports do shed light on the extent to which some of the broader objectives of JSDF are being achieved in the 16 projects where activities were implemented. In 13 of these 16 grants it is reported that all or virtually all the planned grant objectives and outputs were achieved. In one case achievement was partial, and in two it was disappointing. It should again be noted that given the pilot and innovative nature of JSDF projects, the fact that over 80% of projects that got off the ground delivered on their objectives is impressive. Sustainability and replicability are two of the criteria against which the success of JSDF inter- ventions should be measured. Of the 16 grants, 11 report that the activities are certain or very Egyptian children making crates 32 likely to be sustained, three more reported that sustainability was probable and one indicated resources limitation as a factor that may affect sustainability. Only 1 of the 16 reported that the activities were not sustainable. Ten of the 16 grants reported that the activities were clearly replicable— and in some cases were already being replicated, with scaling up under the auspices of Bank operations or other interventions and some are being replicated in other countries. In three further cases it was reported that replication was possible, and in only two was it consid- ered that replication was unlikely or impossible. JSDF is intended to promote projects that work with local governments, civil society institu- tions or NGOs. All the projects met these criteria, and nine of them reported active involve- ment of NGOs, although most were not actually implemented by NGOs. The 18 reports provide some useful information on disbursement patterns.The two grants that were abandoned only disbursed about 5% of the funds allocated to them. The remaining 16 grants disbursed 94% of the funds allocated, with 12 of the 16 grants disbursing over 90% of the grant amounts. 33 Chapter 6 JSDF Administration and Communication COMMUNICATION PROCESSES An annual report is submitted by the World Bank to the Japanese authorities to review the progress of grants financed by the JSDF and to ensure that the overall objec- tives of the Program and the grants are being achieved.The annual report is available on the JSDF website. In addition, review meetings are conducted between the World Bank and Japan where JSDF grant proposals, approvals and process issues are discussed and improvements are agreed. The Annual Policy Document (see Annex 8), in which the JSDF guidelines are specified, is revised each year and approved by the Government of Japan. FURTHER INFORMATION ON JSDF There are several websites which maintain information on the Japan Social Development Fund. The main JSDF web- site is on the World Bank’s external main site: http://www.worldbank.org/jsdf The website of the Tokyo office of the World Bank also includes information on JSDF. English: http://www.worldbank.org/japan/about Japanese: http://www.worldbank.org/japan/about-j 34 Annex 1: JSDF Project and Capacity Building Grants Approved in FY06 Country Grant Amount (grant type1) Title of Grant Proposal (US$) Development Objective Round Sixteen Indonesia (P) Education for Very Poor 1,375,000 To improve primary and junior secondary Children school enrolment and performance in very poor communities. Round Seventeen India (P) Orissa Fund for Development 1,370,532 To implement a pilot project to improve the Initiatives (OFFDI) incomes of the poor informal workers and reduce poverty in Orissa by facilitating development of sustainable livelihood systems centering on handlooms, sericulture and medicinal plants for vulnerable sections of society. Ethiopia (P) Promoting Emergency Access 1,542,375 To increase knowledge about reproductive health to Health Services and risk issues, and identify and implement local transport solutions aimed at improving access to health care and other basic social services. Kenya (P) Kenya Youth Development 1,999,418 To strengthen inclusion, participation and empower- ment of young people through: (a) 40 to 60 grants to youth organizations; (b) capacity building of youth organizations; (c) training in social accountability, participatory monitoring and evaluation and civic engagement and leadership. Round Eighteen Guatemala (C) Capacity Building for 900,000 To build capacity through expert assistance and Indigenous People and training to local indigenous communities to create Local NGOs in the Western better job opportunities, improved incomes, Altiplano increased access to infrastructure and a lower degree of marginalization. These activities will strengthen the capacity of the indigenous people for improving their livelihoods and ability to plan in a participatory manner. Guinea (C) Integrating Reproductive 546,800 To pilot an initiative to use the existing Health with the Onchocerciasis community directed network in Onchocerciasis Program order to distribute family planning and HIV/AIDS interventions and thus accelerating access to reproductive health information and services in rural communities. Honduras (P) Children and Youth 2,000,000 To improve the situation of vulnerable and at-risk Innovation Fund children and youth, with a particular attention given to children and youth affected by HIV/AIDS and those living with a disability in conditions of extreme poverty. 1 P - Project; C - Capacity Building 35 Annex 1: JSDF Project and Capacity Building Grants Approved in FY06 (cont.) Country Grant Amount (grant type1) Title of Grant Proposal (US$) Development Objective Round Eighteen (cont.) Indonesia (P) Improving Rural Connectivity 1,297,595 To contribute to the development of sustainable for Sustainable Livelihoods models and approaches to improve rural popula- tions’ (especially women’s) access to knowledge, information and means of communication that improve their livelihoods. Philippines (C) NGO Sector Efficiency and 361,397 To enhance the accountability and efficiency of Accountability to Strengthen NGOs in delivering basic services to regions with Service Delivery to the Poor high poverty incidence. Turkey (C) Youth Development and 1,932,000 To contribute to increased social cohesion through Social Inclusion the social integration of youth from excluded com- munities into mainstream social, economic and political life. Round Nineteen Kazakhstan (P) Community Based Aral Sea 1,902,285 To improve living conditions of fishing communities Fisheries Management and and communications among them and reducing Sustainable Livelihoods environmental degradation; support pilot work in both improving smoking technology and establish- ing marketing associations to improve returns and the livelihoods of women traders. TOTAL FY06 15,227,402 36 Annex 2: FY01–FY06 Regional Distribution of JSDF Grants Number of Grant Amount Region Fiscal Year Grants (US$) East Asia and Pacific 01 17 19,483,034 02 6 5,573,889 03 6 10,146,014 04 9 12,218,002 05 10 17,265,779 06 3 3,033,992 Subtotal 51 67,720,708 South Asia 01 3 3,686,923 02 4 2,951,900 03 5 4,023,106 04 6 6,758,255 05 0 0 06 1 1,370,539 Subtotal 19 18,790,723 Europe and Central Asia 01 5 3,036,500 02 5 7,037,175 03 4 5,430,500 04 0 0 05 5 7,405,084 06 2 3,834,285 Subtotal 21 26,743,544 Middle East and North Africa 01 0 0 02 3 1,569,295 03 0 0 04 1 1,952,487 05 1 1,128,200 06 0 0 Subtotal 5 4,649,982 Latin America and the Caribbean 01 3 4,270,075 02 2 2,538,500 03 2 2,409,300 04 3 4,063,500 05 6 5,333,345 06 2 2,900,000 Subtotal 18 21,514,720 Africa 01 3 2,225,780 02 3 2,634,949 03 1 649,450 04 5 6,668,582 05 8 10,330,121 06 3 4,087,593 Subtotal 23 22,508,882 Total JSDF Grants 01 31 32,702,312 02 23 22,305,708 03 18 22,658,370 04 24 31,660,826 05 30 41,462,529 06 11 15,226,409 TOTAL 137 166,016,154 37 Annex 3: JSDF Seed Grants Approved in FY06 Country Title of Grant Proposal Grant Amount (in US$) Approval Date Armenia Civil Engagement Support Grant 49,750 07/06/05 Haiti and Dominican Republic Community Disaster Management Project 32,192 07/29/05 Vietnam Engagement of Poor Fishing Communities 49,750 08/18/05 in Co-Management Malawi Story Telling as a Tool to Promote 46,365 12/12/05 Accountability in the Health Sector Russia Strengthening Social Accountability 49,680 05/15/06 and Transparency of the Judiciary TOTAL FY06 227,737 38 Annex 4: Special Program for Pakistan Earthquake Approved in FY06 Title of Grant Proposal (grant type1) Grant Amount (US$) Development Objective Promoting Independent Living Amongst 767,312 The grant objective is to (1) provide innovative, non- Persons with Disabilities (P) residential peer-based rehabilitation services for per- sons with disabilities in earthquake affected areas of AJK and NWFP; (2) reform public policy towards insti- tutionalization of the allocation of provincial and federal funds for similar approaches to peer-based rehabilitation of persons with disabilities; and (3) promote a barrier-free physical and policy environment for persons with disabilities. Building Community Capacity for 1,000,000 The overall objective of the grant is to build the capac- Reconstruction (C) ity of the affected communities and particularly the vulnerable groups among them to (1) reconstruct improved houses with hazard resistant construction standards; (2) participate in social protection sub proj- ects, such as the labor-intensive repair and reconstruc- tion of community infrastructure, including primarily community roads, irrigation channels, and water and sanitation works; and (3) benefit from the various gov- ernment/donor/NGO programs available. Revitalizing and Improving Primary Health 2,999,952 The purpose is to operationalize a public private part- Care (P) nership for post earthquake revitalization of Revitaliz- ing and Improving Primary Health Care (PHC) services. The objective is to: (i) rapidly revitalize PHC services so as to enable wide-spread delivery of a stan- dard package of services; and (ii) help strengthen the capacity of district management to coordinate, plan, implement, and monitor the delivery of PHC services. The project would improve: (a) coverage/utilization of services; (b) quality of care; (c) equity of access to services; (d) ensure that communities are satisfied with services; and (e) support and help existing public health workers who are interested in returning to work to serve their communities. Community-Based Rehabilitation of Persons 1,684,040 The overall objective is to operationalize a community- with Disabilities (P) based model to achieve the following: (1) Significantly improve: (a) coverage and utilization of rehabilitation services and solutions for persons with disabilities; (b) quality of care; and (c) equity of access to rehabilita- tion services and solutions; (2) Strengthen the capacity of community-based organizations and district level stake- holders to effectively organize, plan, implement, monitor and evaluate the delivery of rehabilitation services for persons with disabilities; and (3) Ensure that persons with disabilities are satisfied and involved in the delivery of rehabilitation services and solutions. TOTAL 6,451,304 1 P - Project; C - Capacity Building 39 Annex 5: Special Window for Afghanistan Approved in FY06 Title of Grant Proposal (grant type1) Grant Amount (US$) Development Objective National Solidarity Program—First 10,011,842 The objective of the first supplemental grant is the Supplemental grant to an existing grant (P) same as that of the original grant which is to lay foun- dations for strengthening community level governance and support community-managed sub-projects com- prising reconstruction and development that improve access of rural communities to social and productive infrastructure and services. The proposed additional grant will increase the coverage from 300 villages in 7 districts to 1,118 villages in 14 districts. National Solidarity Program—Second 5,000,000 The objective of the second supplemental grant is the Supplemental grant to an existing grant (P) same as that of the original grant. The second supple- mental grant will finance selected communities in Afghanistan that successfully completed the disarma- ment of illegal armed groups. TOTAL 15,011,842 1 P - Project; C - Capacity Building 40 Annex 6: JSDF Post-Tsunami Recovery Grants Approved in FY06 Country Title of Grant Proposal Grant Amount (US$) Development Objective Indonesia Support for Fisheries Sector 1,927,685 To support a program of livelihood rehabilitation and Post-Tsunami Rehabilitation the recapitalization of the fishing communities affected by the tsunami. Somalia Tsunami Livelihood Recovery 1,642,526 To recover and strengthen the fishing-based livelihood Project of approximately 800 families who were affected by the tsunami. Somalia Puntland Primary Health 525,000 To improve the health status and mitigate the outbreaks Service of epidemics and water-borne diseases of the vulnera- ble people in Northeastern Somalia (Puntland), who have been impacted by the tsunami. Thailand Legal Aid Services for Poor 1,850,000 To rebuild the lives of the poor and vulnerable survivors and Vulnerable People of the tsunami through provision of legal and related Affected by the Tsunami services. TOTAL FY06 5,945,211 41 Annex 7: List of Grants Completed in FY06 Grant Approved Grant Grant No. Number Grant Name Grant type Region Country Amount (in USD) Approval date AFRICA REGION 1 TF051548 JSDF-MALI (WEST Capacity AFR Mali 463,785 04/10/2002 AFRICA): STRATEGIC Building ALLIANCE FOR GRASSROOTS CAPACITY BUILDING 2 TF050948 JSDF-GUINEA (WEST Capacity AFR Guinea 463,785 04/10/2002 AFRICA): STRATEGIC Building ALLIANCE FOR GRASSROOTS CAPACITY BUILDING EAST ASIA AND PACIFIC REGION 3 TF026563 JSDF-INDONESIA: Project EAP Indonesia 2,304,800 11/01/2000 SQUATTER SETTLEMENTS PILOT ASSISTANCE PROJECT (RECIPIENT- EXECUTED) 4 TF026783 JSDF-PHILIPPINES: Project EAP Philippines 1,887,500 04/12/2001 UPSCALING URBAN POOR COMMUNITY RENEWAL SCHEME 5 TF026799 JSDF-INDONESIA: Project EAP Indonesia 1,545,000 07/31/2001 MARGINAL FISHING COMMUNITY DEVEL- OPMENT PILOT 6 TF051332 JSDF-EMPOWERMENT Project EAP Lao PDR 717,270 6/28/2002 OF LOCAL COMMU- NITIES IN REMOTE UPLAND WATERSHED 7 TF050944 JSDF-PHILIPPINES: Project EAP Philippines 718,269 04/10/2002 DEVELOPING COM- MUNITY CAPACITIES FOR PRO-POOR BUDGETING AND LOCAL GOVERN- MENT ACCOUNT- ABILITY FOR POVERTY REDUCTION 42 Annex 7: List of Grants Completed in FY06 (cont.) Grant Approved Grant Grant No. Number Grant Name Grant type Region Country Amount (in USD) Approval date EUROPE AND CENTRAL ASIA REGION 8 TF026774 JSDF-MOLDOVA: Project ECA Moldova 800,000 04/01/2001 RECONCILIATION THROUGH GENERAL SECONDARY EDUCATION 9 TF051331 JSDF-ARMENIA: Project ECA Armenia 961,000 06/28/2002 PILOTING REFORMS IN THE CHILDCARE SYSTEM LATIN AMERICA AND CARIBBEAN REGION 10 TF051227 JSDF-ECUADOR: LAW Capacity LAC Ecuador 1,780,000 06/06/2002 AND JUSTICE FOR Building THE POOR 11 TF051374 JSDF-NICARAGUA: Project LAC Nicaragua 1,489,300 08/14/2002 COMMUNITY-LEVEL VULNERABILITY REDUCTION PROGRAM MIDDLE EAST AND NORTH AFRICA REGION 12 TF026801 JSDF-JORDAN: LEGAL Capacity MNA Jordan 191,000 07/31/2001 AID FOR POOR Building WOMEN SOUTH ASIA REGION 13 TF026802 JSDF-SRI LANKA: Capacity SAR Sri Lanka 282,000 07/31/2001 LEGAL AID SERVICE Building TO POOR WOMEN PROJECT 14 TF050945 JSDF-PAKISTAN: Capacity SAR Pakistan 910,000 04/10/2002 SINDH VULNERABLE Building GROUPS FUND 15 TF051429 JSDF-AFGHANISTAN: Capacity SAR Afghanistan 1,481,100 07/29/2002 CAPACITY BUILDING Building FOR NATIONAL SOLI- DARITY PROGRAM 43 Annex 7: List of Grants Completed in FY06 (cont.) Grant Approved Grant Grant No. Number Grant Name Grant type Region Country Amount (in USD) Approval date SOUTH ASIA REGION 16 TF053445 JSDF-JHARKHAND: Capacity SAR India 432,000 03/06/2004 JHARKHAND PARTIC- Building IPATORY FOREST MANAGEMENT- CAPACITY BUILDING 17 TF051711 JSDF-AFGHANISTAN: Project SAR Afghanistan 500,000 10/31/2002 HEALTH SECTOR EMERGENCY REHA- BILITATION AND DEVELOPMENT PROJECT 18 TF051375 JSDF-INDIA : Project SAR India 956,400 08/14/2002 EMPOWERING THE POOR: A PILOT IT PROGRAM FOR RURAL AREAS OF PUNE DISTRICT 44 Annex 8: FY07 Annual Policy Document JAPAN SOCIAL DEVELOPMENT FUND ( JSDF) FY07 POLICY GUIDELINES AND PROGRAM ALLOCATION 1. Objective. To provide grants in support of innovative social programs to help alleviate poverty in eligible client countries of the World Bank Group.4 Grants approved under the program are subject to the criteria set forth in these Guidelines. 2. Focus. JSDF Grants complement Bank-financed operations and programs compatible with the development objectives of the CAS, PRSP or poverty reduction elements of Sector Strate- gies. The Grants are intended to focus on activities which: (i) respond directly to the needs of the poorest and most vulnerable groups; (ii) encourage the testing of innovative methods; (iii) support initiatives that lead to rapid, demonstrable benefits with positive prospects of developing into sustainable activities; or (iv) build ownership, capacity, empowerment and participation of local communities, non-governmental organizations (NGOs) and other civil society groups to facilitate their involvement in operations financed by the World Bank. Approximately 50 percent of total JSDF funds should go to eligible countries in East, South and Central Asia. 3. Grant Types and Country Eligibility. There are two types of JSDF Grants: (i) Project Grants finance: (a) activities directly providing relief measures, supporting the improvement of services and facilities for poorer population groups, or reinforcing/ reinvigorating social safety nets, or (b) innovation and testing of new approaches, particu- larly in the social sectors. (ii) Capacity Building Grants finance capacity building and improvement measures, e.g., to bolster local communities and NGOs through learning by doing, to expand the capa- bilities or coverage of social fund-type institutions, or to support local governments working with local communities. All low-income and lower middle income countries as defined in the 2006 World Develop- ment Report are eligible for both Project Grants and Capacity Building Grants.5 4 Includes the International Bank for Reconstruction and Development, the International Development Association and the International Finance Corporation, all referred to hereafter as the Bank. 5 Where a seed fund grant has been approved, country eligibility for a follow-on grant will be based on eligibility when the seed fund grant was approved. 45 4. Amount. JSDF Grants can range from US$200,000 to US$2 million. Under exceptional circumstances and after prior clearance by CFP, a grant proposal of up to US$3 million may be submitted for consideration. Proposals exceeding US$2 million would be subject to higher scrutiny by the JSDF Steering Committee; the latter may request technical reviewers to verify the validity and viability of proposed activities and that their costing follows a disciplined process. 5. Funding Proposal. Grants are approved by the Government of Japan (GoJ) on the basis of a standard one-page Funding Proposal.The Proposal contains basic data, overall development objectives of the grant and expenditure categories. In addition to the one-page Funding Pro- posal, the complete application form includes supplementary information comprising a detailed description of the activities to be funded, a general plan for implementation, outputs and outcomes expected, and a detailed budget. This will also include any risks (for example political, environmental, problems with the implementing agency, civil war or post-conflict situation) that may affect implementation of the grant. 6. Review of Proposals. The concerned managing unit in the Bank must sponsor the activity and designate a Task Team Leader (TTL). Requests must be in line with the CAS objectives, as confirmed by the Country Director and the sector approach, confirmed by the Sector Manager, and are submitted to the JSDF Steering Committee through the Japan Trust Funds Administration Unit after review by the Operational Vice Presidencies.To the extent possible, proposals should promote collaboration with local and international NGOs, in particular Japanese NGOs and civil society organizations. 7. Eligible Expenditures. These include goods, small civil works, services, training and workshops, with all expenditures eligible for 100% financing under JSDF. Requests may also include the cost of the grant audits. Incremental costs of up to 5 percent of the total grant amount may be requested, including World Bank staff costs, to facilitate community participa- tion or NGO collaboration. Also, consideration will be given to funding incremental costs for operations of unusual complexity or innovation which require Bank staff resources beyond those that can be financed by the regular administration budget. 8. Ineligible Expenditures. The following cannot be financed under JSDF: (i) pilot activities with no linkages to Bank-financed operations, (ii) academic research, (iii) government staff salaries, (iv) foreign training or study tours, or (v) purchases of motor vehicles.6 9. Grant Execution Arrangements. Grants must be recipient-executed. Recipients of JSDF Grants may be governments (central or local), international or local NGOs, or other local 6 Exceptions on the purchases of motor vehicles may be warranted subject to justification provided in the proposal. 46 community groups which the Task Team Leader has determined are financially sound, have a strong track record, and employ satisfactory arrangements for use and accounting of grant funds. In case the recipient or the implementing agency is an NGO or a local community group, it is required that the central or local government give its agreement to the arrange- ment. UN agencies may not be recipients of JSDF grants.7 In any case, the total term of the grant should not exceed four years after signature of the grant agreement. Any exceptions would need to be fully justified and would require CFP’s clearance.The TTL of the Grant will carry out the Bank’s fiduciary responsibilities for grant supervision, in accordance with Bank standards and use of Procurement Guidelines. 10. Progress Reporting. For the purposes of monitoring the development outcomes, the grant agreement, based on the grant application, will be the binding document.The Task Team Leader will be responsible for preparing annual Grant Status Reports, rating the status of grant implementation, and documenting the completion of deliverables and outputs. For grants over US$1 million, an Implementation Completion Memorandum (ICM) will be prepared at completion documenting actual cumulative inputs, outputs and outcomes through the grant implementa- tion period, and the results will be shared with the donor. For grants under US$1 million, the final Grant Status Report will include additional information regarding grant activity outcomes. 11. Reallocation of Funds by Expenditure (Disbursement) Category or Activities. Real- locations among expenditure categories or grant activities, including dropping or adding new eligible categories or grant activities, may be cleared by the Sector Manager/Director. Advice may be sought from Legal and CFP.The Legal Department should be consulted if any amend- ments are required, to be approved by the Country Director. 12. Change in Grant Objectives. For significant changes in the Grant Development Objectives a request must be sent to CFP which will determine if GoJ approval is required. GoJ will approve/reject the request within four weeks of its receipt from CFP. Subsequent grant amendment letters are cleared with the Legal Department in accordance with Bank procedures. 13. Grant Cancellation Policy. The balance of grants is subject to cancellation under the following circumstances: (i) the grant agreement has not been signed within 6 months of the formal grant approval date, (ii) there has been no implementation progress, including zero disbursements, for six months after signature of the grant agreement, or (iii) there is lack of progress as determined by CFP. CFP may clear exceptions on the basis of a satisfactory explanation. 7 UN agencies may participate in JSDF grant activities as consultants provided that the selection is in accordance with Bank Guidelines. 47 14. Consultation with Local Japan Officials and Japanese Visibility. In order to ensure harmonization and coordination, the Bank task teams are required to consult with the Embassy of Japan accredited to the recipient country about the JSDF grant application before submis- sion of the proposal to CFP for review. Such consultation and information sharing by task teams will help expedite the decision-making process. Staff in operational units should also encourage grant signing ceremonies in the field, with the inclusion of Japanese embassy offi- cials, inviting local and international press to these ceremonies. Task teams should aim to inform the Japanese embassy as well as CFP—which will alert the Japanese authorities in Tokyo—at least 10 days in advance of the signing ceremony. Decisions on any future JSDF grant proposals for a country would take into consideration the Bank and recipient’s efforts to comply with the above. In addition, CFP may promote visibility of JSDF by: (i) informing Country Directors of the importance of signing ceremonies to Japanese officials and the pub- lic to ensure recognition and support for JSDF funding; and (ii) continuing widespread distri- bution of the JSDF Annual Report, inclusion of JSDF information in relevant Bank documents, and occasional information sessions for Japanese organizations. 15. Maintenance of Documentation. Operational departments will keep copies of docu- mentation related to JSDF grants, in accordance with the Bank’s Administrative and document retention policies, among others, Terms of Reference and consultant contracts, reports and other outputs prepared by consultants, and status reports. 16. Allocation. The FY07 allocation, to be approved along the schedule below, is 40 million dollars. 17. Schedule. The JSDF Steering Committee submits proposals to GoJ two to three times a year (see below for FY07). GoJ will confirm its decisions on proposals within four weeks from submission where GoJ is satisfied with the contents of the application. In case GoJ requires clarifications the final decision on the proposal may take longer. SCHEDULE PROPOSED FOR FY07 Round Announcement Submission to Japan Round 21 September 2006 December 2006 Round 22 January 2007 March 2007 Round 23 February 2007 May 2007 48