The World Bank Report No: ISR9715 Implementation Status & Results Kosovo Public Sector Modernization Project (P101614) Public Disclosure Copy Operation Name: Public Sector Modernization Project (P101614) Project Stage: Implementation Seq.No: 5 Status: ARCHIVED Archive Date: 25-Mar-2013 Country: Kosovo Approval FY: 2010 Product Line: IBRD/IDA Region: EUROPE AND CENTRAL ASIA Lending Instrument: Specific Investment Loan Implementing Agency(ies): Key Dates Board Approval Date 04-Feb-2010 Original Closing Date 30-Jun-2013 Planned Mid Term Review Date 30-Jun-2013 Last Archived ISR Date 01-Sep-2012 Effectiveness Date 17-Jun-2011 Revised Closing Date 31-Dec-2014 Actual Mid Term Review Date 30-Jun-2013 Project Development Objectives Project Development Objective (from Project Appraisal Document) (a) To strengthen the performance of key budget organizations in budget formulation, budget execution, and public procurement; (b) To establish the foundations for fiscally sustainable payroll management and effective human resource management in the core civil service; and (c) To create conditions for further automation of government work processes and for development of e-government applications. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Component 1: Improving public financial management performance in selectedbudget organizations 3.00 Component 2 - Improving payroll administration and laying the foundations for a professional civil 2.05 service Component 3 - Increasing the security and efficiency of government information systems 2.30 Component 4 - Project management, including project audit and evaluation 0.40 Public Disclosure Copy Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Moderately Unsatisfactory Moderately Unsatisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Satisfactory Overall Risk Rating Moderate Moderate Implementation Status Overview The project implementation has seen a turn since August. In September 2012, a major contract for the Public Financial Management was signed (1.7 million Dollars) and the implementation is well underway. Soon (within March), the National Data Center (around 2 million Dollars) will start and this will bring an added value for the whole IT enhancement of Page 1 of 8 The World Bank Report No: ISR9715 the Government of Kosovo. The Central Procurement Agency will receive a long term support (1 year) to increase the capacities for the implementation of the new Procurement Law, Centralized Procurement and Framework Agreement through the project. Public Disclosure Copy Locations No Location data has been entered Results Project Development Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target Improved quality o f budget formulation and Text Value PEFA assessment 2009 PEFA PI-1 score B; execution in the budget organizationsthat indicators: PEFA PI-12 (iii), (iv) score B; would participate in the proposed project # PI-1: score: C (actual At least 4/5 beneficiary expenditure deviated from organizations meet at least budget by more than 15% in 5/7 intermediate outcome one of the last three years); indicators # PI-12 (iii, iv): Multi- year perspective in fiscal planning, expenditure policy & budgeting # score: C PI-12 (iii) score: C; PI-12 (iv) score: D; # Only 3/7 quality indicators of budget submissions met by all 5 beneficiary BOs; no BO meets 3 quality indicators for budget execution Date 30-Jun-2009 30-Nov-2011 30-Jun-2013 Comments Increased bidder participation in public Text Value 8,270 bidders participated in Bidder participation increases procurement tenders and cost savings procurement tenders in 2008 by 15% Public Disclosure Copy achieved through Quick Gains actions and e- (1.7 bidders per contract); procurement modules No electronic procurement Price disparities in QG transactions; procurement categories do QG study reports significant not exceed 10% in the same price disparities within year procurement categories in the same year (2008): Cost savings of at least 5% # Civil works/ roads: for each category achieved up to 90%; # Maintenance: 39% Page 2 of 8 The World Bank Report No: ISR9715 # Security: 41%; # Buildings rental 64%; # Food 95%; # Medicines 17-70%; Public Disclosure Copy # Office supplies 26%; # Fuel 9.3% in a year/ up to 31% in a month No electronic procurement transactions QG study reports significant price disparities within procurement categories in the same year (2008): # Civil works/ roads: up to 90%; # Maintenance: 39% # Security: 41%; # Buildings rental 64%; # Food 95%; # Medicines 17-70%; # Office supplies 26%; # Fuel 9.3% in a year/ up to 31% in a month Date 30-Sep-2009 31-Oct-2011 30-Jun-2013 Comments The new Public Procurement Law adopted in August 2011 renames the Public Procurement Agency as Central Procurement Agency, brings it under the MoF, and strengthens its role in Public Disclosure Copy consolidated procurement. The CPA has hired new qualified staff for this function. CPA is annually updating the data on price disparities paid by different contracting authorities. Page 3 of 8 The World Bank Report No: ISR9715 Transparent and coherent pay and grading Text Value No grading system in the civil 100% of permanent civil structure introduced in the core civil service service; servants graded; supported by improved ICT systems that Wide pay variations among Equal bases pay for posts of enable effective fiscal and management civil service bodies; equal grade and salary step Public Disclosure Copy controls in payroll administration PEFA indicator PI-18 across civil service bodies; (effectiveness of payroll Improved PEFA PI-18 score controls) score: D+; (C+ or above) No link between HRMIS, payroll, and Treasury Date 30-Sep-2009 31-Jul-2012 30-Jun-2013 Comments Draft regulation on job classification and the pay structure has been approved in March 2012 as a prior action for SEDPO 2 disbursement. Enhanced security and interoperability of Text Value No adequate, secure data Data center is operational; government information systems (through storage and backup facility for Reduced risk of data loss; centralized data storage and systems major ICT systems; Improved access to data maintenance,and interoperability framework) No interoperability between control and physical security; major ICT systems New systems developedaccording to interoperability framework Date 30-Sep-2009 31-Jul-2012 30-Jun-2013 Comments Intermediate Results Indicators Public Disclosure Copy Page 4 of 8 The World Bank Report No: ISR9715 Indicator Name Core Unit of Measure Baseline Current End Target Improved quality of budget and MTEF Text Value Beneficiary BOs comply with All 5 beneficiary BOs meet submissions of beneficiary budget 3 out 7 budget submission the 7 quality criteria Public Disclosure Copy organizations quality criteria (see comment for explanation) Date 30-Sep-2009 30-Nov-2011 30-Jun-2013 Comments (a) Compliance with ceilings set by MTEF and MoF budget circulars. (5=NO) (b) Consistency with MTEF and sectoral policy priorities (5=YES) (c) Clear explanation of budget objectives and priorities (5=NO) (d) Fully developed cost estimates in budget plans for three separate, consecutive years. (5=NO) (e) Explanation and justification of proposed changes from previous budgets consistent with announced policies and MTEF. (5= YES) (f) Inclusion of all capital projects in PIP prior to their inclusion in budget submissions. (4/5= NO) (g) Compliance with deadlines set by MoF circulars. (5=YES) Improved budget execution rates by beneficiary Text Value (a) Deviation from original All beneficiary BOs meet the Public Disclosure Copy budget organizations (BOs) approved budget expenditure interim outcome indicators for by beneficiary BOs does not budget execution exceed 10 percent (in aggregate and by BO) for the year. (3/5=NO) (b) Variance in expenditure composition exceeds overall deviation in primary expenditure by no more than 5 percentage points for the Page 5 of 8 The World Bank Report No: ISR9715 year. (5=NO) (c) Targets (expenditure and milestones) for at least 70 Public Disclosure Copy percent of projects in approved budgets are achieved. (5= NO) Date 30-Sep-2009 15-Sep-2010 30-Jun-2013 Comments Status of public procurement activities is Text Value No central capacity exists to PPA and PPRC use regularly monitored through contract monitor procurement cycle electronic system to regularly management information system monitor public procurement activities by all contracting authorities in Kosovo Date 30-Sep-2009 30-Nov-2011 31-Oct-2013 Comments SEPA system is being reviewed by counterparts HRMIS functions as a civil service registry and Text Value HRMIS does not include HRMIS rolled out in all civil online data links between HRMIS-payroll- grade or salary step data; service organizations Treasury systems enable effective fiscal and includes only personnel data management controls in payroll administration for 3 civil service organizations Date 30-Sep-2009 31-Jul-2012 30-Jun-2013 Comments The consultant has prepared the functional requirements and the procurement process will be launched in September 2012. Performance appraisal system is introduced Text Value No regular performance Managers trained (no.); and used as a basis for progression along appraisal system or Performance appraisal salary steps mechanism for salary launched in pilot organizations progression Public Disclosure Copy Date 30-Sep-2009 31-Jul-2012 30-Jun-2013 Comments Ministry responsible for public administration Text Value MPA Department of Civil Department responsible for has necessary capacity to exercise key human Service Administration has 25 civil service management has resource management functions for the core staff (14 in payroll unit) staff trained in all core HR civil service functions Date 30-Sep-2009 30-Nov-2011 30-Jun-2013 Comments Page 6 of 8 The World Bank Report No: ISR9715 Civil service training based on training strategy Text Value No civil service training Training impact assessment and monitored according to training impact strategy. KIPA training covers methodology developed; assessment methodology only basic needs of all public KIPA training program service. Training effectiveness revised; Public Disclosure Copy not systematically monitored. MPA & KIPA staff trained in using the methodology Date 30-Sep-2009 30-Nov-2011 30-Jun-2013 Comments Centralized data management and systems Text Value Approx. EUR 0.15 million Cost savings from ICT maintenance leads to efficiency gains annual spending on systems maintenance of 30% duplicated maintenance, plus (compared to stand-alone some EUR 0.4 million in systems) duplicated equipment and development of stand-alone systems Date 30-Sep-2009 06-Mar-2013 30-Jun-2013 Comments Procurement of Government data is completed and the contract will be signed within 2 weeks. Data on Financial Performance (as of 18-Jan-2013) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P101614 IDA-46920 Effective 04-Feb-2010 10-Mar-2010 17-Jun-2011 30-Jun-2013 31-Dec-2014 P101614 IDA-H5450 Effective 04-Feb-2010 10-Mar-2010 17-Jun-2011 30-Jun-2013 31-Dec-2014 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P101614 IDA-46920 Effective XDR 2.90 2.90 0.00 0.00 2.90 0.00 Public Disclosure Copy P101614 IDA-H5450 Effective XDR 2.30 2.30 0.00 0.27 2.03 12.00 Disbursement Graph Page 7 of 8 The World Bank Report No: ISR9715 Public Disclosure Copy Key Decisions Regarding Implementation In July 2012, the project was granted an extension, as a result the new closing date is now December 31, 2014. The team plans the mid-term review within this fiscal year 2014 (May/June), during which a detailed analysis of progress, including a review of progress towards the achievement of the project development objectives= Restructuring History Level two Approved on 23-Jul-2012 Related Projects There are no related projects. Public Disclosure Copy Page 8 of 8