The World Bank Implementation Status & Results Report Strengthening Institutional Capacity for Government Effectiveness Project (P149176) Strengthening Institutional Capacity for Government Effectiveness Project (P149176) AFRICA EAST | Burundi | Governance Global Practice | IBRD/IDA | Investment Project Financing | FY 2015 | Seq No: 10 | ARCHIVED on 03-Sep-2020 | ISR43096 | Implementing Agencies: Government of Burundi, MINISTRY OF FINANCE Key Dates Key Project Dates Bank Approval Date: 22-Apr-2015 Effectiveness Date: 19-Aug-2016 Planned Mid Term Review Date: 08-Mar-2019 Actual Mid-Term Review Date: 08-Mar-2019 Original Closing Date: 31-Dec-2020 Revised Closing Date: 31-Dec-2021 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project Development Objective (PDO) is: to strengthen government institutional capacity to improve fiscal management. Thisobjective will be achieved by supporting government efforts to mobilize domestic revenue, improve public expenditure management andcontrols, produce timely statistics for policy making, and improve mining sector regulatory capacity and practices. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Component 1: Modernizing Revenue Policy and Administration:(Cost $6.30 M) Component 2: Strengthening Public Expenditure Management and Control; Project Management:(Cost $6.80 M) Component 3: Improving ISTEEBU’s Institutional Capacity:(Cost $7.30 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Unsatisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Unsatisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions The Burundi Strengthening Institutional Capacity for Government Effectiveness project (PRCIEG) aims to strengthen government institutional capacity to improve fiscal management. This objective will be achieved by supporting government efforts to mobilize domestic revenue, improve public expenditure management and controls, produce timely statistics for policy making, and improve mining sector regulatory capacity and practices. While the Project Development Objective (PDO) continues to be relevant, the project was restructured in February 2020, in light of lack of overall satisfactory progress and a changing domestic environment less conducive to ambitious public financial management (PFM) reforms. As such, the project restructuring had two main objectives: i) revising and setting a realistic result framework aligned with current PFM reform needs; and (ii) revising the project components to focus on critical activities that have high impact on the PDO and are achievable within the remaining project implementation period. 9/3/2020 Page 1 of 8 The World Bank Implementation Status & Results Report Strengthening Institutional Capacity for Government Effectiveness Project (P149176) Under Component 1 (Modernizing Revenue Policy and Administration), a number of activities have been executed to date including the updating of the MACMOD system by including a fiscal module, and the development of a draft report of the fiscal policy strategy and medium-term action plan transmitted for final approval by the Ministry of Finance. A Computable General Equilibrium Model (MEGC) and a social accounting matrix have also been developed to assess the socio-economic impacts of various policies, with 26 personnel from various sectors trained on their use. On tax administration, activities have included support to the Revenue Authority (Office Burundais des Recettes) to carry out an institutional assessment, the development of internal and tax audit staff capacity, including capacity on risk-based audits and the equipping of regional OBR offices with ICT infrastructure. Under the restructuring, activities have been streamlined to continue to develop capacity in fiscal policy and risk- based tax audit, including in specialized sectors, and project funds have been reallocated to support the updating of the taxpayer registry, and the development and implementation of a strategy to improve and maintain its reliability and accuracy. On improving mining regulatory capacity and practices, now under component 1, a number of activities were completed, including the functional review of the Ministry in charge of mining and its related agencies, the adoption of measures to merge various mining-related entities under one structure and the review of key legislation. The restructuring has streamlined activities to focus on strengthening existing gains: the operationalization of the mining database as a management tool with basic data inputted, improving capacity for the continuous conduct of the inspections of the mining sites to reduce non-compliance, and the finalization of the regulations for Artisanal and Small-Scale Mining (ASM) as part of the new Mining Code. Under Component 2 (Strengthening Public Expenditure Management and Control), the restructuring primarily removed the activities related to the implementation of program-based budgeting as the prerequisites were not yet in place. New activities were instead included to improve public assets management and project monitoring at a centralized level through enhancing the capacity of the Ministry of Finance Office in charge of Monitoring and Evaluation (notably through the development of a computerized M&E system with the related recruitment now launched). The technical assistance to enhance the functionality and use of the IFMIS (SIGEFI) is continuing with the first automated production of the 2016 State financial account (to be submitted to the Court of Auditors), as well as the support to strengthen the audit capacity of the Cour des Comptes and of the National Accountancy Body to align the profession with international standards. Under Component 3 (Improving ISTEEBU’s Institutional Capacity), the production and dissemination of statistics continues to be supported, including production of various indices for the analysis of economic trends and the strengthening of the national accounts. The main change to this component through the restructuring was the addition of the implementation of the Integrated Household Living Condition Survey, which is critical to inform better policy design and decision making since the last survey is dated 2014. The survey is in its second phase and on track with the poverty data report expected by September 2021. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Substantial High Substantial Macroeconomic Substantial High Substantial Sector Strategies and Policies Moderate Substantial Substantial Technical Design of Project or Program Substantial Substantial Moderate Institutional Capacity for Implementation and High High Substantial Sustainability Fiduciary Substantial Substantial Substantial Environment and Social Moderate Moderate Moderate Stakeholders Moderate Moderate Moderate Other -- -- Moderate Overall Substantial Substantial Substantial 9/3/2020 Page 2 of 8 The World Bank Implementation Status & Results Report Strengthening Institutional Capacity for Government Effectiveness Project (P149176) Results PDO Indicators by Objectives / Outcomes Modernizing Revenue Policy and Administration IN00880659 ►Improved predictability of tax policy (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 93.40 115.52 105.50 95.00 Date 01-Jan-2013 31-Dec-2018 30-Jun-2020 31-Dec-2021 This indicator measures the actual aggregate revenue out-turn compared to the original approved budget, as a proxy for predictability of tax policy. This is an annual indicator, linked to the PEFA indicator PI-3. For Comments: FY19-20, it was reached and estimated at 105.5 % against a target of > 95% (pending final review of May and June 2020 revenue data). Strengthening Public Expenditure Management and Control IN00880660 ►Improved financial accountability (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 5.00 Date 31-Dec-2018 31-Dec-2019 30-Jun-2020 31-Dec-2021 This new PDO indicator is about the production of the State financial accounts which have not been produced since 2016. It aims to address the backlog of 2016, 2017, and 2018 (6 months to align with the new FY) State financial accounts and the production of those of 2018-2019, and 2019-2020 by December 31, 2021 (through their automatic production through the IFMIS/SIGEFI). The 2016 financial account has Comments: been finally produced through SIGEFI (with 2 more targeted by December 2020) but has not yet been transmitted to the Court of Auditors. That transmission needs to happen for the indicator to be considered achieved. Improving ISTEEBU's Institutional Capacity IN00880658 ►Improved production of regular and timely statistics (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 66.20 82.10 75.00 Date 01-Jan-2015 31-Dec-2019 30-Jun-2020 31-Dec-2021 The PDO Indicator was revised to focus on the regular production of statistics and the timeliness of their release, as mechanisms to assess the reliability of the majority of the statistics being produced are not Comments: available. It measures a percentage of statistics published in a timely fashion with reference to the publication deadlines defined in the ISTEEBU business program.For FY19-20, that was achieved at 82.1% against a target of 70% for the second to last year of project implementation. 9/3/2020 Page 3 of 8 The World Bank Implementation Status & Results Report Strengthening Institutional Capacity for Government Effectiveness Project (P149176) Improving Mining Regulatory Capacity and Practices IN00880657 ►Improved management and regulatory framework for the mining sector (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No Yes No Yes Date 01-Jan-2015 31-Dec-2018 30-Jun-2020 31-Dec-2021 This indicator aims to measure improved governance in the mining sector through a series of milestones (last year, it was the adoption of measures to merge various mining-related entities under one structure based on the functional review). For year 4, the target is the establishment of a national database on Comments: mining that is accessible to relevant staff within the Office Burundais des Mines (OBM). The mining database has been established but needs to be populated with the relevant data by December 2020 with related activities needing to be accelerated. Intermediate Results Indicators by Components Component 1: Modernizing Revenue Policy and Administration IN00880671 ►A New Fiscal Strategy and Medium-Term Action Plan, with credible revenue targets approved by the Ministry in charge of Finance and published (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 30-Jun-2019 30-Jun-2019 30-Jun-2020 31-Dec-2020 The aim is to build government capacity to develop fiscal policy and conduct revenue forecasting aimed at generating credible revenue forecasts, in a bid to improve fiscal realism. A draft Fiscal Strategy and Medium-Term Action Plan has been developed but needs to be approved by the Ministry of Finance. The Comments: credibility of the revenue targets will be assessed in FY 20-21 with regards to actual revenue collected vs the projection for that year in the Fiscal Strategy. IN00880673 ►Increased taxpayer compliance (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 0.00 Date 31-Dec-2014 31-Dec-2018 30-Jun-2020 31-Dec-2021 This indicator measures the share of taxpayers filing taxes on time compared to total taxpayers on the register, by taxpayer category (LTO = Large Tax Operators; MTO = Medium Tax Operators; SMO = Small Tax Operators) (Baseline: 2014). Per the numbers reported by OBR for FY19-20, the MTO and SMO met Comments: the targets with respectively 91.5% and 161.5% of those taxpayers having filed on time vs targets of 91% and 93.5%. The LTO fell short with 97.8% vs a target of 99%. This indicator however needs the to be measured on the basis of the updating of the taxpayer registry to ensure inactive taxpayers are effectively removed from the registry if they are not being counted when reporting compliance. The rate for SMO is 9/3/2020 Page 4 of 8 The World Bank Implementation Status & Results Report Strengthening Institutional Capacity for Government Effectiveness Project (P149176) explained by the fact that more new taxpayers in FY19-20 (identified from the informal sector through field visits) filed on time that the number of SMO currently captured in the registry and highlights the urgent need to update and clean up the taxpayer registry. IN00880674 Large Tax Operators (Percentage, Custom Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 99.00 99.20 97.80 99.50 Date 01-Jul-2014 31-Dec-2019 30-Jun-2020 31-Dec-2021 IN00880676 Medium Tax Operators (Percentage, Custom Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 83.00 93.60 91.50 97.00 Date 01-Jul-2014 31-Dec-2018 30-Jun-2020 31-Dec-2021 IN00880678 Small Tax Operators (Percentage, Custom Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 60.00 90.20 161.50 95.00 Date 01-Jul-2014 31-Dec-2018 30-Jun-2020 31-Dec-2021 IN00880680 ►Domestic tax revenue collected outside Bujumbura urban, out of the total domestic revenue collected in a given year (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.80 2.40 2.27 2.50 Date 01-Jan-2014 31-Dec-2019 30-Jun-2020 30-Dec-2021 2.27 % in 2019-2020 against a target of 2.2.% Comments: IN00880681 ►Audit completion ratio (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 46.00 79.40 53.50 80.00 Date 01-Jan-2015 30-Jun-2019 30-Jun-2020 31-Dec-2021 53.5% in FY19-20 vs a target of 70%. The target was not achieved due to a significant reduction in audit Comments: visits due to risks linked to COVID-19. IN00880683 ►Percentage of of ASM mines inspected and non-compliant with the mining regulations and mine inspection files (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target 9/3/2020 Page 5 of 8 The World Bank Implementation Status & Results Report Strengthening Institutional Capacity for Government Effectiveness Project (P149176) Value 70.00 36.40 19.05 10.00 Date 01-Jan-2015 31-Dec-2018 30-Jun-2020 31-Dec-2021 Out of 42 sites inspected in 2019-2020, 8 (19%) were not compliant (against a target of 20% or less). Comments: IN00880684 ►Basic mining data (total mine sites with permits, # active miners per site, # of cooperatives, production per mineral and revenues exported) to be inputted to national database twice a year (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 2.00 Date 01-Jan-2015 31-Dec-2019 30-Jun-2020 31-Dec-2021 Minimum data post-restructuring defined to be inputted to the national database and updated on a semi- annual basis. The indicator measures the number of updates per year. TA is being contracted to help operationalize the databases modules and support the relevant Ministry's staff in the methodology and Comments: collection of standardized data and production of data reports. Efforts need to be made for this work to be accelerated with the data inputted/updated at least twice in 2020. Component 2: Strengthening Public Expenditure Management and Control; Project Management IN00880682 ►Number of audit reports produced by the Supreme Audit Institution that are transmitted to Parliament (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 13.00 Date 01-Jan-2015 31-Dec-2018 31-Dec-2018 31-Dec-2021 The restructuring focused on adequately setting the targets to only concern audit related engagements. 7 such audit reports are targeted in 2020 including 3 State accounts in 2020 (2016, 2017 and first 6 months of 2018), 3 municipalities annually including Bujumbura and at least 1 State-Owned Enterprise annually. Comments: The State accounts need to first be produced by the Ministry of Finance and the Court of Auditors has committed to auditing them within six months of receipt. Compliance will be assessed based on the audit reports transmission to Parliament. Component 3: Improving ISTEEBU’s Institutional Capacity IN00880672 ►Number of ISTEEBU staff trained and evaluated with satisfaction in design and analysis of statistics products (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 130.00 136.00 120.00 Date 01-Jan-2015 31-Dec-2019 30-Jun-2020 31-Dec-2021 The project surpassed the target in FY19-20 (136 staff trained and evaluated with satisfaction vs a cumulative Comments: target of 96, with 27.9% of them women). IN00880675 9/3/2020 Page 6 of 8 The World Bank Implementation Status & Results Report Strengthening Institutional Capacity for Government Effectiveness Project (P149176) Number of ISTEEBU staff trained and evaluated with satisfaction in design and analysis of statistics products, of which at least 25% should be women (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 26.90 27.90 25.00 IN00880677 ►Beneficiaries satisfied with quality of services provided by ISTEEBU (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 22.70 52.10 52.10 55.00 Date 01-Jan-2016 31-Dec-2018 31-Dec-2018 31-Dec-2021 The annual survey to assess the rate of satisfaction of beneficiaries on the quality of the services provided by ISTEEBU in 2019 is to be conducted by the end of 2020. Comments: IN00880679 ►Integrated Household Living Conditions Survey (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 01-Dec-2019 31-Dec-2019 30-Jun-2020 31-Dec-2021 Not yet due but on track with the field work expected to be completed in March 2021 and the survey report including the poverty profiles of the populations to be produced by September 2021. Phase 1 (training of Comments: surveyors and conduct of pilot survey) and phase 2 (technical workshop on the calculation of poverty indicators) have been completed. Performance-Based Conditions Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P149176 IDA-D0490 Effective USD 22.00 22.00 0.00 14.87 7.04 68% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P149176 IDA-D0490 Effective 22-Apr-2015 01-Apr-2016 19-Aug-2016 31-Dec-2020 31-Dec-2021 Cumulative Disbursements 9/3/2020 Page 7 of 8 The World Bank Implementation Status & Results Report Strengthening Institutional Capacity for Government Effectiveness Project (P149176) PBC Disbursement Achievement Disbursed amount in Disbursement % PBC ID PBC Type Description Coc PBC Amount Status Coc for PBC Restructuring History Level 2 Approved on 24-Feb-2017 ,Level 2 Approved on 24-Feb-2020 Related Project(s) There are no related projects. 9/3/2020 Page 8 of 8