The World Bank Implementation Status & Results Report TOGO Economic Governance (P158078) TOGO Economic Governance (P158078) AFRICA | Togo | Governance Global Practice | IBRD/IDA | Investment Project Financing | FY 2018 | Seq No: 3 | ARCHIVED on 24-May-2019 | ISR37235 | Implementing Agencies: Ministry of Economy and Finance, Ministry of Finance Key Dates Key Project Dates Bank Approval Date: 03-Oct-2017 Effectiveness Date: 20-Apr-2018 Planned Mid Term Review Date: -- Actual Mid-Term Review Date: -- Original Closing Date: 31-Oct-2022 Revised Closing Date: 31-Oct-2022 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective is to improve public investment management, domestic revenue mobilization and public accountability and monitoring mechanisms for better service delivery in priority sectors. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Management of Public Investments and Public-Private Partnerships:(Cost $6.06 M) Supporting Domestic Resource Mobilization:(Cost $7.20 M) Increasing Public Accountability and Citizen Engagement:(Cost $3.98 M) Project Implementation Support:(Cost $2.56 M) Unallocated:(Cost $0.80 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions Promising results have been attained just six months after the Project official launch in October 2018. The current disbursement rate is set at 21 percent and is expected to reach 25 percent end of June 2019. Most critical activities of project's components have started; namely (i) streamlining Public Investment Management processes; (ii) improving Tax Administration (OTR) capacity, and (iii) launching of accountability activities. 1. Planning and execution of the public investments. The expected results in the implementation of this component focus on strengthening inter-ministerial coordination through the operationalization of the PIP Committee and the evaluation methodologies needed 5/24/2019 Page 1 of 7 The World Bank Implementation Status & Results Report TOGO Economic Governance (P158078) to: (i) improve alignment between planning public investments and their budgeting; (ii) improve the quality of technical and non-technical preparation and thus the maturity of priority public investment projects; and (iii) strengthen management, monitoring and evaluation mechanisms for public investments at sectoral and state level. Discussions with the main actors of this component (DPPD, the MEF advisor, the DGBF and the ARMP), revealed progress made in improving the investment management process; including (i) the existence of a manual of procedures for the selection, prioritization and programming of public investment projects, (ii) the normal functioning of the PIP Committee and (iii) its role in the reorganization of investment projects to be included in the law of finance. In this regard, the mission recommends: (i) the elaboration as soon as possible of the operational tools of the selection manual in order to facilitate the training of the actors concerned and (ii) the elaboration of the manual of physical public investment projects. The mission also took note of the DPPD's desire to have an integrated software for the management and analysis of public investment projects. Prior work should be done with the project coordination unit to arrive at a proposed activity. In the end, the mission noted with satisfaction the progress made in the program budget reform with the quality review of programs and the implementation of sectoral programs carried out. It took note of the difficulties that the Directorate General of Budget and Finance is facing in the process of adapting the budget-program nomenclature with the existing IT system (SIGFIP). The mission recommends to explore the possibility of the PAGE project support to address this issue. 2. Technical Assistance and Results Based Financing (RBF) for the mobilization of domestic resources. This component combines technical assistance to the tax policy unit and support to the tax administration for which disbursements will be made on the basis of results-based financing (RBF), thus linking disbursements to the achievement of established performance (DLI). Tax Policy. The creating acts of the Tax Policy Unit (UPF) were adopted including the decree on the reorganization of the Ministry of Economy and Finance which makes the Tax Policy Unit a structure of the Ministry and the decree of creation of the Tax Policy Unit. However, key staffs in charge of running the Unit have not been designated yet. Moreover, the operationalization of the tax policy unit constitutes an important measure of the budget support program of the European Union to the Togolese State for the period 2019-2020. In order to accelerate the operationalization of this unit, the mission recommends (i) the elaboration of a roadmap clearly defining the necessary steps to achieve this action and the future of the actors of this unit; and (ii) using the resources of subcomponent 2.1 "Technical assistance" to support the main UPF actors (The manager and 4 section heads ) for two (2) years. Tax Administration. Discussions with Togolese Office of Revenue (OTR) made it possible to take stock of the activities carried out and the indicators triggering disbursements achieved, notably the three (3) DLIs achieved in the first quarter of 2019,: (DLI 1.1: full automation of cross-checking of taxpayer returns for VAT and customs declarations; DLI 1.2: 15 percent of OTR qualified operational staff who are deployed for field audits; DLI 2.1: Completion of general taxpayer census in Lome); the verification of which enabled to obtain the disbursement of the equivalent of 1.5 million US dollars. In addition, the mission noted that the OTR does not always transmit the quarterly reports to the project coordination unit for consolidation. It recommends to the OTR to regularly transmit to the PCU the quarterly activity implementation reports, and to carry out the taxpayer satisfaction survey to estimate the rate of satisfaction of Lomé's large taxpayers. 3. Citizen engagement and public accountability on the budgetary processes in priority sectors: This component aims to strengthen public accountability and citizen engagement by strengthening accountability mechanisms and citizen participation in budget preparation and implementation processes, and citizens' feedback on quality and the accessibility of public services in the three priority sub-sectors (maternal and child health, primary education and water supply in urban areas). The mission discussed with the focal points of the sectoral ministries and the civil society organizations on the introduction of platforms and mechanisms of citizen participation in the dialogue with the government on budget priorities, budget execution, and bring their concerns on the quality and accessibility of public services in targeted sectors. In this regard, the mission recommends the coordination unit to finalize the recruitment of consultants to support the preparation of the citizen budget and the training on the BOOST tool as well as that of the Consulting Firm responsible for drawing up the baseline indicators on the satisfaction rates of the population with respect to the quality of services in the selected sectors. The mission also discussed with state control bodies such as the General Inspectorate of Finance (IGF), the Court of Auditors and the Finance and Development Committee of the National Assembly to take stock of activities carried out and prospects. The following recommends were agreed upon : (i) support the operation of the IGF (vehicle repair), (ii) carry out the risk-based mapping of the four ministries selected for 2019, (iii) submit to the PCU the ToR for the preparation of the Court of Auditors strategic plan no later than July 2019 and (iv) work with the National Assembly Finance Committee to identify their capacity development needs. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Substantial Substantial Substantial Macroeconomic Substantial Substantial Substantial Sector Strategies and Policies Substantial Moderate Moderate 5/24/2019 Page 2 of 7 The World Bank Implementation Status & Results Report TOGO Economic Governance (P158078) Technical Design of Project or Program Moderate Moderate Moderate Institutional Capacity for Implementation and Sustainability Substantial Substantial Substantial Fiduciary Substantial Substantial Substantial Environment and Social Low Low Low Stakeholders Substantial Substantial Substantial Other -- -- -- Overall Substantial Substantial Substantial Results PDO Indicators by Objectives / Outcomes Improve Public Investment Management IN00706524 ►Public investment projects approved for financing that have been appraised in line with Public Investment Management appraisal guidelines (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 50.00 Date 04-Apr-2017 04-Sep-2018 21-May-2019 31-Oct-2022 This indicator will be determined in Ocober 2019 when the Budget 2020 will be submitted to the Parliament for adoption. It is only at that stage that we will determine the Public Investments projects Comments: approved for financing. However, the Manuel for Public Investment Selections has been adopted and is already being used by the selection committee (PIP committee). Improve Domestic Revenue Mobilization IN00706525 ►Share of total registrants post taxpayer census increased in Lome (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 15.00 Date 04-Apr-2017 04-Sep-2018 21-May-2019 31-Oct-2022 This indicator will be determined in December 2019 after the overall completion of the analysis of the taxpayers census. The field work of taxpayers census in Lomé is already completed, as certified by the Comments: Verification Firm. OTR started the Analysis phase of the census and will be able to provide final data by December 2019 for records. IN00706568 Increase in filing taxpayers in Lome with a turnover exceeding 10 million CFAF (Percentage, Custom Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 30.00 Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 5/24/2019 Page 3 of 7 The World Bank Implementation Status & Results Report TOGO Economic Governance (P158078) Improve Public Accountability and Monitoring Mechanisms for better service delivery in priority sect IN00706566 ►Citizens satisfied with quality and access to basic services in maternal and child health, primary education, and urban water supply (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 15.00 Date 30-Jun-2017 04-Sep-2018 04-Sep-2018 31-Oct-2022 The selection process of the Consultant Firm that will set the baseline to track citizen satisfaction has Comments: been launched. Indicators will be available by December 2019. IN00706567 ►Satisfaction of large taxpayers with the responsiveness of OTR (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 43.80 43.80 43.80 60.00 Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 This indicator is under OTR control and will be available in December 2019. OTR has already started the Comments: recruitment process of the Firm which will conduct the survey. Overall Comments PDO Most indicators data will be available by December 2019. However, the Project has started all preparatory work to meet the target by December 2019. The Project is on good track toward the achievement of all critical indicators. Intermediate Results Indicators by Components Management of Public Investments and Public-Private Partnerships IN00706569 ►Systematic use of economic and cost-benefit analyses for appraisal of major public investments including PPP (programs superiror to 2 billion FCFA) (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 30.00 Date 04-Apr-2017 04-Sep-2018 21-May-2019 31-Oct-2022 This indicator will be determined in October 2019 when the Budget 2020 will be submitted to the Parliament for adoption. It is only at that stage that we will determine the Public Investments projects Comments: approved for financing. However, the Manuel for Public Investment Selections has been adopted and is already being used by the selection committee (PIP committee). IN00706572 ►Difference between Public Investment Program, Sectoral Medium Term budget framework DPPD and Finance Law in priority sectors (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target 5/24/2019 Page 4 of 7 The World Bank Implementation Status & Results Report TOGO Economic Governance (P158078) Value 15.00 15.00 15.00 5.00 Date 30-Jun-2017 30-Jun-2017 21-May-2019 31-Oct-2022 This indicator will be determined in October 2019 when the Budget 2020 will be submitted to the Parliament for adoption. It is only at that stage that we will determine the Public Investments projects Comments: approved for financing. However, the Manuel for Public Investment Selections has been adopted and is already being used by the selection committee (PIP committee). Supporting Domestic Resource Mobilization IN00706570 ►Reduction of national tax instruments (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 29.00 29.00 13.00 15.00 Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 This indicator has been fully met ahead of the project closing date. The number of tax instruments have been reduced from 29 to 13 with the adoption of the New Tax Code in late December 2018. The end Comments: target is 15 by October 2022. On this indicator the project has exceeded target. IN00706573 ►Full automation of cross checking of taxpayer returns for VAT and customs declarations (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No Yes Yes Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 This indicator is among the DLI met during the first quarter 2018. It has been confirmed by the Verification Comments: firm. IN00706575 ►OTR operational staff are qualified and deployed for field audits (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 6.00 15.00 23.00 15.00 Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 This indicator is among the DLI met during the first quarter 2018. It has been confirmed by the Verification Comments: firm. IN00706577 ►Reduced length of time to address taxpayer requests (Days, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 12.00 12.00 12.00 6.00 Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 This indicator will be available as soon as OTR has completed the Client Satisfaction Survey. Comments: 5/24/2019 Page 5 of 7 The World Bank Implementation Status & Results Report TOGO Economic Governance (P158078) Increasing Public Accountability and Citizen Engagement IN00706571 ►Introduction of citizen report cards to provide MDAs with citizen feedback on quality and access of service delivery for maternal and child health, primary education, and urban water supply (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 6.00 Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 The Selection process of the Consulting Firm in charge of setting the baseline has been launched. Data Comments: will be available by the end of 2019. IN00706574 ►Publication of citizens national budget (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 The selection process of the Consultant in charge of Citizen Budget has been launched. Data will be Comments: available by the end of December 2019. IN00706576 ►Government and CSO staff trained in new accountability, citizens engagement mechanisms and PFM (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 62.00 400.00 Date 30-Jun-2017 04-Sep-2018 21-May-2019 31-Oct-2022 The project has exceed the intermediate target of 50. During the period 62 people including 7 women Comments: have been trained on PFM. IN00706578 Women trained in new accountability, citizens engagement mechanisms and PFM (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 11.00 20.00 Overall Comments IR The Project is on good track to meet intermediate results indicators. Almost all indicators related to the Domestic Revenue Mobilization have been exceed. Strong progress is also noted on other indicators. Data on Financial Performance Disbursements (by loan) 5/24/2019 Page 6 of 7 The World Bank Implementation Status & Results Report TOGO Economic Governance (P158078) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P158078 IDA-D2340 Effective USD 15.00 15.00 0.00 3.17 11.71 21% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P158078 IDA-D2340 Effective 03-Oct-2017 21-Dec-2017 20-Apr-2018 31-Oct-2022 31-Oct-2022 Cumulative Disbursements Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 5/24/2019 Page 7 of 7