The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) REPORT NO.: RES45663 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF JORDAN EMERGENCY CASH TRANSFER COVID-19 RESPONSE PROJECT APPROVED ON JUNE 25, 2020 TO HASHEMITE KINGDOM OF JORDAN SOCIAL PROTECTION & JOBS MIDDLE EAST AND NORTH AFRICA Regional Vice President: Ferid Belhaj Country Director: Saroj Kumar Jha Regional Director: Keiko Miwa Practice Manager/Manager: Anush Bezhanyan Task Team Leader(s): Khalid Ahmed Ali Moheyddeen, Cristobal Ridao-Cano The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) ABBREVIATIONS AND ACRONYMS AF Additional Financing CT Cash Transfers NAF National Aid Fund PBC Performance Based Condition PDO Project Development Objective UCT Unified Cash Transfer The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) BASIC DATA Product Information Project ID Financing Instrument P173974 Investment Project Financing Environmental and Social Risk Classification (ESRC) Substantial Approval Date Current Closing Date 25-Jun-2020 31-Dec-2024 Organizations Borrower Responsible Agency Hashemite Kingdom of Jordan,Ministry of Planning and International Cooperation Project Development Objective (PDO) Original PDO The project development objective is to provide cash support to poor and vulnerable households affected by the COVID- 19 pandemic in Jordan. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IBRD-93480 17-Mar-2022 05-Apr-2022 31-Dec-2024 350.00 0 350.00 IBRD-92820 24-Jun-2021 13-Jul-2021 06-Aug-2021 31-Dec-2024 290.00 53.05 236.95 IBRD-91390 25-Jun-2020 26-Oct-2020 11-Nov-2020 31-Dec-2024 350.00 303.48 46.52 TF-B3363 25-Jun-2020 26-Oct-2020 11-Nov-2020 31-Dec-2022 24.17 24.17 0 The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING 1. Project Status. The project is making solid progress toward achievement of its Project Development Objective (PDO). The last ISR rated Progress toward achievement of the PDO and Implementation Progress as Satisfactory. A second Additional Financing (AF2) loan was approved by the Board of Directors for the project on March 17, 2022. The Loan Agreement for AF2 has yet to be declared effective. 2. To date, projects disbursements stand at US$356.53 million out of the total loan amount of US$990 million (US$303.48 million out of US$350 million under the parent project; and US$53.05 million out of US$290 million under the AF). Under the Jordan Inclusive Growth and Economic Opportunities Multi-Donor Trust Fund, approved with the parent project, the full Grant amount of US$24.17 million was disbursed by the project. 3. Key Project Results. As of May 2022, the number of households receiving cash support through the project has made solid progress towards achieving the target indicators under Components 1 and 4. The number beneficiaries who received benefits from any of the cash transfer (CT) programs reached a total of 366,576 households out of a targeted of 400,000 under Component 1, while the number of workers benefiting from wage subsidies under Component 4 has reached 109,327 against a target of 110,000. In December 2021, the Government began the implementation of the recertification plan by opening registration for all current beneficiaries and non-beneficiaries including those who had not previously registered. In 2022, the Government discontinued COVID- 19 emergency cash programs and announced the “Unified Cash Transfer Program (UCT)”, as the consolidated regular CT program, and began recertifying beneficiaries under the old CT program, in preparation for their migration to the UCT. With support from the Bank, NAF has improved the targeting formula by using the Households Income and Expenditure Survey data to allocate weights for indicators that are used to calculate imputed income. In addition, the National Aid Fund (NAF) has also simplified the benefit calculation formula to enable a better understanding by beneficiaries and is issuing payments on a monthly basis. The Government has also decided to increase the budget for UCT from JOD 100 million (about $140 million) to JOD 140 million (about $200 million). The number of applicants for the new program has reached 412,056 households of which 120,000 were selected and 119,791 were paid for January, February, and March 2022. 4. Performance Based Condition (PBC) Achievement. In addition to the PBCs achieved earlier, the project has met a number of PBCs under Category 2, namely: PBC#1.3 (partially for Q1 2022), PBC# 2.1, PBC#2.2 and PBC# 2.4 (as referenced under Schedule 4 of the Loan Agreements and the Amendment to the Loan Agreements of the parent project, the first AF, and the AF2) as follows: PBC # 1.3: NAF reported that the Number of Beneficiaries enrolled and paid under the Cash Transfer Program has reached 119,791 by March 2022. An amount of US$27.5 million will thus be released against this PBC. Upon approval of the proposed restructuring and receipt of the Audit Bureau Report according to the related Disbursement Calculation Formula, PBC # 2.1: the National Aid Fund (NAF) board of directors approved the revised targeting methodologies; PBC #2.2: NAF implemented the revised targeting methodology; PBC 2.4: NAF has implemented the plan for the recertification of Takaful beneficiaries. The evidence will be shared with the Bank upon countersignature of the proposed amendment to the loan agreement under the proposed restructuring. An amount of US$106.775 million will thus be released once the evidence is received based on the related Disbursement Calculation Formula. The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) 5. Compliance with Legal Covenants. Despite initial delays, the project has made progress towards complying with its key legal covenants including the following: (i) hiring a PMU manager to oversee and coordinate overall project implementation; (ii) establish a PMU to oversee project implementation; (iii) appointing a Technical Coordinator within MOPIC to be responsible for monitoring and reporting activities under Part 4 of the project; (iv) appointing a verification agent through MOPIC; and (v) hiring a Social Officer, a Financial Management Officer and a Procurement Officer. The two legal covenants related to updating the Operations Manual and Operations Guidelines for NAF and the Social Security Corporation (SSC) Istidama program are still underway with a timeline of 30 days within effectiveness of the AF2. 6. Rationale for Restructuring. The proposed restructuring entails an amendment to the AF2 Loan Agreement (Loan No. IBRD- 93480) to rectify an administrative oversight. Specifically, the amendment will introduce a revision to PBC 1.3 in the Additional Financing Agreement, a revision to add PBC 1.3 to Schedule 4 of the project’s original Loan Agreement (Loan No. IBRD-91390), and to correct the calculation formula under PBC#1.4 in the AF2 Loan Agreement. A description of the revision is outlined in section II (Description of Proposed Changes) below. The restructuring is in response to a request from the Government dated June 7, 2022. II. DESCRIPTION OF PROPOSED CHANGES 7. The proposed restructuring entails the following revisions to the Loan Agreement: (i) Paragraph 3 under Section IV of Schedule 2 to the Loan Agreement for AF2 is amended to read as follows (emphasis added): ‘3. PBC 1.3 in the Additional Financing Agreement will read as follows: “Description of achievement PBC#1.3 120,000 eligible households are enrolled in the Takaful-1 Cash Transfer Program and paid in 2022 and “Disbursement Calculation Formula PBC 1.3: from the baseline of 0, $2,500,000 for each 10,000 households received their payments in each quarter of 2022, up to $80,000,000” ’ (ii) Schedule 4 of the Loan Agreement is restated in its entirety as reflected in Annex A of the Amendment Letter to the Government. (iii) PBC 1.3 (PBC#1.3 120,000 eligible households are enrolled in the Takaful-1 Cash Transfer Program and paid in 2022) is added to Schedule 4 of the Original Loan Agreement. Accordingly, Schedule 4 of the Original Loan Agreement is restated in its entirety as reflected in Annex B of the Amendment Letter to the Government. 8. No other revisions are envisioned under the proposed restructuring. The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) III. SUMMARY OF CHANGES Changed Not Changed Results Framework ✔ PBCs ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ Components and Cost ✔ Loan Closing Date(s) ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ Overall Risk Rating ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Implementation Schedule ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) . The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) . Results framework COUNTRY: Jordan Jordan Emergency Cash Transfer COVID-19 Response Project Project Development Objectives(s) The project development objective is to provide cash support to poor and vulnerable households affected by the COVID-19 pandemic in Jordan. Project Development Objective Indicators by Objectives/ Outcomes RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline End Target Cash support to poor and vulnerable households affected by the COVID-19 pandemic in Jordan Number of households receiving cash support through the 0.00 400,000.00 project (Number) Number of individuals (Number) 0.00 2,000,000.00 Percentage of female-headed households (Percentage) 0.00 10.00 Support to workers in firms affected by COVID-19 Number of individuals receiving wage subsidies through the 0.00 110,000.00 project (Number) Percentage of females (Percentage) 0.00 50.00 PDO Table SPACE The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) Intermediate Results Indicators by Components RESULT_FRAME_TBL_IO Indicator Name PBC Baseline End Target Component 1: Cash support to poor and vulnerable households affected by COVID-19 Number of households receiving temporary cash transfers 0.00 132,000.00 (Number) Number of individual beneficiaries (Number) 0.00 660,000.00 Percentage of female beneficiaries (Percentage) 0.00 50.00 Number of households receiving cash transfers under the Takaful PBC 1, 1 45,000.00 170,000.00 program (Number) Number of individuals (Number) 0.00 850,000.00 Percentage of females (Percentage) 50.00 50.00 Component 2: Project Management, Monitoring and Evaluation Number of new participating institutions connected to NUR 15.00 20.00 (Number) Percentage of beneficiary households receiving payments 20.00 100.00 digitally (Percentage) Percentage of females receiving payments digitally 4.00 9.00 (Percentage) Number of NAF staff benefiting from training and capacity 0.00 50.00 building programs provided through the project (Number) Number of NAF MIS modules improved through the project 0.00 3.00 (Number) Percentage of grievances, complaints and inquiries addressed within timeframe that is specified and publicly communicated by 20.00 80.00 the project. (Percentage) The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline End Target Percentage of beneficiaries who expressed satisfaction with the project interventions, including on delivery and communication 0.00 90.00 modalities (Percentage) NAF’s NUR is modified to obtain real-time information on the geographic location of weather-related shocks to enable NAF to No Yes automatically generate list of poor and vulnerable families. (Yes/No) Number of social services that use NUR as the only intake 0.00 5.00 channel for applicants (Number) (Number) Component 4: Support to workers in firms affected by COVID-19 Number of individuals receiving wage subsidies through the 0.00 110,000.00 project (Number) Percentage of Females (Percentage) 0.00 50.00 Number of firms supported by Istidama program (Number) 0.00 7,500.00 IO Table SPACE Performance-Based Conditions Matrix DLI IN01154777 ACTION PBC 1 Number of households receiving cash transfers under the Takaful program Type of PBC Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Number 397,000,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 45,000.00 The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) from the baseline of 0, $8,000,000 2020 32,000,000.00 for each 11,000 by the end of 2020 from the baseline of 0, $2,250,000 for each 10,650 households paid in 2021 75,000,000.00 each quarter of 2021, up to $75,000,000 from the baseline of 0, $2,250,000 for each 12,000 households paid in 2022 120,000,000.00 each quarter of 2021, up to $120,000,000 from the baseline of 0, $2,250,000 for each 17,000 households paid in 2023 170,000,000.00 each quarter of 2021, up to $170,000,000 2024 0.00 Action: This PBC has been Revised. See below. DLI IN01154774 ACTION PBC 1 Number of households receiving cash transfers under the Takaful program Type of PBC Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Output Yes Number 397,000,000.00 18.14 Period Value Allocated Amount (USD) Formula Baseline 45,000.00 from the baseline of 0, $8,000,000 2020 32,000,000.00 for each 11,000 by the end of 2020 from the baseline of 0, $2,250,000 2021 75,000,000.00 for each 10,625 households paid in The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) each quarter of 2021, up to $75,000,000 from the baseline of 0, $2,500,000 for each 10,000 households paid in 2022 120,000,000.00 each quarter of 2022, up to $120,000,000 from the baseline of 0, $2,500,000 for each 10,000 households paid in 2023 170,000,000.00 each quarter of 2023, up to $170,000,000 2024 0.00 DLI IN01154779 ACTION PBC 2 Improvements in Takaful Type of PBC Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Outcome Yes Yes/No 99,275,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline No 2020 No 0.00 0.00 PBC#2.1: $10m; PBC #2.2: $50m; 2021 Yes 80,000,000.00 PBC #2.3: $20m 2022 Yes 19,275,000.00 PBC#2.4: $19.275m 2023 0.00 2024 0.00 The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) DLI IN01154784 ACTION PBC 3 Migration of Beneficiaries into Takaful Cash Transfer Program Type of PBC Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Outcome Yes Yes/No 120,210,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline No PBC #3.1: From the baseline of 0, $5,000,000 for every 14,000 2020 Yes 5,000,000.00 Beneficiaries whose payments are digitized, up to $10,000,000 2021 Yes 16,330,000.00 PBC#3.1: $5m; PBC#3.2: $11.330 #3.3:from the baseline of 0, $7.5m for each 10% qualifying (for Takaful) 2022 Yes 75,000,000.00 households of the regular CTP enrolled in Takaful upto $75m PBC#3.4: NAF Board of Directors approves a time-bound plan to 2023 Yes 23,880,000.00 phase out the regular monthly CT program. 2024 0.00 The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) DLI IN01154786 ACTION PBC 4 PBC 4: Operationalization of the National Unified Registry (NUR) Type of PBC Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Intermediate Outcome Yes Number 59,000,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 0.00 2020 0.00 2021 0.00 PBC # 4.1: GOJ endorses the executive plan to launch NUR as 2022 15,000,000.00 single gateway for applicants seeking social assistance. PBC # 4.2: from the baseline of 0, $6,000,000 for each social service 2023 5.00 30,000,000.00 that uses NUR front-end as the only intake channel PBC #4.3: NAF develops a module in its MIS to automatically generate list 2024 14,000,000.00 of poor families affected by climate- related shocks The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) DLI IN01154788 ACTION PBC 5 PBC 5: Implementation of the Economic Empowerment Program Type of PBC Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount Intermediate Outcome Yes Number 33,000,000.00 0.00 Period Value Allocated Amount (USD) Formula Baseline 0.00 2020 0.00 2021 0.00 PBC #5.1: NAF endorses the revised 2022 15,000,000.00 instruction for NAF’s Training and Employment Unit to implement EEP. PBC #5.2: from the baseline of 0, $6m for each 1,000 beneficiary 2023 5,000.00 18,000,000.00 member of NAF targeted for employment support 2024 0.00 Verification Protocol Table: Performance-Based Conditions DLI_TBL_VERIFICATION PBC 1 Number of households receiving cash transfers under the Takaful program PBC 1.1: 44,000 eligible households are enrolled in Takaful-1 Cash Transfer Program and paid in 2020 PBC 1.2: 85,000 eligible households are enrolled in Takaful-1 Cash Transfer Program and paid in 2021 Description PBC 1.3: 120,000 eligible households are enrolled in Takaful-1 CT Program and paid in 2022 Excluding households included in PBC 3.3, namely households that are moved into Takaful-1 from the regular monthly cash transfer program in 2022. The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) PBC 1.4: 170,000 eligible households are enrolled in Takaful-1 CT Program and paid in 2023; Including households that are moved into Takaful-1 from the regular monthly cash transfer program in 2022. NAF MIS Data source/ Agency Jordan Audit Bureau - validated by the World Bank. Verification Entity PBC#1.1, PBC# 1.2, PBC# 1.3, and PBC# 1.4: NAF generates list of beneficiaries enrolled and paid in Takaful program from the MIS. NAF will cause the Audit Bureau to prepare and furnish to the Borrower and the Bank, a report on the results of the verification process of such scope and in such detail as the Bank shall reasonably request, and recommend Procedure corresponding payments to be made, as applicable. DLI_TBL_VERIFICATION PBC 1 Number of households receiving cash transfers under the Takaful program PBC 1.1: 44,000 eligible households are enrolled in Takaful-1 Cash Transfer Program and paid in 2020 PBC 1.2: 85,000 eligible households are enrolled in Takaful-1 Cash Transfer Program and paid in 2021 PBC 1.3: 120,000 eligible households are enrolled in Takaful-1 CT Program and paid in 2022 Excluding households included Description in PBC 3.3, namely households that are moved into Takaful-1 from the regular monthly cash transfer program in 2022. PBC 1.4: 170,000 eligible households are enrolled in Takaful-1 CT Program and paid in 2023; Including households that are moved into Takaful-1 from the regular monthly cash transfer program in 2022. NAF MIS Data source/ Agency Jordan Audit Bureau - validated by the World Bank. Verification Entity PBC#1.1, PBC# 1.2, PBC# 1.3, and PBC# 1.4: NAF generates list of beneficiaries enrolled and paid in Takaful program from the MIS. NAF will cause the Audit Bureau to prepare and furnish to the Borrower and the Bank, a report on the results of Procedure the verification process of such scope and in such detail as the Bank shall reasonably request, and recommend corresponding payments to be made, as applicable. The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) DLI_TBL_VERIFICATION PBC 2 Improvements in Takaful PBC # 2.1: NAF develops and adopts a revised Takaful targeting methodology based on the findings from the evaluation study and approved it by its the Board of Directors. PBC # 2.2: NAF implements the revised Takaful Targeting methodology. Description PBC # 2.3: NAF develops and adopts a plan for the recertification of Takaful beneficiaries. PBC # 2.4: NAF implements the recertification of Takaful beneficiaries NAF Data source/ Agency Implementing entity with validation by the World Bank. Verification Entity PBC #2.1: NAF provides the Bank with the revised targeting formula that is satisfactory to the Bank team based on the findings of the targeting evaluation. This will be validated by the World Bank. PBC #2.2: NAF applies the revised targeting formula in the MIS for the following rounds of Takaful. This will be validated by the World Bank. PBC #2.3: NAF provides the World Bank with the recertification plan of Takaful beneficiaries. This will be validated by the Procedure World. PBC #2.4: NAF submits a report on the data collection and enrollment of beneficiaries following the recertification plan guidelines. The report will be reviewed and accepted by the World Bank. DLI_TBL_VERIFICATION PBC 3 Migration of Beneficiaries into Takaful Cash Transfer Program PBC #3.1: NAF digitizes payments to Beneficiaries under Regular Monthly Cash Transfer Program Description PBC # 3.2: NAF Board of Director issues decision to discontinue new enrollment under the Regular Monthly Cash Transfer Program. The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) PBC # 3.3: NAF enrolls in the Takaful CT Program beneficiaries of the regular monthly CT programs that qualify for the Takaful PBC # 3.4: NAF Board of Directors approves a time-bound plan to phase out the regular monthly CT program. PBC #3.1: NAF MIS PBC #3.2: NAF Data source/ Agency PBC #3.3: NAF MIS PBC #3.4: NAF Implementing entity submits the evidence with validation by the World Bank. Verification Entity PBC #3.1: NAF provides the Bank with the list of beneficiaries of the monthly cash transfers who were enrolled and paid through the digitized payments. This will be validated by the World Bank. PBC #3.2: NAF provides the World Bank with a copy of the decision made by Board of Directors: PBC #3.3: NAF provides the Bank with the list of beneficiaries who were recertified and migrated from the Regular Cash Procedure Transfer Program to Takaful or exited from the Regular Cash Transfer program. This will be validated by the World Bank PBC #3.4: NAF provides the World Bank with the approved plan and a copy of the decision made by Board of Directors. DLI_TBL_VERIFICATION PBC 4 PBC 4: Operationalization of the National Unified Registry (NUR) PBC 4.1: GOJ endorses the executive plan to launch NUR as single gateway for applicants seeking social assistance. PBC 4.2: The GOJ uses NUR front-end as the only intake channel for the citizen to apply for five government social services. (incremental). Description PBC 4.3: NAF develops a module in the NAF MIS that connects to the NUR to enable NAF to automatically generate list of poor families affected by the climate-related shocks. PBC 4.1: NAF PBC 4.2: NUR platform Data source/ Agency PBC 4.3: NAF MIS The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974) Implementing entity with validation by the World Bank. Verification Entity PBC # 4.1: The Borrower provides the endorsed executive plan to launch NUR as single gateway for applicants seeking social assistance. PBC #4.2: Borrower provides a list of social services that use NUR front-end as the intake channel for citizen’s application Procedure and a related report. PBC #4.3: Borrower provides a report that the system has been developed. DLI_TBL_VERIFICATION PBC 5 PBC 5: Implementation of the Economic Empowerment Program PBC 5.1. NAF endorses the revised instruction for NAF’s Training and Employment Unit to implement EEP BC 5.2: 3,000 of Takaful-1 beneficiaries targeted for employment support, based on the criteria set in the EEP, are included Description in the target population for national employment programs under Sajjil and apply for support. (incremental). PBC 5.1: NAF shares the revised instruction endorsed. Data source/ Agency PBC 5.2: NAF MIS and Sajjil Platform of the Ministry of Labor Implementing entity with validation by the World Bank. Verification Entity PBC #5.1: NAF Board of Directors has revised instructions for NAF’s Training and Employment Unit to implement EEP. PBC #5.2: NAF provides the list of beneficiaries benefiting from the Economic Empowerment Program from the Sajjil Procedure platform at the Ministry of Labor. . The World Bank Jordan Emergency Cash Transfer COVID-19 Response Project (P173974)