The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) Sri Lanka Public Financial Management Strengthening Project (P178432) SOUTH ASIA | Sri Lanka | IBRD/IDA | Investment Project Financing (IPF) | FY 2023 | Seq No: 2 | Archived on 29-Apr-2024 | ISR00277 Implementing Agencies: Ministry of Finance, Economic Stabilization and National Policies - Public Finance Department, NATIONAL AUDIT OFFCIE OF SRI LANKA, National Audit Office of Sri Lanka 1. OBJECTIVE 1.1 Development Objective Original Development Objective (Approved as part of Approval package on 28-Jun-2023) To enhance the institutional capacity and transparency in procurement and external audit. Has the Development Objective been changed since Board Approval of the Project Objective? No 2. COMPONENTS Name Improving the operational efficiency and transparency in public expenditures through e-procurement:(Cost 4,000,000.00) Enhancing accountability and institutional capacity of NAOSL:(Cost 3,500,000.00) Project Management, implementation support, evaluation and audit:(Cost 100,000.00) 3. OVERALL RATINGS Name Previous Current Progress towards achievement of PDO  Moderately Satisfactory Overall Implementation Progress (IP)  Moderately Satisfactory Overall Risk Rating Moderate Moderate 4. KEY ISSUES & STATUS Apr 29, 2024 Page 1 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) 4.1 Implementation Status and Key Decisions The project supports two reform areas (a) development and rollout of a government e-Procurement system; and (b) enhancing accountability and institutional capacity of the National Audit Office of Sri Lanka (NAOSL). The e-Procurement (e-GP) system has been rolled out with the functional module for procurement following shopping procedures and approximately 5500 tenders have been bid out through the e-GP system till date. Modules for competitive. The progress under the component for institutional strengthening of the NAOSL has been slow and NAOSL has prepared a detailed operational plan for implementing the reforms. 5. SYSTEMATIC OPERATIONS RISK-RATING TOOL Rating at Approval Last Approved Rating Risk Category Approval Package - ISR Seq. 01 - 19 Oct Proposed Rating 28 Jun 2023 2023 Political and Governance Substantial Substantial Substantial Macroeconomic Substantial Substantial Substantial Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Moderate Moderate Moderate Institutional Capacity for Implementation and Moderate Moderate Moderate Sustainability Fiduciary Moderate Moderate Moderate Environment and Social Low Low Low Stakeholders Moderate Moderate Moderate Overall Moderate Moderate Moderate Apr 29, 2024 Page 2 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) 6. RESULTS 6.1 PDO Indicators by PDO Outcomes Enhanced transparency in procurement Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Information on Dec/2022 Information on 26-Mar-2024 Information on 26-Mar-2024 Enhanced Nov/2026 shopping shopping shopping access to procurement procurement procurement information on using e- using e- using e- procurement procurement procurement procurement opportunities Information available in the in 40 (8 in 245 (30 in 245 (30 available in the public domain on percent) pilot percent) pilot percent) pilot public domain procurement opportunities procuring procuring procuring to bidders and (Text) entities entities at the entities at the citizens available in the national are national are public domain available in the available in the public domain public domain Comments on This indicator measures the increase in transparency by the information available in the public achieving targets domain of (i) procurement opportunities (bids) carried out using the e-GP system. Enhanced Institutional capacity in procurement Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Lack of Dec/2022 Baseline 27-Mar-2024 Baseline 27-Mar-2024 10 percent Nov/2026 Reduction in procurement information on survey in two survey in two reduction in cycle time in at least two procurement MDAs is MDAs is time taken for procurement entities with cycle time in delayed and is delayed and is procurement Apr 29, 2024 Page 3 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) significant procurement procuring expected to be expected to be over the volumes (Text) entities completed by completed by baseline in Sept 30, 2024 Sept 30, 2024 selected procurement entities. Comments on This indicator will measure the efficiency in procurement in terms of time taken in at least two achieving targets key selected procuring entities within ministries or departments. Enhanced transparency in external audit Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year A limited Dec/2022 Activity is 27-Mar-2024 Activity is 27-Mar-2024 Audit reports Nov/2026 number of delayed. The delayed. The of specialized specialized consultants for consultants for audits audits carried reviewing and reviewing and available in out by NAOSL updating the updating the public domain and the framework framework absence of a and manuals in and manuals in Specialized audits carried out manual for the process of the process of by NAOSL that are made procurement being being publicly available (Text) audit or dated contracted. contracted. audit Yet to be Yet to be framework for initiated initiated environment audit. Comments on This indicator measures the enhanced of institutional capacity of the NAOSL to carry out achieving targets specialized audits as per the acceptable framework developed and adopted by by NAOSL. Enhanced Institutional Capacity in external audit Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Apr 29, 2024 Page 4 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) Limited Dec/2022 Engagement 27-Mar-2024 Engagement 27-Mar-2024 NAOSL’s Nov/2026 engagement of with potential with potential institutional citizens in the peer SAIs peer SAIs capacity for audit process initiated initiated participatory audit is NAOSL’s capacity developed enhanced and to undertake participatory the results are audits (Text) shared with the citizens in the public domain Comments on This indicator measures the capacity of NAOSL to involve citizens in audit thereby enhancing achieving targets citizens engagement 6.2 Intermediate Results Indicators by Components Improving the operational efficiency and transparency in public expenditures through e-procurement Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year There is an e- Nov/2022 A draft 27-Mar-2024 A draft 27-Mar-2024 An E- Nov/2026 procurement implementatio implementatio procurement system that n plan has n plan has system E-procurement system provides the been been covering established and operational functionality of prepared. The prepared. The various (Text) only the revised target revised target methods of Request for date for date for procurement Quotations notifying the notifying the has been mandatory use mandatory use developed and Apr 29, 2024 Page 5 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) (shopping) for e-GP for e-GP performance method system for system for reports shopping shopping published procurement procurement by central level by central level MDA's is MDA's is September 30, September 30, 2024 after 2024 after addressing addressing some technical some technical aspects in the aspects in the e-GP system - e-GP system - version 2.1. version 2.1. Comments on This indicator measures the development of the core modules of the e-GP system and achieving targets enabling administrative guidelines that mandates the use of the e-GP system Shopping Dec/2022 Of the 445 27-Mar-2024 Of the 445 27-Mar-2024 E-Procurement Nov/2026 module rolled procuring procuring system rolled out in 40 pilot entities (PE) entities (PE) out to all procuring registered at registered at procuring entities the national the national entiries at the Scale up of existing modules level in the e- level in the e- national level and roll out of new modules GP system,245 GP system,245 of the e-GP system (Text) (30 percent) (30 percent) are active are active users of the e- users of the e- GP system GP system Comments on This indicator measures the progress in roll out of the various modules of the e-GP system to achieving targets the procuring entities Information on contract Contract Dec/2022 MoF has 27-Mar-2024 MoF has 27-Mar-2024 60 percent of Nov/2026 award in public domain award mandated the mandated the shopping Apr 29, 2024 Page 6 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) (Text) information e-publication e-publication procurement not available of contract of contract and 50 percent in public awards awards of open domain information information procurement above Rs 200 above Rs 200 method million in the million in the contract award e-GP portal, e-GP portal, information while shopping while shopping available in the procurement procurement public domain initiated in the initiated in the e-GP system as e-GP system as enabled to enabled to display the display the award on award on completion of completion of the award. As the award. As on date on date information on information on 270 contract 270 contract awards above awards above Rs 200 million Rs 200 million have been e- have been e- published and published and 34 contract 34 contract awards awards following following shopping shopping method have method have been disclosed been disclosed on the e-GP on the e-GP portal portal Apr 29, 2024 Page 7 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) Comments on This indicator measures the percentage of contract award information against procurement achieving targets carried out using the e-GP system available in respect of entities using the e-GP system Enhancing accountability and institutional capacity of NAOSL Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year NAOSL Nov/2019 NAOSL has 27-Mar-2024 NAOSL has 27-Mar-2024 Increase in Nov/2026 performing prepared in- prepared in- NAOSL’s SAI- between the house a house a PMF founding and detailed detailed Assessment established operational operational rating in levels as per plan for plan for priority SAI-PMF implementatio implementatio indicators over assessment at n of the n of the baseline Improvement in performance an aggregate Development Development assessment in rating of NAOSL in selected level with low Action Plan Action Plan Domains B, C priority indicators as per SAI- scores in (DAP) (DAP) (Audit Quality PMF Assessment (Text) Domain B - and Internal Reporting), Governance and E - Human and Domain E- Resources and Human Training Resources and Training Comments on This measures the improvement in selected indicators related to the institutional capacity of achieving targets the NAOSL Limited and Dec/2022 Update of 27-Mar-2024 Update of 27-Mar-2024 The capacity of Nov/2026 Capacity Building of NAOSL absence of manuals yet to manuals yet to NAOSL staff staff in specialized Audits structured be initiated be initiated enhanced to (No. of staff trained) (Text) training in carry out Apr 29, 2024 Page 8 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) specialized specialized audits audits Comments on This indicator measures the human resource capacity enhancement to carry oit specialized achieving targets audits Nil Dec/2022 Nil 27-Mar-2024 Nil 27-Mar-2024 40 female staff Nov/2026 have received specialized training in Financial Of which No. of staff Attest, trained are female Procurement (Text) and Environment Audit Comments on As Above achieving targets Outdated AMS Dec/2022 Consultant to 27-Mar-2024 Consultant to 27-Mar-2024 Enhanced Nov/2026 and no CAAT study the study the efficiency in Enhanced access and use of tools in use existing AMS existing AMS audits by audit management software and and NAOSL (AMS) and Computer appropriate appropriate through use of Assisted Audit Techniques CAAT tools to CAAT tools to IT tools (CAAT) (Text) be contracted be contracted Comments on This indicator measures the enhancement in the efficiency of audit process using IT based achieving targets audit management tools Apr 29, 2024 Page 9 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) 7. DATA ON FINANCIAL PERFORMANCE 7.1 Cumulative Disbursements 7.2 Disbursements (by loan) Loan/Credit/TF Status Original Revised Cancelled Disbursed Undisbursed % Disbursed TF-C1642 Effective 4.20 4.20 0.00 0.56 3.64 13.33% 7.3 Key Dates (by loan) Loan/Credit/TF Status Approval Signing Effectiveness Orig. Closing Rev. Closing TF-C1642 Effective 28-Jun-2023 06-Jul-2023 06-Jul-2023 30-Nov-2026 30-Nov-2026 8. KEY DATES Apr 29, 2024 Page 10 of 11 The World Bank Implementation Status & Results Report Sri Lanka Public Financial Management Strengthening Project (P178432) Key Events Planned Actual Approval 30-Jun-2023 27-Jun-2023 Effectiveness 06-Jul-2023 06-Jul-2023 Mid-Term Review No. 01 30-Mar-2025 Operation Closing/Cancellation 30-Nov-2026 9. RESTRUCTURING HISTORY 10. ASSOCIATED OPERATION(S) There are no associated operations Apr 29, 2024 Page 11 of 11