Document of The World flank FOR OFFICIAL USE ONLY Report No: 25463-PAK PAIUSTAN Joint Staff Assessment of Poverty Reduction Strategy Paper Preparation Status Report January 31, 2003 Prepared by Staffs of the International Development Association and the International Monetary Fund This document has a restricted distribution and may be used by recipients only in the performance of official duties. Its contents may not otherwise be disclosed without World Bank authorization. FOR OFFICIAL USE ONLY INTERNATIONAL MONETARY FUND AND THE INTERNATIONAL DEVELOPMENT ASSOCIATION PAKISTAN Joint Staff Assessment of the PRSP Preparation Status Report Prepared by the Staffs of the International Monetary Fund and the International Development Association Approved by George T. Abed and Michael T. Hadjimichael (IMF) and Mieko Nishimizu and Gobind Nankani (IDA) January 31, 2003 1. The Pakistani authorities presented to the Executive Boards of the IDA and the IMF in December 2001 the interim Poverty Reduction Strategy Paper (I-PRSP). The Boards agreed that the document provided a sound basis for the development of a fully participatory PRSP. At that time, the full PRSP was expected to be finalized by January 2003 following elections and the forrnation of a civilian government. Elections were held as planned but with no party gaining an absolute majority, formation of new governments at both the national and provincial levels was delayed. Consequently the Government of Pakistan has decided to delay preparation of the full PRSP until April, 2003. Given the importance of ensuring full ownership of the PRSP by the new government, the: staffs of the Bank and the Fund support this decision. As the PRSP will not be finished within one year of the completion of the I-PRSP, the authorities have issued a Preparation Status Report for presentation to the Boards of the World Bank and IMF. The report outlines the main activities undertaken, next steps, and a revised timeline for preparation of the full PRSP. 2. The Joint Staff Assessment (JSA) of the I-PRSP identified some important gaps in the poverty reduction strategy for Pakistan. These included the following: a detailed rural development strategy; a more focused human development strategy; a coherent fiscal framework taking into account mechanisms for transfer of resources and responsibilities from federal and provincial governments to the district governments (in the context of the ongoing devolution exercise); costing of programs to achieve targets, particularly in the health and education sector; and a monitoring framework-particularly for tracking intermediate indicators in the social sectors and anti poverty programs. The preparation status report emphasizes the government's commitment to continuity of the reforms envisaged in the I-PRSP and outlines various aspects of the process, timeline, content, and progress along these dimensions. .9 3. Country Ownership and Participation. The I-PRSP outlined key processes to be set in motion to ensure full participation in formulation of the PRSP, including at the provincial level and by the newly elected district officials and civil society. The Govermment of Pakistan launched a PRSP-type process to ensure full consultation at the level of provinces and districts. This process camne to a halt as the new government was being installed following the national elections in October 2002. The preparation status report outlines a new timeline for getting inputs from the provinces. The authorities report that the participatory process is fully engaged at the provincial level, with a nurmber of seminars and workshops for consultations in the provinces being conducted or planned, This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not be otherwise disclosed without World Bank authorization. - 3 - which should be strengthened with more extensive community level discussions. The timeline outlined in the report reflects the latter, through activities like consultation with stakeholders by provinces and with communities through the Rural Support Program network. Among the provinces, it appears that North West Frontier Province (NWFP), Sindh, and Balochistan are ahead of Punjab where a majority of the population of Pakistan resides. While this marks encouraging progress, ensuring full participation of Punjab is critical. In line with the restoration of democratically elected government, the staffs believe it would also be useful to encourage wider public discussion through, for example, media mediated debates or other forums including the newly formed parliament, in addition to placing the document on the web as the authorities plan according to the preparation status report. 4. Poverty Diagnostics. The I-PRSP presented the poverty diagnostics though 1998-99. In the meantime the 2000-01 round of the Pakistan Integrated Household Survey has been completed. Recent discussions around this issue point to concerns of the GOP on methodology and data quality, and a committee is being set up to assess these concerns. The staffs have been assured that there will be quick resolution of this matter and expect that the full PRSP will update the diagnostics along important dimensions of poverty measurement (outlining the methodology of the newly adopted official poverty line) and social indicators with necessary disaggregation to portray the rural-urban and other regional dimensions and link these insights into refinements of the core policy priorities. 5. Development of the Full PRSP. The preparation status report highlights and endorses the policy agenda outlined in the I-PRSP. Key issues include: (i) Macro economic Framework Although not elaborated in the preparation status report, recent developments indicate further progress towards macroeconomic stabilization, in line with the I-PRSP framework. The continuation of sound macroeconomic and structural policies has contributed to a significant improvement of the external and fiscal positions and a pick-up in growth. The authorities have pursued an ambitious tax administration reform agenda that appears to have started bearing fruit. However, lack of significant improvements in the performance of some public sector enterprises, notably in the power sector, is imposing a serious drain on public finances. The staffs recommend that the authorities monitor carefully these macroeconomic developments and to develop perhaps 2 different macroeconomic scenarios in the PRSP, including a cautious baseline scenario and a more optimistic one reflecting a rapid implementation and impact of economic reform. (ii) Sectoral Policy Agenda. First, while the increase in poverty-related expenditures as reported in the preparation status report is a positive development, the staffs recommend the full PRSP forcefully address implementation problems at the local level. With devolution, responsibility for service delivery (health, education, water, and community infrastructure) rests with the newly formed district governments and rationalization of the roles and responsibilities of the three tiers of government-federal, provincial, and district-is a critical component of effective devolution. The preparation status report outlines establishment of provincial finance commissions, as well as the additional federal transfers envisaged, but further work is needed to define mechanisms for adequate costing and governance structures to ensure accountability. The full PRSP should also address the challenge of capacity building at the district level in planning and budgeting, as well as revenue raising mechanisms. Second, rural development is a priority area for a poverty reduction strategy in Pakistan and the JSA identified this as a key area for deepening policy and action. The preparation status report views the rural strategy through the lens of the provincial agenda in the newly devolved environment and expects the strategy to emerge -4 - from provincial inputs for the full PRSP. However, other key challenges in the sector including improving access to land and other assets by the landless lie within the federal ambit; a discussion of these broader challenges is important as highlighted in the I-PRSP and the JSA. Lastly, the growth strategy envisaged could be strengthened by identifying the sources of growth and making the links between growth, employment and poverty, to examine the key factors that would translate into poverty reduction. For example, stagnancy in rural poverty suggests a lack of progress in enhancing rural productivity. (iii) Gaps identified in the Interim-PRSP. The Status report highlights the gaps in the I-PRSP, and identifies areas the full PRSP will likely address, drawing on inputs from a number of sources, including analytical work and surveys conducted by various donors. However, given the limited time, it may be useful to prioritize the areas that can be addressed by the PRSP. In the staffs' view, the first areas of priority are costing of reforms and pro-poor programs and financing and resource gap. In this context, the inclusion of medium term costing of the health and education sectors in the full PRSP-mentioned in the status report-will be a significant step. 6. Institutional Arrangements. The PRSP Preparation Status report extensively highlights the institutional arrangements for the implementation of the full PRSP. The government had set up a PRSP Secretariat during the preparation of Interim-PRSP, and this has since been strengthened in a number of ways. This includes setting up a National Steering Committee headed by the Finance Secretary with high level representation of relevant Ministries, institutions and provinces, and the appointment of a high level official as the focal person in the PRSP Secretariat, reporting directly to the Finance Secretary and the Finance Minister. The staffs view these as positive steps-likely to improve the clarity of responsibility for implementing the process, the coordination among all implementing agencies, and the process of building consensus among all stakeholders like the provinces and civil society institutions. 7. Monitoring and Evaluation. The preparation status report highlights progress in expenditure tracking and the government has been publishing quarterly reports presenting PRSP-related expenditures. There has been significant progress on the monitoring of public expenditures. A whole new system has been set up to monitor expenditures at the local level, and these are now being reported on a quarterly basis for the first time ever. However, there is a concern that expenditure reporting may not be fully comparable between the different provinces. The authorities have rightly put great emphasis on increasing social and poverty-related spending while devolving spending responrsibility to local governments. At the same time, continued implementation problems at the local level result largely from capacity bottlenecks and continued 'teething' problems with devolution. The full PRSP will need to pay close attention to these implementation problems, as well as expenditure tracking, ensuring comparability across provinces, to achieve adequate and high quality social service delivery. 8. On poverty monitoring, further progress is needed in implementation. ThA-PRSP has a well designed framework, but challenges remain in the areas of implementing independent monitoring of outcomes and intermediate indicators. The Government's quarterly PRSP reporting has included information on several health and education intermediate indicators, including benchmarks for four of them. Additional intermediate indicators have been selected through a thorough consultation process, which has ensured broad consensus among relevant ministries, provinces and institutions about their appropriateness to track the impact of reforms in social sectors and provide feedback to policymakers. The process has also ensured that the indicators chosen are consistent with the Millennium Development Goals, tailored to the local context of Pakistan. In the staff's view, a well- - 5 - focused annual Core Welfare Indicators Questionnaire (CWIQ) like the ones fielded in many African countries could be a highly useful supplement to and cross-check of the data reported through the traditional administrative reporting channel. The latter may indeed be biased toward reporting "success" and in some cases measure only the quality of the public service delivery, whereas social outcomes are also influenced by private service providers (providing about 40 percent of education and health services). However, implementation arrangements for a CWIQ are not detailed in the preparation status report. With respect to poverty outcomes and human development, the authorities will need to rapidly address the technical concerns regarding the Pakistan Integrated Household Survey in order to establish the credible baselines needed for costing the interventions needed to achieve health, education and other PRSP targets. Finally, the Federal Bureau of Statistics, the institution that designs and collects poverty monitoring data, needs greater autonomy and capacity- building support in order to effectively carry out this responsibility. The staffs look forward to elaboration of these issues in the PRSP. 9. In light of the scope of preparatory work still needed, and the need to ensure broad public consultation, the timeline for finalization of the full PRSP is ambitious, although achievable. The staffs consider it of utmost importance that it should not harm the quality of the PRSP. Having said that, extensive discussions with the government have revealed that in order to maintain the momentum of the reform process, the government would like to adhere to this timeline. The staffs agree with the need to retain the momentum of reforms, for which the pace of the PRSP process will be critical. Risks and Outlook 10. The JSA of the I-PRSP identified four risks to implementation: political opposition to reforms; lack of continuity; insufficient institutional capacity; and exogenous shocks. While these risks are still prevalent, their relative importance has shifted. The authorities have made significant progress in implementing the agenda set out in the I-PRSP. While some of the measures taken, for example the gas prices increases, were highly unpopular, they were implemented in the end. The government's efforts at communicating the content and rationale of such difficult measures was an integral part of the implementation process, although much more needs to be done. Continuation of such open communication should further help in canrying forward the reform agenda. The new government has clearly stated its commitments to the PRSP policy content and process. There is substantial continuity of the economic team of the cabinet. However, with the government holding only a small majority in parliament, reforms could slow down due to the need to build consensus in the coalition govemment and Parliament. In particular, building support in Parliament for the devolution initiative will be important for ensuring its success. Insufficient institutional capacity continues to be a problem, even though some progress has been made since the I-PRSP. The authorities will need to intensify their efforts in this respect to ensure that the reforms translate into tangible improvements for the people and the poor in particular. Lastly, exogenous shocks still constitute a significant risk. Slower than expected winding down of regional tensions or a possible conflict in the Middle East could adversely effect growth and fiscal projections. 11. In sum, the staffs of the World Bank and the IMF consider that progress on the development of the full PRSP, as evidenced by the PRSP Preparation Status Report, is satisfactory, especially given the dramatic political transition, and provides a basis for continued access to IDA adjustment lending and Fund concessional financial assistance. The staffs recommend that the Executive Directors of the World Bank and IMF reach the same conclusion. Government of Pakistan Finance Division Policy wing (PRSP Secretariat) 30.1.2003 PREPARATION OF Full PRSP-PROGRESS REPORT The Government of Pakistan outlined its policy objectives for promoting pro-poor economic growth and reducing poverty in the Interim-Poverty Reduction Strategy Paper (I-PRSP) in November 2001, after a thorough consultative process and discussions, from October 1999 to October 2001, with a diverse set of stakeholders that included the federal and provincial ministries/departments, academia, NGOs and the general public. The IPRSP was approved in Joint Staff Assessment of the World Bank and the IMF in December 2001. The core principles of comprehensive poverty reduction strategy (PRS) included: a) Engendering Growth through i. Macroeconomic Stabilization ii. Tax Reforms iii. Expenditure Management iv. Prudent Monetary Policy v. Debt Management b) Enabling Investment Environment c) Implementation of broad based governance reforms d) Improving social sector outcomes e) Reducing vulnerability to shocks 2. PRSP is a technique to develop a Comprehensive Development Framework (CDF). The process is pretty dynamic which would get institutionalized through an evolving process at all levels of government, i.e. national, provincial and districts. It needs capacity building particularly at sub-national level. PRSP will need a mechanism for periodical updating, either on annual or medium term basis, to reconcile it with emerging socio-economic realities and improvements in service delivery as the data from various surveys and agencies keeps pouring in. Eventually, it may become a rolling CDF. This progress report as well as full PRSP ought to be evaluated in this context. 3. In contrast to the approaches adopted in the past where poverty reduction was considered as a by-product of growth process, poverty alleviation in fact has taken the center-stage of the country's macroeconomic policy framework. The macroeconomic policies for the last three years have been geared towards poverty alleviation and improving the living conditions of vulnerable segment of society. The Government of Pakistan has launched a credible program for poverty reduction. Our development partners are helping in our efforts to reduce poverty and improve social indicators. The Government is raising its pro-poor budgetary expenditures by at least 0.2 percent of GDP per annum. This reflects a significant shift from past budgetary performance when pro- poor public expenditures declined by an average of 0.25 percent of GDP per annum during 1995-2000. 4. The government constituted a high-level National PRSP Implementation Committee headed by the Secretary General of Finance to oversee IPRSP implementation initially. It has now been substituted by a National Steering Committee headed by the Finance Secretary comprising heads of relevant Ministeries, Institutions and Additional Chief Secretaries of the Provinces with the following mandate: i. To oversee implementation of I-PRSP policy reforms, evaluate its impact and suggest appropriate adjustments in the policy regime ii. To review poverty related expenditures, monitor intermediate indicators outcomes and take appropriate measures iii. To build national consensus by engaging all stakeholders including the civil society as well as the Provincial Governments to formulate full Poverty Reduction Strategy Paper iv. To strengthen capacity of the PRSP partner agencies v. To engage with the donor agencies vi. To hire consultants/manpower to support PRSP Secretariat in finalizing PRSP vii. Any other item related to above The Committee may co-opt any member from private and public sector to achieve its goals. 6. The Government is also maintaining continuity and is moving forward to developing full PRSP. Joint Secretary (Policy and EF-IFR) has been designated as focal person and PRSP Secretariat is functioning in Finance Division, which has been mandated to coordinate, monitor, evaluate, track implementation of the PRSP; and report 2 progress on pro-poor public expenditures, intermediate social indicators, and final outcomes. The PRSP Secretariat is being strengthened by hiring Consulting Economists and Financial Analyst to institutionalize capacity. 7. The PRSP Secretariat is tracking the following on quarterly basis: a) Pro-Poor budgetary expenditures that include current and development expenditures on i. Roads, Highways, & Bridges ii. Water Supply and Sanitation iii. Education iv. Health v. Population Planning vi. Social Welfare vii. Natural Calamities and other Disasters viii. Irrigation ix. Land Reclamation x. Rural Development xi. Food Subsidies xii. Food Support Program b) Non-budgetary pro-poor expenditures on i. Zakat ii. Employees Old-age Benefit Institution, iii. Micro-Credit Disbursement iv. Allotment of state land v. Regularization of Katchi Abadis c) Intermediate indicators i. Lady Health Workers Program ii. utilization of health care facilities iii. number of functional schools iv. number of functional schools with basic facilities The tracking mechanism has been institutionalized with the Controller General of Accounts. The PRSP Secretariat in the Ministry of Finance is reporting pro-poor expenditures on a quarterly basis from Ql of FY 2001-02. These pro-poor expenditures are compared with the expenditures of corresponding categories of the previous year's quarter, trends are analyzed and reported on Ministry of Finance web site. 8. The Govemment plans to spend Rs 161 billion during the current financial year (2002-2003), an increase of Rs 27.5 billion (20.6%) over the last financial year (2001-2002). The most promising feature of Ql of FY 2002-2003 pro-poor expenditures is that spending registered an increase in the critical areas of water supply and sanitation (by 16%), education (by 26%), health (by 44%), population planning (by 223%), natural 3 calamities (by 542%), irrigation (by 38%), land reclamation, rural development (by 37%), and food subsidies (nine out of twelve sectors). Overall PRSP expenditures registered a growth of 39 percent in first quarter (July-September) of the current financial year over corresponding period of last financial year---rising from Rs 21.044 billion to Rs 29.312 billion in absolute terms. The Province wise increase in pro-poor spending during Ql of 2002-2003 over corresponding period of 2001-2002 is 27% in Punjab and 110% in NWFP whereas Baluchistan and Sindh showed a decline of 13% and 8% respectively which is expected to be picked up during the course of the financial year. 9. The government has also established a broad compensating cash transfer mechanism to provide social protection to vulnerable segments of the society. The details are reflected at para 6 supra and details of expenditures are on the Web. 10. The consultative process with various stakeholders is continuing through various Workshops and Seminars to get their input for full PRSP, the details thereof are as follow: a. Three Workshops to finalize intermediate indicators for Health (7) and Education (5) b. Three Workshops to develop mechanism for timely collection of date for monitoring indicators in Education Sector (NEMIS) c. Three Workshops to develop mechanism for timely collection of data for monitoring indicators in Health Sector (HEMIS) d. Seminar to develop Employment- Poverty Reduction nexus e. Two Workshops on Gender Issues (World Bank) f. Workshop to determine Poverty Line (World Bank) g. Three Seminars on Pakistan Poverty Assessment (World Bank) h. Seminar on Population and Poverty Reduction (UNFP-World Bank) i. Seminars on Provincial Dialogue ( Sindh and Baluchistan) j. Provincial Consultation with Districts and civil society 11. During the on-going consultative process with the Ministeries, donors, and the civil society on full PRSP, following gaps have been identified in the IPRSP: a. Employment (Growth-Employment-Poverty nexus) and allied issues b. Gender c. Environment d. Provincial PRSPs including service delivery mechanism 4 e. Costing of reforms and pro-poor programs f Financing and Resource Gap Efforts are in hand to address these gaps while developing full PRSP. On some of these issues, various donors have commissioned studies that would be useful inputs for the PRSP. To begin with, full PRSP is most likely to contain costing of health and education sector over the medium term. 12. The efforts of donors would generate inputs for PRSP, as follows: DFID - Participatory Poverty Assessment (Report Awaited) - Environment-Poverty Nexus - IPRSP Dissemination/Communication Strategy - PRSP Cell in Punjab ILO - Employment-Poverty nexus - Country Employment Review UNICEF - Multi-Indicators Clusters Survey NWFP (Done) - Multi-Indicators Clusters Surveys for Punjab, Sindh (work in progress). UNICEF has also indicated interest to carryout similar exercise in Baluchistan. UNDP/EDCG - Environment INGAD/CIDA/ NORAD - Gender JICA - Support to HMIS for finalization of baseline projections for agreed intermediate indicators 13. The Provincial Governments have also been provided a tentative outline by the PRSP Secretariat to develop their PRSPs and dialogue is scheduled in NWFP as well as Punjab to finalize first round of consultation. It is also being planned to visit all the four provinces to facilitate them in developing and finalizing their PRSPs. Sindh and Baluchistan have provided their initial drafts whereas NWFP is discussing its first draft with District governments and civil society. The concerned Ministeries are also updating their inputs. 14. Through a series of interactive consultation with line Ministeries and statistics organizations, a set of intermediate indicators has been determined. DFID provided necessary support for this purpose. The indicators were selected on the basis of their ability to convey effective information about quality of service and its usefulness. 5 Availability of data and need for strengthening statistical efforts were the key focus of the work. Based on this exercise, a proposal has been formulated to undertake CWIQ (Core Welfare Indicators Questionnaire) Survey- a sort of mini-PIHS. Federal Bureau of Statistics has already been requested to undertake this survey on annual basis. The requisite documentation is currently under consideration for approval process. Survey design and related preparatory work is expected to be completed by mid-April 2003. This would include: establishment of a technical committee to adapt the CWIQ to Pakistan context; piloting and subsequent refinement of the questionnaire design and data entry system and finalizing the sampling frame of the survey. The findings of the survey would facilitate in determining baselines and monitoring of the intermediate indicators. The agreed intermediate indicators for Health (7) and Education (5) are as under: Health i. Utilization of First Level Care Facilities (BHUs and RHCs) ii. Lady Health Workers Coverage iii. Immunization Coverage of Children iv. Percentage of births attended by skilled birth attendants v. Number of skilled female birth attendants vi. Number of skilled female health workers vii. Number of First Level Care Facilities staffing norms Education i. Number of functional schools (Primary and Secondary) ii. Percentage of trained teachers iii. Teachers Absenteeism iv. Percentage of sanctioned staff strength filled v. Percentage of schools with sanitary facilities, water supply, electricity, and boundary wall 15. Presently, expenditures on four out of twelve intermediate indicators are being tracked. NEMIS and HMIS are being strengthened to streamline reporting mechanism to ensure availability of authentic data once baselines of these indicators are determined. It will provide a fair assessment for timely and accurate policy interventions for human development. It would also facilitate in determining the efficacy of PRSP expenditures. 16. Devolution is taking roots and it will get institutionalized gradually. The initial teething problems have largely been resolved. The devolution of political and 6 functional responsibilities have been fully backed up by administrative authority and financial support. The mechanism for resource transfer to districts, tehsils, and Union Councils has been institutionalized by establishing Provincial Finance Commission in each Province having due representation of stakeholders from Province, district, and tehsils. Provincial Finance Awards have been notified on the recommendations of the Provincial Finance Commissions starting from financial year 2002-2003 except in case of Punjab. Though the resource transfer is taking place in Punjab but forrnal award is awaited. The details of these awards would be covered at length in full PRSP. The Provincial Finance Commissions have statutory protection. 17. For prompt and regular transfers to districts and sub-district levels, a separate account has been established in each Province and under that account each district has been allotted a subsidiary account number. Likewise, each Tehsil has its own account in National Bank of Pakistan. Under the Provincial Finance Award, the Provincial Governments are required to transfer revenues to the districts and sub-district levels as per notified revenue sharing formulae on monthly basis. Special transfers made by the Federal Government or Provincial Government are in addition to this. Each level of local governments has also been empowered to raise its revenues through various levies under the Local Government Ordinance. 18. As regards resource transfer from the Federation to the Provinces, the mechanism is already institutionalized under the Constitution in the form of National Finance Commission that is required to give award for revenue sharing after every five years. The discussions for the new Award (2003-04 to 2007-08) are already in process. 19. Provincial Governments have taken initiatives for rural development. NWFP is executing various foreign assisted area development projects, such as Barani Area Development Project, Malakand Rural Support Project, FATA Development Program, Dir Area Development Project, for rural uplift and developing community participation. Sindh is also implementing Sindh Rural Development Project and so are other Provinces. In addition, GOP initiated income-employment generation Khushal Pakistan Program and micro-credit programs. It may be appreciated that rural development is primarily a provincial subject. The sector will be dealt in full PRSP incorporating input from Provincial PRSPs. 20. The PIHS data has already been made public and HIES numbers may become available soon that may further facilitate the work of PRSP 7 21. The formulation of I-PRSP was a first step in the direction of preparing a comprehensive national anti-poverty strategy which encompassed the economic, structural, and social initiatives undertaken and planned to be taken over the medium term by the federal, provincial, and district governments for targeting multidimensional nature of poverty and human development in Pakistan. The full PRSP, in addition to provincial programs, would reflect an updated status of existing policy programs as well as new initiatives taken by the Federal Government since November 2001. The gaps highlighted supra will be addressed through consultative process. The tentative schedule of activities planned for the next four months is as under: a. Update Ministeries' input 31.1.2003 b. Completion of Provincial Dialogue 31.1.2003 c. Consultation with all stakeholder by the Provinces 31.1.2003 d. Consulting the Communities through Rural Support Program Network 15.2.2003 e. Finalization of Reports for Gaps Identified 15.2.2003 f. Costing of reforms and programs (Health & Edu) 15.2.2003 g. Finalization of Provincial PRSPs 22.2.2003 h. First Draft of full PRSP 15.3.2003 i. Dissemination of first Draft PRSP 15.3.2003 j. Final Draft of full PRSP 15.4.2003 Above timelines seem very ambitious but these have been kept deliberately to maintain pressure on the line ministeries as well as the Provincial Governments to provide their inputs for full PRSP and to have cushion for any slippage due to unexpected circumstances. 22. It is felt that the following inputs are quite essential for finalizing PRSP: * Completion of costing exercise in Health and Education sectors * Completion of Employment-Poverty nexus report by ILO * Completion of Gender Report by INGAD * Macro-Economic Framework Projections for the next three years and sources of growth in Pakistan by Economic Advisor Wing * Completion of Environment and Poverty nexus study by DFID * Clearance of PC-II for IDF Grant by the Planning Commission 8 23. The draft full PRSP would be posted on the web and would be widely distributed for constructive feedback from all tiers of governments, private sector, civil society, academia and other stakeholders. This feedback after due sensitization would become part of full PRSP. The overall objective of PRSP would be to focus on poverty reduction structural policies/measures without compromising macroeconomic stability. 9 IMAGING Report No.: 25463 PAK Type: CAS