The Republic of Serbia Ministry of Finance Central Fiduciary Unit of the Ministry of Finance Improving Public Financial Management for the Green Transition Operation Project Procurement Strategy for Development (PPSD) February, 2023 1 Country: The Republic of Serbia Improving Public Financial Management for the Full Project Name: Green Transition Operation Total Finance: EUR 69,300,000.00 Project Number: P175655 Loan Number: xxxx YF Program Development Objective is to improve Summary of Project core PFM functions and institutional capabilities Development Objectives needed for Serbia’s fiscal resilience and green transition. 1. The Project has an allocation of EUR 3M for the IPF component to assist with implementation of the Program and to cover the following activities as detailed in the initial procurement plan: (a) provision of technical assistance, Training and Operating Costs to the MOF, PPS, MoEP, RPD, and PPO for the Operation’s management, implementation, monitoring and evaluation, including the costs for the Verification Agent; (b) preparation of Training manuals and materials; (c) targeted capacity building activities to enable the implementation of activities; (d) procurement of 2 software: software to enhance the GHG MRV IT solution, and the Calculator; (e) change management and behavioral change interventions; (f) communication, outreach, and awareness-raising activities; and (g) identification of lessons learned and best practices in other countries that may be relevant for the Borrower. 2. Strategic Assessment of Country, Borrower and Marketplace a. Operational Context The current policy process in the country has both strengths and weaknesses as outlined in this brief SWOT analysis: 2 STRENGTHS WEAKNESSES • Previous experience of the CFU • The current portfolio of different with other project financed by the projects in CFU is increasing. World Bank. • Limited capacity of Implementing • Previous institution’s experience agencies including Evaluation (PPS) as the verification agent to Committee (EC) Members to carry support the verification processes out evaluation of under the IPF component EOIs/Proposals/Bids; OPPORTUNITIES THREATS • Relatively slow decision/approval/ • Technical assistance ongoing which coordination process and internal allows for significant up-front procedures due to multiple preparation of procurement stakeholders involved. activities. • Risk derived from the potential • Use of Procurement Regulations different interests/decisions of should provide more flexibility in stakeholders. designing procurement arrangements for the project. • The readiness of CFU and Implementing Agencies to strengthen capacity on procurement, through continuous trainings to the beneficiaries. • Carefully plan the estimated budget to avoid financial proposals exceeding the available budget. • Assure zero tolerance to fraud and corruption cases as defined in the Bank’s Anti-Corruption Guidelines. b. Client Capability and OCU/CFU Assessment An Operation Coordination Unit (OCU) within DICEI (MoF) has been assigned with responsibilities related to the day-to-day management of the operation, to be complemented and supported by the existing Central Fiduciary Unit (CFU) also based in the MoF. The OCU will also serve as a secretariat for the Steering Committee and the technical working group in terms of preparing meetings and issues for discussion. As needed, the OCU will be strengthened by hiring of external experts under the IPF component. The CFU is an existing entity in the MoF, providing support for all IBRD IPF operations and well experienced with the World Bank fiduciary requirements. The CFU is comprised of the following staff: Director, Head of Operations, three Procurement Specialists and three Financial Management Specialists. Considering the current workload of CFU staff, additional staff (one Procurement and one Financial Management Specialist) will be hired by the end of 2nd quarter 2023. The MoF provides office and equipment for the staff and their salary is paid against investment projects it supports. The CFU has an Operation Manual which was updated in January 2023. At the moment, the CFU is responsible for financial management and procurement for twelve investment projects and one donor-funded project. 3 A dedicated Steering Committee (SC) will be established for the operation which will provide strategic guidance for the implementation of the Program and the Project and monitor ministries and agencies’ implementation of Program activities. The SC will be chaired by the Minister of Finance (or his or her delegate, such as the MoF State Secretary) and will include representatives of MoF, MoEP, MoCTI, PPS, PPO, MoME, MoPI, MoAFWM and RPD. 3. Procurement Risk Analysis The overall implementation and oversight of procurement will be carried out by the CFU. The initial procurement risk rating is considered as Moderate, because the activities in the procurement plan are mainly consulting services of small value and purchase of two small-scale software additions. All procurement activities will be subject to post review. Procurement of goods, consulting services and non-consulting services will be conducted in accordance with the World Bank’s Procurement Regulations for IPF Borrowers: Procurement in Investment Project Financing – Goods, Works, Non- Consulting and Consulting Services (November 2020) and the World Bank's ‘Guidelines on Preventing and Combating Fraud and Corruption in Program-for- Results Financing’, dated February 1, 2012, and revised July 10, 2015. Risks Mitigation Measures The OCU capacity in preparing TORs Hire consultants to supplement or and technical increase the OCU capacity specifications/requirements Capacity-building activities to strengthen the implementation capacity, covering the technical, fiduciary, and environmental and social dimensions Capacity of Evaluation Committee Provide trainings to Evaluation (EC) members in evaluating Committee (EC) members expressions of interest, and Ensure that EC members declare any consultant’s proposals conflicts of interest Involve the staff of Implementing Agencies as EC members Inform the EC members about fraud and corruption as defined in the Bank’s Anti-Corruption Guidelines Implement best practice policies, guidelines, and practices Maintain ethical environment Use support from external experts Coordination challenges between the Regular meetings between the OCU OCU and the CFU staff and the CFU and submission of progress reports to the Bank Ensure funds are spent for the Post-review audits will be randomly designated purpose performed to assure funds are spent for the designated purpose. Close 4 cooperation with Bank’s procurement staff Procurement and implementation Close cooperation between delays MoF/OCU/CFU in order to monitor contract awards and contract implementation. Active and close supervision and involvement of the Borrower as well as the Bank team in project planning and implementation activities. Procurement Arrangement: The OCU, with the support of the CFU, is responsible for overall procurement quality assurance. The detailed procurement implementation arrangement will be defined in the Operation Implementation Manual (“OIM”) containing detailed arrangements and procedures for the implementation of the operation. 4. Procurement Objective under the Project (SMART-Specific, Measurable, Achievable, Relevant and Time-bound, prioritized) The procurement objective is to carry out and complete the procedures for all contracts as provided in the procurement plan in a timely, efficient, transparent manner with an emphasis on fit-for-purpose, quality and value for money. The project will use STEP to create and publish all procurement notices under the project, including the General and Specific Procurement Notices, Requests for Expression of Interest, Invitations for Bids, and Contract Award Notices. 5. Recommended Procurement Approach for the Project Non-Consulting services under the Project – Upgrade of the software for the MRV system Attribute Selected arrangement Justification Summary/Logic Sustainability No Requirements Contract Type Apply the form of contract provided in the Bank’s Standard Procurement Document (SPD). Lump-sum Supplier Collaborative Relationship Price Yes, price adjustment formula as Adjustments per procurement document Selection Method Request for Bids Market Approach Open, International Evaluation Request for Bids (RFB) Selection Method 5 Evaluation of As per procurement document Costs Domestic No Preference Rated Criteria Yes 6. Grievance redress services Communities and individuals who believe that they are adversely affected as a result of a World Bank supported PforR operation, as defined by the applicable policy and procedures, may submit complaints to the existing program grievance redress mechanism or the World Bank’s Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed in order to address pertinent concerns. Affected communities and individuals may submit their complaint to the World Banks’s independent Inspection Panel which determines whether harm occurred, or could occur, as a result of World Bank non-compliance with its policies and procedures. Complaints may be submitted at any time after concerns have been brought directly to the World Bank's attention, and World Bank Management has been given an opportunity to respond. For information on how to submit complaints to the World Bank’s corporate Grievance Redress Service (GRS), please visit http://www.worldbank.org/GRS. For information on how to submit complaints to the World Bank Inspection Panel, please visit http://www.inspectionpanel.org. 6 PROCUREMENT Serbia : Improving public financial management for the green transition PLAN General Information Country: Serbia 2024-02-06 Bank’s Approval Date of the Original Procurement Plan: 2025-02-13 Revised Plan Date(s): (comma delineated, leave blank if none) Project ID: P175655 GPN Date: Project Name: Improving public financial management for the green transition Loan / Credit No: IBRD / 94820 Central Fiduciary Unit Executing Agency(ies): WORKS Activity Reference No. / Estimated Actual Am Bid Evaluation Report Loan / Credit N Market Approac Procurement Pro Prequalification High SEA/SH R Procurement D Process St Draft Pre-qualification Prequalification Evalu Draft Bidding Docum Specific Procurement Bidding Documents a Proposal Submission / Contract Complet Description Component Review Type Method Amount (U ount (US$ and Recommendation Signed Contract o. h cess (Y/N) isk ocument Type atus Documents ation Report ent / Justification Notice / Invitation s Issued Opening / Minutes ion S$) ) for Award Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned GOODS Activity Reference No. / Bid Evaluation Report Loan / Credit N Market Approac Procurement Pro Prequalification Estimated Am Actual Amount Process St Draft Pre-qualification Prequalification Evalu Draft Bidding Docum Specific Procurement Bidding Documents a Proposal Submission / Description Component Review Type Method and Recommendation Signed Contract Contract Completion o. h cess (Y/N) ount (US$) (US$) atus Documents ation Report ent / Justification Notice / Invitation s Issued Opening / Minutes for Award Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual NON CONSULTING SERVICES Activity Reference No. / Bid Evaluation Report Loan / Credit N Market Approac Procurement Pro Prequalification Estimated Am Actual Amount Process St Draft Pre-qualification Prequalification Evalu Draft Bidding Docum Specific Procurement Bidding Documents a Proposal Submission / Description Component Review Type Method and Recommendation Signed Contract Contract Completion o. h cess (Y/N) ount (US$) (US$) atus Documents ation Report ent / Justification Notice / Invitation s Issued Opening / Minutes for Award Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual CONSULTING FIRMS Activity Reference No. / Combined Evaluation Loan / Credit N Market Approac Contract Type Estimated Amo Actual Amount Expression of Interest Short List and Draft R Request for Proposals Opening of Technical Evaluation of Technic Description Component Review Type Method Process Status Terms of Reference Report and Draft Neg Signed Contract Contract Completion o. h unt (US$) (US$) Notice equest for Proposals as Issued Proposals / Minutes al Proposal otiated Contract Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual SER-AUDIT-QCBS-CS-24-07-I PFMGT / Audit for (IPFMGT), f or the years part of 2023 and Quality And Cost- 2024-first period, 2025-secon IBRD / 94820 Post Open - National 75,000.00 0.00 Canceled 2024-02-23 2024-02-19 2024-02-24 2024-03-26 2024-03-01 2024-04-05 2024-04-12 2024-05-05 2024-05-29 2024-06-03 2028-01-31 Based Selection d period, 2026- third period a nd 2027 (Closing date March 31, 2027 plus 6 months IBRD and 9 months AFD)- fourth p eriod. SER-IPFMGT-CQS-CS-24-06 / Consultant Qualifi Portal for Citizens Participatio IBRD / 94820 Post Open - National 275,000.00 0.00 Signed 2024-05-31 2024-05-17 2024-06-21 2024-08-04 2024-06-21 2024-08-18 2024-07-18 2024-08-28 2024-07-22 2025-06-24 cation Selection n in the Budgetary Process SER-AUDIT-QCBS-CS-24-07-2 -IPFMGT / Audit for (IPFMGT), for the years part of 2023 an Quality And Cost- Under Implement d 2024-first period, 2025-sec IBRD / 94820 Post Open - National 75,000.00 0.00 2024-08-16 2024-09-12 2024-08-17 2024-09-17 2024-09-30 2024-09-27 2024-11-01 2024-10-27 2024-11-25 2024-11-20 2024-12-09 2024-11-25 2028-01-31 Based Selection ation ond period, 2026- third perio d and 2027 (Closing date Mar ch 31, 2027 plus 6 months IB RD and 9 months AFD)- fourt h period. INDIVIDUAL CONSULTANTS Activity Reference No. / Loan / Credit N Market Approac Contract Type Estimated Amo Actual Amount Invitation to Identifie Draft Negotiated Cont Description Component Review Type Method Process Status Terms of Reference Signed Contract Contract Completion o. h unt (US$) (US$) d/Selected Consultant ract Planned Actual Planned Actual Planned Actual Planned Actual Planned Actual SER-IPFMGT-IC-CS-23-01-1 / Consultant for Strengthen ins Individual Consult IBRD / 94820 Post Open - National 16,500.00 0.00 Signed 2024-01-19 2024-02-20 2024-02-06 2023-11-09 2024-02-08 2023-11-21 2024-02-11 2023-11-21 2024-04-30 titutional capacity for perfor ant Selection mance management SER-IPFMGT-IC-CS-23-01-2 / Consultant for Strengthen ins Individual Consult IBRD / 94820 Post Open - National 16,500.00 0.00 Signed 2024-01-19 2024-02-20 2024-02-09 2023-11-09 2024-02-11 2023-11-21 2024-02-14 2023-11-21 2024-04-30 titutional capacity for perfor ant Selection mance management. SER-IPFMGT-IC-CS-23-02 / In Individual Consult dependent Verification Agent IBRD / 94820 Post Open - National 6,500.00 0.00 Signed 2024-01-19 2024-02-20 2024-02-15 2024-05-13 2024-02-22 2024-06-11 2024-02-26 2024-06-24 2026-03-31 ant Selection for Disbursement Linked Indi cator 1 SER-IPFMGT-IC-CS-23-03 / S Individual Consult Under Implement ocial and Citizen Engagemen IBRD / 94820 Post Open - National 27,500.00 0.00 2024-01-19 2024-02-20 2024-02-17 2024-02-22 2024-02-28 2024-05-23 ant Selection ation t Specialist SER-IPFMGT-IC-CS-23-04 / C onsultant for the developme Individual Consult IBRD / 94820 Post Limited 22,000.00 0.00 Signed 2024-01-22 2024-02-20 2024-02-01 2024-04-11 2024-02-11 2024-04-15 2024-02-26 2024-04-22 2024-06-28 nt of Guidelines on Inclusion ant Selection of Green Aspects into Public Policy Documents SER-IPFMGT-IC-CS-24-05 / C Individual Consult onsultant for the Green Proje IBRD / 94820 Post Limited - National 36,500.00 0.00 Signed 2024-05-31 2024-05-17 2024-06-15 2024-05-20 2024-06-30 2024-07-09 2024-07-06 2024-07-12 2026-03-31 ant Selection ct coordination SER-IPFMGT-IC-CS-24-07 / C onsultant for Support to the P Individual Consult ublic Policy Secretariat for th IBRD / 94820 Post Limited - National 33,000.00 0.00 Signed 2024-07-17 2024-07-21 2024-07-22 2024-07-22 2024-08-12 2024-09-20 2024-08-20 2024-09-23 2026-03-31 ant Selection e verification process for Dis bursement Linked Indicators 2-5 SER-IPFMGT-IC-CS-24-08 / C onsultant for Support to the P Individual Consult ublic Policy Secretariat for th IBRD / 94820 Post Limited - National 33,000.00 0.00 Signed 2024-07-17 2024-07-21 2024-07-22 2024-08-15 2024-08-12 2024-09-25 2024-08-20 2024-09-30 2026-03-31 ant Selection e verification process for Dis bursement Linked Indicators 6-8 SER-IPFMGT-IC-CS-24-09 / Fi Individual Consult Under Implement scal risk management Specia IBRD / 94820 Post Open - National 21,000.00 0.00 2024-07-02 2024-07-31 2024-08-04 2024-09-25 2024-08-25 2024-10-22 2024-09-15 2025-05-15 ant Selection ation list for LSGs Page 1 SER-IPFMGT-IC-CS-24-10 / C onsultant to Develop Method ologies for the Preparation of Individual Consult Under Implement IBRD / 94820 Post Open - National 43,000.00 0.00 2024-10-04 2024-10-09 2024-11-10 2024-11-01 2024-11-15 2024-11-06 2024-11-19 2025-04-19 Baseline Scenarios Tailored t ant Selection ation o the Needs of the Ministry of Finance and Other Budget Us ers SER-IPFMGT-IC-CS-24-11 / C Individual Consult Under Implement onsultant for the update of th IBRD / 94820 Post Limited - National 11,000.00 0.00 2024-12-20 2024-12-18 2024-12-27 2025-01-03 2025-01-20 2025-04-30 ant Selection ation e Costing Manual SER-IPFMGT-IC-CS-24-12 / C Individual Consult Under Implement onsultant for the developme IBRD / 94820 Post Limited - National 11,000.00 0.00 2024-12-20 2024-12-18 2024-12-27 2025-01-13 2025-01-03 2025-02-11 2025-01-20 2025-03-31 ant Selection ation nt of technical specification f or the Calculator SER-IPFMGT-IC-CS-24-13 / C onsultant for developing of h Individual Consult Under Implement IBRD / 94820 Post Open - National 33,000.00 0.00 2024-12-25 2024-12-20 2025-01-23 2025-02-02 2025-02-07 2026-02-02 uman resources strategy and ant Selection ation reviewing existing job classifi cation SER-IPFMGT-IC-CS-23-03-2 / Individual Consult Pending Impleme Social and Citizen Engageme IBRD / 94820 Post Open - National 16,200.00 0.00 2025-02-10 2025-03-11 2025-03-16 2025-03-22 2027-03-31 ant Selection ntation nt Specialist Page 2