Document of The World Bank Report No: ICR00003131 IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-44080) ON A CREDIT IN THE AMOUNT OF SDR 37.8 MILLION (US$60.0 MILLION EQUIVALENT) TO THE FEDERAL REPUBLIC OF NIGERIA FOR A RURAL ACCESS AND MOBILITY PROJECT (RAMP I) May 10, 2017 Transport and ICT Global Practice Africa Region CURRENCY EQUIVALENTS (Exchange Rate Effective June 30, 2016) Currency Unit = Nigerian Naira (NGN) SDR 1.00 = US$ 1.37 US$ 1.00 = NGN 279.70 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS AADT Annual Average Daily Traffic AIDS Acquired Immunodeficiency Syndrome ARAP Abbreviated Resettlement Action Plan CBA Cost-Benefit Analysis CEA Cost Effectiveness Analysis CPS Country Partnership Strategy EMP Environmental Management Plan EIRR Economic Internal Rate of Return ESMF Environmental and Social Management Framework FM Financial Management FMA&RD Federal Ministry of Agriculture and Rural Development FPMU Federal Project Monitoring Unit GDP Gross Domestic Product HDM-4 Highway Development and Management Model HIV Human Immunodeficiency Virus ICR Implementation Completion and Results Report KAPWA Kaduna State Public Works Agency LGA Local Government Authority M&E Monitoring and Evaluation NEEDS National Economic Empowerment and Development Strategy NPRTT National Policy on Rural Travel and Transport NPV Net Present Value NTSC National Technical Steering Committee OPRC Output- and Performance-based Road Contract PAP Project Affected Person PAD Project Appraisal Document PDO Project Development Objective PS Permanent Secretary RED Roads Economic Decision RPF Resettlement Policy Framework RAMP Rural Access and Mobility Project RTTP Rural Travel and Transport Program SEEDS State Economic Empowerment and Development Strategy SMOWT State Ministry of Works and Transport SPIU State Project Implementation Unit SPMC State Project Management Committee SPSMC State Project Steering and Monitoring Committee VPD Vehicles per Day Vice President: Makhtar Diop Country Director: Rachid Benmessaoud Senior Global Practice Director: Jose Luis Irigoyen Practice Manager: Aurelio Menendez Project Team Leader: Olatunji Ahmed ICR Team Leader: Justin Runji   FEDERAL REPUBLIC OF NIGERIA Rural Access and Mobility Project (RAMP I) CONTENTS Data Sheet .................................................................................................................................. i  A. Basic Information ....................................................................................................... i  B. Key Dates .................................................................................................................... i  C. Ratings Summary ........................................................................................................ i  D. Sector and Theme Codes ........................................................................................... ii  E. Bank Staff ................................................................................................................... ii  F. Results Framework Analysis ...................................................................................... ii  G. Ratings of Project Performance in ISRs .................................................................... v  H. Restructuring (if any) ................................................................................................. v  1. Project Context, Development Objectives and Design............................................... 1  2. Key Factors Affecting Implementation and Outcomes .............................................. 6  3. Assessment of Outcomes .......................................................................................... 13  4. Assessment of Risk to Development Outcome ........................................................ 17  5. Assessment of Bank and Borrower Performance ..................................................... 17  6. Lessons Learned ....................................................................................................... 20  7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners .......... 22  Annex 1. Project Cost and Financing by Component................................................... 24  Annex 2. Outputs by Component ................................................................................. 25  Annex 3. Economic Analysis ....................................................................................... 26  Annex 4. Bank Lending and Implementation Support/Supervision Processes ............ 33  Annex 5. Beneficiary Survey Results ........................................................................... 36  Annex 6. Stakeholder Workshop Report and Results .................................................. 37  Annex 7. Summary of Borrower's ICR......................................................................... 38  Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ....................... 44  Annex 9. List of Supporting Documents ...................................................................... 45   MAP …………………………………………………………………………………………46  Data Sheet A. Basic Information Rural Access and Mobility Country: Nigeria Project Name: Project (RAMP) Project ID: P072644 L/C/TF Number(s): IDA-44080 ICR Date: 08/02/2016 ICR Type: Core ICR THE GOVERNMENT OF Lending Instrument: Specific Investment Loan Borrower: NIGERIA Original Total XDR 37.80 million Disbursed Amount: XDR 37.42 million Commitment: Revised Amount: XDR 37.80 million Environmental Category: B Implementing Agencies: KADUNA STATE MINISTRY OF WORKS AND TRANSPORT Cofinanciers and Other External Partners: B. Key Dates Revised / Actual Process Date Process Original Date Date(s) Concept Review: 12/15/2005 Effectiveness: 12/16/2008 12/16/2008 Appraisal: 02/04/2008 Restructuring(s): Approval: 04/01/2008 Mid-term Review: 10/31/2011 11/18/2011 Closing: 12/31/2014 06/30/2016 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Moderately Satisfactory Risk to Development Outcome: Substantial Bank Performance: Moderately Unsatisfactory Borrower Performance: Moderately Unsatisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Quality at Entry: Moderately Unsatisfactory Government: Moderately Unsatisfactory Implementing Quality of Supervision: Moderately Satisfactory Moderately Satisfactory Agency/Agencies: Overall Bank Overall Borrower Moderately Unsatisfactory Moderately Unsatisfactory Performance: Performance: C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments (if Indicators Rating Performance any) Potential Problem Project at Yes Quality at Entry (QEA): None any time (Yes/No): i Problem Project at any time Quality of Supervision Yes None (Yes/No): (QSA): DO rating before Moderately Satisfactory Closing/Inactive status: D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) Central Government (Central Agencies) 8 8 Rural and Inter-Urban Roads 87 87 Sub National Government 5 5 Theme Code (as % of total Bank financing) Administrative and civil service reform 33 33 Rural services and infrastructure 67 67 E. Bank Staff Positions At ICR At Approval Vice President: Makhtar Diop Obiageli Katryn Ezekwesili Country Director: Rachid Benmessaoud Galina Y. Sotirova Practice Manager/Manager: Aurelio Menendez C. Sanjivi Rajasingham Project Team Leader: Olatunji Ahmed Justin Runji ICR Team Leader: Justin Runji ICR Primary Author: Justin Runji F. Results Framework Analysis Project Development Objectives (from Project Appraisal Document) To improve road access for rural communities in Kaduna State and improve management of State road network in a sustainable manner. Revised Project Development Objectives (as approved by original approving authority) The PDO was not revised. (a) PDO Indicator(s) Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised Target approval Completion or Values documents) Target Years Indicator 1: Number of trips per day, per selected road link increased Value (Quantitative or 37 Trips 50 Trips — 76 Trips Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 ii   Comments Overachieved by 52%. Data was based on average daily vehicle counts and reconfirmed (including % through household interviews. The results are summarized in Table 8 of the Report achievement) “Collection of Data on Monitoring and Evaluation Indicators” (Cycle 4 Report) Indicator 2: Reduction of transportation unit cost, Naira per trip Value (Quantitative or Naira 232 Naira 220 — Naira 185 Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Comments Overachieved by 16%. By 2016, the transportation unit cost would however have been (including % about Naira 77.00 in real cost terms. During the eight years between 2008 and 2016, the achievement) Naira value dropped 2.4 times, from NGN 117.00 to NGN 279.70 per U.S. dollar. Indicator 3: Increase in rural population in project areas with access to an all-weather road within 2 km Value (Quantitative or 1.00 million 1.50 million — 1.50 million Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Comments Achieved by 100%. Data was established by first converting the baseline population to a (including % percentage of the people with access to an all-weather road and, through interviews, achievement) determining how that proportion had changed. (Annex 5, Page 103 of Borrower’s ICR) . Indicator 4: Increased amount of agricultural produce transported across improved river crossings Value (Quantitative or 3.5 million tons 3.8 million tons — 4.6 million tons Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Overachieved by 25%. As in the case of Indicator 3 above, data collection method Comments differed slightly from that at appraisal stage. The monitoring report presents the proportion (including % of respondents indicating increased transportation of agricultural produce across the new achievement) river crossings. Indicator 5: Three-year rolling plan produced and used for budget preparation Value (Quantitative or None Plan prepared — Plan prepared Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Comments Achieved 100%. The Three-year rolling plan was adopted. It was further reported that (including % allocation of funds to Kaduna State Public Works Agency had improved following the achievement) adoption of the plan. Indicator 6: Share of rural population with access to an all-season road Value (Quantitative or 47.00 50 — 55 Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Comments Overachieved by 10%. The resulting 55% accessibility index is above the national (including % average of 47%. The comment made on PDO Indicator 3 above, regarding comparability achievement) of data, applies. The baselines and targets were based on calculated values. Indicator 7: The development and use of a Road Management Systems Value (Quantitative or None In use — None Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 iii   Comments Target was partially achieved. Some of the activities leading to the development of a (including % Road Management System; the study, road information system, equipment, and policy achievement) were completed, but not fully used. (b) Intermediate Outcome Indicator(s) Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised Target approval Completion or Values documents) Target Years Indicator 1: Number of kilometers of roads rehabilitated under OPRC contracts Value (Quantitative 0 427 — 475 or Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Comments Overachieved by 11.2%. This was a notable achievement. Lower unit costs than (including % originally estimated resulted in more roads, which in turn reached out to more achievement) communities. Indicator 2: Number of river crossing structures completed Value (Quantitative 0 132 — 146 or Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Comments Overachieved by 10.6%. This was also a notable achievement. As a result, the project (including % benefited more people than envisaged. achievement) Indicator 3: Road network reclassification study Value (Quantitative 0 Yes — Yes or Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Comments The indicator was achieved 100%. (including % achievement) Indicator 4: Digitized state road map showing the complete road network of the State Value (Quantitative 0 Yes — Yes or Qualitative) Date achieved 04/04/2008 08/30/2013 — 06/30/2016 Comments The indicator was achieved 100%. (including % achievement) Indicator 5: Simplified road management and road inventory system database Value (Quantitative 0 Yes — No or Qualitative) Date achieved 04/04/2008 — — 06/30/2016 Comments Target was not achieved. A simplified road management and road inventory database is (including % a basic entry point towards professional road planning and is relatively easy to implement. achievement) This was a missed opportunity. iv   G. Ratings of Project Performance in ISRs Date ISR Actual Disbursements No. DO IP Archived (US$, millions) 1 06/27/2008 Satisfactory Satisfactory 0.00 2 12/16/2008 Satisfactory Satisfactory 0.00 3 06/20/2009 Moderately Satisfactory Moderately Satisfactory 2.25 4 12/18/2009 Moderately Satisfactory Moderately Satisfactory 3.23 5 06/14/2010 Moderately Satisfactory Moderately Satisfactory 8.38 6 03/27/2011 Moderately Unsatisfactory Moderately Satisfactory 10.32 7 09/24/2011 Moderately Satisfactory Satisfactory 14.72 8 02/07/2012 Satisfactory Satisfactory 19.29 9 08/19/2012 Satisfactory Satisfactory 28.30 10 03/27/2013 Satisfactory Satisfactory 34.86 11 10/23/2013 Satisfactory Satisfactory 42.30 12 05/24/2014 Satisfactory Satisfactory 45.25 13 12/10/2014 Satisfactory Satisfactory 47.59 14 06/27/2015 Satisfactory Satisfactory 50.36 15 12/30/2015 Moderately Satisfactory Satisfactory 53.47 16 06/30/2016 Moderately Satisfactory Satisfactory 56.01 H. Restructuring (if any) ISR Ratings at Amount Board Restructuring Restructuring Disbursed at Reason for Restructuring & Key Approved PDO Date(s) Restructuring in Changes Made Change DO IP US$, millions  Extension of closing date to 12/02/2014 S S 47.6 December 31, 2015  Extension of closing date to 12/29/2015 MS S 53.5 June 30, 2016 I. Disbursement Profile v   1. Project Context, Development Objectives and Design 1.1 Context at Appraisal Country Background 1. By 2008, when the Rural Access and Mobility Project (RAMP) was approved, Nigeria’s political and economic transformation was becoming apparent. In 1999, after three decades of military rule, Nigeria transitioned to democratic civilian rule. Institutions and mechanisms for accountability and good governance were in the process of being strengthened. The transformation was essential in assisting Africa’s most populous country in achieving sustained social and economic development. Its poverty reduction agenda was underpinned by the medium-term (2003–2007) National Economic Empowerment and Development Strategy (NEEDS) which sought to raise the country's standard of living through a variety of reforms, including macroeconomic stability, deregulation, liberalization, privatization, transparency, and accountability. The same strategy was cascaded to the states through the State Economic Empowerment Development Strategy (SEEDS). 2. Government’s efforts on micro-stabilization and better governance had started to yield results. One such initiative was the implementation of fiscal policies to forestall economic vulnerability to oil price shocks. Consolidated fiscal surplus rose to 10 percent of gross domestic product (GDP) on a cash basis, and annual inflation decelerated sharply from 24 percent to 10 percent between 2003 and 2004. By 2005, real GDP was estimated to have grown about 6 percent. Non-oil GDP growth for 2005 was about 5 percent, compared to 3.4 percent on average in the previous two decades. 3. Poverty levels were however still high, with significant geographical disparities. Nigeria’s per capita income of US$350 in 2003 was below Sub-Saharan Africa’s average of US$450. Approximately 70 million of the 130 million population were living on less than a dollar a day. Income poverty in the rural areas, where most Nigerians lived, was estimated at 64 percent, higher than in urban areas where it was estimated at 35 percent. In addition, poverty rates in the northern regions were substantially higher than in the southern regions. 4. Encouraging micro-stabilization efforts notwithstanding, continued underinvestment in infrastructure and transport was negatively affecting economic growth. By 2005, Nigeria’s competitiveness had declined noticeably—the country was ranked 93 out of 104 countries on the Global Competitive Index and one of the four main contributing factors was a huge infrastructure deficit.1 The deficit in turn had hindered non-oil growth and contributed significantly to the cost of doing business. Poor road infrastructure was estimated to exact an annual cost of about 3 percent of GDP. It was apparent that Nigeria's reform efforts and development challenges needed strong international support. Sector Background 5. The extent and quality of Nigeria’s transport infrastructure has been linked to the changing fortunes of its oil wealth. In the 1970s, during the oil boom years, the country invested heavily in transport with special focus on capacity expansion on ports, roads, bridges,                                                              1 The other three were (a) the ‘Dutch disease’ phenomenon that had weakened the non-oil sector, (b) policy instability, and (c) inadequate access to medium- and long-term finance. 1 and airports. However, following the decline in federal oil revenues in the 1980s and 1990s, government expenditure on new transport infrastructure dropped significantly. Lack of maintenance of the existing infrastructure led to its sharp deterioration. In an effort to address the infrastructure deficiency, the NEEDS recognized the necessity to mobilize national resources to facilitate the development of a transport infrastructure that would also improve Nigeria’s image as an investment destination. 6. There was also a particular need for state-level transport sector interventions. With 47 percent rural accessibility and more than half of its population living in rural areas, Nigeria had in excess of 30 million rural inhabitants for whom the nearest all-season road was more than 2 km away. Furthermore, more than 50 percent of the rural road network was in poor condition due to the lack of maintenance. Recognizing the rural mobility gap, the Federal Government adopted the National Policy on Rural Travel and Transport (NPRTT), as part of its poverty eradication program. Coupled to the policy, the Government realized the need to start a systematic investment in rural connectivity under the Rural Accessibility and Mobility Program—a national program that would be gradually rolled out to eventually cover all the states. 7. Kaduna State was identified as an ideal state to launch the national rural roads improvement program. Located in Nigeria’s middle belt, its good rainfall and soils make Kaduna one of the most agriculturally endowed states in Nigeria. With a population of 6 million then, it was the third most populous state. About 80 percent of the population was engaged in small- and medium-scale farming. Apart from being a major source of livelihood, agriculture was the largest employer and a key contributor to wealth, income creation, and poverty alleviation. The rural roads were few, relative to its population, and poorly maintained. At the time of project preparation, there were no security concerns in Kaduna. Road classification was not considered important in planning for road investments and the extent of the state responsibilities with regard to state road asset management, including road maintenance was unclear. 8. At project preparation, the responsibilities for road management in Kaduna State were shared between three composite and loosely coordinated entities: the normal ministerial entities, parastatals, and the local government organization. The Kaduna State Ministry of Works and Transport (SMOWT) was the state government body responsible for construction of roads and other transport infrastructure. In practice this function excluded road maintenance and local government roads. The ministry organization was headed by a Commissioner of Works and Transport, a member of the State Executive Council under the direction of the State Governor. Below the Commissioner, in the hierarchy, was the office of the Permanent Secretary (PS) under whom were six directorates. Among them was the Directorate of Civil Engineering which was responsible for general infrastructure, including roads. Under the directorates were the Zonal Managers for the six zones: Birnin Gwari, lkara, Kachia, Kafanchan, Saminaka, and Zaria. Each Zonal Manager’s responsibilities mirrored the state organization at the zonal level, that is, they were responsible for the multiplicity of ministerial functions, including road management. The Directorate of Civil Engineering, had another layer of three subdirectorates, one for each of the three senatorial zones of the state: North, Central, and South. Overall, the ministry had some capacity gaps in technical skills. 9. In addition to the above organization there were state parastatals that reported to the PS. One such parastatal was Kaduna State Public Works Agency (KAPWA). Established in 2002, KAPWA also had as part of its broad mandate, the responsibility to construct, upgrade, rehabilitate, and maintain roads. In practice KAPWA was the state agency responsible for road 2   maintenance. Nonetheless, its capacity in skills and funding was limited. 10. At the local government level, a local government council headed by an Executive Chairman oversaw the functions of the Legislative Council comprising Supervisory Councilors to whom the Departments of Works (including roads), Administration, Health, and Agriculture reported. Below the Supervisory Councilor for Works was the head of Department of Works under whom the construction, rehabilitation, and maintenance of rural roads fell. The reporting lines on road functions, from the local government to the top state administrative structures bypassed the Directorate of Civil Engineering. Technical skills for road maintenance and its funding were both suboptimal. 11. The above institutional organization affected the general road condition. The efforts of the state, through the Directorate of Engineering, were more focused toward the construction, upgrading, and rehabilitation of the high order roads. Investment choices were not backed by empirical processes and annual plans excluded formal road maintenance strategy. There was evidence of a general lack of maintenance on all categories of roads, but the lower order roads were more affected. For this reason, it was decided that introduction of performance-based road rehabilitation and maintenance approach would be appropriate. Rationale for World Bank Support 12. The World Bank’s support to Nigeria was linked to Nigeria’s strategy for growth and poverty reduction as articulated in the NEEDS and the SEEDS. The three underpinning pillars for NEEDS were (a) empowerment of the people and improvement of social delivery, (b) growing the private sector and focusing in non-oil growth, and (c) changing the way the government works and improving governance. The Kaduna SEEDS identified public sector reforms and provision of road infrastructure, as part of the medium-term development agenda. 13. The objective of the Country Partnership Strategy (CPS) at the time of the project preparation was to support Nigeria in its efforts to boost growth and to achieve the Millennium Development Goals. The three key pillars of the partnership were to support (a) improved service delivery for human development in health, education, and Human Immunodeficiency Virus (HIV)/Acquired Immunodeficiency Syndrome (AIDS); (b) enhanced transparency and accountability for better governance, and (c) improved environment and services for non-oil growth. The project was therefore designed to contribute toward non-oil growth, under the CPS’s third pillar. 14. An additional reason for the World Bank involvement in RAMP was its internal policy toward infrastructure development in Sub-Saharan Africa. The World Bank’s transport sector strategy recognized the pivotal role that efficient transport infrastructure played as a catalyst for poverty reduction. Therefore, one of the World Bank’s objectives, in line with the World Banks’s 2005 Africa Action Plan, was to assist Sub-Saharan African countries close the infrastructure gap by increased resource allocation toward specific sectoral outputs. In transport, the Africa Action Plan outputs included rehabilitation of road networks, implementation of reform programs, and establishment of sustainable financing and 3   management mechanisms. RAMP would provide additional resources to 1 of Nigeria’s 36 states and have all the three Africa Action Plan’s outputs as part of its design. 1.2 Original Project Development Objectives (PDO) and Key Indicators 15. The original PDO was to improve road access for rural communities in Kaduna State and to improve management of State road network in a sustainable manner. 1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and Reasons/Justification 16. The original PDO was not changed. 17. The achievement of the PDO was monitored using the following outcome indicators: (a) Number of trips per day, per selected road link increased (b) Reduction of transportation unit cost, Naira per trip (c) Increase in rural population in project areas with access to an all-weather road within 2 km (d) Increased amount of agricultural produce transported across improved river crossings (e) Three-year rolling plan produced and used for budget preparation (f) Share of rural population with access to an all-season road (g) The development and use of a Road Management System 18. In addition to the above PDO indicators, the intermediate outcome indicators were (a) Number of kilometers of roads rehabilitated under OPRC contracts; (b) Number of river crossing structures completed; (c) Road network reclassification study; (d) Digitized state road map showing the complete road network of the State; and (e) Simplified road management and road inventory system database. 1.4 Main Beneficiaries 19. The Project Appraisal Document (PAD) does not specifically discuss the beneficiaries of the project. However, it is apparent that there was a wide spectrum of beneficiaries. The main direct beneficiaries were the rural communities served by the improved road infrastructure. Impact studies established that 1.50 million people now live within 2.0 km of an all-season road.2 Rural businesses located or serving communities living within the general road corridors, including transporters, will also benefit from improved accessibility. The                                                              2 Kaduna State Monitoring Report Cycle 4 of June 2015 (page 37) and Annex 5 of Borrower’s ICR.. 4   Kaduna State Government in general and the state road administration in particular, benefited from the institutional capacity-building interventions. The local construction industry benefited in skills development through their participation in the—first of its kind in Nigeria—Output- and Performance-based Road Contract (OPRC). At the federal level, development of human resources was enhanced through training and related support to the Federal Project Monitoring Unit (FPMU). 1.5 Original Components (as approved) Component A: Upgrading, Rehabilitation, and Maintenance of Transport Infrastructure (US$51.91 million) 20. The component was to support the upgrading, rehabilitation, and maintenance of about 427 km of rural roads and about 132 river crossings spread across the entire state. Depending on traffic volume and other considerations, about 142 km of roads (or one-third of the total length) were to be upgraded to bituminous surface dressed standards while the rest or about 285 km would be upgraded to gravel wearing course standards. There were two subcomponents within Component A: (a) improvement and maintenance of roads within six intervention areas of the state through the OPRC and (b) construction and rehabilitation of selected river crossings across the entire state. Component B: Institutional Strengthening, Reforms, and Capacity Building (US$8.09 million) 21. This component focused on the following: (a) Supporting project implementation by providing the necessary goods, materials, and equipment and by ensuring the existence of the appropriate project management capacity and skills at both the federal and the state levels (b) Strengthening the institutional capacity, including management of road network, rationalization of the establishment and enhancement of skills in strategic planning, program and project scheduling, designing, implementation and maintenance in relation to rural road infrastructure; development and implementation of institutional reforms with a view to enhancing efficiency in resource allocation, procurement, and quality control responsibilities at the state government level (c) Other cross cutting issues, such as awareness creation and related work on road safety, gender, and HIV and AIDS (d) Preparation of state-funded follow-on RAMP 22. Component B had been designed with the aim of addressing several dimensions of the state’s capacity to manage roads. Activities linked to strength enhancement included (a) technical training of both the state and federal officials; (b) development of a road information system database, and (c) acquisition of road management operational equipment, such as vehicles, information technology hardware and software, and materials testing facilities. Institutional reforms were to be supported through a study to review the capacity of the SMOWT and its agencies and to make recommendations on appropriate road sector reforms. The study specifically targeted the poorly resourced Kaduna Public Works Agency, a quasi- 5   government agency, whose mandate included road maintenance. Other road management studies were to focus on road classification, road inventory, road management options, financing options, technical standards, and optimization of the use of resources. It would also include options for strengthening of Local Government Authorities (LGAs). The component was also to support the preparation of the Rural Travel and Transport Policy (RTTP) implementation plan and guidelines to be implemented by the FPMU. 1.6 Revised Components 23. The components were not revised. 1.7 Other Significant Changes 24. There were no other significant changes. 2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design, and Quality at Entry 25. The project was directly linked to a policy of the Federal Government for which an implementation momentum was already in place. The project supported the Federal Government’s NPRTT which was prepared with the support of the World Bank-managed Sub- Saharan Africa Transport Policy Program. The responsibility to implement the policy was vested with the Federal Ministry of Agriculture and Rural Development (FMA&RD), which in turn commenced the implementation of the policy through the RTTP. The overall objective of the policy was to develop an adequate, safe, environmentally sound, and economically efficient rural travel and transport system. 26. The Federal Government had already initiated a generic multi-state RAMP which helped resolve some institutional arrangements. In August 2004, after a thorough selection process, the Federal Government identified 18 possible RAMP states. As preparation work continued in Kaduna, it had become apparent that although the project supported the Federal Government's policy on rural travel and transport, the implementation responsibilities had to be vested with the states. This would among other benefits, ensure better ownership and sustainability. The implication was that every RAMP state, including Kaduna, had to have its own project implementation unit. At the same time, there had to be one federal coordination unit. The decision was also taken to prepare the first RAMP in Kaduna State, being among the top ranked lead states, and to keep it simple for ease of replication. 27. Lessons learned during the implementation of the previous operation were incorporated into the project design. The last IDA-supported state road project in Nigeria was the Second Multi-State Roads Project (Credit 2485-UNI) which closed on December 31, 1999. One of the lessons learned from the operation was the need to place special emphasis on institutional capacity building. At completion, the project was rated Unsatisfactory on Sustainability, and Medium on Institutional Development Impact. Overcoming the sustainability and institutional development challenges led to the introduction of the capacity-building component and also guided the selection of the specific interventions within the component. 6   28. The World Bank’s experience in OPRCs was instrumental in shaping the technical aspects of the project. Before the project, OPRCs’ work had not been executed in Nigeria and there was no local experience to guide the process. The World Bank’s generic procurement documentation for OPRCs was particularly useful. Consultants assisting Kaduna State to prepare the bidding documents relied on these documents. 2.2 Implementation 29. One of the main factors affecting timely implementation was delays occasioned by the administrative processes and initial challenges of starting the relatively new OPRC concepts. At the very start, there was an eight and a half month delay between the project approval date and its effectiveness. RAMP was approved by the Board on April 1, 2008 but only became effective on December 16, 2008. The main reason for the delays was administrative—the processing of the two agreements, the Credit Agreement between the World Bank and Nigeria for the project and the on-lending agreement between the Federal Government and Kaduna State Government. 30. Procurement documents for civil works were still under preparation at the time the project was approved in April 2008. This caused an additional 18-month delay including procurement of the OPRC contractors. The main part of this delay was specifically attributed to the poor response and quality of bidders at the prequalification stage, due to lack of experience in OPRCs and lack of interest because of perceived high risks. This necessitated a change in the procurement process from pre-qualification to post-qualification. The post- qualification approach focused on identifying contractors with the necessary capacity to rehabilitate and maintain roads under one contract, at competitive prices, and not at the technical skills needed to design roads. The procurement of the river crossing contracts was also delayed by about four months, due to late finalization of the bidding documents. A further complication was the slow procurement procedures within the State Project Implementation Unit (SPIU). The procurement officials who were transferred to the unit in Kaduna State were new to the World Bank procedures and had difficulties in applying them. They often referred procurement issues to the parent ministry for reviews and clearances. 31. Intermittent contributions by the state toward counterpart funding contributed to delays. The agreed counterpart funding was the equivalent of US$12 million, to be made according to the schedule shown in table 1. While the state was fully in agreement to the counterpart arrangement and its rationale at project design, its contributions, especially in the initial years, did not always tally with the agreed schedule due to changing priorities. Internal financial allocations to various sectors, including roads, at the state level was, in general, erratic and dependent on other pressing concerns of the state government of the day. In the first three years, from 2008 to 2010, the state could not meet the agreed target of US$4 million as annual contribution and this affected the implementation. The contractor’s invoices could not be fully paid. In the later part of the project (between 2014 and 2016), the situation improved significantly and the state made its full contribution to the counterpart funding. The actual payments and time of contribution is not available, but the World Bank supervision teams confirmed that Kaduna State ultimately over-contributed toward the counterpart funding. This is further confirmed by the feedback received from the FPMU. As shown in Annex 1, government’s counterpart contribution amounted to US$ 12.15 million at the end of the project. 7   Table 1. Planned Counterpart Funding Contribution Government financial year 2008 2009 2010 2011 2012 2013 2014 Total Expenditure Streams Works 0.00 3.00 14.00 17.00 14.00 8.52 3.84 60.36 Goods 0.00 0.60 1.10 0.10 0.10 0.10 0.09 2.09 (US$ million) Consultancies 0.00 1.50 2.00 1.50 1.08 0.50 0.50 7.08 Others 0.00 0.90 0.60 0.30 0.30 0.30 0.07 2.47 Total 0.00 6.00 17.70 18.90 15.48 9.42 4.50 72.00 IDA 0.00 5.00 14.70 15.90 8.42 8.42 3.50 60.00 Source of million) Kaduna 0.00 1.00 3.00 3.00 1.00 1.00 1.00 12.00 Funds (US$ Federal 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 32. The method of appointment of the key staff in both the SPIU and the FPMU was not as planned and it led to suboptimal implementation capacity within these units. The initial plan was that these units would be manned by personnel who would be openly and competitively recruited from the existing civil service establishment. The processes would have yielded a team of experienced civil servants who would manage the project, gain more skills and then reintegrate back into the service after the project. The project made provision for remuneration of such personnel in accordance with market rates. Both the FMA&RD and the SMOWT transferred their personnel to their respective project units, initially as a temporary measure. Efforts to kick-start a formal recruitment were not successful. The personnel assigned to both the federal and state project units continued but because project funds could not be used to remunerate the personnel, civil service remuneration levels were maintained, which did not contribute toward improved commitment. 33. SPIU’s ability to execute day-to-day project management functions was influenced by the state administration and was not always assured. During the initial years of the project, the SPIU had its regular authority that is, they were allowed to exercise their mandates under the normal control of the parent ministry. This was followed by a period of near-absolute autonomy, with minimal ministerial oversight. In an attempt to correct the situation, what followed was a full control of the SPIU’s operations. The project design made provision for the creation of a State Project Steering and Monitoring Committee (SPSMC) comprising policy officials from stakeholder ministries and departments. The Chairperson of the Committee was the PS, SMOWT. The PS’s office being part of civil service, reported to the Commissioner for Works, which is a political office. Between December 2009 and June 2010, the State Commissioner for Works and Transport, assumed the role of the Chairmanship of the SPSMC, contrary to the agreed structures. This arrangement stifled project implementation. When the state administration took full control of the SPIU, the SPSMC did not meet regularly. The functions of the committee were left to the PS and the opportunity for the all-inclusive oversight functions was missed. 34. The security situation in the country, especially in the middle and northern parts of Nigeria, affected project implementation. Although not an issue at project preparation stage and the early parts of its implementation, Kaduna State experienced a series of security incidences especially from about 2010 that affected the rate at which the project could be 8   implemented. More specifically, there were ethnic clashes near project sites that made it impossible for the contractors or the supervision teams to operate. Often, the World Bank supervision missions were unable to make field trips to construction sites. Sometimes, the team relied on reports of third-party technical monitoring teams hired by the FPMU to obtain independent reviews on the progress and quality of the civil works contracts. 2.3 Monitoring and Evaluation (M&E) Design, Implementation, and Utilization 35. Identification of PDO indicators is considered to have been balanced but the same cannot be said about the intermediate indicators. The accessibility objective that is, the provision of improved rural roads and construction of river crossings, which was backed by more than 70 percent of the project credit, was monitored through five of the seven indicators. These included the rural accessibility index—one of the core roads indicators. There was also an effort to indirectly monitor the impact of the new infrastructure on the rural economy, by the amount of agricultural produce transported across the new river crossings, as a proxy. Monitoring of the number of trips and the transportation costs along the new roads assessed the impact in terms of utilization and efficiency of the infrastructure. Nevertheless, the choice of the six intermediate indicators lacked an essential element that is, it missed out on the monitoring of the progress toward road sector reforms. Explicit inclusion of the study on KAPWA would have kept this important issue in focus, probably forestalled delays in its implementation and provided ample time for policy-level dialogue with the client. 36. Systematic data collection was substantially delayed and the process did not benefit from thorough quality checks. Although project implementation effectively commenced in early 2009, there was a lack of M&E capacity within the SPIU, necessitating the appointment of a consultant, whose contract was signed four years later, in November 2013. At the time of the midterm review in November 2011, sufficient data was not available to assess performance. The SPIU commendably commissioned a cyclic data monitoring process in 2014, which produced quarterly reports. 37. The reports are general, assessing the socioeconomic impact of the project rather than focusing on the agreed Results Monitoring Framework. The data structure, method, and presentation in the reports were not linked to the indicators. The studies drew heavily on household surveys even where quantitative means would have been more appropriate. For instance, the number of people living within 2 km of an all-weather road, which is typically determined by the measured or estimated population within a 4 km wide road corridor, was obtained by assessing peoples’ perception that is, if in their view, they lived within 2 km of an all-weather road. This particular set of results is admissible, as it correlates to the improved road lengths, but because the project documents did not provide guidance on how the data was to be collected, such method diverged from the one used during appraisal. 38. The observed inadequacies in the M&E arrangements would require notable improvements. The choice of indicators, especially for the institutional capacity building component would have to be better linked to the objectives. The indicators would also have to be those with readily available data. The method of establishing baseline data would require clearer elaboration to guide subsequent data collection processes. Capacity building for M&E within the project implementation unit would be required and the management of M&E better articulated. To ensure quality checks, the FPMU would be expected to have the overall responsibility of reporting. 9   2.4 Safeguards and fiduciary compliance Environmental Issues 39. There were no reported compliance issues. In accordance with the World Bank and Federal Ministry of Environment policies and regulations, the FPMU prepared the required safeguard instruments, including the Environmental and Social Management Framework (ESMF). Similarly, the Kaduna SPIU prepared an Environmental and Social Impact Assessment and separate Environmental Management Plans (EMPs) for both the OPRC and river crossings. Other safeguard instruments prepared were the Resettlement Policy Framework (RPF) and Abbreviated Resettlement Action Plan (ARAP). The ARAP was prepared consistent with the provisions of the RPF to provide a plan for assistance or rehabilitation of Project Affected Persons (PAPs). 40. The FPMU also engaged the services of an independent environmental and social safeguards specialist to carry out a critical audit of the performance of the project with respect to the implementation of the environmental and social mitigation measures as identified in the policy documents prepared by Kaduna State’s RAMP. The audit did not reveal issues of safeguard concerns. Social Issues 41. Except for general safeguards implementation weaknesses, there were no non- compliance social issues. The project RAP was disclosed in-country between November 9 and 12, 2011 and at the InfoShop on November 14, 2011. The supervision missions of November 2012 and January 2013 observed that the ARAP document omitted some PAPs on one of the roads (Sabon Itch to Kuyeri road in Kagarko LGA) and therefore needed to be revised. The revision was carried out after several months of delay3 and the report was disclosed as an addendum to the ARAP. The process did not affect the progress of the works and the PAPs were eventually compensated. Following this incidence, the SPIU set up a Resettlement Implementation Committee and Grievances Redress Committee to implement social safeguard recommendations. Financial Management 42. There were no financial management (FM) concerns. The implementation of the project at the state level was the responsibility of the Kaduna SPIU anchored by the SMOWT. The anchoring ministry had the overall responsibility for leadership, supervision, and direction of project activities in the state. Furthermore, the Federal Project Financial Management Division located in the office of the Accountant General of the Federation was responsible for FM for all World Bank-funded projects. It assigned a qualified Accountant and Internal Auditor to the FPMU to oversee the use of financial resources under RAMP. Consequently, the project maintained sound and robust internal control system that allowed for segregation of duties. The project complied with the FM Manual and the project implementation manual. An external auditing firm regularly audited the project. The 2014 audit report noted that the project management largely complied with the instructions and guidelines contained in the manuals. It further noted significant improvement in ledger accounts.                                                              3 The review of the ARAP is reported to have been completed in the Aide Memoire of the March/April 2014 mission. 10   43. The accounting process was affected by the introduction of a new State Government FM policy in May 2015. Because of the policy, SPIU transferred all its project accounts to the state Treasury Single Account. While the policy was laudable with regard to overall government controls over the use of its resources, its implementation constituted a deviation from procedures that the project implementation unit was used to, hindering the smooth operation of the project and causing delays in payments to service providers. By November 2015, with the intervention of the World Bank, the state government resolved the matter and approved reopening of a new project accounts within the Treasury Single Account of the state. Procurement 44. Besides inadequate procurement capacity within the SPIU, procurement of civil works was slowed down significantly by the particular processes requirements for the OPRC. It was initially considered necessary to use a two-stage process and prequalify bidders to eliminate those who did not meet the requirements. One such requirement was the existence of engineering capacity within the bidder’s establishment. Typically, medium- and small-size contractors do not have significant engineering competencies. It took 18 months before the contracts could finally be awarded. This was attributed to the poor response and quality of bidders at the prequalification stage, which necessitated re-advertisement, calling for direct bidding that is, it was not necessary to prequalify. The effect of this change in approach was that the bidders were not thoroughly vetted for specialized engineering capacity to design the roads. The approach was effective in that bidders tendered their bids, contracts were awarded, and the works were completed on time. The supervision consultants were tasked with the responsibility of designing the roads. 45. Procurement of river crossing contracts, which did not have to follow a pre- qualification procedure, took four months to complete. The procurement and construction of the Bailey bridge on the Fadan Daji - Chenchichuona road presented a special challenge. This was because while the project provided for the construction of foundations and piers only, a substantial part of the bridge (the Bailey panels) had to be salvaged from another existing bridge and then assembled by the Nigerian Army. Quality control was poor and in May 2014, the substructure failed. The Kaduna State Government had undertaken to finance the completion of the bridge but the contract was not completed by the time the project closed. 46. Creation and transfer of procurement skills was ultimately beneficial to the state. The World Bank procurement team provided guidance to both the SPIU and the FPMU. They also conducted training events for the units. The SPIU continued to be obliged to refer procurement cases to the State Tender Committee for ratification before approaching the World Bank for clearance, but had had no control over the speed at which their cases could be reviewed by the State Tender Committee. The linkage between the SPIU and the state procurement system was observed to have a positive influence in the process. It was learned that after the SPIU was disbanded at the end of the project, procurement personnel were reintegrated into the state procurement offices, where their skills were being put to good use. 2.5 Post-completion Operation/Next Phase 47. Adoption of sound principles of strategic road asset preservation still requires special attention by the state. On account of economic viability and technical considerations, which included road life cycle costs and projected traffic volumes, about 78 percent (372 km) of the 475 km of the newly completed rural roads are to engineered lateritic gravel wearing course standards. The decision on the actual length of roads to be upgraded to bituminous 11   surface standards, based on economic considerations, was taken during the finalization of bidding documents4. Under the OPRC arrangement, road sections were constructed in the first two years, and then maintained over the next three years under one contract. When the five- year contracts came to an end, the OPRC contractors handed over the roads to Kaduna State Department of Works. With the introduction of the OPRC a culture of long-term road asset management approach was to be institutionalized. At the time the Implementation Completion and Results Report (ICR) mission visited the sites, the state had taken the decision to extend some of the OPRCs. The mission was informed that the state was planning to pave some of the roads, along which traffic volumes increased significantly, to bitumen surfaced standards. The state would also budget for continued maintenance of the other roads. The ICR mission agreed with the authorities that a more lasting solution, not only for the project roads, but also for the upkeep of the rest of the network in the state, was essential. The state would be considering the adoption of more robust methods, such as life cycle costs, as a means of guiding the decision- making process. 48. The impacts and momentum created through RAMP I need to be sustained. The current state development budget could be more rationalized by directing resources in a manner reflective of the state government’s rural development objectives. In 2016, the roads budget was only 27 percent of the Ministry of Works and Transport’s capital budget, most of it for construction and rehabilitation of roads to paved standards. Due to the high cost of paved roads, the state government’s efforts to rapidly open up more agricultural areas and to reach more rural communities, will be a slow process. This could be addressed by allocating funds for expansion of the RAMP-like road network. It is estimated that the equivalent of US$10 million would create 100 km of rural roads annually. 49. There is a need for more adoption and utilization of the institutional capacity building outputs of the project. The project assisted in the creation of a road reclassification system for the state, the formulation of a three-year rolling plan to guide the budgeting process, and the digitization of the state road map, thus improving precision in the planning process. Adoption and more utilization of these tools, by the Department of Roads needs to be encouraged. While the state is still considering an appropriate approach toward road sector reforms, the Department of Roads could already start addressing two main challenges: adoption of a more robust road network management approach and ensuring that road maintenance was well institutionalized and funded. A new approach to road network management could include better identification of the current and future road network funding needs, improved rationalization of the budgets, improved internal technical competencies, and, to the extent possible, identification of more assured means of funding state roads. The tools already developed under the project would facilitate these improvements and thus constitute a significant starting point for the department.                                                              4The projected traffic volume was used in the economic analysis to determine the viability of upgrading the roads to bituminous standards. 12   3. Assessment of Outcomes 3.1 Relevance of Objectives, Design, and Implementation Rating: Modest 50. Relevance of Objective - Substantial. The objectives of the project that is, to improve rural accessibility and institutional capacity, remained substantially relevant. The CPS for 2014 to 2017, builds upon Nigeria’s Vision 20:2020 and the Transformation Agenda. The CPS program is structured around three strategic clusters: (a) promoting diversified growth and job creation by reforming the power sector, enhancing agricultural productivity, and increasing access to finance; (b) improving the quality and efficiency of social service delivery at the state level to promote social inclusion; and (c) strengthening governance and public sector management. Under the first cluster, the CPS identifies road infrastructure (together with energy, information, and communication technology among others) as one of the binding constraints to Nigeria’s economic development. The CPS recognizes that poor infrastructure increases transport costs for farmers and that it also affects human capital, as poor households can neither send their children to local schools nor access social services provided in health or community centers.5 51. Under the third strategic cluster (strengthening governance and public sector management), the CPS focuses on improving efficiency of the government machinery at both federal and state levels. Based on the findings of the Country Assistance Framework developed by Nigeria’s partners at the time of drafting the CPS, the CPS acknowledges that Nigeria’s evolution of growth and poverty has been significantly influenced by its institutional capacity. As a result, it commits to leverage external resources and enhance the role of knowledge partnerships in building capacity at the state level. 52. Relevance of Design and Implementation - Modest. RAMP is still relevant for Kaduna State today, with some adjustments in the design and implementation. The two main components (upgrading and maintenance of transport infrastructure and institutional strengthening and capacity building) remain relevant, but their content and method of implementation could have been better adapted to local reality to obtain better impact. Institutions responsible for implementation of the OPRC have indeed gained initial knowledge but the project could instead have aimed at enhancing the capacity within the state road administration structures further. 53. Implementation would have considered more appropriate sharing of responsibilities between the state and the federal structures. At the federal level, the Government’s rural accessibility program was well supported, but the state-level operation itself could have been better linked to the federal program. Due to the federation principle6 the FMA&RD was the interlocutor ministry for the project. The ministry in turn created an FPMU. At the state level, the project was implemented by the Kaduna SMOWT. Because the two ministries did not have a strong functional linkage and the FPMU only had a monitoring function, the Federal Government did not have major leverage on the way the project was implemented at the state level. A significant change would have been to increase the responsibility of the FPMU, by making it responsible for M&E, and providing it with resources for technical audit purposes.                                                              5 CPS for 2014–2017, World Bank 2014 - Page 11, Paragraph 33. 6 According to devolved functions, the State Governments are responsible for rural roads. At the Federal Government level, there is therefore no ministry responsible for rural roads. 13   3.2 Achievement of Project Development Objectives Rating: Substantial 54. The two objectives of the project—to improve rural accessibility and improve management of road network sustainably, were achieved, with notably high results on the accessibility objective. The project’s impact in relation to the construction and rehabilitation of road infrastructure, including the river crossings, exceeded expectations. Five of the seven PDO indicators monitored accessibility and all of their targets were either achieved or surpassed. Road usage by the rural population, measured through the number of road trips per day, was exceeded by 52 percent; transportation efficiency, measured in terms of transportation cost, was exceeded by 16 percent; rural beneficiaries, measured by the additional population with improved access, was achieved 100 percent; impact on rural economy, measured by agricultural produce transported on the new infrastructure, was exceeded by 25 percent; and rural accessibility, measured by the proportion of the rural population with access to an all- season road, was exceeded by 10 percent. Of the two PDO indicators monitoring project outcomes on institutional capacity to manage roads, development of a three-year rolling plan was fully achieved while the development and use of a road management system was partially achieved. 55. Two of the five intermediate indicators on accessibility were exceeded. The length of roads constructed was surpassed by 11.2 percent, from 427 km to 475 km while the number river crossings was exceeded by 10.6 percent, from 132 to 146. One of two intermediate indicators on management of roads (road network classification study) was fully achieved. Development of a simplified road management and road inventory system database was not achieved. 56. In view of the above, the project objectives were met overall substantially, with high results on accessibility and modest achievements on sustainable institutional capacity. The institutional component aimed at introducing sustainable positive changes in the way roads were managed. This aspect was so critically important that it was included as part of the project covenants. The reform policy was developed but not adopted. Policy adoption goes beyond the scope of the project, and it should not affect project rating. Furthermore, other project outputs that were intended to support sustainability in road management e.g. Three-year rolling plan, the road network reclassification, and digitization of state road map, were also delivered. 3.3 Efficiency Rating: Substantial 57. Economic analysis was performed to assess whether the economic benefits of the road investments—which accounted for about 70 percent of the overall World Bank support—were higher than their respective economic costs. The analysis also sought to establish if these benefits were similar to those estimated at project preparation. Due to the initial low traffic levels, most of the roads were evaluated through a multi-criteria analysis focusing mainly on their ability to provide basic access and the cost of doing so per beneficiary. The higher trafficked roads, were however evaluated using the classical consumer surplus approach, where the benefits were assumed to stem from reduction in vehicle operating costs. 58. The results indicate that with the improvement of 475 km of rural roads at an estimated total cost of US$51,063,335.60, of which about 372 km were to gravel standard, an additional 309,641 of the population benefitted from improved accessibility. The investment cost per beneficiary was also estimated to be US$165 per beneficiary, which dropped by about 18 14   percent from US$200 per beneficiary,7 the level of cost effectiveness considered acceptable during project appraisal. It should however be noted that there are no established criteria for determining minimum thresholds for cost effectiveness measures, and the decision is usually left in the hands of the policy makers.8 59. The Cost-Benefit Analysis (CBA) of roads with traffic in excess of an Annual Average Daily Traffic (AADT) of 50 also shows cost effectiveness of the investment. The results are specifically from the Fadan Kamantan - Yangal - Walijo Road over an analysis period of 10 years. The results show that the best alternative is the upgrading of the road to single surface dressing, with a net present value (NPV) of US$3,342 million and an EIRR of 30 percent. However, the constructed alternative (upgrading to double surface dressing) is also economically justified with an NPV of US$3,143 million and an EIRR of 27 percent. This analysis further confirms the justification to upgrade roads with traffic levels exceeding 50 AADT to at least single surface dressing standard, as recommended in the PAD. Table 2. Upgrading Contracts NPV and Economic Internal Rate of Return NPV at ICR EIRR at EIRR at Road Sections (US$, million) ICR (%) Appraisal (%) Fadan Kamantan - Yangal - Walijo 3.342 30 15 Road 60. A sensitivity analysis by increasing or decreasing the normal traffic, normal traffic growth rate, and generated traffic by 25 percent produced an NPV of between US$2.731 million and US$4.851 million, and EIRR values of between 20 percent and 34 percent. The analysis of switching values for the option of road upgrade to double surface dressing standard as constructed, showed that the option would still be economically justified even when the normal traffic reduces by 46 percent, the investment cost increases by 91.3 percent, or when the annual maintenance cost per kilometer increases to US$35,100. 61. Economic benefits from river crossings. The largest river crossing constructed was a two-span reinforced concrete bridge, with each span measuring 12.5 m, located in Kajuru LGA of Kaduna State. Benefits from such a structure would normally include direct positive impact on local economic activity, including increased agricultural productivity, improved market prices for agricultural produce, and reduced cost of agricultural inputs. These are in addition to non-quantifiable benefits such as better access to schools, health facilities, and markets. 62. Data specific to this structure was not available to permit an objective evaluation of the benefits derived from the investment made. However, information from a recent study on M&E indicators noted that 76.4 percent of farmers, who before the provision of improved river crossings experienced problems in transporting agricultural produce during the wet season, are now able to do so without problems. The study estimates that the volume of agricultural produce transported across new bridges, culverts, and drifts has increased by an average of 31 percent.9                                                              7 Project Appraisal Document: Rural Access and Mobility Project, Kaduna (RAMP I), 2008. World Bank Report No.42455-NG, Page 90. 8 Where to Use Cost Effectiveness Techniques rather than Cost Benefit Analysis. World Bank Transport Note No.TRN-9, Page 7. 9 Collection of Data on Monitoring and Evaluation Indicators, Draft Final Report (Cycle 4), 2015. SPIU, Kaduna SMOWT. Borrower’s ICR Annex 5. 15   63. Cost estimates and contract prices. An analysis of the estimated costs and contract prices indicates that the prices of the road upgrading contracts are, on an average, about 8 percent lower than the estimated costs. These figures, coupled with the significant depreciation of the Nigerian naira against the U.S. dollar (from NGN 117.8per U.S. dollar at the time of Credit approval to about NGN 279.7 per U.S. dollar at project closing), suggest that the project had substantial savings, because most of the project cost was in local currency. A comparison of actual expenditure to date on Component A1 (Rehabilitation and maintenance of roads) with the estimate at the time of appraisal suggests a savings to the tune of 10 percent of the original estimates. 64. Besides the physical works for which economic benefits are readily quantifiable, the project did generate substantial non-quantifiable benefits, including improved accessibility for beneficiary communities, employment creation, better road safety environment, and institutional capacity enhancement. 3.4 Justification of Overall Outcome Rating Rating: Moderately Satisfactory 65. After combining the ratings for project relevance, its efficacy, and efficiency, for which the respective ratings are Modest, Substantial, and Substantial, the project is overall evaluated as having achieved the PDO Moderately Satisfactorily. 3.5 Overarching Themes, Other Outcomes and Impacts (a) Poverty Impacts, Gender Aspects, and Social Development 66. The new roads brought about an increase in the agricultural activities within the rural communities. The number of farming households increased by about 40 percent, from 51 percent in 2008 to 72 percent in 2015, which resulted in agricultural production growth. This is supported by the measured rise in the quantity of farm products transported over the new infrastructure. At project start in 2008, 3.5 million tons of agricultural produce were transported across the unimproved structures. This quantity rose to 4.6 million tons, an increase of 31 percent. Part of the increase could also be accounted for by the reduction in post-harvest losses. The income levels in the project area rose notably. At project start, households with annual earnings between NGN 10,000 and NGN 50,000 stood at 54 percent. The number of households in this income bracket rose to 62 percent, an increase of 15 percent at the close of the project (b) Institutional Change/Strengthening 67. At the federal level, the Government benefited through capacity building of the FPMU, which will in turn facilitate the implementation of Nigeria’s RTTP. Capacity-building support to the FPMU included FM, project management, leadership, procurement, computer skills, and management of the OPRC. The training was extended to the members of the FMA&RD’s National Technical Steering Committee (NTSC), comprising representatives from stakeholder federal ministries and states participating in the RTTP. With this capacity, the FPMU has become the Federal Government’s best-equipped agency for rolling out RAMP-like projects countrywide. Examples of such projects include the World Bank-supported RAMP Phase II covering three states: Enugu, Osun, and Niger. (c) Other Unintended Outcomes and Impacts (positive or negative) 16   68. According to Kaduna State’s Cycle 4 report of June 2015, new roads triggered a sharp rise in the ownership of other means of transportation. In particular, motorcycle ownership went up tenfold. At project start, about 6.5 percent of households owned motorcycles. This number rose to 68 percent at project closing. 3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops 4. Assessment of Risk to Development Outcome Rating: Substantial 69. There is inadequate evidence that the physical outputs of the project—the roads and river crossings—will be sustainably maintained. For the newly constructed roads, the arrangement was that they would be handed over by the contractors, to the SMOWT after the end of the OPRCs and that the ministry would continue with the maintenance. The ministry is to be commended for funding six months of road maintenance beyond December 31, 2015. But it is unclear how these roads will be maintained thereafter and how effective the new arrangement would be, especially in view of KAPWA’s present capacity. A visit by the ICR mission on four roads10 observed that although they were generally well maintained, there were manifestations of drainage-related damage. The ministry indicated that the cost of maintenance for these roads would be budgeted for and that some contractors would be retained to maintain them. The contracts of the newly completed river crossings were also terminated and there were no clear plans on how they would be maintained in the long term. 70. Technical skills development and institutional strengthening, without the backing of proper reforms is not likely to have a substantial impact. The SPIU benefitted from the training and capacity-building programs during project implementation. The project also supported the preparation of a Training Needs Assessment and Capacity Building Framework for the Civil Engineering Department of the SMOWT. The report was completed in June 2015, but its recommendations are unlikely to be implemented after project closure. Before the project, strategic planning for roads, project implementation capacity, road funding, and road maintenance, were some of the obvious weaknesses. The plan was to create a more robust institution to address these concerns. KAPWA was to be reformed into a more professional and better funded institution. The state indicated that plans were under way to advance the reforms but it was apparent that the proposed route was unlikely to yield the originally intended outcomes. Instead of focusing on the roads subsector, the state decided to reform the entire transport sector. 71. In the absence of appropriate institutional arrangements, that is, with the roads department of the ministry remaining essentially the same as it was at project approval, there will be little capacity and incentive to use the newly created road management tools. One of the project’s focus was to provide tools in support of better road network management. Consequently, the project supported new road reclassification, digitization of the road network, and three-year rolling budgets. These outputs are likely to remain partially unused. 5. Assessment of Bank and Borrower Performance                                                              10 During the ICR mission of July 25 to August 2, 2016, the team visited four new roads, three located in the southern part of Kaduna and one in the northern part. These were the 2.1 km long R417 from Awon road junction to Gora, the 1.4 km long road from Awon junction to Angwasin, and 14 km road from Banga to Mai- Ido-Kufari—all located in the south; and the 11 km long R225 from Sabon Birni to Yoro Jura in the north. 17   5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry Rating: Moderately Unsatisfactory 72. At entry, the project was well prepared and articulated. The World Bank ensured that the project was well dovetailed to the overall government policy on rural travel and transport and guided the Borrower in the definition of objectives and identification of components that were highly relevant to the main goals of the CPS. The quantification of physical project deliverables was well conducted and sound exit arrangements were in place. Project preparation also benefited from lessons learned from previous operations. Nevertheless, the project design included two particularly overambitious elements. The inclusion of the adoption of a state road sector reform policy in an environment that lacked a comprehensive federal model11 appears not to have been appropriate at the time. Also the requirement that Kaduna State makes counterpart contribution, especially in view of the fact that it was largely dependent on federal allocations was too onerous. 73. Also, the World Bank underestimated the heavy burden placed on the Borrower with regard to the preparations needed for successful implementation of the OPRC, especially in view of the Borrower’s inadequate internal capacity. In its review of the Borrower’s procurement plans the World Bank could have provided more intensive guidance, allowing sufficient time for bid preparation and actual bidding. The World Bank was overly concerned about low disbursements and pushed for the early commencement of works. The World Bank should have done a better job in designing a model that was more in line with the capacity of the construction industry and the government. The World Bank could also have carried out a heightened level of awareness creation and promoted private sector buy-in and conducted all- inclusive training ahead of the starting the OPRC. (b) Quality of Supervision Rating: Moderately Satisfactory 74. During project implementation, the World Bank carried out approximately two supervision missions per year (there are 16 Implementation Status and Results Reports filed from the project’s start to close). The team made special arrangements to circumvent the risky circumstances occasioned by insecurity, especially in the last three years of the project. However, some supervision issues, such as M&E, appear to have affected the project in a protracted manner. For example, while the rehabilitation of roads and bridges was substantially completed by March 2013, monitoring of the results indicator regarding the proportion of people with access to an all-weather road was still incomplete by September 2014. Bank intervened by advising the SPIU to recruit support personnel in the needy areas including M&E. This advice was heeded to and it resulted in remarkable improvement. 75. The midterm review does not appear to have had any impact on project implementation, despite the various shortcomings. The midterm review took place in November 2012, a delay of two months beyond the planed review date. Perhaps due to the absence of monitoring data, and therefore the inability to assess if the project was on its way to achieving its objectives. However, disbursements were low, and some of the OPRCs, especially in the southern parts of Kaduna were lagging behind. Capacity within the SPIU was low and institutional strengthening                                                              11 At the federal level, the Federal Road Maintenance Agency is responsible for road maintenance only with direct, typically suboptimal federal funding. Its governance structures are not particularly robust. 18   activities were not progressing as expected. The Government’s contribution toward the counterpart funding had stopped, during the first half of the project implementation. Bank intervened by approaching the state administration directly and explaining the effects of the lack of counterpart funding. The State Government thereafter reintroduced the counterpart funding in its state budget and ultimately made its contribution in full. (c) Justification of Rating for Overall Bank Performance Rating: Moderately Unsatisfactory 76. The overall World Bank performance rating is Moderately Unsatisfactory. 5.2 Borrower Performance (a) Government Performance Rating: Moderately Unsatisfactory 77. At the federal level, the Government is to be commended for putting the policy and strategy in place at the time of project preparation and for the initial steps taken to coordinate its implementation. The Federal Government used the RTTP to guide selection of participating states, define overall project outputs, to allocate internal resources toward a national program, including the creation of an FPMU. However, the FPMU staffing did not follow the agreed procedures. To ensure that the federal unit had the necessary capacity to guide the states, it was necessary to recruit FPMU staff in an open and competitive manner. The project made provision for commensurate remuneration of such staff. Instead of this procedure, the FPMU staff were directly transferred from various government ministries to the project and paid some allowance by government. 78. Kaduna State is to be commended for eventually providing the necessary counterpart funding, albeit with initial delays. However, its commitment toward reforms appear to have changed. The state did not complete the final critical steps of the agreed road sector reform process. The project design had identified a process that would lead to better institutionalization of road maintenance in the state, by reforming KAPWA (the state agency responsible for upkeep of the state’s assets) into a more effective road maintenance agency. While the road sector institutional study, the review of KAPWA legislation, and drafting of the amendment to the legislation were carried out, the process was stalled as the state opted to start a reform process for the entire SMOWT. At the time of project closing, there was no evidence that the road sector reform would be implemented. 79. Kaduna State did not prepare a follow-on state-funded RAMP. For sustainability purposes, it had been agreed that the project would finance studies leading to a follow-on state- funded project that would be similar to RAMP. The state argued that there would not be sufficient funds to implement the project. (b) Implementing Agency or Agencies Performance Rating: Moderately Satisfactory 80. The SPIU is to be commended for implementing and achieving higher than estimated outputs on the infrastructure aspect of the project. Its capacity was however generally inadequate throughout the project. The unit’s key staff was transferred from the SMOWT. Although project design made provision for the creation of a State Project Management Committee (SPMC), the unit did not strategically capitalize on the committee as the intended 19   process facilitator. Between December 2009 and June 2010, the State Commissioner for Works and Transport, had, contrary to the agreed structure, assumed the role of the Chairman of the SPMC. While the matter was resolved, World Bank missions in 2008 and 2009 records that the SPIU staff had notable internal differences.12 81. The SPIU operated under difficult circumstances and still delivered, especially on the roads component. By April 2014, the unit recruited three technical assistants for safeguards, M&E, and communications. By October 2014, the SPIU did not have an experienced roads engineer. The World Bank mission advised the SPIU to recruit one from the private sector. There was a delay of about two years between the completion of the river crossings and commencement of contracts to maintain them. Despite these capacity constraints, the SPIU delivered 475 km of roads and 146 river crossings, both about eleven percent above the planned 427 and 132 respectively. On capacity building, the SPIU did its part, albeit with delays, especially in terms of preparing the necessary reform documentation. (c) Justification of Rating for Overall Borrower Performance Rating: Moderately Unsatisfactory 82. The combined results of a Moderately Unsatisfactory performance by the Government and Moderately Satisfactory performance by the implementation agency is overall Moderately Unsatisfactory. 6. Lessons Learned 83. For the OPRC to be successful, sufficient preparatory work is required on the client’s part. The project experienced technical challenges arising from contractors’ poor appreciation of the expectations of the contract. The client should therefore have a clear understanding of the project road condition and the standards to which it will be brought through the OPRC. Conceptual designs should be prepared, with sufficient detail, to enable the bidders interpret and cost the inputs, but giving them enough room to include innovation where possible. The process should include comprehensive pre-bid sensitization and thorough review of proposals, including the pricing and evidence that bidders have a full understanding of contract expectations. It should, in particular, evaluate the existence of the requisite technical capacity within the bidder’s establishment. In particular, the share of rehabilitation and maintenance costs should be assessed. Following the choice of the bidder, sufficient time should be provided for the production of final designs by contractors. Work should not commence unless the client has ensured completeness of the design. 84. In the absence of the requisite OPRC implementation capacity, the World Bank could support upfront capacity building for the implementing agencies and service providers. During project preparation, the World Bank could provide resources to support the implementing agencies in acquiring the requisite competencies though skills development or by staffing them with knowledgeable personnel. The agencies could in turn create awareness within the construction industry and ensure its appreciation of the approach well before                                                              12 World Bank Aide Memoire of October 1 to 13, 2019 Mission (Paragraph 35). 20   commencement of the actual bidding process. The bidding process should be accompanied by a carefully planned information dissemination and bid evaluation process and should not be hurried. 85. When the capacity of bidders to properly design the OPRC roads is low, it is advisable to consider an OPRC bid process that removes this responsibility from them. Bidders are expected to develop the road agency’s conceptual designs to working designs that meet technical and economic requirements. Bidders for contracts similar to those under this project are typically medium-size contractors without full in-house engineering capacity for this requirement. In addition, assessment of the designs by the agency to ensure their comparability at bid evaluation and acceptability at implementation requires sufficient lead time and could delay the contract award and commencement of works. In such circumstances, the agency would minimize the cost and quality risks, as well as delays by providing the designs where they are necessary. 86. Review the risks associated with lump-sum prices for improvement and rehabilitation works in the OPRC bid documents. Lump-sum prices assume that all the necessary inputs for a road with the specified levels of service are fully costed and that they would be incorporated into the works. In the absence of the bill of quantities, road agencies cannot contractually hold contractors liable for omissions especially, if such omissions are not explicitly implied in the definitions of levels of service. In such instances, the agency would be advised to ensure completeness in the provided minimum specifications, as well as the definition of levels of service. In addition, the agency would be advised to internally establish the minimum costs for all activities as benchmarks for lump-sum priced items. 87. In choosing the road links that would form the OPRC packages, it is important to minimize logistical challenges at implementation. Under the OPRC, contractors are required to rehabilitate and maintain the roads as part of the same contract. Typically, the financial incentives for the contractor relate to the first part of the contract, the rehabilitation phase. Thereafter contractors normally demobilize, leaving behind suboptimal resources for road maintenance. If the OPRC packages comprise road links that are far apart, maintaining them presents a unique challenge. This was particularly the case in the OPRC packages chosen for the northern part of Kaduna. Contractors found it difficult to manage the project sites because they were far apart. 88. The choice to invest in the provision of basic accessibility leveraged government resources. The subcomponent on the improvement of river crossings, had the advantage that it encouraged the state government to provide its own resources to improve the ‘missing’ road links. Some rural roads in Kaduna are motorable during the dry parts of the year. However, during the rainy season the same roads are rendered impassable due to a few flooded crossings. At project design, it was decided to provide basic accessibility by improving drainage structures only along such roads. It was later observed that after the completion of the drainage structures, the state government, in some instances, made budgetary allocations to improve the roads leading to the improved river crossings. 89. Packaging of river crossing contracts requires careful consideration of the logistical implications. As noted in paragraph 88, the choice to develop isolated structures, like missing river crossings, is beneficial but the assumption is that the roads are generally motorable. This is not necessarily the case, especially during the rainy season when river crossing sites could become inaccessible. The implementation challenge is further complicated if sites of the same contract are far apart. It is therefore advisable to select improvement 21   structures located within the same vicinity and allow for time lost during the wet parts of the contract period. 90. Reforms present a unique challenge. The institutional component failed to deliver reforms although the necessary steps leading to the reforms were taken. Although accomplished late, the study on KAPWA was carried out and the necessary policy and legislation were drafted. But the decision to reform KAPWA was not taken by the policy makers. Based on the work carried out under the Nigeria Federal Roads Development Project (P090135), the federal-level road sector reforms had also not progressed as planned. The proposed reforms would have included funding of road maintenance using some form of road user-charging system or taxation system. Such a system would have been difficult to fully implement without a review of the principles governing the federation arrangements. In the absence of a federal-level model, the planned reforms in Kaduna State faced uncertainty. 91. Counterpart funding should be avoided wherever possible. At project preparation, Kaduna State committed itself to providing about US$12 million as counterpart funding in pre- agreed amounts annually. The state’s contribution was however not remitted strictly in accordance with the schedule, which affected project implementation. Over time, circumstances, priorities, and public institutions changed and these changes did override the original intentions. It is suggested that in instances where demonstration of commitment on the part of the Government is necessary, an approach that isolates the project from possible failure to comply could be found. An example would be to agree on a realistic increase in the internal budgetary allocations toward related activities. The project could have, for instance, required Kaduna State to increase its budgetary allocation toward road maintenance by a realistic proportion annually. Failure to achieve the target would have had no effect on the project implementation. 92. Inadequate institutional project implementation capacity should be addressed as early as possible. In the case of the FPMU and the SPIU, the failure to recruit personnel correctly resulted in initial implementation inadequacies that were reflected throughout the life of the project. The problem was exacerbated by the absence of prior World Bank project implementation skills within the institutions from which the FPMU and SPIU personnel were sourced. Once the FPMU and the SPIU were staffed, there would have been internal resistance to correct the situation.. In this instance, the World Bank could have insisted on the agreed recruitment procedures being followed. A strong FPMU, made up of openly recruited and experienced former employees of stakeholder government ministries, would have better guided the SPIU and forestalled some of the shortcomings at the state level. 93. Absence of continuous M&E increases the risk of missed opportunities. It appears that in the initial part of project implementation, the importance of M&E was downplayed—at midterm review, there was not sufficient data to assess the project’s progress toward achieving its objectives. As a result, the project focused on the rather obvious deliverables—the road infrastructure—with insufficient focus on the transformational and institutional aspects of the project. The momentum for reform appears to have been lost and by the time the related activities were implemented, sufficient time was not available for internalization of the outcomes and meaningful dialogue with stakeholders. 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (a) Borrower/implementing agencies Not applicable. 22   (b) Co-financiers Not applicable. (c) Other partners and stakeholders Not applicable. 23     Annex 1. Project Cost and Financing by Component (a) Project Cost by Component (US$, million equivalent) Appraisal Cost Estimate (US$, million)13 Actual Costs (US$, million)14 %age of Components IDA Gov. Total IDA Gov. Total Appraisal A) Upgrading, rehabilitation, and maintenance of transport infrastructure 51.91 12.00 63.91 48.62 12.15 60.77 95 A. 1) Rehabilitation and maintenance of roads 39.55 8.55 45.39 37.66 9.41 47.07 104 A.2) River crossings 16.16 3.45 18.51 10.96 2.74 13.70 74 B) Institutional strengthening, reforms, and capacity building 8.09 0.00 8.09 2.67 0.00 2.67 33 15 Total 60.00 12.00 72.00 51.29 12.15 63.44 88 (b) Project cost by source of financing (US$, million equivalent) Type of Appraisal Actual/Latest Percentage of Financing Estimates Estimates Appraisal Borrower Counterpart 12.00 12.15 104 IDA Credit 60.00 51.29 85 Total 72.00 63.44 88 Source: Project Appraisal Document and Project Portal Summary.                                                              13 Cost estimates at Appraisal were taken from the Project Appraisal Document 14 Government actual costs were provided by FPMU, IDA costs are from Project Portal Summary 15 The amount is equivalent to SDR 37.42 or 99% of the original Credit amount of SDR 37.80. The difference was due to losses in exchange rate fluctuations between the US$ and the SDR. 24     Annex 2. Outputs by Component Project Objective The PDO is to improve road access for rural communities in Kaduna State and improve management of State road network in a sustainable manner. Component Targets Actual/Latest Estimates Component A: (i) Subcomponent A1: 427 The actual total length of roads rehabilitated Upgrading, Rehabilitation, km of rural roads and maintained is 475 km, which was 48 km and Maintenance of more than 427 km of roads planned. Transport Infrastructure (ii) Subcomponent A2: 135 150 river crossings that is, 15 above the river crossings original estimate of 135. Component B: (i) To support project  13 individual consultants were engaged to Institutional Strengthening, implementation by provide technical assistance to the SPIU. Reform, and Capacity providing goods and  Base line surveys Building services.  Communication on the concept and benefits of RAMP I to stakeholders  Technical and financial audits of the FPMU. (ii) Strengthening the  Training and workshops capacity of the public sector o The training covered skills in FM, to manage road network project management, leadership, procurement, and computer skills.  Training Needs Assessment and detailed Capacity Building Framework was prepared for the Civil Engineering Department of the SMOWT and the final report submitted to the SPIU in June 2015.  Road Information Management System study, completed in May 2015.  Road management operational equipment - operational vehicles, computers, printers, copiers, and so on. (iii) Implementation of  Road reclassification studies institutional reforms  Study of road management institutional development and capacity-building reforms.  Digitized state map  Road sector reforms – studies have been completed and a policy document prepared and awaiting approval by the state government. (iv) Cross cutting issues,  Road safety incorporated in the road including awareness design creation and related work  Awareness creation and road safety on road safety, gender, and campaigns HIV/AIDS  Gender studies on RAMP I -“Evaluation of Community Involvement and Gender Issues in the Rural Access and Mobility Project (RAMP-I) in Kaduna State” conducted in 2013.  HIV/AIDS sensitization workshop (v) Preparation of state  No action was taken for the preparation of funded follow-on RAMP. the next phase of RAMP in Kaduna State.   25   Annex 3. Economic Analysis 1. Introduction 1.1 Background 1. The Government of Kaduna State with the support of the World Bank implemented RAMP to improve access for its rural communities, as well as, improve the management of its road network in a sustainable manner. The project closed on June 30, 2016, and as part requirement for the preparation of the Implementation Completion and Results Report by the Government, an economic evaluation was required. 1.2 Objective and Scope of Assignment 2. The objective was to review the economic efficiency of the rural transport infrastructure investments supported by RAMP in Kaduna State. An economic evaluation of the project was earlier carried out at the project appraisal stage, and this study would serve to review the economic efficiency of the project in the light of updated and current information derived from actual project implementation. 2.0 Project Description 3. The PDO was to improve road access for rural communities in Kaduna State and improve management of State road network in a sustainable manner. This PDO supported the higher-level objective of poverty reduction by boosting non-oil growth through interventions with potential for triggering and sustaining growth, shaping existing reform initiatives and guiding new investments at all levels of governance.16 4. RAMP I intervention in Kaduna State had two main components. The first was the upgrading, rehabilitation. and maintenance of rural transport infrastructure; while the second component comprised institutional strengthening, reforms, and capacity building of road transport sector agencies. About 457 km of rural roads located in six identified intervention areas, covering eight LGAs of the state, were upgraded, rehabilitated, and maintained over a period of five years using the long-term OPRCs; in addition 132 river crossings spread across the State were constructed and rehabilitated. The OPRC works were implemented within 60 months, between 2011 and 2016. 5. Of the roads earmarked for improvement, 86 percent of the rural roads were upgraded to gravel standards along engineered routes; while the remaining 14 percent had bituminous surfacing. Before RAMP I implementation, most of the project roads (74 percent) carried less than 50 vehicles per day (VPD). The estimated levels of motorized traffic are shown in figure 3.1. Although vehicular traffic on most roads was low, there was high use of the roads by motorbikes and nonmotorized traffic often carrying agricultural produce. This demonstrated the potential for traffic growth once the roads were improved.                                                              16 Project Appraisal Document (PAD): Rural Access and Mobility Project, Kaduna (RAMP I), 2008. World Bank Report No.42455-NG, Page 4.   26   Figure 3.1. Road Traffic Levels Figure 3.2. Distribution of Road Surface Condition 6. Furthermore, only about 28 percent of the roads were in such a condition that they could be maintained by routine maintenance without major repairs (figure 3.2). About 72 percent of the roads required substantial improvements and initial works to bring them to a maintainable condition.17 7. A multi-criteria analysis was employed for screening, prioritizing, and selecting roads to be included into the OPRC project based on cost-effectiveness, population of communities along the road, traffic volume along the road, and community preference criteria. 8. For the river crossings, the criteria considered for selection included complexity of the engineering interventions and size of required facility, with higher priority attached to the less complex structures. The final criterion was the location of the river crossing and its potential to contribute to rural accessibility, and therefore, alleviation of rural poverty.18                                                              17 Final Report: Consultancy Services for The implementation of a Long Term Output and Performance Based Road Contracts (OPRC), 2010. EgisBCEOM and Enviplan International, Page 20. 18 Project Appraisal Document (PAD): Rural Access and Mobility Project, Kaduna (RAMP I), 2008. World Bank Report No.42455-NG, Pages 5 and 6.   27   3.0 Economic Evaluation Approach and Methodology 3.1 Overview of Approach 9. The conventional (consumer surplus) approach to the economic evaluation of road projects is the application of CBA methods to compare the total costs and benefits that will be incurred over the analysis period if no investment is made (‘do nothing’ alternative) with the costs and benefits arising as a result of making the investment. For the RAMP I road improvement scheme, the costs to the economy include the initial construction and rehabilitation cost and subsequent cost of maintenance; while the main tangible benefit from the improved riding surface quality is the savings in the transport operating cost. Alternative investments are compared on the basis of NPV and EIRR. 10. Consumer surplus methods have been shown to be particularly reliable when applied to roads carrying more than 200 VPD. For traffic levels below 50 VPD, as is the case on the majority (74 percent) of the OPRC roads in Kaduna State, application of consumer surplus methods becomes inappropriate as the main benefits do not come from savings in vehicle operating costs, but instead relate to the provision of access itself.19 In such situations, it is advisable to use measures derived from Cost Effectiveness Analysis (CEA) or multi-criteria analysis as the basis for investment decision making; provided that the contribution of the intervention to meeting the overarching objectives of the investment strategy is clearly stated and the project concerns the provision of least cost basic access.20 Use of the CEA methods for the economic evaluation of rural transport infrastructure are found to be useful in project screening and ranking; as well as, project evaluation where benefits estimation is difficult, options are similar (for example, prioritizing the rehabilitation of a number of rural roads), or the cost of data collection is high, relative to cost of the proposed intervention. 11. Thus, for the current assignment, the CEA method was adopted for economic evaluation of project roads with AADT of less than 50; while for traffic levels between 50 and 200 AADT, the World Bank’s Roads Economic Decision (RED) Model (version 3.2) was employed to perform the CBA of road investment options. The RED Model also uses the consumer surplus approach, but modified and customized to account for the characteristics of low-volume roads, such as high uncertainty of model inputs, particularly the traffic and condition of unpaved roads, importance of travel time measurements to characterize the condition of unpaved roads, the need for a comprehensive analysis of generated traffic, and the need to clearly define all accrued benefits.21 The model estimates benefits accruing to normal, generated, and diverted traffic, as a function of savings in the vehicle operating and time costs. Costs are estimated using the road user costs relationships from the Highway Development and Management Model (HDM-4), which is                                                              19 Low Volume Roads. World Bank Transport Note No.TRN-21, 2005, Page 3. 20 Where to Use Cost Effectiveness Techniques rather than Cost Benefit Analysis. World Bank Transport Note No.TRN-9, Page 10. 21 Jerry Lebo and Dieter Schelling. 2001 “Design and Appraisal of Rural Transport Infrastructure: Ensuring Basic Access for Rural Communities.” World Bank Technical Paper No.496, 2001., Page 80.   28   calibrated to local conditions.22 It also estimates safety benefits, as well as, performs sensitivity, switching values, and risk analyses. 12. The conventional CBA methods have been found to be unsuitable for roads carrying traffic of 50–200 AADT as they do not adequately capture all the benefits accruable from rural roads investments, in addition to requiring a series of data inputs which are impractical or too expensive to collect for low traffic levels.23 3.2 Methodology (Traffic less than 50 AADT) 13. For the project roads with traffic of less than 50 AADT, representing about 74 percent of the project roads, least cost basic access was provided through rehabilitation to a laterite gravel wearing course with the view of triggering and/or promoting social and economic development, thereby contributing to improved rural livelihoods and poverty alleviation. Accessibility impact of the intervention was evaluated by estimating the population served within 2 km of the project roads. The population density for each local government area was based on the 2006 national population census and was projected at an annual population growth rate of 3.045 percent24 to obtain the 2016 densities. 14. The investment cost per beneficiary was used as the measure of cost effectiveness. That is, 3.3 Methodology (Traffic between 50 and 200 AADT) 15. In the case of roads with AADT of between 50 and 200, the 21.8 km long Fadan Kamantan - Yangal - Walijo Road in Zangon Kataf LGA of Kaduna State was chosen and subjected to a CBA using the RED Model. The road had a vehicular traffic of 65 AADT, which was considered representative of the worst-case scenario for project roads with traffic levels within the lower band of the 50–200 AADT range. Thus, if this road meets the economic efficiency criteria for viability, then the rest of the roads with equal or greater traffic would most likely also be economically viable. Traffic estimates and growth rates were guided by findings from the earlier rural road prioritization study.25 Traffic estimates and characteristics were assumed to be the same for both dry and wet seasons, while the price elasticity of demand for transport infrastructure was taken as 1.0. The economic evaluation ignored nonvehicular traffic, especially motorcycle traffic. Diverted traffic and road safety benefits were also not considered in the evaluation due to lack of appropriate data.                                                              22 Configuration and Calibration of HDM-4 to Nigerian Conditions, 2014. Road Sector Development Team, Federal Ministry of Works. 23 Rodrigo S. Archondo-Callao. 1999. Roads Economic Decision (RED) Model for Economic Evaluation of Low Volume Roads, Sub-Saharan Africa Transport Policy Program Note No.18., Page 1. 24 2006 National Population Census. National Population Commission. 25 Prioritization of Intervention Areas and Selection of Initial Road Program in Kaduna State, 2006. Ark Consult Ltd., Page 97.   29   16. The total investment costs comprised cost of physical works (initial/rehabilitation, spot improvements, and emergency) at contract award and costs associated with consultancy services for the OPRC design and supervision.26 17. For each project alternative, the RED Model presented detailed reports of economic feasibility, road user costs and benefits, and sensitivity and switching values analyses. 4.0 Presentation and Discussion of Economic Evaluation Results 4.1 CEA (Traffic < 50 AADT) 18. The accessibility impact for affected population, based on a population growth rate of 3.045 percent is contained in table 3.1 for each of the OPRC roads; while the investment cost per beneficiary is shown in table 3.2. The results indicate that with the improvement of 457 km of rural roads at an estimated total cost of US$51,063,335.60, of which about 372 km were upgraded to gravel standard, an additional 309,641 of the population benefitted from improved accessibility. The investment cost per beneficiary was also estimated to be US$165 per beneficiary, which deviated by about 18 percent from the US$200 per beneficiary27 measure of cost effectiveness considered acceptable during RAMP I project appraisal. 19. There are no established criteria for determining minimum thresholds for cost- effectiveness measures, and the decision is usually left in the hands of policy makers.28 Therefore, to explore the likelihood of a more appropriate range for the minimum threshold, given the current knowledge of actual scope of works and associated costs, the cost per beneficiary by contract lot was determined as shown in table 3.3, which showed cost per beneficiary values of between US$125 and US$162. Furthermore, a cost per beneficiary of US$161 was obtained from the CBA of the Fadan Kamantan - Yangal - Walijo Road for gravel standard alternative. Thus, the minimum threshold for cost effectiveness in the range of US$100 to US$120 for roads with traffic levels less than 50 AADT and US$150 to US$160 for roads with traffic levels of between 50 and 200 AADT may be considered adequate. Table 3.1. Estimation of OPRC Accessibility Impact Interve Road 4 Km 2006 2016 Affected S/No. Road Link LGA ntion Length Area Population Population Population Area (Km) (Km2) Density Density Dagon Dawa - U/Danko - 1 B/Gwari 13 13.78 55 40 54 3,002 Kwashi 2 Ungawan Fari - Bugai B/Gwari 16 11.70 47 40 54 2,549 3 Bugai - U/ Alhaji Shehu B/Gwari 16 12.73 51 40 54 2,773 4 Galadimawa - Gamba Giwa 13 11.00 44 136 184 8,094 5 U/Liman - Fatika - U/Kanawa Giwa 13 27.41 110 136 184 20,168 6 Giwa - Yakawada Giwa 13 12.17 49 136 184 8,954                                                              26 Contract Document for Improvement/Rehabilitation/Maintenance of Rural Roads in Kaduna State using Output and Performance based Road Contracts, 2011. SPIU, Kaduna SMOWT. 27 Project Appraisal Document (PAD): Rural Access and Mobility Project, Kaduna (RAMP I), 2008. World Bank Report No.42455-NG, Page 90. 28 Where to Use Cost Effectiveness Techniques rather than Cost Benefit Analysis. World Bank Transport Note No.TRN-9, Page 7.   30   7 Nasarawa - Gangara -Dundubus Giwa 13 13.46 54 136 184 9,904 8 Gwada - Sabon Birnin Giwa 13 8.99 36 112 184 6,620 9 Kerawa – Gedage Giwa 13 6.53 26 112 184 4,806 10 Dunki - Labar - Jaji Igabi 13 40.34 161 112 151 24,300 11 Kerawa – Sako Giwa 13 8.25 33 112 184 6,071 12 Kakangi - Murai - Karaukarau Giwa 13 7.12 28 136 184 5,239 13 Wazata - Rafin Yashi - Kugu Igabi 13 3.38 14 112 151 2,035 14 Rigachikun - Tami - Birnin Yero Igabi 13 9.83 39 112 151 5,921 15 Sabon Birnin Yero - Dallatu Igabi 13 9.25 37 112 151 5,574 16 F/Kagoma - Jagindi Tasha Jemaa 2 15.62 62 163 220 13,744 Bakinkogi - Godogodo - 17 Jemaa 2 29.76 119 163 220 26,186 Dangoma 18 Jagindi Tasha - Kogum Jemaa 2 12.71 51 163 220 11,184 19 Amere - Gerti Jemaa 2 7.03 28 163 220 6,186 20 Kibori - Sako Jemaa 2 6.75 27 163 220 5,939 Fadan Kamantan - Yangal - 21 Z/Kataf 3 21.80 87 116 157 13,659 Walijo 22 Lenak – Zuturun Z/Kataf 3 15.96 64 116 157 10,000 U/ Wakili - U/ Rohogo - Takanai 23 Z/Kataf 3 23.8 95 116 157 14,913 - Gora Segwaza 24 Barga - Mai Ido Kufai Kachia 15 14.74 59 53 71 4,212 25 Awon Road - Gora Kachia 15 2.18 9 53 71 623 26 Awon Road - U/ Rimi Kachia 15 1.41 6 53 71 403 27 Sabon Gida - Kudiri - Kagarko Kagarko 15 12.84 51 125 168 8,651 28 Sabon Itche - Kuse - Kagunyi Kagarko 15 6.68 27 125 168 4,500 29 Kubacha - Kukui - Kusam Kagarko 15 14.2 57 125 168 9,567 30 Kabara - Aribi Kagarko 15 7.88 32 125 168 5,309 Kagarko - Kushe - Kasaru - 31 Kagarko 15 55.18 221 125 168 37,176 Kenyi - K/Dangana 32 Kenyi - Fai - U/Fari Jaba 15 8.4 34 412 556 18,679 33 Goraa Road Kagarko 15 4.01 16 125 168 2,702 456.8 Total 309,641 9 Table 3.2. Estimation of Cost Effectiveness Indicator Alternative Total Road Additional Total Investment Cost per Length Accessibility Cost Beneficiary Road rehabilitation (81% to 457 km 309,641 Persons US$51,063,335.60 US$165 unsealed gravel standard) Table 3.3. Estimation of Cost effectiveness by Contract Lot Road Cost per Beneficiary Contract Affected Length Investment Cost (NGN) Lot Population (km) NGN US$ N1 102.25 55,443 1,394,010,046.00 25,143.20 162.21 N2 93.70 60,566 1,994,781,733.48 32,935.85 212.49 S1 133.40 101,811 1,978,346,471.30 19,431.49 125.36 S2 127.52 91,821 2,094,154,936.14 22,806.88 147.14 456.87 309,641 7,461,293,186.92 4.2 CBA (50 ≤ Traffic ≤ 200 AADT)   31   20. The summary results of the CBA of Fadan Kamantan - Yangal - Walijo Road over an analysis period of 10 years is presented in table 3.4. The results show that the best alternative is the upgrading of the road to single surface dressing, with an NPV of US$3.342 million and an EIRR of 30 percent. However, the constructed alternative (upgrading to double surface dressing) is also economically justified with an NPV of US$3.143 million and an EIRR of 27 percent. This analysis further confirms the justification to upgrade roads with traffic levels exceeding 50 AADT to at least the single surface dressing standard, as recommended in the PAD. Table 3.4. CBA Summary Result Country Nigeria Project RAMP I Road F/ Kamatan - Yangal - Walijo Without Possible Project Project Alternative Alternatives Alternative Alternative Alternative Alternative 0 1 2 3 Rehabilitated to Gravel Upgraded to Single Upgraded to Double Unmaintained Road Standard and Surface Dressing and Surface Dressing and Maintained Maintained Maintained 0.000 2.898 3.342 3.143 #N/A 36% 30% 27% 21. A sensitivity analysis by increasing or decreasing the normal traffic, normal traffic growth rate, and generated traffic by 25 percent produced NPV of between US$2.731 million and US$4.851 million and EIRR values of between 20 percent and 34 percent. The analysis of switching values for the option of road upgrade to the double surface dressing standard as constructed, showed that the option would still be economically justified even when the normal traffic reduces by 46 percent, the investment cost increases by 91.3 percent, or the annual maintenance cost per kilometer increases to US$35,100. 4.3 Economic Benefits from River Crossings 22. The terms of reference requires the evaluation of the economic benefits from the largest river crossing constructed in RAMP I. The largest river crossing constructed is a two-span reinforced concrete bridge, with each span measuring 12.5 m, located in Kajuru LGA of Kaduna State. Benefits from such a structure normally concerns the impact of transport investments on local agricultural productivity and output like increase in agricultural output, improved market price for agricultural produce, and reduced cost of agricultural inputs. These are in addition to non- quantifiable benefits such as better access to schools, health facilities, and markets. 23. Data specific to this structure were not available to permit an objective evaluation of the benefits derived from the investment made. However, information from a recent study on M&E indicators noted that 76.4 percent of farmers, who before the provision of improved river crossings experienced problems in transporting agricultural produce during the wet season, are now able to   32   do so without problems. The study estimates that the volume of agricultural produce transported across new bridges, culverts, and drifts has increased by an average of 30.7 percent.29 5.0 Summary of Key Study Findings 24. Table 3.5 provides a summary of the key economic efficiency indicators obtained from the economic evaluation review in comparison with the indicators estimated at the project appraisal stage of RAMP I. Table 3.5. Comparison of Economic Efficiency Indicators A) Cost Effectiveness Analysis  PAD REVIEW  Total Length of OPRC Project 427  457  Roads (km)  Total Investment Cost (US$)  45,390,000 51,063,335  Affected Population (Persons)  239,948 309,641  Cost/Beneficiary (US$/Person)  189  165      B) Cost Benefit Analysis  Alternative 1  Alternative 2 Alternative 3  Rehabilitate to Gravel Upgrade to Single Upgrade to Double PAD  REVIEW PAD  REVIEW  PAD  REVIEW NPV (US$ million at   1.324 2.898  0.469  3.342  -0.241  3.143  12% Discount Rate  EIRR (%)  26 36  15 30  11  27                                                               29 Collection of Data on Monitoring and Evaluation Indicators, Draft Final Report (Cycle 4), 2015. SPIU, Kaduna SMOWT.   33   Annex 4. Bank Lending and Implementation Support/Supervision Processes (a) Task Team Members Responsibility/ Names Title Unit Specialty Lending Bayo Awosemusi Lead Procurement Specialist AFTPW Procurement review Petrus Benjamin Gericke Lead Transport Specialist AFTTR Team leader Okwudili N. Ikejiani Consultant AFCW2 Technical support Yitzhak A. Kamhi Consultant AFTTR Technical support Anne Njuguna Country Program Assistant MNCA2 Team support Chukwudi H. Okafor Senior Social Development Specialist AFTCS Social safeguards Comfort Onyeje Olatunji Program Assistant SASDO Team support Environmental Africa Eshogba Olojoba Senior Environmental Specialist MNSEE safeguards Adenike Sherifat Oyeyiola Senior Financial Management Specialist AFTME Financial management Justin Runji Senior Transport. Specilaist. AFTTR Team leader Supervision/ICR Environmental Amos Abu Senior Environmental Specialist AFTN1 safeguards Financial management Akinrinmola Oyenuga Akinyele Sr Financial Management Specialist AFTMW reviews Mary Asanato-Adiwu Senior Procurement Specialist AFTPW Procurement reviews Bayo Awosemusi Lead Procurement Specialist AFTPW Procurement reviews Anil S. Bhandari Consultant AFTG1 Transport Specialist Aisha Donald Kaga Senior Executive Assistant AFCW2 Team support Regina Oritshetemeyin Nesiama Senior Program Assistant ECSSD Team support Anne Njuguna Country Program Assistant MNCA2 Team support Chukwudi H. Okafor Senior Social Development Specialist AFTCS Social safeguards Environmental Africa Eshogba Olojoba Senior Environmental Specialist MNSEE safeguards Olatunji Ahmed Senior Transport Specialist GTIDR Transport Specialist Justin Runji Senior Transport Specialist GTIDR Transport Specialist (b) Staff Time and Cost US$ Thousands (Including No. of Staff Weeks travel and consultant costs) Lending FY01 5.51 37,795.48 FY02 0.00 0.00 FY03 8.73 69,391.83 FY04 8.93 65,787.84 FY05 23.32 145,245.63 FY06 28.87 162,215.14 FY07 18.79 138,097.09 FY08 26.46 160,103.70 Total: 120.61 778,636.71 Supervision/ ICR FY09 14.39 82,777.31   34   FY10 17.74 127,222.59 FY11 38.85 147,525.94 FY12 37.68 148,508.85 FY13 26.27 72,974.68 FY14 34.39 110,426.74 FY15 21.97 87,712.09 FY16 16.03 80,249.77 FY17 8.87 50,190.79 Total: 216.19 907,588.76   35   Annex 5. Beneficiary Survey Results Not applicable.   36   Annex 6. Stakeholder Workshop Report and Results Not applicable.   37   Annex 7. Summary of Borrower's ICR Background 1. In support of the implementation of the Nigerian Government’s RTTP, the Federal Republic of Nigeria, through the FMA&RD, has received financing from the International Development Association (IDA) and lent the financing to Kaduna State Government toward the cost of RAMP I. The FPMU of the FMA&RD at the national level has the overall coordination and facilitation of the project, while the physical implementation of the project is the responsibility of the Kaduna State RAMP. 2. The FPMU operates under the strategic oversight of the NTSC, an existing structure within FMA&RD. This NTSC comprises the following members:  PS of FMA&RD  Technical ministries’ representatives  Coordinators of all IDA-financed agriculture and infrastructure programs in FMA&RD 3. The NTSC meets on a quarterly basis. This arrangement is expected to facilitate the alignment of RAMP with the other relevant Federal Government programs, as well as the expansion of the project to cover 36 states and the Federal Capital Territory. The FPMU is currently coordinating both RAMP I and II and is fully staffed with civil servants and consultants recruited competitively. 4. The rural transport infrastructure component of the Kaduna RAMP includes: (a) Upgrading, Rehabilitation, and Maintenance of about 475 km of roads across the northern and southern part of the state based on the OPRC. The roads (199.23 km) included in Lots N1 and N2 are located in the northern part of Kaduna State, while those included in Lots S1 and S2 (267.26 km) are located in the southern part of the state. (b) Another component of the rural transport infrastructure is the construction and rehabilitation of selected river crossings across the entire state. One of the prominent topographical features in Kaduna State is the dense network of rivers, streams, and other drainages. These dense networks of drainages constitute obstacles to accessibility, particularly in the rural areas due to the absence of crossings, and where they exist, most of the time they are locally constructed with local materials, which cannot withstand the floods and storm water during the rainy season. For this reason, 132 river crossings were approved for construction as a component of RAMP. Project Preparation and Design   38   5. The FPMU supported the establishment of the SPIU and carried out some preparatory studies as follows: (a) Consultancy services for the identification of intervention areas and selection of high- priority rural roads in Kaduna State. (b) Consultancy services for the development of the RTTP Implementation Plan. 6. The objectives of these studies is to develop an adequate, safe, environmentally sound, and economically efficient and sustainable rural travel and transport system that will ensure all-season, basic access in the rural areas and will facilitate integrated rural development and poverty reduction, as well as empower rural dwellers to become more economically productive. Project Implementation and Monitoring 7. RAMP I in Kaduna State has piloted four trials (N1, N2, S1, and S2) of the OPRC model for the upgrading and maintenance of rural roads in the state. The SPIU also constructed 132 river crossings across the state. 8. The FPMU supports the physical implementation of the project in Kaduna through the provision of technical support and carrying out some important studies, as well as monitoring the implementation progress. Some of the activities include the following: (a) Engagement of two technical assistants (engineering) to represent the FPMU and support the SPIU in ensuring quality control and supervision of the construction works. (b) Participation in all technical support missions organized by the World Bank (c) Coordination and facilitation between the National Planning Commission, Federal Ministry of Finance, World Bank, and other relevant stakeholders (d) Consultancy services for the development of a result-based M&E framework (e) Consultancy services for management information system (f) Organization of various short duration courses for capacity building of the FPMU and SPIU staff Project Review and Compliance 9. The concept of OPRC in rural roads in Nigeria is new. Therefore, it elicited a wide range of perceptions and expectations from the clients, consultants, and contractors on how the OPRC concept is being practiced, what has been achieved, and what elements need to be fine-tuned to increase the success of the concept, including realistic affordability. 10. Against this backdrop, the FPMU engaged the services of an international asset management consultant, Dr. Ian Greenwood, to review the implementation of the concept in   39   Kaduna. The objective of the review was to determine and document the challenges and success of the concept with a view to providing recommendations that could improve subsequent OPRC packaging and implementation in Kaduna State and Nigeria at large. 11. Despite the many challenges, including lack of prior knowledge of the concept by the project team, consultants, and the contractors, the Kaduna trials were a success, with all parties accepting advancement in their knowledge and technical abilities of asset management because of the pilot. The communities in the states benefitted with about 475 km of rural roads mostly unpaved and about 132 river crossings across the states. 12. The FPMU in the discharge of its responsibilities, due diligence, and oversight functions also engaged the services of different consultants to support the implementation of the project through reviews and audits, these include the following: (a) Consultancy services for the technical review/audit of OPRCs in Kaduna (b) Consultancy services for the technical review/audit of Kaduna river crossings contracts (c) Consultancy services for safeguards audit of Kaduna RAMP 13. These technical audits are to allow an independent team to form a professional opinion on the compliance of road works carried out under Kaduna RAMP I with the technical specifications and standards described in the relevant bidding documents. 14. The report from the audits/reviews indicates Satisfactory performance with, as usual, areas of improvement clearly indicated. Safeguards 15. In compliance with the World Bank and Federal Ministry of Environment policies and regulations on environmental and social due diligence of the project, the FPMU prepared the required safeguard instruments, including an ESMF, to identify and address potential adverse impacts of the project at a broad perspective. Similarly, the Kaduna SPIU prepared an Environmental and Social Impact Assessment and separate EMPs for both the OPRC and river crossings. Other safeguard instruments prepared for the Kaduna RAMP are the RPF and the ARAP. The ARAP is prepared consistent with the provisions of the RPF to provide a plan for assistance and/or rehabilitation of PAPs so that their losses would be compensated and their standards of living will at least, be restored to pre-project levels. 16. The FPMU engaged the services of an independent environmental and social safeguards specialist to carry out a critical audit of the performance of the project with respect to the implementation of the environmental and social mitigation measures as identified in the policy documents prepared by Kaduna State RAMP. The consultant submitted his draft final report and the performance of the SPIU in the area of safeguard implementation was found to be Satisfactory from the recommendation of the report.   40   Fiduciary 17. As part of the financing, the FPMU manages the Project Preparatory Fund of US$2 million as part of the Credit. The Project Preparatory Fund is to finance project preparatory studies, project implementation supervision, M&E activities, and provision of technical support and backstopping. 18. Furthermore, the Federal Project Financial Management Division located in the office of the Accountant General of the Federation is responsible for FM for all World Bank-funded projects implemented at the federal level and has assigned a qualified accountant and internal auditor to the FPMU to support the use of financial resources under RAMP in an economic, efficient, and effective manner and in compliance with the FM requirements of the World Bank. 19. The implementation of the project at the state level is the responsibility of the Kaduna SPIUs anchored by the SMOWT. The anchoring ministry has the overall responsibility for leadership, supervision, and direction of project activities in the state. The parent ministry has established an SPMC responsible for oversight and monitoring functions. 20. The FM responsibilities, both for IDA and counterpart financings, is being handled by the State Project Financial Management Units, in cooperation with the SPIU, as for all IDA-financed operations at the state level. 21. The detailed procurement procedures that were used under the project for procurement of works, goods, and consultants are based on the following: (a) Guidelines: Procurement of Goods, Works, and Non-Consulting Services under IBRD Loans and IDA Credits and Grants by World Bank Borrowers, dated January 2011 and revised in July 2014 (b) Guidelines: Selection and Employment of Consultants under IBRD Loans and IDA Credits and Grants by World Bank Borrowers, dated January 2011 and revised in July 2014 (c) World Bank’s Standard Bidding Documents and Standard Request for Proposals and evaluation forms are used as appropriate 22. Throughout the procurement and FM procedures, the SPIU has always adhered to the guidelines and procedures as stipulated in the guidelines and World Bank FM procedures. Implementation Challenges 23. The OPRC concept is a design in which the contractors are given more responsibility for maintenance of the roads to keep them at good service level within minimal reasonable cost over a period of some years after construction/rehabilitation works. 24. This concept, as stated earlier, is not a common practice in Nigeria and therefore, posed a serious challenge to the project team, supervision consultants, and contractors during implementation. These challenges also span from procurement, technical, and financial perspectives.   41   25. Due to limited time for international consultants to respond to the request for expression of interest, Yaroson Partnership was selected. Though it had little or no experience in maintenance supervision, it had experience in externally funded projects and the traditional-type supervision of construction works. The selection of contractors also presented its own challenges. Selection of contractors was based on the lowest bid process and contractors who were selected had no prior knowledge of the OPRC and had only traditional contract experience with no maintenance contract experience. 26. Technical challenges. The existing OPRC practiced in Kaduna is a trial, and with any such trials there will be lessons to be learned and such lessons learned/challenges in Kaduna include the following: (a) Due to the lack of understanding and knowledge of the OPRC, the contractors failed to understand the significant costs associated with the maintenance and periodic works on earth and gravel roads (b) There was gross underestimation of the cost to maintain the road network, along with the risk transfer. Nevertheless, the pilot trial delivered a vastly improved understanding of the OPRC to those involved in the current process (c) The present contract allocated most of the risk to the contractor. And the contractor was in no way competent to understand or analyze many of the risks, such as traffic growth and challenges in climatic conditions. 27. Given all the challenges and the available capacity in the pilot scheme, the Kaduna example can be said to be a success. About 475 km of mostly unpaved roads and about 132 river crossings were constructed. These activities provide the communities with all-weather access roads, thus bringing about increased access to social amenities (schools, hospitals, markets, and so on) and reduction in transportation. Lessons Learned at the Preparatory Stage 28. The experiences of rural roads constructed under Directorate of Food, Roads, and Rural Infrastructure, State ADPs, and the Rural Development Department of the FMA&RD has shown that maintenance of rural roads is a difficult challenge in Nigeria, which can likely be addressed using the OPRC concept. Lack of adequate knowledge of the concept brought about delays in contract packaging and procurement processes. Lessons Learned at the Implementation Stage 29. The innovative character of the new contracting arrangement took time to be understood by the project team, consultants, and contractors, which therefore resulted in implementation delays. 30. Lack of state road classifications and road information management system. It was observed before and during project implementation that roads were not classified and there was no Geographic Information System-based state road map that could serve as a guide for decision making and reference purposes.   42   31. The pilot OPRC approach should be complemented by a clear plan for scaling up, as well as flexibility in reallocating resources and contract packaging. There were implementation and contract extensions due to security challenges in some parts of the state.   43   Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders Not applicable.   44   Annex 9. List of Supporting Documents 1. Prioritization of Intervention Areas and Selection of Initial Road Program in Kaduna State, 2006. Ark Consult Ltd. 2. Country Partnership Strategy for 2014–2017, World Bank, 2014. 3. Contract Document for Improvement/Rehabilitation/Maintenance of Rural Roads in Kaduna State using Output and Performance-based Road Contracts, 2011, State Project Implementation Unit, Kaduna State Ministry of Works and Transport. 4. Project Appraisal Document (PAD): Rural Access and Mobility Project, Kaduna (RAMP I), 2008. World Bank Report No.42455-NG. 5. Where to Use Cost Effectiveness Techniques rather than Cost Benefit Analysis. World Bank Transport Note No.TRN-9 6. National Economic Empowerment and Development Strategy (NEEDS)- National Planning Commission, Abuja, 2004. 7. Country Partnership Strategy for the Federal Republic of Nigeria 2005–2009. World Bank Group and the Department for International Development (DFID), June 2005. 8. Kaduna State Economic Empowerment and Development Strategy (KADSEEDS) - Kaduna State Government, 2004. 9. Study on the Detailed Assessment, Prioritization and Engineering Design for Reinstating/constructing of Damaged and Washed Away Crossings on Rural Roads Network of Kaduna State -(by SNC LAVALIN) State Ministry of Works and Transport, Kaduna, 2007 10. Kaduna State Monitoring Report Cycle 4, Kaduna SPIU, June 2015.   45   MAP     46