Page 1 PROJECT RESTRUCTURING FOR RVP APPROVAL PROJECT PAPER (PP) IRAQ EMERGENCY DISABILITIES PROJECT (P096774) Grant No. TF054052 Human Development Department Middle East and North Africa Region The World Bank 49697 Page 2 DATA SHEET PROJECT PAPER Date: January 15, 2008 Country: IRAQ Project Name: Emergency Disabilities Project Project ID: P096774 Task Team Leader: Francisca A. Akala Sector Manager/Director: Akiko Maeda/Steen Jorgensen Country Director: Hedi Larbi Environmental Category: B Borrower: Republic of Iraq Responsible agency: Ministry of Health Revised estimated disbursements (Bank FY/US$m) FY 2006 2007 2008 2009 2010 Annual 0 0.47 1.61 5.52 9.20 Cumulative 0 0.47 2.08 7.60 16.80 Current closing date: September 30, 2009 Revised closing date [if applicable]: June 30, 2010 Indicate if the restructuring is: Board approved ___ RVP approved X _ Does the restructured project require any exceptions to Bank policies? Have these been approved by Bank management? Is approval for any policy exception sought from the Board? __ Yes X No _ Yes __ No __ Yes X No Revised project development objective/outcomes: The Project Development Objective (PDO) will be to improve access of the disabled population in the targeted areas in Iraq to rehabilitation and prosthetic services. Does the restructured project trigger any new safeguard policies? No. Revised Financing Plan (US$m) Source Local Foreign Total Borrower IBRD/IDA Other: Iraq Trust Fund Total 6.45 6.45 10.35 10.35 16.80 16.80 Page 3 1 Introduction 1. This Project Paper seeks the approval of the Regional Vice President to restructure the Iraq Emergency Disabilities Project, and any accompanying amendments to the P roject’s legal documents. The proposed changes in project scope and components are required due to the challenging political and security conditions in the country after Project effectiveness. As a result of this context, implementation was significantly delayed, and the number of project sites was reduced. 2. Proposed Project Restructuring and Amendments to the Grant Agreement . The Ministry of Health has been unable to implement the activities under Component 1 – Policy Development and Partnerships – in the limited time available, and has requested the Bank to cancel this component. The proposed restructuring will also result in cancellation of US$2.7 million of the Grant proceeds and reallocation of the remaining amount to the revised activities. This restructuring will require an extension of the Project Closing Date to June 30, 2010, as agreed with the Ministry of Health (MOH). The Project Development Objective (PDO) has been revised, as follows: to improve access of the disabled population in the targeted areas in Iraq to rehabilitation and prosthetic services. This will be carried out by: (i) constructing new facilities and workshops and equipping them; (ii) upgrading technical skills of the service providers; and (iii) providing medical aids to the disabled persons. The restructured Project is expected to result in: (a) an increase in the number of disabled using the newly constructed and equipped facilities, and (b) an increase in the number of disabled who will receive medical aids. Background and Reasons for Restructuring 3. The original Project was approved by the Iraq Strategic Review Board (ISRB) on August 24, 2005, and became effective on November 23, 2005. The original PDO was to support the delivery of improved rehabilitation and prosthetic services that would reduce the burden of physical disability. Specifically, the Project would (i) support the development of a national policy on disabilities; (ii) increase the capacity of Iraqi institutions and other stakeholders to meet the needs of disabled persons; (iii) strengthen the partnerships between the Government and civil society in providing services to disabled persons; and (iv) upgrade the infrastructure and equipment of selected rehabilitation and prosthetic centers throughout Iraq. These objectives would be achieved through the three components, namely: (i) Component 1 – Policy Development and Partnerships; (ii) Component 2 – Delivery of Services to Disabled Persons; and (iii) Project Management. The original Project Closing Date was September 30, 2007, but was subsequently extended to September 30, 2009, in an amendment letter dated June 15, 2007. 4. Page 4 2 Original Project Scope and Design 5. Under Component 1 , the Project was to support establishment of a Disabilities Working Group (DWG) that would develop a national policy and legislative framework for the disabled. In addition, through the partnership of the Government and the various non-government organizations (NGOs), the Project would provide resources to allow NGOs to provide support services to the disabled, including monitoring of the provisions of disability services and raising public awareness on the conditions of the disabled in the country. 6. Because of the political and security context, and the lack of capacity within the MOH, the original activities could not be implemented within the available time frame of the Project. 7. Under Component 2 – Delivery of Services to the Disabled, the original project design included the construction of nine new rehabilitation facilities and renovation of five existing facilities in thirteen governorates. Three of the new rehabilitation facilities were also to have workshops for the production and repair of prostheses and orthoses. The management and technical skills of the service providers of the disabled persons were targeted to be developed in the new facilities and/or upgraded in others. 8. However, because of the deterioration in the value of the Iraqi currency and inflation caused by the security conditions, the Project was subjected to significant cost escalation in its implementation. As a result, during the design phase of the fourteen facilities, it became evident that the costs of construction and renovation estimated at appraisal were significantly underestimated. The high domestic inflation in construction made coverage of all the planned construction and equipping impossible. Two centers were dropped due to security reasons, and subsequently, the MOH decided to also cancel all renovation works to reduce the scope of construction to fit the available funding under the Grant. In addition, the MOH cancelled one more center due to land dispute issue. The six new centers, which are all under construction, can now be completed, fully equipped and staffed. They comprise: (i) four new Rehabilitation Centers in: Amara, Basrah, Samawa and Karbala; and (ii) two new Rehabilitation Centers with Workshops in: Dewaniyah, and Kut. This component also provided support to procurement of specialized equipment for prosthetic workshops, equipment for rehabilitation centers, computer workstations for management and registration of beneficiaries, and office equipment and furniture for the selected locations. Support is also provided for training activities to improve the services for physical rehabilitation, both inside and outside the country. 9. Under Component 3 – Project Management, financing is provided to support management of project activities to ensure effective implementation. A Project Management Team (PMT) composed of a Project Director and fiduciary staff (finance and procurement) coordinates the technical implementation of the components and Page 5 3 ensures fiduciary management and control of the Project, including the annual audits and maintenance and management of the Project records. 10. Project Performance to Date . The first ISR Implementation Progress (IP) rating was satisfactory (S). Subsequent IP ratings have been marginally unsatisfactory (MU), with the exception of the most recent ISR (December 2008) in which the IP rating was upgraded to marginally satisfactory (MS). Notably, Component 1 has been consistently rated as highly unsatisfactory because the agreed activities could not be implemented due to the lack of sufficient attention by the Ministry as well as project management capacity issues within the MOH Project Management Team (PMT). As a result of this lack of real progress in Project implementation, the original PDO would likely not be met by the Project Closing Date. 11. Rationale for Restructuring . When the Project became effective in late 2005, it coincided with a dramatic deterioration of security conditions in the country. For almost two years, Project implementers were unable to travel to project sites for visits, and consequently there was minimal contact with local government authorities. The capacity- building goals of the project were not achievable because of the worsening security environment. As a consequence, implementation experienced significant delays during this period of heightened insecurity in the country. 12. Uncertain Project Implementation Leadership . From late 2005 to late 2007, the leadership at the Ministry of Health (MOH) was also unstable. Since Project Effectiveness in November 2005 until the present, there have been four different Ministers of Health responsible for the Project. For seven months, from April 2007 to October 2007, the MOH did not have a minister to lead and make the key decisions with respect to the Project. The unstable MOH project oversight and ownership and the implementation challenges significantly delayed implementation. As a result, the PMT was not fully staffed and was not able to function adequately. The security conditions during this period were very precarious, and in fact, it was during this time that the Deputy Minister of Health for Donor Affairs, who was leading the project implementation for the MOH, was kidnapped and is presumed dead. 13. Although the security situation started to stabilize in October 2007, significant implementation time had already been lost. In spite of the recent improvement in the pace of implementation, the low implementation capacity of the MOH, the complexities and scope of the original project design of Component 1, and the uncertainty concerning the future political and security conditions in the country are major risks that will likely prevent the completion of the original agreed program of activities and allow the Project to achieve its original PDO before the current Project Closing Date of September 30, 2009. Page 6 4 Proposed Changes and Restructuring 14. Proposed Revised PDO . The representatives of the MOH proposed to revise and simplify the PDO, as well as revising the results framework and performance indicators. The revised PDO is: “to improve the access of the disabled population in the targeted areas in Iraq to rehabilitation and prosthetic services”. 15. Revised Project Scope . Component 1 – Policy Development and Partnerships - will be cancelled from the Project and the Grant resources will be reallocated to the remaining components. The revised scope of the Project will focus on the construction and equipping of six new facilities and workshops in six governorates and equipping two facilities in two governorates to serve the disabled population, instead of the fourteen facilities in thirteen governorates as agreed in the original Project design. 16. Revised Component 1 – Delivery of Services to the Disabled . Originally Component 2, this will become the new Component 1. There will now be only six new facilities to be constructed: four rehabilitation centers and two rehabilitation plus workshop centers. The Project supports training activities to improve the services for physical rehabilitation, including: (i) specialized training for production and fitting of prostheses; (ii) training for physiotherapists; (iii) management training for workshop and rehabilitation center managers; and (iv) specialized training in physical therapy for hospital-based physicians. Although all the planned training courses have been completed under this Project, the MOH has proposed organizing additional follow-on training courses using the existing Grant proceeds based on the success of the completed training courses. 17. For the equipment needs, s ince the Baghdad/Al Karkh facility has been cancelled because of a land dispute issue, two existing facilities (Al Hakim, Baghdad and Al Najaf) will benefit from the equipment that was destined for Baghdad/Al Karkh, and therefore the project will support the equipping additional two centers with prostheses/orthoses workshops. 18. Electrical wheelchairs: Reallocated funds will be used to purchase electric wheelchairs for adults and children. 19. Revised Component 2 – Project Management and Monitoring and Evaluation . This original Component 3 will be retained and now will be referred to as Component 2. Because of the proposed extension of the Project Closing Date, additional resources will be provided from the Grant proceeds to cover the expenses expected to be incurred until the revised closing date, to ensure that the MOH PMT can continue functioning adequately. 20. Cancellation and Reallocation . Based on the cancellation of Component 1 – Policy Development and Partnerships -- and the reduction of the scope of the number of facilities as agreed with the MOH, the amount of US$2.7 million will be cancelled from Page 7 5 the Grant proceeds and the remaining amount will be reallocated to the remaining two components. (See Annex 1 for the Revised Schedule 1 of the Grant Agreement) 21. Extension and Revised Closing Date. In order to complete all the revised and agreed activities, the Closing Date of the Project will be extended to June 30, 2010. Based on the agreed revised implementation schedule, the new completion date is December 31, 2009. Analysis 22. The proposed changes will reduce the scope of the investment but will focus more on the access and availability of rehabilitation services and prosthetics to the targeted population of disabled people in the eight governorates. With this narrower focus, the project has been tailored to ensure that the project objectives and activities are aligned with the realities on the ground. The project is not expected to have the same social and economic impact on beneficiaries as originally planned because the number of rehabilitation centers and workshops that will be supported by the project has dropped significantly from 14 to 8 (including two facilities receiving equipment only). There is no change in the environmental category and no new safeguard policies are triggered. This restructuring does not involve any exceptions to Bank policies. Expected Outcomes 23. Revised Project Results Monitoring Framework . Based on the proposed changes to the project, the Results Monitoring Framework is also revised accordingly, reflecting revised PDO and indicators, agreed with the MOH. The revised PDO and indicators will allow for a more realistic rating of project results. The revised Results Monitoring Framework is shown below: Revised Results Monitoring Framework Matrix Revised Outcome Indicators Target at the end of the Project Achievement of Target to Date · Number of disabled who have used the newly constructed and equipped facilities 500 clients/facility/month Not yet applicable Revised PDO: - to improve access of the disabled population in the targeted areas in Iraq to rehabilitation and prosthetic services · Number of disabled who have received medical aids through the project 39,900 clients Not yet applicable Revised Component Revised Output Indicators · Number of new basic rehabilitation centers constructed 6 new facilities 6 facilities under construction Component 1. Delivery of Services to the Disabled · Number of new prosthetic workshops constructed 2 new workshops 2 workshops under construction Page 8 6 · Number of staff trained in the area of physical rehabilitation · 70 physiotherapists (regular training ) · 8 physiotherapists (specialized additional training ) · 30 physicians (specialized training ) · 66 trained physiotherapists · 16 trained physician · Number of staff trained in the area of production and fitting of prostheses and orthoses · 47 staff ( outside Iraq ) · 30 technicians (local training) 36 trained staff · Number of facility managers trained in the area of facility management 20 managers 15 trained facility managers · Number of medical aids (wheelchairs, crutches, walking sticks, walking frames, walking rollators, tripods) procured 39,900 items 38,000 items · Number of quarterly progress monitoring reports 18 reports 7 reports Component 2: Project Management and Monitoring and Evaluation · Submission of Project Completion Report 1 report not yet applicable Benefits and Risks 24. Benefits . The Project will provide access to 500 disabled clients per month per facility in the eight governorates in the eight facilities and workshops (six newly built and equipped and two equipped only) that will provide them with rehabilitation services. In the facilities with workshops, the disabled will have access to fittings of prostheses and orthoses, including their repairs. The Project will also provide 39,900 disabled clients with medical aids. The new facilities will be used for training of staff in rehabilitation services for the disabled and technicians for the workshops. 25. Risks . The following are the major risks identified and mitigation measures: a. Uncertain Security and Political Environment . The security and political environment in Iraq has been improving during the past several months. However, the security and political context continue to be factors beyond the control of the Project management. The reduced project scope and limited number of project sites would allow project implementation to proceed, even in the most challenging security and political environment. Page 9 7 b. Lack of Capacity and Inadequate Leadership . Political uncertainties in the past, as well as lack of familiarity of MOH officials with working with international donors and business community contributed to the lack of implementation capacity and inadequacies in managing a Bank-financed project. It is possible that the political and/or security context could deteriorate once more as the result of a new crisis, and the current leadership and PMT staff could change as a result. The recent improvement in the political environment in the country and the stronger leadership at the MOH that has been very supportive of this Project will greatly reduce the risk of Project failure. There is growing stability and professionalism at the MOH and this has helped stabilize the PMT. The regular interactions with the Bank project team and the recent support provided by the MOH leadership have contributed to the improved implementation capacity, as indicated in the accelerated phase of implementation during the past few months. Page 10 8 Annex 1 Revised Schedule 1 Allocation of the Grant Proceeds Category Current Amount of the Grant Allocated (Expressed in US Dollars Equivalent) Proposed Revised Amount of the Grant Allocated (Expressed in US Dollars Equivalent) (1) Civil Work 4,700,000 6,700,000 (2) Goods 11,230,000 6,400,000 (3) Consul tants’ Services 1,920,000 800,000 (4) Training 1,300,000 2,200,000 (5) Operating Costs 170,000 250,000 (6) Unallocated 180,000 450,000 To be cancelled (2,700,000) Total 19,500,000 16,800,000 Page 11 9 A n n e x 2 R e v i s e d P r o j e c t I m p l e m e n t a t i o n S c h e d u l e C a l e n d a r Y e a r s C Y - 2 0 0 8 C Y - 2 0 0 9 M o n t h s M a r A p r M a y J u n J u l A u g S e p O c t N o v D e c J a n F e b M a r A p r M a y J u n J u l A u g S e p O c t N o v D e c W e e k s 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 M i s s a n / A m a r a - N e w R e h a b i l i t a t i o n C e n t e r 1 P M T s u b m i t s B i d d i n g D o c u m e n t s t o I D A ( c o m p l e t e d ) 2 I D A i s s u e s i t s " N . O . " t o p r o c e e d w i t h b i d d i n g 3 B i d A d v e r t i z i n g 4 B i d d i n g p e r i o d 5 B i d e v a l u a t i o n 6 I D A i s s u e s i t s " N . O . " 7 C o n t r a c t a w a r d 8 C o n t r a c t i s s i g n e d , c o n t r a c t o r m o b i l i z e s t o m o v e i n t o t h e s i t e P r o g r e s s t o d a t e 8 % 9 C o n s t r u c t i o n p e r i o d ( 1 2 M o n t h s ) B a s r a h / B a s r a h - N e w R e h a b i l i t a t i o n C e n t e r 1 P M T s u b m i t s B i d d i n g D o c u m e n t s t o I D A ( c o m p l e t e d ) 2 I D A i s s u e s i t s " N . O . " t o p r o c e e d w i t h b i d d i n g 3 B i d A d v e r t i z i n g 4 B i d d i n g p e r i o d 5 B i d e v a l u a t i o n 6 I D A i s s u e s i t s " N . O . " 7 C o n t r a c t a w a r d 8 C o n t r a c t i s s i g n e d , c o n t r a c t o r m o b i l i z e s t o m o v e i n t o t h e s i t e P r o g r e s s t o d a t e 6 % 9 C o n s t r u c t i o n p e r i o d ( 1 1 M o n t h s ) M u t h a n n a / S a m a w a - N e w R e h a b i l i t a t i o n C e n t e r 1 P M T s u b m i t s B i d d i n g D o c u m e n t s t o I D A ( c o m p l e t e d ) 2 I D A i s s u e s i t s " N . O . " t o p r o c e e d w i t h b i d d i n g 3 B i d A d v e r t i z i n g 4 B i d d i n g p e r i o d 5 B i d e v a l u a t i o n 6 I D A i s s u e s i t s " N . O . " 7 C o n t r a c t a w a r d 8 C o n t r a c t i s s i g n e d , c o n t r a c t o r m o b i l i z e s t o m o v e i n t o t h e s i t e P r o g r e s s t o d a t e 6 % 9 C o n s t r u c t i o n p e r i o d ( 1 3 M o n t h s ) B i d d i n g B i d d i n g E q u i p . B i d d i n g E q u i p . E q u i p . Page 12 1 0 C a l e n d a r Y e a r s C Y - 2 0 0 8 C Y - 2 0 0 9 M o n t h s M a r A p r M a y J u n J u l A u g S e p O c t N o v D e c J a n F e b M a r A p r M a y J u n J u l A u g S e p O c t N o v D e c W e e k s 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 K a r b a l a / K a r b a l a - N e w R e h a b i l i t a t i o n C e n t e r 1 P M T s u b m i t s B i d d i n g D o c u m e n t s t o I D A ( c o m p l e t e d ) 2 I D A i s s u e s i t s " N . O . " t o p r o c e e d w i t h b i d d i n g ( c o m p l e t e d ) 3 B i d A d v e r t i z i n g ( c o m p l e t e d ) 4 B i d d i n g p e r i o d ( c o m p l e t e d ) 5 B i d e v a l u a t i o n ( s e c o n d s t a g e e v a l u a t i o n / n e g o t i a t i o n ) 6 I D A i s s u e s i t s " N . O . " 7 C o n t r a c t a w a r d 8 C o n t r a c t i s s i g n e d , c o n t r a c t o r m o b i l i z e s t o m o v e i n t o t h e s i t e P r o g r e s s t o d a t e 7 0 % 9 C o n s t r u c t i o n p e r i o d ( 1 0 M o n t h s ) Q a d i s s i y a h / D e w a n i y a h - N e w R e h a b i l i t a t i o n C e n t e r + W o r k s h o p 1 P M T s u b m i t s B i d d i n g D o c u m e n t s t o I D A ( c o m p l e t e d ) 2 I D A i s s u e s i t s " N . O . " t o p r o c e e d w i t h b i d d i n g 3 B i d A d v e r t i z i n g 4 B i d d i n g p e r i o d 5 B i d e v a l u a t i o n 6 I D A i s s u e s i t s " N . O . " 7 C o n t r a c t a w a r d 8 C o n t r a c t i s s i g n e d , c o n t r a c t o r m o b i l i z e s t o m o v e i n t o t h e s i t e P r o g r e s s t o d a t e 1 0 % 9 C o n s t r u c t i o n p e r i o d ( 1 0 M o n t h s ) W a s s i t / K u t - N e w R e h a b i l i t a t i o n C e n t e r + W o r k s h o p 1 P M T s u b m i t s B i d d i n g D o c u m e n t s t o I D A ( c o m p l e t e d ) 2 I D A i s s u e s i t s " N . O . " t o p r o c e e d w i t h b i d d i n g 3 B i d A d v e r t i z i n g 4 B i d d i n g p e r i o d 5 B i d e v a l u a t i o n 6 I D A i s s u e s i t s " N . O . " 7 C o n t r a c t a w a r d 8 C o n t r a c t i s s i g n e d , c o n t r a c t o r m o b i l i z e s t o m o v e i n t o t h e s i t e P r o g r e s s t o d a t e 2 5 % 9 C o n s t r u c t i o n p e r i o d ( 1 3 . 5 m o n t h s ) E q u i p . B i d d i n g E q u i p . B i d d i n g E q u i p .