FOR OFFICIAL USE ONLY Report No: PAD2945 INTERNATIONAL DEVELOPMENT ASSOCIATION PROJECT APPRAISAL DOCUMENT ON A PROPOSED CREDIT IN THE AMOUNT OF SDR 19.6 MILLION (US$27 MILLION EQUIVALENT) TO THE LAO PEOPLE’S DEMOCRATIC REPUBLIC FOR A REDUCING RURAL POVERTY AND MALNUTRITION PROJECT February 21, 2019 Social Protection and Jobs Global Practice East Asia and Pacific Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective November 30, 2018) Currency Unit = Lao Kip (LAK) LAK 8,543 = US$1 US$ 1.3832 = SDR 1 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS ACCPAC A Complete and Comprehensive Program for Accounting Control AFN Agriculture for Nutrition ANC Antenatal Care ASA Advisory Services and Analytics ASEAN Association of Southeast Asian Nations CCT Conditional Cash Transfer CDD Community-Driven Development CLTS Community-Led Total Sanitation CNP Community Nutrition Project CPF Country Partnership Framework DA Designated Account DAFO District Agriculture and Forestry Office DHIS2 District Health Information System DLI Disbursement-Linked Indicator DoPF Department of Planning and Finance DP Development Partner DPT Diphtheria, Pertussis, and Tetanus DRDC Department of Rural Development and Cooperative ECE Early Childhood Education FM Financial Management G2P Government-to-Person GDP Gross Domestic Product GoL Government of Lao PDR GRM Grievance Redress Mechanism HANSA Health and Nutrition Services Access HCP Human Capital Project HEF Health Equity Fund HGNDP Health Governance and Nutrition Development Project IBM Iterative Beneficiary Monitoring ICT Information and Communication Technology IFAD International Fund for Agricultural Development IFR Interim Financial Report IGA Income-Generating Activity ILO International Labour Organization IT Information Technology KAP Knowledge, Attitudes, and Practices LECS Laos Expenditure and Consumption Survey LSIS Laos Social Indicator Survey LUFSIP Lao PDR Uplands Food Security Improvements Project LWU Lao Women’s Union MAF Ministry of Agriculture and Forestry M&E Monitoring and Evaluation MIS Management Information System MOES Ministry of Education and Sport MOF Ministry of Finance MOH Ministry of Health MOU Memorandum of Understanding MPI Ministry of Planning and Investment MPWT Ministry of Public Works and Transportation NHI National Health Insurance NNC National Nutrition Committee NNS National Nutrition Strategy NNSPA National Nutrition Strategy and Plan of Action NSEDP National Social Economic Development Plan PAFO Provincial Agriculture and Forestry Office PDO Project Development Objective PDR People’s Democratic Republic PMD Project Management Division PMT Proxy Means Test PMU Project Management Unit PNC Postnatal Care PPSD Project Procurement Strategy for Development PRF Poverty Reduction Fund SBCC Social and Behavior Change Communication SCD Systematic Country Diagnostic SHG Self-Help Group STEP Systematic Tracking of Exchanges in Procurement TOR Terms of Reference UNICEF United Nations Children's Fund VF Village-Based Facilitator WASH Water Supply, Sanitation, and Hygiene Regional Vice President: Victoria Kwakwa Country Director: Ellen A. Goldstein Senior Global Practice Director: Michal J. Rutkowski Practice Manager: Philip O'Keefe Task Team Leader(s): Francesca Lamanna, Nkosinathi Vusizihlobo Mbuya The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) TABLE OF CONTENTS DATASHEET ................................................................................. Error! Bookmark not defined. I. STRATEGIC CONTEXT ...................................................................................................... 8 A. Country Context................................................................................................................................ 8 B. Sectoral and Institutional Context .................................................................................................... 8 C. Relevance to Higher-Level Objectives ............................................................................................ 20 II. PROJECT DESCRIPTION.................................................................................................. 20 A. Project Development Objective ..................................................................................................... 20 B. Project Components ....................................................................................................................... 22 C. Project Beneficiaries ....................................................................................................................... 29 D. Results Chain .................................................................................................................................. 29 E. Rationale for Bank Involvement and Role of Partners ................................................................... 31 F. Lessons Learned and Reflected in the Project Design .................................................................... 32 III. IMPLEMENTATION ARRANGEMENTS ............................................................................ 34 A. Institutional and Implementation Arrangements .......................................................................... 34 B. Results Monitoring and Evaluation Arrangements......................................................................... 35 C. Sustainability................................................................................................................................... 36 IV. PROJECT APPRAISAL SUMMARY ................................................................................... 36 A. Technical, Economic and Financial Analysis (if applicable) ............................................................ 36 B. Fiduciary.......................................................................................................................................... 38 C. Safeguards ...................................................................................................................................... 39 V. KEY RISKS ..................................................................................................................... 41 A. Overall Risk Rating and Explanation of Key Risks ........................................................................... 41 VI. RESULTS FRAMEWORK AND MONITORING ................................................................... 45 ANNEX 1: Implementation Arrangements and Support Plan .......................................... 58 ANNEX 2: World Bank Country Portfolio Results Chain for an Integrated Approach to Tacking Childhood Stunting .......................................................................................... 70 ANNEX 3: Monitoring and Evaluation Framework for the Nutrition convergence approach ..................................................................................................................................... 79 ANNEX 4: Framework for the Design of a Common Nutrition Social Behavioral Change and Communication Strategy for the Overall World Bank-Financed Nutrition Convergence Approach ...................................................................................................................... 89 ANNEX 5. MAP .............................................................................................................. 94 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) DATASHEET BASIC INFORMATION BASIC_INFO_TABLE Country(ies) Project Name Lao People's Reducing Rural Poverty and Malnutrition Project Democratic Republic Project ID Financing Instrument Environmental Assessment Category Investment Project P162565 B-Partial Assessment Financing Financing & Implementation Modalities [ ] Multiphase Programmatic Approach (MPA) [ ] Contingent Emergency Response Component (CERC) [ ] Series of Projects (SOP) [ ] Fragile State(s) [ ] Disbursement-linked Indicators (DLIs) [ ] Small State(s) [ ] Financial Intermediaries (FI) [ ] Fragile within a non-fragile Country [ ] Project-Based Guarantee [ ] Conflict [ ] Deferred Drawdown [ ] Responding to Natural or Man-made Disaster [ ] Alternate Procurement Arrangements (APA) Expected Approval Date Expected Closing Date 14-Mar-2019 31-Mar-2024 Bank/IFC Collaboration No Proposed Development Objective(s) The Project Development Objective is to support the design and implementation of a nutrition-sensitive social assistance program to improve nutrition behaviors, and enhance the convergence of nutrition-focused interventions. Page 1 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Components Component Name Cost (US$, millions) Component 1: Developing the building blocks of a social protection system 3.00 Component 2: Conditional cash transfer program 16.70 Component 3: Coordination, management, monitoring and evaluation 7.30 Organizations Borrower: Lao People’s Democratic Republic Implementing Agency: Ministry of Agriculture and Forestry PROJECT FINANCING DATA (US$, Millions) SUMMARY -NewFin1 Total Project Cost 27.00 Total Financing 27.00 of which IBRD/IDA 27.00 Financing Gap 0.00 DETAILS -NewFinEnh1 World Bank Group Financing International Development Association (IDA) 27.00 IDA Credit 27.00 IDA Resources (in US$, Millions) Credit Amount Grant Amount Guarantee Amount Total Amount National PBA 27.00 0.00 0.00 27.00 Total 27.00 0.00 0.00 27.00 Expected Disbursements (in US$, Millions) Page 2 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) WB Fiscal Year 2019 2020 2021 2022 2023 2024 Annual 0.49 4.94 5.14 6.29 6.02 4.12 Cumulative 0.49 5.43 10.57 16.86 22.88 27.00 INSTITUTIONAL DATA Practice Area (Lead) Contributing Practice Areas Social Protection & Labor Health, Nutrition & Population, Poverty and Equity Climate Change and Disaster Screening This operation has been screened for short and long-term climate change and disaster risks Gender Tag Does the project plan to undertake any of the following? a. Analysis to identify Project-relevant gaps between males and females, especially in light of Yes country gaps identified through SCD and CPF b. Specific action(s) to address the gender gaps identified in (a) and/or to improve women or Yes men's empowerment c. Include Indicators in results framework to monitor outcomes from actions identified in (b) Yes SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT) Risk Category Rating 1. Political and Governance  Moderate 2. Macroeconomic  Substantial 3. Sector Strategies and Policies  Substantial 4. Technical Design of Project or Program  High 5. Institutional Capacity for Implementation and Sustainability  Substantial 6. Fiduciary  Substantial 7. Environment and Social  Low Page 3 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) 8. Stakeholders  Substantial 9. Other 10. Overall  Substantial COMPLIANCE Policy Does the project depart from the CPF in content or in other significant respects? [ ] Yes [✓] No Does the project require any waivers of Bank policies? [ ] Yes [✓] No Safeguard Policies Triggered by the Project Yes No Environmental Assessment OP/BP 4.01 ✔ Performance Standards for Private Sector Activities OP/BP 4.03 ✔ Natural Habitats OP/BP 4.04 ✔ Forests OP/BP 4.36 ✔ Pest Management OP 4.09 ✔ Physical Cultural Resources OP/BP 4.11 ✔ Indigenous Peoples OP/BP 4.10 ✔ Involuntary Resettlement OP/BP 4.12 ✔ Safety of Dams OP/BP 4.37 ✔ Projects on International Waterways OP/BP 7.50 ✔ Projects in Disputed Areas OP/BP 7.60 ✔ Legal Covenants Sections and Description Financing Agreement, Schedule 2, Section I Para C The Recipient shall: (a) prepare, not later than June of each year, an annual work plan and budget (“Annual Work Plan and Page 4 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Budget”) for the Project for the following Fiscal Year, in a manner and substance satisfactory to the Association, covering the activities and expenditures proposed for the subsequent year of Project implementation, and the source(s) of financing of such activities and expenditures; which plan and budget shall be of such scope and detail as the Association shall have reasonably requested; and (b) thereafter implement the activities under the Project during the relevant Fiscal Year in accordance with such plan and budget as agreed with the Association. Sections and Description Financing Agreement, Schedule 2, Section I Para D (1) (2) 1. To facilitate the carrying out of Part 2.2 of the Project, the Recipient, through MAF, shall ensure that the selection and enrolment of Beneficiaries and the provision of Cash Transfers are conducted in accordance with the provisions of this Agreement and the Cash Transfer Manual in a manner satisfactory to the Association. 2. Without limitation to the generality of Section I.D.1 above, the Recipient, through MAF, shall ensure that no Beneficiary shall be eligible to receive a Cash Transfer unless the Recipient shall have documented that requirements set out in the Cash Transfer Manual have been satisfied, including but not limited to, the Beneficiaries’ co-responsibilities. Sections and Description Financing Agreement, Schedule 2, Section I Para D.3 (a) For purposes of carrying out Part 2.2 of the Project, and prior to the distribution of Cash Transfers to Beneficiaries by any Payment Agent, the Recipient, through MAF, shall enter into an agreement with said Payment Agent (the Payment Agent Agreement), acceptable to the Association, including, inter alia, the obligation of: (i) the Payment Agent to distribute, on behalf of MAF, the Cash Transfers to Beneficiaries in accordance the eligibility criteria, disbursement conditions, and approval and administration arrangements as set out in the Cash Transfer Manual; (ii) the Payment Agent to comply with the Anti-Corruption Guidelines; (iii) the Payment Agent to take appropriate measures to prevent, inform on, respond to and investigate corrupt, fraudulent, collusive, coercive and obstructive practices with respect to their payment of Cash Transfers; (iv) the Payment Agent to allow the Association to inspect its accounts, records and other documents relating to the Project upon the Association’s request and in the company of the Recipient’s representatives; (v) the Payment Agent to allow the Association, at its request, to have such accounts, records and other documents audited by or on behalf of the Association, under the terms of reference acceptable to the Association, with the collaboration of MAF; (vi) the Recipient to agree to suspend or terminate the Payment Agent’s right to process the Credit proceeds or from any other agreement with the Association, if the Associate has declared the Payment Agent ineligible under Page 5 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) the Anti-Corruption Guidelines; and (vii) the Recipient to agree to obtain restitution from the Payment Agent of any amount of the Credit with respect to which fraud and corruption has occurred. (b) The Recipient, through MAF, shall exercise its rights and carry out its obligations under the Payment Agent Agreement in such a manner as to protect the interests of the Recipient and the Association, and to accomplish the purposes of the Credit. The Recipient, through MAF, shall not amend, suspend, terminate or waive any provision of the Payment Agent Agreement in such a manner so as to affect materially and adversely, in the opinion of the Association, the ability of the Recipient to comply with its Project related obligations set forth in this Agreement (including the provisions related to the Anti-Corruption Guidelines). In case of any conflict between the terms of the Payment Agent Agreement and those of this Agreement, the terms of this Agreement shall prevail. Sections and Description Financing Agreement, Schedule 2, Section I Para D.4 The Recipient shall, by no later than eighteen (18) months and thirty six (36) months after the Effective Date of the Project, conduct two independent assessments by an independent third party on the performance of the Conditional Cash Transfer Program under Part 2.2 of the Project under a term of reference acceptable to the Association. Sections and Description Financing Agreement, Schedule 2, Section I Para F Safeguards: The Recipient shall ensure that all terms of reference for any technical assistance or studies carried out under the Project are consistent with the Association’s environmental and social safeguards policies, as well as the Recipient’s laws relating to the environment and social aspects. Sections and Description Financing Agreement, Schedule 2, Section I Para G To facilitate the carrying out of Part 1.2 and 1.3 of the Project, the Recipient, through MAF shall, no later than one (1) year after the Effective Date of this Agreement, produce a poverty assessment questionnaire and an implementation manual for assessing the poverty and socio-economic status of households in the Project area, based on statistically underpinned methodology reflecting the international best practices, in a manner satisfactory to the Association. Conditions Page 6 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Type Description Disbursement Financing Agreement, Schedule 2, Section III Para B (1) (b) For payments under Category (2) unless and until the Association has received evidence to its satisfaction that the following aspects of the Conditional Cash Transfer Program have been developed: (i) the MAF has entered into a Payment Agent Agreement with the Payment Agent for providing Cash Transfer services on behalf of MAF, under the terms and conditions acceptable to the Association; (ii) MAF has adopted a Cash Transfer Manual, acceptable to the Association, for guiding the implementation of Part 2.2 of the Project; and (iii) MAF has put in place and operationalized an information management system to support implementation and monitoring of the Conditional Cash Transfers Program. Page 7 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) I. STRATEGIC CONTEXT A. Country Context The Lao People’s Democratic Republic (Lao PDR) has experienced rapid economic growth over the past decade, albeit without proportional gains in poverty reduction. A landlocked country of 6.9 million, its Gross Domestic Product (GDP) growth averaged 7.6 percent per year over the past decade and poverty declined from 33.5 percent to 23.2 percent between 2002/03 and 2012/13, making it the 13th fastest-growing economy globally. However, growth has not been particularly inclusive and was driven largely by mega projects in the natural resource sector, which have created limited employment. The pace of poverty reduction was modest compared to some of Lao PDR’s neighbors (a 1.0 percent increase in GDP in Cambodia translated to 1.2 percent poverty reduction, whereas in Lao PDR it was only 0.4 percent). Inequality widened over the last decade and the Gini coefficient increased from 32.4 (2002) to 36.2 (2012). Inequality in Lao PDR is characterized by rising disparities within urban areas and between rural and urban areas. Economic growth has been heavily concentrated in urban areas1 while in rural areas high levels of poverty and inequality prevail. Poverty incidence is estimated at 23.2 percent nationally, but it is 40 percent in rural areas without roads compared to 10 percent in urban areas. Poverty, along with lack of access to basic social services, remains entrenched in remote and highland areas in the northern part of the country. Infrastructure in remote areas is particularly limited, and many communities are inaccessible during the annual rainy season. These remote areas also continue to be characterized by poor access to appropriate sanitation facilities and other publicly provided social services such as health and education. Poverty and human development indicators are also worse for ethnic minorities, many of whom live in remote areas. For instance, poverty rates among the Mon-Khmer and Hmong (at 42 percent and 40 percent, respectively) are nearly three times higher than that among the majority Lao Tai (at 15 percent). In addition, poverty reduction is continually threatened by high vulnerability to shocks and the absence of adequate support or risk mitigation measures for most of the population (World Bank 20162). B. Sectoral and Institutional Context Levels, Trends, and Determinants of Undernutrition Despite significant economic growth, childhood chronic undernutrition (stunting) levels remain high. About 33 percent of children under five years are stunted,3 21 percent are underweight, and 9 1 World Bank. 2014. “Poverty Profile in Lao PDR: Poverty Report from the Lao Consumption and Expenditure Survey 2012-3.” 2 World Bank. 2016. Lao PDR Systematic Country Diagnostic: Priorities for Ending Poverty and Boosting Shared Prosperity. Report 112241-LA. 3 Stunting is a reflection of chronic malnutrition as a result of failure to receive adequate nutrition over a long period and recurrent or chronic illness. It is measured is by height-for-age. Children whose height-for-age is more than two standard deviations below the median of the reference population are considered short for their age and are classified as moderately or severely stunted. Those whose height-for-age is more than three standard deviations below the median are classified as severely stunted. Lao Statistics Bureau. 2018. Lao Social Indicator Survey II 2017, Survey Findings Report. Vientiane, Lao PDR: Lao Statistics Bureau and UNICEF. Page 8 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) percent are wasted. Stunting affects several groups disproportionately—the poor, ethnic minorities, rural children, and upland areas of the country—and stunting and underweight rates among children in the poorest wealth quintile (which is predominantly rural) are over three times the rates for children in the richest quintile. The persistence of high levels of childhood undernutrition presents a staggering, yet avoidable, loss of human and economic potential for Lao PDR. At the current levels of maternal and childhood malnutrition, the burden on the national economy has been estimated to be at least US$200 million annually, representing about 2.4 percent of the country’s GDP.4 In addition, stunting has long-term adverse developmental impacts that far surpass childhood and has been linked to slower learning outcomes, poor academic performance, and lower productivity and wages in adulthood. Stunted children are unable to develop their human capital to its full potential, with negative consequences on the aggregate level in terms of labor market productivity and economic growth. Although there have been marked improvements in stunting over time, Lao PDR still performs poorly compared to other countries with similar levels of income and to other Association of Southeast Asian Nations (ASEAN) countries (figure 1). Figure 1. Persistence of Undernutrition in Lao PDR Is Higher Compared to Other ASEAN Countries 60 Burundi (Latest year,2014-2017) 50 Stunting Prevalence Guatemala 40 India Nepal Bangladesh Lao PDR Philippines 30 Myanmar Lower middle income Vietnam Middle income 20 Malaysia Sri Lanka Peru 10 Thailand Samoa 0 200 2,000 GNI, per capita (logarithmic scale, current US$ ) Source: World Bank staff calculation.5 National aggregates of childhood undernutrition also mask wide inequalities, with far worse outcomes in some provinces than in others. For example, stunting rates are higher in provinces such as Phongsaly (54 percent), Sekong (49.9 percent), Xiengkhuang (48.3 percent), and Huaphanh (40.7 percent) (figure 2). There is also significant variation across income levels; both stunting and underweight rates among children in the poorest wealth quintile (48 percent stunted) are close to three times the rates for children in the richest quintile (14 percent stunted). These are also disproportionately high for ethnic groups (that is, stunting among Hmong is about 50 percent). 4 Bagriansky, Jack, and Saykham Voladet. 2013. “The Economic Consequences of Malnutrition in Lao PDR: A Damage Assessment Report.” NERI and UNICEF Working Paper. 5 World Bank Group. 2016. “Nutrition in Lao PDR, Causes, Determinants and Bottlenecks.” Page 9 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Figure 2. Stunting Rates by Province: 2017 Source: Laos Social Indicator Survey (LSIS) 2017. The multidimensional causes of childhood stunting in Lao PDR underscore the diversity of actions that are needed across different sectors to address stunting and suboptimal childhood development. Childhood undernutrition is an outcome of immediate, underlying, and basic causes6 (see figure 3). At the immediate level, nutritional status is determined by nutrient intake to the body to meet its requirements and the status of health (illness). Underlying causes are related to food security (access to and availability and utilization of food), maternal and child care practices, access to health services as well as clean water, and appropriate sanitation and hygiene. The basic causes behind these factors include poverty and other economic and institutional constraints, such as women’s socio-economic status. 6The United Nations Children's Fund (UNICEF) Conceptual Framework on Undernutrition, originally designed in 1990, identifies basic, underlying, and immediate causes of malnutrition. The basic causes address systemic challenges including social, cultural, economic, and political that contribute to an unequal distribution of resources. Page 10 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Figure 3. Conceptual Framework of the Causes of Malnutrition in Lao PDR Source: Lao PDR National Nutrition Strategy (NNS) 2016–2025 based on the 1990 United Nations Children’s Fund (UNICEF) Conceptual Framework. Coverage of water supply, sanitation, and hygiene (WASH) interventions is limited and is an important underlying cause of undernutrition. While approximately 78 percent of households have access to ‘basic’ drinking water, over 83 percent of households have E. coli contamination in their source of water. Only 65 percent of rural households have access to basic sanitation and as many as 32 percent of households practice open defecation. There are large regional variations, with 47 percent of households in Phongsaly practicing open defecation (LSIS 2017). Diet affordability and diversity are also considerable issues in Lao PDR and are correlated with stunting prevalence. Only 55 percent of households in Lao PDR can afford a nutritious diet (WFP 20177); estimates from LSIS 2017 are even higher at 61 percent. Affordability of a nutritious diet can vary widely by province, for example, at 83 percent in Vientiane versus 5 percent in Sekong. Since unaffordability is a major constraint to diet diversity, household access to diverse diets is low. As shown by the 2012–2013 Laos Expenditure and Consumption Survey (LECS V), this phenomenon is more acute in rural areas where most households consume only three of the seven recommended food groups. Limited access to health and nutrition services is a strong determinant of child undernutrition and has a notable gender gap. Both men and women in rural Laos have limited access to health services. Due to women’s child bearing roles, this lack of access to services disproportionally impacts women and their risk of dying. Lao PDR’s maternal mortality rate remains the highest in the region, at a rate of 197 per 100,000 live births compared to East Asia’s regional average of 62 per 100,000 live births. Negative health effects of pregnancies are also heightened due to the lack of nutrition information and services during and after pregnancy. The LSIS 2017 found that only 52 percent of pregnant women from the poorest wealth quintile received antenatal care (ANC) from a trained health professional and over 36 7 WFP (World Food Program), and Ministry of Health. 2017. Fill the Nutrient Gap Lao-PDR. Vientiane. Page 11 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) percent of pregnant women living in rural areas without roads received no antenatal services. For the rural poor, many of whom live in remote areas, distance to health facilities is a major barrier to access. Only 34.1 percent of pregnant women in rural households were assisted by a skilled birth attendant when giving birth, compared to the national average of 64.4 percent (LSIS 2017) and the regional average in rural areas of 90 percent. As a result, Lao PDR’s maternal mortality rate remains the highest in the region, at a rate of 197 per 100,000 live births compared to East Asia’s regional average of 62 per 100,000 live births. Unsurprisingly, limited access to maternal health care also translates into inadequate health care for children—about 90 percent of rural women do not go for postnatal care (PNC) and less than 50 percent of children are fully vaccinated across the country, with fewer still in the northern provinces (LSIS 2017). Cross-cutting gender dimensions and social and cultural norms also contribute to Lao PDR’s high stunting prevalence. Diverse literature on the causes of stunting in Lao PDR point to elements such as women’s and mothers’ socioeconomic status, level of education, early marriage, and age of pregnancy, among others, as determinants of stunting.8 Mothers’ level of education, for example, is significantly correlated with stunting, and about 45 percent of stunted children’s mothers received no education or only early childhood education (ECE) (LSIS 2017). Less than 60 percent of women in poor households can read and write, compared to over 80 percent of men. Early marriage, particularly in rural areas and among women with lower educational attainment, remains widely accepted and is the leading cause for teenage pregnancy in Lao PDR (Osornprasop and Pimhidzai 2016). Children born to mothers ages 18 and below are 10 percentage points more likely to be stunted. Lao PDR’s adolescent birthrate was the highest in the region—about 94 out of 1,000 births correspond to girls ages 15 to 19 (UNFPA 20169) compared to East Asia’s regional average of 47 out of 1,000 births. Beyond teenage pregnancy, cultural beliefs that are potentially detrimental to pregnant women and children also affect behaviors at the household level and are often promoted, and at times enforced, by influential family members such as grandmothers and husbands. Mothers have reported that they are encouraged to restrict food intake during pregnancy due to certain taboos or so that they can have smaller babies and easier deliveries. These taboos and restrictions often continue through the delivery and breastfeeding period. Women’s agency and empowerment, or lack thereof, have also been found to be determinants of stunting.10 Three dimensions of women’s autonomy—confidence in the ability to exert control over their own health care, self-esteem, and control over own spending or money—are associated with better nutritional outcomes in Lao PDR. In other words, the likelihood of stunting is lower with women’s increased access to health care, both in terms of distance and access costs, and with their ability to make spending decisions and use money as they wish. Two separate studies also found that higher self-esteem for women, defined as their intolerance for domestic violence, is also associated with lower levels of stunting in Lao PDR.11 8 These studies include: Kamiya et al. 2018. “Mothers’ Autonomy and Childhood Stunting: Evidence from Semi-Urban Communities in Lao PDR.” BMC Women's Health 18: 70; Kamiya, Yusuke. 2011. “Socioeconomic Determinants of Nutritional Status of Children in Lao PDR: Effects of Household and Community Factors. ” Journal of Health, Population and Nutrition 29 (4): 339–348; and S.Osornprasop, and O.Pimhidzai. 2016. Nutrition in Lao PDR: Causes, Determinants, and Bottlenecks. Washington, DC: World Bank Group. 9 UNFPA (United Nations Population Fund). 2016. State of World Population Report. 10 See Kamiya et al. 2018. 11 Kamiya et al. 2018; Kamiya 2011. Page 12 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Though climate change is a likely threat to food security and ability to access health and nutrition services in Lao PDR, it is expected to have a low impact on stunting. It has been predicted that nationally, average daily temperature will rise, precipitation will increase, and the frequency of droughts might increase, though marginally so. Consequently, heavy precipitation, for example, may limit both the ability of patients to access health facilities to receive essential nutrition and health service as well as the ability of health workers to travel to remote areas to provide these services. The community-based platforms that the Government of Lao PDR (GoL) has established are also likely to reduce the adverse impacts of these consequences. Although poverty is cross-cutting and a key basic cause of childhood undernutrition, Lao PDR currently lacks social protection programs that explicitly address it. While most countries in the East Asia region and beyond have invested significantly in the past decades in developing targeted programs in support to the poor and most in need, Lao PDR still lacks them.12 The Poverty Reduction Fund (PRF) is one of the few programs which focuses on poverty reduction through a community-driven development (CDD) approach. As such, the coverage of social assistance is extremely limited,13 with no Government-financed noncontributory programs. Those who are covered by social protection programs are mostly confined to social insurance provided by the private sector or the civil service, with a few programs providing health insurance to the poor on a limited scale. A recent stocktaking of social protection programs in Lao PDR undertaken by the International Labour Organization (ILO) found that only about 2 percent of the population is covered by any form of social protection, including social insurance. Overall spending on social protection is about 1.7 percent of GDP (including pensions), far below neighboring Vietnam at 6.7 percent and the East Asia region average of 5.7 percent. Social assistance programs are fragmented, small scale, and financed mainly by development partners (DPs). There has been to date no large-scale safety net program that provides support at the household level specifically. The fragmentation of these programs has resulted in little to no development of the underlying building blocks of a social protection system to support poor and vulnerable households. Such building blocks would include systems for identification, registration, and payments and systems to enable coordination, monitoring, or evaluation. The use of digital technologies to disburse government-to-person (G2P) payments for social protection is seriously underdeveloped, particularly outside of the capital, Vientiane. The Government conducts a yearly poverty census (referred to as a poverty assessment) and creates, at the local level, a list of poor households in accordance with the national poverty criteria. The exercise, however, is used to collect aggregate data (that is, number of poor households) to monitor progress toward poverty reduction targets and not as a targeting system for programs by and large. As such, there is no consolidated national registry or list of poor households. Since 2016, the Government has revised its poverty criteria and methodology in collaboration with the World Bank. This included the development of a simplified Proxy Means Test (PMT) questionnaire which was piloted in five districts and refined to better adhere to the new poverty criteria and simplified to enable easier implementation, given 12World Bank. 2018. The State of Social Safety Nets. 13 The latest data available for Lao PDR on spending on social assistance showed a very limited spending; only 0.3 percent of GDP. Source: World Bank Atlas of Social Protection Indicators or Resilience and Equity-ASPIRE (http://datatopics.worldbank.org/aspire/), 2018. Page 13 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) local capacity constraints. A discussion on the potential rollout of a PMT survey14 at the national level, with the objective of informing poverty-targeted programs, is underway. Among the social protection programs in existence, Health Equity Funds (HEFs) provide health insurance for the poor. HEFs were piloted in 2004 and rolled out nationwide in 2009 with the goal of promoting utilization of health services through service fee waivers and coverage of nonmedical expenditures such as food and transportation allowances. In 2016, HEFs covered approximately 501,000 people or 46 percent of the population below the national poverty line15 using the Government lists of the poor in addition to others identified through different targeting mechanisms (MOH 201716). There have been no known studies to date on utilization of HEFs, but anecdotal evidence suggests that utilization remains low due to low demand for health services. Since the launch of the National Health Insurance (NHI) scheme in 2016, various social health protection schemes for the poor and informal sector — including HEFs and the free maternal and child health program targeted at pregnant women, mothers, and children under five years—have been merged under the NHI. Social health insurance schemes for the formal sector are still managed separately under the National Social Security Fund though eventual integration is being planned under the NHI law. In 2017, the NHI was rolled out nationwide except in Vientiane, covering 4,996,070 people or 74 percent of the total population; as such, health insurance schemes cover about 94 percent of the population (MOH 2018). Users in the list of poor households, pregnant women, and children under five years are exempted from the co-payments.17 Government Strategies to Address Malnutrition The GoL’s commitment to finding solutions to the pressing issues of poverty and malnutrition is clearly spelled out in its National Development Strategy. Notably, among the key objectives of the 8th National Social Economic Development Strategy (NSEDP) 2016–2020 are developing human capital, graduating from less developed country status by 2020, and achieving a reduction in poverty to 15 percent by 2020 through sustained and inclusive growth. The NSEDP calls for poverty reduction among all ethnic groups and equal access to education and health for both genders in all ethnic groups as well as decreased malnutrition. The Government also promulgated the first National Nutrition Policy in 2008 and based on this policy the 2016–2025 National Nutrition Strategy and Plan of Action (NNSPA) was formulated. The guiding framework for addressing malnutrition is the National Nutrition Strategy (2016– 2025) and Plan of Action (2016–2020), which establishes a multisectoral convergence approach. The NNSPA was designed to accelerate the reduction of stunting in children under five years from 44 percent to an ambitious target of 25 percent by 2025. The NNSPA has four strategic directions: addressing the immediate, underlying, and basic causes of malnutrition and addressing their links (see figure 3).18 Its 11 14 The term ‘PMT’ is used to describe a situation where information on individual characteristics of households of correlated with welfare levels is used in a formal algorithm to estimate households’ income, welfare, or need. 15 As noted earlier, the lists of the poor were developed in accordance with Lao PDR’s old poverty cri teria, according to which about 11 percent of the population was classified as poor in 2016. This stands in contrast to household survey poverty data, such as that from LECS V, which estimate a 23 percent poverty rate. As such, the HEF program covers a much narrower segment of the population. 16 MOH. 2017. “Key Features of the Official Social Health Protection Schemes in Lao PDR.” 17 MOH. 2018. “Annual Report on the Implementation of Health Insurance 2017 and Workplan for 2018 .” 18 The NNS causal framework for undernutrition is based on the 1990 UNICEF Conceptual Framework on Undernutrition, which specifies the main causes for malnutrition in children at different levels: immediate, underlying, and basic. Page 14 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) strategic objectives include (among others) improving nutrient intake; achieving adequate food consumption emphasizing the first 1,000 days of life; improving availability and access to nutritious foods; improving maternal and child health practices; improving water, sanitation, and environments; and improving access to health and nutrition services. To achieve these objectives, 29 interventions have been identified, 22 of which are considered first-order priority interventions for improved nutrition (box 1). These priority interventions are ‘assigned’ to specific sectors such as health, agriculture, WASH, and education, plus a few cross-cutting ones, and the strategy emphasizes working through and strengthening community-level platforms. Coverage of the 22 priority actions,19 however, is scattered and fragmented due to limited resources—in 2017, the DPs provided 86 percent of the total budget for the 22 nutrition actions, and a financing gap of US$30 million was foreseen for 2018.20 Box 1. 22 Priority Actions of the NNS 2016–2025 and Plan of Action 2016–2020 HEALTH, NUTRITION, AND WASH (14) 1. Iron supplements weekly for reproductive age women, daily for pregnant women 2. Vitamin A supplements for children < 5 years 3. Deworming children < 5 years 4. Universal salt iodization 5. Breastfeeding of infants/young child feeding promotion counselling 6. Food supplements for pregnant and lactating women 7. Food supplements for children < 2 years 8. Food safety and fortification 9. Management of acute malnutrition in community-based facilities 10. Education community programs for out-of-school girls through Lao Women’s Union (LWU)/other community networks 11. Growth monitoring for children < 5 years (for individual counselling link to action 5) 12. Capacity building - community to central level 13. Strengthening specific nutrition surveillance reporting system 14. WASH - strengthening water supply systems in health centers, communities, households, and schools EDUCATION (4) 15. Provision of school lunch 16. School-based gardens combined with nutrition education (with encouragement of school children as change agents) 17. Inclusion of nutrition in primary, secondary, and high school curriculum 18. Using education as a delivery platform for nutrition-specific interventions (deworming and iron-folic acid for school- age students) FOOD AND AGRICULTURE (4) 19. Production and promotion of diversified crop production (including home gardens, herb boxes, bean production, and so on) and agriculture-linked nutrition education 20. Production and promotion of small and healthy livestock (focus on poultry, pigs, and so on) 19 It is noteworthy that the World Bank health projects will cover all interventions except 4, 6, 7, 8, and 10. The WASH project will contribute to intervention 14. The PRF Additional Financing and AFN will support almost all elements of the four priority interventions under Food and Agriculture. See next section for details. 20 National Nutrition Committee Symposium, November 2017. Page 15 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) 21. Improve post-harvest handling and promote food processing to improve year-round food security 22. Support and promote income-generating activities (IGAs)—for example, agricultural products as well as non-timber forest products including traditional herbs—and education on wise use of family income. A National Nutrition Committee (NNC) was created in 2013 and amended in 2016 to lead and coordinate efforts around nutrition. The committee is chaired by a Deputy Prime Minister with one Vice Chair being the Minister of Health. The NNC has Deputy Ministers from 12 ministries and mass organizations as members. The Ministry of Health (MOH), Ministry of Education and Sport (MOES), Ministry of Planning and Investment (MPI), and the Ministry of Agriculture and Forestry (MAF) are the four leading agencies in charge of implementing the strategy. The Secretariat is headed by the Deputy Minister of Health with three Deputy Heads and it oversees implementation of the NNSPA. The leading technical team comprises members from the MOH, MOES, MPI, and MAF. A similar structure is being progressively mirrored at the provincial and district levels. A nutrition-sensitive social protection program, coupled with investments in key social protection system building blocks, could bolster the ongoing dialogue with the GoL on the development of a national social protection strategy and ensure protection for the poor and vulnerable. While there is no single ministry with a social protection mandate, the recent expansion of the MAF’s mandate now comprises rural development and poverty reduction, which were previously under the purview of the National Leading Committee for Poverty Eradication and Rural Development in the Prime Minister’s Office. Some of the key functions that were remapped to the MAF include the coordination and implementation of rural poverty reduction programs as well as the annual poverty assessment. A nutrition-sensitive social protection program under the MAF could be an ideal entry point for systems development, with the flexibility to enable future expansion and coordination of social protection programs. It would also be well aligned with the MAF’s ongoing nutrition-related activities and its rural development and poverty reduction focus. The program would also promote policy discussion on social protection alongside a draft social protection strategy which is being developed with assistance from the ILO, UNICEF, Australian Department of Foreign Affairs and Trade, and other DPs working jointly with the Ministry of Labor and Social Welfare. World Bank Multisectoral Action Plan to Reduce Stunting In response to the multidimensional causes of malnutrition in Lao PDR, the World Bank has made a commitment to a multisectoral action plan to support the Government’s efforts in tackling childhood stunting. The long-term vision for the World Bank nutrition agenda is aligned with the GoL’s objective of reducing stunting prevalence at the national level by 44 percent (to 25 percent) by 202521 (see figure 4). As such, the goal is to redefine the World Bank’s approach to tackling undernutrition in Lao PDR to optimize existing and future operational and technical assistance (TA) commitments, as well as the policy dialogue on nutrition, anchored in a defined mechanism to lead a multisector policy dialogue. It was agreed that nutrition-sensitive and nutrition-specific interventions in Lao PDR will be coordinated to the extent feasible in four key areas: (a) geographic convergence of nutrition-specific and nutrition- sensitive interventions in the same communities and households; (b) use of common Social and Behavior Change Communication (SBCC) strategy, action plan, and tools for consistent messaging; (c) leveraging of each other’s delivery platforms, for example, pre-established community structures; and (d) exploring of 21 Country Partnership Framework, 2017-2021, Report No.110813-LA. Page 16 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) possibilities for common monitoring and evaluation (M&E) Frameworks. An overarching framework is summarized in figure 4. Figure 4. World Bank-Lao PDR Phased Multisectoral Approach to Reduce Stunting, 2018–202822 In phase 1, the overall objective is to lay the institutional and operational foundations for the multisector convergence approach before possible scale-up in subsequent phases. Three active and four pipeline operations have been identified as nutrition sensitive and, through simultaneous implementation in the same geographic regions and reaching the same households, will help maximize the reduction in stunting prevalence. Each of these interventions will address a key cause of undernutrition in Lao PDR: poverty and vulnerability, limited access to quality health and nutrition services, limited access to water and sanitation, and limited knowledge of adequate maternal and child health and nutrition practices and early childhood development at the household level. In addition, these projects will help address issues that cut across sectors, particularly gender dynamics that contribute to high levels of stunting. The specific projects include the Health Governance and Nutrition Development Project (HGNDP; P151425);23 a new health operation under preparation (Health and Nutrition Services Access Project [HANSA; P166165]); the Scaling-up water supply, sanitation and hygiene Project (P164901) under preparation24; the ongoing Early Childhood Education (ECE; P145544); the Poverty Reduction Fund Project (PRFIII; P157963) and its additional financing (P168620); and the proposed project. In the short term, the five proposed sectoral operations will jointly contribute (see figure 5) to tackling the immediate and underlying causes of malnutrition in 12 priority districts in the provinces with the highest share and absolute numbers of stunted children. The objective for phase 1 across the portfolio is to produce a significant reduction in stunting in targeted areas, about a 20 percent reduction in the targeted areas, and a 1.75 percent reduction nationally (for more details see annex 3). 22 The national target ofreduction of stunting to 25 percent pertains to the national level. The World Bank convergence approach will be centered on a subset of four provinces and given that the operations will converge in areas with a higher stunting prevalence (including some provinces with over 60 percent stunting), the approach will significantly contribute to the national goal of stunting reduction. 23 The existing operation and its additional financing (approved in 2017) close in 2020. 24 The expected Board date for Scaling-up water supply, sanitation and hygiene Project is also March 14, 2019. Page 17 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Figure 5. World Bank Programmatic Approach Portfolio in Phase 1 The proposed project will address poverty and vulnerability specifically, which are among the key basic causes of undernutrition. The project will incorporate best practices from other nutrition- sensitive social protection programs in the region and around the world, such as Peru and the Philippines. It will provide regular cash transfers to poor and vulnerable households and help close the financial gap that contributes to undernutrition, particularly unaffordability of food and transport to access essential services. The project will also encourage households to adopt optimal health, nutrition, and hygiene practices through co-responsibilities attached to the cash transfers. These will include attendance of regular SBCC sessions that focus on maternal and child health and nutrition-related topics which are being delivered through the health, education, PRF, and WASH projects. The project will thus complement the parallel efforts of the other World Bank projects as well as other interventions financed by the Government and other DPs. As a cross-cutting operation that will complement other sector work on nutrition, this operation will serve as the ‘flagship’ nutrition operation, providing coordination mechanism for policy-level dialogue on nutrition and the higher-level objectives of the multisector approach. Relationship to Country Partnership Framework (CPF) The World Bank Group Country Partnership Framework (CPF)25 for Lao PDR FY2017–FY2021 sets the stage for a multisectoral long-term strategy to support the Government in addressing malnutrition, which is aligned with the 8th NSEDP 2016–2020 and the NNS 2016–2025. The strategy embodies a multisectoral convergent approach designed to accelerate the reduction of maternal and child 25 CPF - Report No. 110813-LA. Page 18 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) malnutrition from the current rate of decline of 0.8 percentage points per year in stunting to 1.6 percentage points between 2016 and 2020 and 1.8 percentage points during 2021–2025. The Lao PDR Systematic Country Diagnostic (SCD)26 highlighted the urgent need to address poverty and malnutrition, which the CPF supports through its focus area 2 on ‘investing in people’ and which the World Bank supports at a global level through the Human Capital Project (HCP). Human capital—a product of the knowledge, skills, and health that people accumulate over their lives—has been a key factor behind sustained economic growth and poverty reduction in many countries, especially in East Asia. The World Bank Group is committed to help countries prioritize human capital development in a sustained way, given the deepening recognition that a healthier and better-skilled workforce is key to progress in countries at all income levels. As the engines of economic growth shift away from traditional patterns that relied heavily on low-skilled labor and toward more skilled occupations and sectors, human capital is an increasingly important enabling factor for economic transformation and growth. The HCP will develop a new international metric for human capital that goes beyond time spent in school to quality- adjusted years of learning and that also includes indicators such as child stunting, which reflects future learning and earning ability, as well as health beyond life expectancy. Stunting is a key component of human capital given its ability to hamper its development later in life. Programs that focus on stunting reduction therefore provide an entry point for a long-term agenda for investing in human capital. With the overall goal of the convergence approach being stunting reduction among Lao children, the project is well aligned with the HCP. The proposed project will specifically contribute to Sub-Objective 2.1 of the CPF, which is to reduce the prevalence of malnutrition, and Sub-Objective 2.4, which is to reduce vulnerability and promote inclusive access to social services. Specifically, the CPF has identified several World Bank operations that will be ‘nutrition specific’ or ‘nutrition sensitive’ and will aim to incorporate or enhance pertinent nutrition objectives, indicators, activities, and/or components into target projects during phase 1. This includes financing activities that seek to reduce the underlying and basic as well as the immediate causes of stunting (and overall childhood development), delivered through several relevant sectoral operations. Social protection systems developed for the project could also eventually be expanded and streamlined to support a broader social protection framework for increasing resilience and reducing vulnerability. The complementary Advisory Services and Analytics (ASA) to this operation, the social protection ASA Addressing Vulnerability through Social Protection (P160711),27 has contributed to furthering the policy dialogue on social assistance. Policy dialogue on reducing stunting in Lao PDR, Myanmar, and Cambodia programmatic ASA (P165482) complements ongoing and pipeline nutrition operations across the three countries and has contributed to the development of a common M&E framework for nutrition convergence in Lao PDR. The proposed project will play a key role in closing the gap in protecting the poor and most in need, ensuring that they can benefit from positive growth in the years to come. The project is also aligned with the World Bank’s Gender Equality Strategy (2016–2023), as gender aspects are incorporated into its design that support the first objective of the strategy: improving human endowments through investment in health, education and social protection. The 26Report No. 112241-LA 27 The objective of this ASA is to support the Government in developing a social protection system to address poverty, vulnerability, and malnutrition in poor rural areas, and providing TA to the MAF and Ministry of Social Welfare. Page 19 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) operation will support implementation of the East Asia and Pacific Regional Gender Action Plan and the specific priorities of the Country Gender Action Plan (CGAP) for Lao PDR 2017-2021 which include tackling high maternal mortality rates and adolescent pregnancy and promoting participation of women in planning and decision making at the local level. Specifically, it will support mothers in better investing in their health and nutrition and that of their children and will contribute to their empowerment through improved knowledge, access to financial services, and direct access to cash. C. Relevance to Higher-Level Objectives The project is fully aligned with the country’s 8th NSEDP 2016–2020, the World Bank Group’s twin goals of eradicating poverty and promoting shared prosperity, the World Bank Group’s 2012–2022 Social Protection and Labor Strategy, and the World Bank Group’s 2017–2021 CPF. Through the provision of nutrition-sensitive income support to families, the project will contribute to the Government’s higher- level objective of reducing poverty, particularly in remote rural areas, and of investing in their human capital. The project will also fill an important gap in the Government’s nutrition strategy, which is currently focused on supply-side investments, by addressing one of the basic causes of undernutrition, that is, poverty. Income support to families can lead to improvements in nutritional status if families are carefully guided, as shown by the positive impact of cash transfers from around the world on household consumption, particularly food consumption. Combined with adequate knowledge of maternal care and infant and young child feeding practices, increased food consumption can contribute to improved diet diversity and a more nutritious diet for pregnant women and children 0–2 years and, eventually, a reduction in stunting, which is also a higher-level objective. Evidence from countries that have successfully implemented cash transfer programs also suggests that when cash transfers are tied to conditions, they can have a positive influence on service utilization and can leverage investments in service delivery by ensuring that households can access them. II. PROJECT DESCRIPTION A. Project Development Objective PDO Statement The Project Development Objective (PDO) is to support the design and implementation of a nutrition-sensitive social assistance program to improve nutrition behaviors, and enhance the convergence of nutrition-focused interventions. The project will finance a nutrition-sensitive conditional cash transfer (CCT) program and associated delivery systems/mechanisms. It will contribute to better nutritional outcomes by increasing the affordability of nutritious food; improving pro-nutrition knowledge, attitudes, and practices (KAP); and stimulating increased demand for and utilization of essential health and nutrition services known to improve nutritional outcomes. The cash transfer program will incorporate the following features: targeting the most nutritionally vulnerable window of opportunity (that is, first 1,000 days) and directing transfers to women, with the ultimate goal of reducing poverty and improving child nutritional outcomes. The project will also finance the development of key building blocks for an effective social protection system, particularly the setting up of a targeting system and a social registry, which will enhance efficiency Page 20 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) of spending, in particular for programs and projects targeted at the poor. As the project is part of a broader effort of the World Bank to support Lao PDR in tackling poverty and malnutrition with a multisectoral nutrition convergence approach, the project will also finance interventions that will enhance the nutrition convergence and its rigorous evaluation. PDO-Level Indicators Key results that will be measured throughout the life of the project include: (a) Percentage of households with periodically updated socio-economic survey information reported in the social registry; (b) Number of beneficiaries of social safety net programs;28 (c) Percentage of children ages 6–23 months29 from cash transfer beneficiary households consuming foods from four or more recommended food groups; (d) Number of villages in project districts where at least three nutrition convergence projects have been implemented. Although childhood stunting, being underweight, wasting, and other indicators of child nutritional status are not explicit outcomes of the proposed project, these indicators will nonetheless be monitored through project-specific surveys (for example, the HGNDP supported the implementation of the health and nutrition-related KAP survey in the same districts) as well as relevant national surveys (for example, LSIS) to inform the World Bank’s engagement on nutrition in project provinces and also across the nation. Tracking these indicators will also shed light on the effectiveness of the World Bank’s multisectoral convergence approach and how this could be enhanced/improved in priority districts. Overall, the project and other nutrition-focused or nutrition-sensitive operations should be viewed as important initial interventions to support the Government in reaching its goals, with the likelihood of a more extended World Bank program of support over the coming decade to achieve the intended national stunting reduction goals. For greater effectiveness, the project will follow the principle of geographic convergence and its interventions will be coordinated with the health, PRF, and WASH projects that will focus on generating improvements in the supply of health, nutrition, and water and sanitation services, as well as the Agriculture for Nutrition (AFN) project funded by the International Fund for Agricultural Development (IFAD). The project will be implemented in districts in the northern provinces of Phongsaly, Oudomxay, Huaphanh and Xiengkhuang, all of which have levels of childhood stunting well above the national average. The proposed area of geographic convergence was selected given the high stunting rates and to further exploit the capacity created in those districts while implementing the World Bank-financed HGNDP, PRF, and ECE projects. The proposed area of geographic convergence covers a total population 28 This is a Corporate Results Indicator for Social Protection and for this project it refers to the number of beneficiaries of the nutrition-sensitive CCT program. 29 Standard reporting for indicator on children diet diversity (WHO). Page 21 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) of approximately 345,785 people (see annex 2). Annex 3 outlines the overall scope of phase 1 of the World Bank-financed multisectoral nutrition convergence approach, with expected outcomes. B. Project Components The project will comprise three components that support the implementation of a nutrition- sensitive social assistance program to address poverty and malnutrition, and key mechanisms to ensure the overall effective implementation of a multi-sectoral nutrition convergence approach. Component 1 will focus on setting up the basic building blocks of a social protection system, namely a targeting system for social programs and a social registry which will be critical to inform policy makers on gaps in the supply of programs and to report on the overlap of coverage in programs. Component 2 will support CCTs focused on families with pregnant women and infants ages 0–2 years (that is, the first 1,000 days) intended to improve diet diversity, increase utilization of essential health and nutrition services, and encourage health and nutrition practices advocated through existing SBCC activities targeted at households in poor, rural areas. Project activities will complement the other World Bank-financed nutrition-specific and nutrition- sensitive projects in rural health and nutrition services, WASH, and rural infrastructure, as well as the IFAD-funded AFN project. Component 3 will finance day-to-day support for the implementation of the project, as well as the coordination and M&E for the overall World Bank multisectoral nutrition convergence approach. Component 1: Developing the building blocks of a social protection system (IDA Credit: US$3 million) The objective of this component is to develop the key building blocks of a social protection system. This includes support to develop a household targeting system and to create a social registry. To populate the social registry, the project will leverage the government’s previous poverty assessment data collection exercise and finance the data collection in the selected four provinces. The social registry will provide a ‘gateway’ for easier identification of beneficiaries for targeted social programs. Specifically, the social registry, which will rank households by way of a PMT, will be used to determine household eligibility for the CCT program in Component 2 and other targeted interventions within the nutrition convergence approach. This component will also finance the establishment of an integrated beneficiary registry which will allow for monitoring and coordinating ‘who receives what’ across programs in target areas. Subcomponent 1.1. Design and operationalization of a methodology for identification of poor households. This subcomponent will build on the Government’s current system for identifying poor households (the national poverty assessment) and also on previous World Bank technical assistance to the Department of Rural Development and Cooperative (DRDC) within the MAF on poverty measurements30. The activity will develop a simplified PMT socioeconomic questionnaire, translating the Government’s existing Well-Being Criteria into objective indicators for assessing poverty and the socioeconomic situation of households.31 In addition to the basic PMT indicators, the questionnaire will capture categorical indicators that could be useful for targeting in social sectors. This component will also finance the development of an Operational Manual to effectively implement the targeting system. 30Lao PODR Poverty Measurement and Monitoring (P146141). 31Implement the National Decree which sets the criteria for poverty graduation and development for households, communities and villages, Lao PDR Decree No. 348, November 16, 2017. Page 22 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Subcomponent 1.2. Implementation of the socioeconomic survey in project provinces. As proof of concept, the project will finance the data collection (that is, the PMT survey) across all households in the four provinces of the convergence approach. This encompasses training central, provincial, and district officials to supervise and/or collect data at the household level. This subcomponent will also finance contractual personnel to assist in smooth and effective implementation of the poverty assessment. The project activities are intended to: (a) improve the process of data collection by Government officials; (b) improve and institutionalize the supervision structure; and (c) enhance the overall quality control mechanisms to improve the robustness of the data collection process. The project will finance the logistical costs needed for two rounds of data collection in these provinces, at the beginning and midpoint of the project. The project will leverage the use of digital platforms and technology to the extent possible to improve the quality of data collection and to lower costs. This includes procuring tablets for data collection and developing the software application for electronic data collection. Central, provincial, and district officials will be trained on the use of these new digital platforms, and the training materials and operational guidelines will be used for the eventual rollout of the instruments nationwide. This subcomponent will also finance the training of trainers at a national level and additional training at the provincial level to facilitate the eventual rollout of the data collection nationally. Subcomponent 1.3. Development of a social registry and a beneficiary registry. The project will finance the development of an information system to capture household information collected under Component 1.2 in the four convergence provinces, as part of the implementation of Decree 348 and its implementation instructions, and their poverty classifications. This information system is referred to as a social registry. The project will also finance the information technology (IT) infrastructure and systems for collecting and aggregating the household-level data into a centralized social registry to provide a harmonized database for social programs to target their interventions and the required human resources to manage it. The social registry will go a step further than the Government’s past poverty assessments whereby the household list of the poor was never systematically collected and maintained at the central level. The registry will also collect data from other provinces if and when the exercise is rolled out beyond the four provinces, thus making it over time into a national social registry. Every individual recorded in the social registry will receive a unique identifier number32 The social registry will be complemented by a beneficiary registry (see box 2), that is, a database which will allow the Government to track the interventions that each household in the targeted areas receives, under this or any other Government project, through the unique identifier. The beneficiary registry will be designed to be interoperable with the CCT program’s management information system (MIS) (see Component 2.1) and the ministry’s other existing information systems where possible. The proposed social and beneficiary information systems will also be designed to be interoperable, to the extent possible and where relevant, with other ministries’ information systems for programs in the 12 districts, particularly WASH and Health. The project will thus invest in IT systems for secure data transfer between the central, provincial, and district levels; server management and database maintenance;33 and additional IT technical support for updating and maintaining the systems. If and when the CCT program is 32This number will be linked to the national ID. 33For more information on social registries see: Leite, P., George, T., Sun, C., Jones, T., and Lindert, K. 2017. “Social Registries for Social Assistance and Beyond: A Guidance Note & Assessment Tool,” World Bank Social Protection and Labor Discussion Paper 1704. http://documents.worldbank.org/curated/en/698441502095248081/pdf/117971-REVISED-PUBLIC-Discussion- paper-1704.pdf. Page 23 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) rolled out beyond the 12 districts, the beneficiary registry for the 12 districts will be the base for the future national beneficiary registry for the program. Box 2. The Role of the Social and Beneficiary Registries The social and beneficiary registries will enable the GoL to objectively identify the poor and those in need of assistance as well as track whether those needing assistance are actually receiving it and the nature of the assistance they are receiving. With respect to the CCT program and for all the projects which are a part of the nutrition convergence approach, these information systems will be critical to maximize the impact of the proposed interventions. As illustrated in the diagram below, the Social Registry will gather and retain data (poverty assessment data) on all potential beneficiaries of poverty alleviation programs implemented by the GoL, starting with the nutrition convergence districts. In the World Bank-GoL convergence districts where the social registry will first be piloted, it will support the process of determining eligibility for the poverty-targeted interventions in the convergence approach, for example, the CCTs, subsidies for building latrines, and support for IGAs (livelihoods). The social registry is also expected to be used for targeting the health insurance and in the case of emergencies. The Beneficiary Registry will be used to track information on beneficiaries and benefits received (track integrated support provided to households, that is, nutrition convergence beneficiaries in the target districts). Page 24 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Component 2: Conditional cash transfer program (IDA Credit: US$16.70 million) Component 2 will support the GoL in setting up and delivering a CCT program to support pregnant women and/or children under two years old in poor and vulnerable households in selected rural areas. The goals of the CCT program will be to incentivize nutrition-promoting behaviors such as improving dietary quality (in terms of diversity and amount), increase utilization of essential health and nutrition services, and contribute to poverty reduction in targeted areas. This component will finance the development and implementation of the key operational aspects of the CCT program.34 Subcomponent 2.1. Building the delivery system for a conditional cash transfer program. This subcomponent will support the development of the delivery mechanism to implement the CCT program effectively. These include: (a) an MIS to support implementation and monitoring; (b) an effective system to enroll eligible households; (c) a system for delivery of secure and timely cash payments;35 and (d) a system for grievance redress. CCT Program MIS. This subcomponent will finance the development of the CCT MIS to support key elements of program implementation and monitor intermediate outcomes. The MIS will be linked to the social registry under Subcomponent 1.2 and will draw a preliminary list of eligible households from the social registry. The MIS will be used to record beneficiary compliance with program co-responsibilities and to track cash payments to beneficiaries as well as to follow the progress of households up until the point that they ‘graduate’ from the program when a child turns two. Enrolment. The project MIS will compile a list of eligible beneficiaries from the social registry based on categorial and poverty criteria. Following an extensive information campaign, including frequent outreach by village leaders and district-level staff, eligible households will be invited to register in the program during large-scale registration events. Other households that consider themselves to be eligible (for example, newly pregnant women in poor households) will also be invited to attend these registration events. If their households are included in the social registry, meet both poverty and categorical eligibility criteria, and are validated by the community, they will be invited to register in the program. Once households are registered in the program, their information, including their unique identifier, will be imported into the CCT MIS and beneficiary registry from the social registry. All registered households will be provided with a program identification card that has their unique identifying number/code (same as the social registry) and an electronic identifier (that is, a barcode or QR code) that links to the MIS. Verification of Conditionalities. The transfer of cash to beneficiaries will be conditioned on specific behaviors. The program Operations Manual will clearly describe these conditionalities as well as the method and frequency of compliance verification and provisions for suspension. The cash transfers will be conditioned on attendance at the monthly village-level SBCC sessions as well as beneficiary utilization of key health and nutrition services, namely, ANC for pregnant women, growth monitoring and 34 In year one of implementation of the project, the Government will mostly focus on developing and implementing the socioeconomic surveys under component 1.2. and setting up the required delivery systems for the CCT program (that is, MIS, payment system, grievances, and so on). Once those are in place, the CCT program will be progressively introduced in the target districts, in the first six months in half of the villages and in the following six months in the remaining villages. Progressive phasing- in will allow testing of the implementation mechanisms and also allow for an experimental design for the impact evaluation. 35 This will include the contracting fee for the payment agents to deliver the cash transfers to beneficiaries. Page 25 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) promotion sessions for children ages 0-2 years, and age appropriate vaccination for children ages 0-2 years.36 These conditions and their compliance will be regularly monitored. Payment system. The project will procure the services of a third-party payment provider (that is, a bank or other licensed payment service provider/payment agents) to deliver regular cash transfer payments to beneficiaries as per the agreed schedule (every two or three months). Cash transfers may include several modalities given the limited coverage of banks and mobile payment providers but will favor digital payments wherever available to ensure that transfers reach their intended beneficiaries in a transparent and traceable manner. The scarce availability of financial service providers in the targeted areas, as well as limited financial inclusion and literacy, is likely to pose challenges in the initial phases of the project. To the extent possible, the project will work with private and public partners to find ways to incentivize the expansion of digital financial services to targeted areas and the financial inclusion of marginalized communities. Grievance redress mechanism (GRM). A GRM will allow all stakeholders, especially communities in the selected areas, to register complaints or report irregularities in an anonymous and confidential manner. This will include grievances from the time of enrolment and throughout the program’s implementation. The project will consider various modalities for registering grievances, including digital (through an online link or website), paper, and telephone. The project will finance the development of the needed software and specialized personnel or time of existing personnel to report regularly on progress in solving grievances. Subcomponent 2.2. Conditional cash transfers for eligible pregnant women and mothers of children ages 0–2. This subcomponent will finance cash transfers to pregnant women and children under age two in the selected areas. Cash transfer amounts will be set at LAK 140,000 per beneficiary household per month (around US$17), which is about 14 percent of household consumption for the poor. This will ensure, on the one hand, that transfers can have a sufficient impact on consumption and service utilization and, on the other hand, that they do not distort labor market incentives. Cash transfers will provide the additional income that will contribute to greater consumption of more diverse and nutritious foods and/or for covering transportation and other costs to access health and nutrition services. The program is expected to target the bottom 50 percent of households based on the national poverty threshold, as identified under Component 1. Based on simulations, this will account for approximately 88 percent of stunted children in the selected districts (figure 6). 36 An assessment of supply availability and readiness will be conducted to inform the expected compliance with co- responsibilities. Where the supply is diagnosed to be an issue, conditionalities will be waived. Page 26 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Figure 6: Sequencing Activities for Components 1 and 2 Subcomponent 2.3. Innovations in social behavioral change communication. This subcomponent will complement national as well as other World Bank-funded activities (primarily by the HGNDP) through community-based SBCC activities aimed at contributing to improvements in: (a) maternal nutrition and related caring practices; (b) infant and young child feeding and caring practices; (c) sanitation and personal as well as environment-related hygiene behaviors; (d) dietary diversification; and (e) other determinants of nutrition at the village level. Village-based facilitators (VFs) who have been recruited by the HGNDP, and who will comprise mostly female village health volunteers and/or members of the LWU, will support the SBCC implementation at village level. The VFs are currently organizing monthly communication sessions, conducting home visits for follow-up on pregnant women and children under two years old, and facilitating organization of edutainment community events, whilst liaising with relevant district line agencies. As part of the convergence approach, the different World Bank teams have agreed to use, to the extent possible, the same community-based platform to deliver SBCC, that is, the monthly village SBCC sessions primarily targeted at pregnant women and women with young children (see annex 4). For select sessions, male heads of households and mothers-in-law may be invited to participate. Specifically, this proposed project will finance the following additional activities:  Development of new SBCC modules on the optimal use of cash to buy health and nutrition inputs; women’s empowerment, namely modules that address sexual and gender-based violence; basic financial literacy; and disaster preparedness. These modules are currently not available. The subcomponent will deliver them to all participants in the village SBCC sessions, as it would be beneficial to all families.  Development of innovative audio-visual tools to deliver key SBCC modules (namely, use of cash, optimal infant and young child feeding practices, and personal hygiene). The high rates of illiteracy among beneficiaries and the low capacity of VFs have rendered the current ‘lecture’ approach to messaging suboptimal. The videos will not be limited to project beneficiaries and will be offered to all SBCC participants and by other World Bank-financed projects. They will be developed in close collaboration with and under the technical leadership of the National Nutrition Center. Page 27 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Relevant formative research on potential use of different innovative approaches to one-on-one and/or group counselling and other forms of message packaging and delivery will also be financed through this subcomponent. This subcomponent will be planned and implemented in close collaboration with the MOH, MOES, and other projects including PRF and AFN. Component 3: Coordination, management, monitoring and evaluation (IDA Credit: US$7.30 million) The objective of this component is to support the MAF in the management and timely implementation of the project, and the overall coordination and M&E of the nutrition convergence approach. The component will finance project coordination, management, policy research, citizen engagement, and capacity-building support to the MAF for project implementation and to other entities (for example, MPI) that will facilitate multisectoral coordination at the province and district levels. The component will also support the M&E of the implementation of the multisectoral nutrition convergence approach in the project areas. Subcomponent 3.1. Project management. This subcomponent will support the provision of technical and operational assistance for the day-to-day implementation, coordination and cooperation, communication, procurement, financial management (FM), safeguards management, and M&E of the project. The implementing agency’s human resources will be complemented as needed by additional staff, all of whom will receive regular capacity building. This subcomponent will also finance the implementation of key process monitoring tools for the day-to-day operation of the CCT program for which regular surveys will be conducted (that is, post-monetary distribution surveys, citizen engagement through perception and satisfaction surveys), as well as analyses of the different processes involved in the cash transfer, their pertinence, and their timeliness (that is, timeliness of registration of beneficiaries; time for reporting a change in location of households or proxy for receiving the cash; timeliness of payments) and overall use of innovations and information and communication technology (ICT) to enhance results. Lessons from these surveys will be incorporated into the Project Operations Manual and CCT MIS as needed. Subcomponent 3.2. Support the coordination, monitoring, and evaluation of the multisector nutrition convergence approach. The objective of this subcomponent is to support the planning, coordination, and M&E of the nutrition convergence approach through technical and operational assistance. It will finance the development of planning guidelines to be used at different levels; training and operational costs for the execution of the coordination, development, and implementation of M&E functions (that is, additional staffing, facilitation of and/or support for organizing regular multisectoral nutrition coordination meetings at the provincial and district levels, regular supervision); and studies and/or surveys and citizen engagement activities to assess operational effectiveness and impact of the convergence approach. The MPI will coordinate the implementation of this subcomponent. Documenting progress in the effectiveness of the convergence approach in reducing stunting will be critical for its future scale-up. A comprehensive M&E Framework will be established to: (a) track the convergence of the World Bank’s portfolio of nutrition interventions at the village level; (b) report on nutrition outputs, outcomes, and impact indicators; and (c) quantify the impact of the convergence approach. The monitoring of the convergence approach will be conducted through five main tools: village score cards, iterative beneficiary monitoring (IBM), administrative data (sector and convergence projects’ MIS), spot checks, and key informant interviews. This subcomponent will also finance the evaluation of the convergence approach Page 28 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) (see annex 3). A key feature of the convergence approach will be the staggered rollout of the different projects in the convergence districts, which will permit embedding an evaluation of the impact and cost- effectiveness of the convergence approach. The evidence base for the proposed project and overall convergence approach will build on the results of the KAP survey, which is being collected every 18 months and will continue until mid-2019 by the HGNDP (see more under the M&E section). The first KAP survey was conducted in the 12 priority districts in July–August 2017. The information gathered from this survey is informing the design of the SBCC and overall program design. A follow-up (midline) KAP survey is scheduled for 2019 and a final one (end line) in 2021. These studies will enable a deeper understanding of the sociocultural norms, behaviors, enabling environments, and obstacles to improved health and nutrition-related practices. The midline survey will serve as the baseline for the proposed nutrition multisectoral programmatic approach, and resources will be provided under this project to finance one more round of the KAP as the end line for phase 1 of convergence. This subcomponent will also finance qualitative studies in the 12 selected districts, which will be designed to complement parallel quantitative data gathering efforts. C. Project Beneficiaries The social registry will cover the entire population of the selected four provinces of intervention (approximately 1,115,000 indirect beneficiaries). If the socioeconomic survey/PMT is expanded to other provinces using the same methodology, it will also include those indirect beneficiaries. Women and ethnic minorities represent the majority of the population in the selected geographic priority districts37 and are likely to benefit the most from project activities. The conditional cash transfer program will cover approximately 42,743 beneficiaries in the target provinces. Other households in the target provinces as well as the public at large will also benefit from mass media and community-wide campaigns which will be a part of the revamped SBCC and of the overall nutrition convergence approach. D. Results Chain The proposed results chain for the project is presented in figure 7. The final intended outcome of the project, as part of the contribution in phase 1 of the overall World Bank nutrition convergence approach, is to contribute to reducing childhood stunting, particularly focusing on improving diet diversity of children and on improving key nutrition behaviors that are known to reduce childhood stunting. Annex 3 presents the overall results chain of the proposed World Bank multisectoral nutrition convergence approach and the overall M&E approach for the World Bank portfolio on nutrition. 37 Key characteristics of the Lao target ethnic groups are summarized in annex 3. Page 29 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Figure 7. Project Results Chain Inputs Activities Outputs Outcomes Impact Component 1: Developing the building To contribute to blocks of a social protection system 1. Poor and vulnerable reductions in 1. Targeting system developed and households surveyed 1. Develop and implement a targeting system stunting rates among Staffing, to identify poor households implemented 2. Systems developed with data collection process for SP children under five Capacity Building, 2. Implement of the socioeconomic survey 2. Social registry developed years in project programs covering targeting, TA, 3. Beneficiary registry developed social registry, and beneficiary provinces •3. Develop a social registry Operational registry Assistance, 4. Develop a beneficiary registry Materials and 1. Beneficiaries receive regular Tools, 1. CCT program MIS developed and informs Component 2. Conditional cash transfer operation CCTs. Financing program 2. Infants and children ages 6–23 •2. Grievance cases addressed in a timely 1. Build systems to implement the program manner months are fed a diverse diet and (payment system, MIS, grievances) use the heatlh/nutrition centers •3. Target beneficiaries receive cash more frequently 2. Cash distributed to target beneficiaries transfers as per schedule Percentage of 3. Increased utilization of 3. Enhanced SBCC tools designed •4. Behavioral changes promoted through essential health and nutrition children under community-based SBCC activities services resulting from the CCT five years (with a focus on those Component 3. Coordination, Management, 1. Number of villages with at least •1. Staff recruited and trained to implement under two) who Monitoring and Evaluation three nutrition convergence the project projects implemented are stunted in 1. Recruit and train key project staff 2. Up-to-date monitoring reports received •2. Improved coordination, regularly participating 2. Develop a M&E system for the project and management, and monitoring of for nutritional convergence approach 3. Regular multisectoral convergence nutrition and nutrtition-related provinces meetings held activities at district level 3. Strengthen district-level authorities to •3. Multisectoral nutrition coordinate multisectoral nutrition 4. Surveys conducted to evaluate nutrition convergence impact convergence approach implemented programming and monitored in targeted districts Multisectoral Convergence and District and Community Level: SP, HNP, WASH, Education, and Agriculture Page 30 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) E. Rationale for Bank Involvement and Role of Partners The project will provide a nutrition-sensitive safety net to poor rural families with pregnant women and young children in the selected provinces, an approach that has been successfully implemented with World Bank support in many countries. International evidence shows that social safety net programs play an important role in speeding up the momentum of poverty reduction, improving the uneven distribution of the benefits of growth across the population, and improving social indicators. Studies have shown that social safety nets increase the quantity and improve the quality of household consumption, improve children's nutritional intake, improve children's education and health status, and increase expenditures on the productive activities and assets needed to build the resilience of the most vulnerable population.38 The project will contribute to reducing poverty and improving nutrition- related behaviors and outcomes, with a special focus on the first 1,000 days nutrition window of opportunity—it will also help improve access to health and nutrition services as part of the overall nutrition convergence World Bank programmatic approach and reduce their overall vulnerability. The provision of social assistance, particularly to underserved and isolated populations, is the responsibility of the Government as it addresses fundamental market failures. The project will also contribute to developing key building blocks of a robust delivery system, such as targeting and payment systems, which are classic public-sector functions in countries at all income levels. Public sector intervention in the sector of social safety nets in Lao PDR is highly justified given the poverty and inequality situation in Lao PDR. Geographic disparities remain elevated and have failed to shrink. Numerous households remain highly vulnerable to exogenous and idiosyncratic shocks. The poorest households have limited access to basic services which could help them improve their living conditions and their ability to generate incomes. Informal support and insurance mechanisms are not sufficiently developed to protect the poorest and most vulnerable from the impact of shocks. Public financing for incentivizing and improving nutrition services is also justifiable due to widely recognized market failures resulting from limited competition, myopic and irrational actors, imperfect information, and externalities. Many nutrition programs and interventions such as regular growth monitoring and promotion are underdeveloped in Lao PDR, leading to limited accessibility and suboptimal quality of nutritional care as well as health care in general. Furthermore, health and nutrition care providers might know more about the consequences of undernutrition and how to treat/prevent it than their patients. Therefore, targeted public financing and provision of services are necessary to respond to the imperfections and to improve the benefits to the most vulnerable individuals and society. In Lao PDR, public investment in nutrition can be more effective particularly for children whose caregivers’ education/knowledge level is relatively low and the presence of the private sector is limited. Moreover, failure to invest in children’s health and nutrition in the first 1,000 days has also been shown to have irreparable consequences and negative impacts on learning outcomes and productivity later in life. Even if parents do realize the need for investments in nutrition, there can be market imperfections that prevent low-income households from overcoming budget constraints and taking concerted actions across multiple areas such as health, education, and WASH to ensure that children are well nourished and cared for and receive early stimulation and learning opportunities. 38Independent Evaluation Group (2011). Evidence and Lessons Learned from Impact Evaluations on Social Safety Nets. Washington, DC: World Bank. Page 31 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Value Added of World Bank’s Support The World Bank’s value added in this project centers around its ability to work across sectors to support the nutrition-specific and nutrition-sensitive investments holistically through its engagement with ministries and agencies in multiple sectors and to support the development of key building blocks for an effective social protection system. This multisectoral approach to investments will be done through the strategic selection of target areas based on the World Bank’s investments across sectors and complementarity of services to be provided (for example, incorporation of consistent behavior changes communications for all the sectors). Furthermore, the World Bank has significant global expertise in several key areas of the project, having financed a large number of nutrition-sensitive social safety nets programs around the world, such as in Peru, the Philippines, Indonesia, Bangladesh, Ethiopia, and others. The team will continue to draw on a wealth of knowledge and evidence from evaluations of similar past projects that offer lessons for low-capacity contexts. The development of a social and beneficiary registry will also be critical for other interventions targeted at the poor and most in need and will provide an opportunity for better planning new interventions (identify where there are gaps in coverage). In this area, the World Bank brings extensive experience in multiple regions. F. Lessons Learned and Reflected in the Project Design Global evidence shows that well-designed and -implemented cash transfer programs can play a powerful role in combating poverty, inequality, and vulnerability as well as contributing to improved human development outcomes. In a global review of cash transfers (both conditional and unconditional), 76 percent of studies found increased spending on food or total consumption, with minimal use for non- essential items. Globally, CCT programs have had an unambiguously positive impact on access to education and health and documented impacts on human development outcomes.39 For example, in the Philippines, the Pantawid CCT program led to a reduction in the poverty rate nationally of 1.5 percent per year, and a 10-percentage point reduction in severe stunting among beneficiary children, as well as a significant increase in safe deliveries among beneficiaries. In Brazil, the large safety net program, Bolsa Familia, reaches close to 25 percent of the population and has contributed to dramatic reductions in poverty and inequality. Lessons from global experience have informed the design of this project and these include: (a) the importance of including cash transfers as part of a national social safety net system; (b) the value of accompanying measures to encourage investments in human capital; and (c) the key role of well-developed operational service delivery systems such as targeting, MIS, and GRM. Evidence from several countries suggests that the combination of cash transfers to poor families and SBCC, alongside improvements to quality of health, water and sanitation, and nutrition services, is an effective way to improve nutrition outcomes, as opposed to the implementation of either one on its own (World Bank 2012; Bastagli et al. 2016). Although the GoL currently has no national social protection strategy in place (though one is under development), a CCT program was previously introduced under the World Bank-financed Community Nutrition Project (CNP) FY10–FY13 (P114863). The CNP piloted a CCT to address demand for nutrition and maternal and child health services. Despite implementation-related challenges (the CCTs implementation by health centers was found to be an ineffective delivery modality), the program did yield some positive results, such as improved knowledge of maternal and child health 39Bastagli et al. 2016. “Cash Transfers: What Does the Evidence Say? A Rigorous Review of Program Impact and the Role of Design and Implementation Features.” ODI. Page 32 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) and nutrition-related practices. The CCT increased utilization of maternal and child health and nutrition services and also showed significant impact on the health-seeking behaviors of the bottom 40 percent of the population. For example, as a result of the program, more households reported having vaccination cards and full diphtheria, pertussis, and tetanus (DPT) vaccines and increased breastfeeding rates within three hours of birth, and more households began seeking treatment for diarrhea for their children. Evidence from the CNP shows that it played a key role during the food, fuel, and financial crisis as a social safety net protecting the poor against those shocks. The CNP set an important precedent for a similar type of intervention, with some design, operational, and institutional lessons learned that are incorporated into this project’s design. International experience suggests that the combination of incentives and behavior change communication is much more effective in improving nutrition outcomes (Grosh et al. 200840); as health supply improves, co-responsibilities can be progressively incremented to more advanced health conditionalities. The proposed approach for multisectoral nutrition convergence and a special focus on the first 1,000 days builds on a wealth of experience and evidence from across the world. The early years, or first 1,000 days, of life—from conception, through pregnancy and birth, the newborn period, infancy, and transition to primary school—is a pivotal period of development. Exposure to risks and adversities during these years can disrupt cognitive, emotional, and physical development, and hold children back from reaching their full potential. Such adversities and risks include poverty; malnutrition; lack of access to clean water and sanitation facilities; lack of nurturing care and stimulation; high levels of family stress; exposure to conflict, violence, child abuse, or neglect; and lack of access to quality healthcare and education services. An estimated 250 million young children in low‐ and middle‐income countries are exposed to such risks (equivalent to 43 percent of all children in these countries). There is growing evidence that a ‘convergence approach’—in which coordinated multisectoral interventions are jointly targeted at selected geographical areas and the most vulnerable low‐income populations—can accelerate the improvement of child health and development outcomes (Levinson, and Balarajan 201341). Such an approach has been successfully applied in Peru, Brazil, and Bangladesh (Levinson and Balarajan 2013; Huicho et al. 2016;42 Huicho 201743). For example, child stunting rates in Peru fell by almost half in less than a decade (2008–2016) (Huicho et al. 2016), partly because of a major multisectoral nutrition effort. 40 Grosh, M., Ninno, C., Tesliuc, F., and A. Ouerghi. 2008. For Protection and Promotion: The Design and Implementation of Effective Social Safety Nets. Washington, DC: World Bank. 41 Levinson, FJ., and Y. Balarajan. 2013. “Addressing Malnutrition Multisectorally: What Have We Learned from Recent International Experience.” UNICEF Nutrition Working Paper, UNICEF and MDG Achievement Fund, New York. Levinson and Balarajan (2013); Gillespie, Stuart, Hodge, Judith, Yosef, Sivan, and Rajul Pandya‐Lorch, eds. 2016. Nourishing Millions: Stories of Change in Nutrition. IFPRI. 42 Huicho, L, Segura, ER, Huayanay‐Espinoza, CA, de Guzman, JN, Tam, Y, Barros, AJ, and CG Victoria. 2016. “Child Health and Nutrition in Peru within an Antipoverty Political Agenda: A Countdown 2015 Country Case Study.” Lancet Glob Health 4 (6): 414– 26. 43 Huicho, L, Segura, ER, Huayanay‐Espinoza, CA, de Guzman, JN, Tam Y, Barros, AJ, and CG Victoria. 2017.) “Factors Behind the Success Story of Under‐Five Stunting in Peru: A District Ecological Multilevel Analysis.” BMC Pediatrics 17: 29. Page 33 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) III. IMPLEMENTATION ARRANGEMENTS A. Institutional and Implementation Arrangements The DRDC within the MAF has overarching responsibility for overseeing and coordinating rural poverty reduction programs at the national level and monitoring progress toward achievement of poverty reduction goals. This includes an annual exercise to identify poor households. The DRDC also houses the PRF program. The PRF under the MAF is one of Lao PDR’s core poverty reduction programs, with coverage in 10 out of 14 provinces. Its objectives are to foster CDD and poverty reduction through the promotion and support of self-help groups (SHGs) and investments in small-scale community infrastructure. In addition to poverty reduction-oriented initiatives, the MAF is working on a joint platform with other ministries to improve nutrition, including efforts to improve service provision in health, education, water and sanitation, and agriculture. The MAF is responsible for 4 out of 22 agreed actions under the NNS and is already a strong partner in countrywide efforts to implement SBCC and community- led total sanitation (CLTS). The MAF will be responsible for overall implementation of the project. Day-to-day project implementation will be managed by the DRDC, whose mandate is closely aligned with the project objectives. The MAF’s Department of Planning and Finance (DoPF) will be responsible for overseeing fiduciary aspects of the project, in which it has experience through the implementation of other World Bank-financed projects, and overall coordination within the ministry. Because the DRDC is a relatively new department with limited experience in managing World Bank-financed projects, early investments in capacity building will be part of Component 3 of the project. Building technical capacity within the DRDC, at the central and local levels, will be a key element of the project, complemented by TA from the World Bank on the development of social protection systems. The PRF and IFAD-financed AFN projects, which are also under the MAF, will be key internal partners as they provide an effective service delivery platform at the local level . The PRF and the AFN projects provide an on-the-ground presence that is needed for the successful delivery of the proposed program, particularly given their demonstrated ability to provide outreach and organize communities. At the district level they are already being integrated into the District Agriculture and Forestry Office (DAFO), which will allow for easier coordination at that level. Activities at the local level will thus be planned jointly with the AFN and the PRF staff at the district level. Though complementary services and activities are not financed through the project specifically, the project will rely on several partners for the implementation of such services and activities. This includes services such as SBCC provision by the AFN and the MOH as well as the LWU (through the HGNDP and the pipeline health and nutrition operation). All these entities, with additional support from the WASH and health operations, will continue to implement, expand, and improve their SBCC activities in the targeted districts. The CNP pilot proved that this was a replicable model for delivering messages given their existing knowledge of communities and widespread presence, as well as their ability to communicate with women. The MOH will also play a critical role in ensuring improved quality of essential health and nutrition services to maximize the impact of the demand-side interventions supported by this project, both in health facilities and through community outreach services. Memorandums of Understanding Page 34 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) (MOUs) and partnership agreements will be signed accordingly with the implementing partners to ensure effective synergistic implementation of the program. For more details, see annex 1. In the four World Bank convergence provinces, the MPI will assume the leadership role for coordination and M&E of nutrition convergence for the provinces, building on existing systems under the supervision of the NNC and the NNC Secretariat. The MAF will work in close collaboration with the MPI for the overall planning, coordination, and M&E of nutrition-specific and nutrition-sensitive activities across the different ministries. At the provincial and district levels, the project will finance a devoted convergence team and the convening of multisectoral steering committees which, through their regular meetings and activities, will oversee and provide guidance for the overall implementation of the proposed nutrition convergence approach as well as conduct periodic reviews of the approach. These committees will report on progress made directly to the Vice Governors as Chair of the Nutrition Committees, while the convergence team will work on day-to-day assignments. The project’s strategic direction and progress will be reported annually to the NNC44 and semiannually to the Provincial Vice Governor as chair of the NNC at the provincial level. These meetings will also be the venue to discuss and agree on the work program, coordination, and M&E mechanisms with other key actors in the selected geographic area of intervention. B. Results Monitoring and Evaluation Arrangements The Results Framework indicators for the project shall be monitored using a combination of administrative and survey data. The CCT MIS will serve as the main source of administrative data for tracking indicators such as the number of CCT beneficiaries, timeliness of payments, project response to grievances, and attendance at village SBCC sessions. Survey data will be used to capture household- and individual-level outcomes such as dietary diversity intake at the child or household level and utilization of essential health and nutrition services. The beneficiary registry will be used to report on the number of interventions received by the target population. The surveys will also inform the World Bank portfolio-level multisectoral nutrition convergence monitoring to maximize synergies when monitoring household-level indicators. For this purpose, the 2017 KAP survey has been used as a baseline survey for most project indicators. Two additional household surveys will be undertaken and financed under this project, one about 18 months into the program, just before the cash payments begin, and another at the end of the program. These surveys will be representative of the 12 selected districts. They shall be conducted by an independent survey firm contracted under the project. Process monitoring, citizen engagement, and GRM systems financed by the project will be enhanced using IBM to solicit regular beneficiary feedback. These will comprise annual quick, small, targeted surveys. The IBMs will track a narrow set of indicators such as timeliness of payments, handling of grievances, and participation in community nutrition sessions, and three such surveys will be conducted in the second, third, and fourth years of the project. Citizen engagement will be monitored through indicator 7 in the Results Framework (grievances and timely of responsiveness). Given that the CCT 44The NNC was created in July 2013 with the mandate to provide overall leadership and guidance for the coordination of the NNSPA. Page 35 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) program will be in its initial phase, an independent assessment of the CCT will be conducted in the first six months of implementation of the conditional cash transfer program and then after 18 months. An impact evaluation of the CCT program will be embedded in the project. This will take advantage of: (a) the phased implementation of the cash transfer, starting with coverage of half of eligible beneficiaries and (b) regression discontinuities imposed by targeting of the bottom 50 percent of households in the national distribution in the targeted areas and the age cutoff for the first batch of beneficiaries that will be enrolled in the program. These features make it possible to analyze the impact of the CCTs on dietary diversity and stunting by taking advantage of the discontinuity in eligibility criteria and the impact of cash only against a combination of cash and other interventions by taking advantage of the phased rollout of the cash transfer and other ongoing interventions such as under the WASH program and the PRF. C. Sustainability The project is fully aligned with the Government’s 8th NSEDP, NNSPA, and its long-standing agenda on poverty reduction. The project supports the Government’s efforts to reduce poverty and reduce childhood malnutrition, thereby contributing to human capital development in the long term. Support for the setting up of a CCT program would be critical in the Government’s strategy to provide the required support to those most in need to invest in human capital for their children. Lao PDR’s spending on social safety nets remains very low. The proposed targeted CCT program will only increase spending by less than a 0.05 percentage point of GDP in social protection, keeping Lao PDR in the group of countries that spend the least in social safety nets in the region (average spending in East Asia and Pacific is around 1 percent, based on Aspire 2018), and Lao PDR spending remains significantly behind. Scaling up the CCT program nationally (covering the bottom 50 percent) would cost the GoL approximately 2.2 percent of Government budget annually, which corresponds to 0.5 percent of GDP. The design of the program is such that households are only eligible during the period from pregnancy to a child’s second birthday. As such, their reliance on the program is short-lived; furthermore, alongside the knowledge gained from participation in the program, parallel efforts to improve access to and quality of health services, improved access to water and sanitation, and other investments will potentially render long-term poverty reduction gains. Long-term improvements in nutrition outcomes and poverty reduction will eventually offset the costs of program expansion as fewer households are eligible for the program. IV. PROJECT APPRAISAL SUMMARY A. Technical, Economic and Financial Analysis (if applicable) Technical The interventions in the proposed project are in line with global evidence of what works and consider the specificities of the Lao context and lessons learned from World Bank and donor-supported health and nutrition operations and analytical work. In 2013, the Lancet Series on Nutrition identified 10 effective interventions that would reduce the burden of stunting by one-fifth if all delivered at 90 percent coverage. Implementing multisectoral nutrition-sensitive interventions that address the multidimensional Page 36 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) causes of childhood undernutrition simultaneously with nutrition-specific interventions is expected to reduce the remaining 80 percent of the stunting burden. Significant and sustained reductions in childhood stunting require nutrition-specific and nutrition-sensitive interventions that target both mothers (pregnant and lactating) as well as infants and young children.45 The selected provinces will also benefit from other key nutrition-sensitive multisectoral actions, either through the project (that is, cash transfers) or through the broader World Bank program (that is, health, nutrition, and population; WASH; education; and agriculture), targeting the same geographic areas and vulnerable households. CCT programs have played an important role within social protection policies in countries throughout the world. Over the last two decades they have been a key element of governments’ poverty reduction strategies. They have also been an important tool to generate adequate incentives for poor families to invest in the education, health, and nutrition of their children. CCTs have also served as the entry point to improve coordination among social strategies. Finally, CCT programs have worked as triggers to improve supply of basic social services and other related programmatic public supply. These roles can be observed in mature programs like Brazil’s Bolsa Familia and in México’s Oportunidades now Prospera. In the selected areas of intervention, affordability of a nutritious diet and of financing transport to regularly use health and nutrition services is extremely limited. The proposed approach of investing in providing incentives for these remote poor and vulnerable households to invest in their children’s human capital is perfectly aligned with the need to invest in enhancing human capital in the long run. Economic Nutrition interventions contribute significantly to child survival and cognitive development and to improvements in educational performance and economic growth. Nutrition interventions are among the most cost-effective interventions to enhance welfare and reduce poverty. The Copenhagen Consensus 200846 ranked five nutrition interventions in the top 10 among 30 proposals presented to answer the question on the best way to advance global welfare. Improving child health and nutrition, especially in the first 1,000 days, is critical for addressing the Word Bank Group’s twin goals of reducing poverty and boosting shared prosperity. At the individual level, chronic malnutrition in children is estimated to reduce a person’s potential lifetime earnings by at least 10 percent (World Bank 200647). Other studies have shown that a 1 percent loss in adult height results in a 2 to 2.4 percent loss in productivity (Caulfield et al. 2004; Horton and Steckel 2013;48 Strauss and Thomas 199849). The economic costs of undernutrition have the greatest effect on the most vulnerable in the developing world. A recent analysis estimates these losses at 4 to 11 percent of GDP in Africa and Asia each year (Horton and Steckel 2013)—equivalent to 45 Maternal stature and nutrition are important predictors of intrauterine growth retardation and size at birth (Ozaltin et al. 2010). Maternal birthweight not only affects the birthweight of the offspring (Ramakrishnan et al. 1999) but also extends to health later in life. For example, birthweight is inversely related with the risk of coronary heart disease and stroke (Barker and Clark 1997; Huxley et al. 2007). 46 http://www.copenhagenconsensus.com/Projects/Copenhagen%20Consensus%202008-1.aspx. For further reading, see Lomborg, Bjorn, ed. 2004. Global Crises, Global Solutions. Cambridge and New York: Cambridge University Press. 47 World Bank. 2006. Repositioning Nutrition as Central to Development: A Strategy for Large Scale Action . Washington, DC: World Bank. 48 Horton, S., and R. Steckel. 2013. “Global Economic Losses Attributable to Malnutrition 1900– 2000 and Projections to 2050.” In The Economics of Human Challenges, edited by B. Lomborg. Cambridge, U.K.: Cambridge University Press. 49 Strauss, J., and D. Thomas. 1998. “Heath, Nutrition and Economic Development.” Journal of Economic Literature 36 (1): 766– 817. Page 37 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) about US$149 billion of productivity losses each year. Most of those losses are due to cognitive deficits. As developing countries move from manual labor-based economies to ones that are based on skilled labor, the impact of child malnutrition and stunting on incomes and economies will likely further increase. International experience has shown that CCT programs together with the improvement in health, nutrition, water and sanitation service delivery, as supported by the nutrition convergence projects, can be a highly effective measure to reduce chronic malnutrition. Several evaluations and reviews (Bastagli et al. 2016; IEG 201150) have demonstrated the impact of safety net programs on poverty reduction and human development outcomes. The body of evidence on cash transfers shows significant positive impacts of those programs on household consumption and health prevention/access to health and nutrition services. With over 34 percent of its children chronically undernourished, Lao PDR faces significant economic costs both in the short and long run. In the short run, malnutrition-caused recurrent child morbidity affects the household economy by increasing health expenditure and forgone income of caregivers. In the medium to long run, undernutrition elevates the risk of infant and child morbidity and mortality, increases expenditure on health care and social safety nets, lowers the efficiency of investments in education, and decreases lifelong income-earning potential and labor force productivity, with the potential to be transmitted across generations. It is urgent to intervene because the loss represents on average about 2.4 percent of the country’s GDP.51 B. Fiduciary (i) Financial Management The overall FM risk is considered high. Based on the assessment of the FM capacity in the MAF, in particular the DRDC and the Project Management Division (PMD) of the DoPF, MAF FM capacity and systems are considered relatively weak for implementing a CCT program, given the project complexity and geographic spread. More specifically, the implementing agency lacks sufficiently qualified FM staff with substantial experience in implementing World Bank-financed projects, robust systems, and clearly documented procedures. This will likely increase risks of non-compliance, delays in submitting financial and audit reports, unsatisfactory accounting records, and misuse of funds. The assessment identified a number of potential risks (see annex 1 for more details). Risk mitigation measures include the following: (a) Develop an Operations Manual and update the existing FM Manuals to be tailored for CCT payouts. (b) On FM staffing, the MAF should assign designated FM personnel for the project, whose roles and responsibilities are specified in agreed terms of reference (TOR). Additional FM consultants will also be hired, including any additional manpower that may be necessary for ensuring that cash grants are delivered and monitored. 50 IEG (Independent Evaluation Group). 2011. Social Safety Nets: An Evaluation of World Bank Support, 2000-2010. Washington, DC: World Bank. 51 Bagriansky, Jack, and Saykham Voladet. 2013. “The Economic Consequences of Malnutrition in Lao PDR: A Damage Assessment Report.” NERI and UNICEF Working Paper. Page 38 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) (c) A Complete and Comprehensive Program for Accounting Control (ACCPAC) software with some configuration will be used to record transactions and produce project interim financial reports (IFRs). (d) Provide training to staff concerned once the project is effective. (e) An annual budget and work plan will be prepared and approved by the World Bank. (f) Annual audit carried out by a qualified independent audit firm acceptable to the World Bank. In addition, the MAF will prepare status of actions taken to address the findings and recommendations of auditors on the project financial statements. (g) IFRs will be prepared quarterly and submitted to IDA no later than 45 days after the quarter ends. (ii) Procurement The proposed project procurement will be carried out in accordance with the World Bank Procurement Regulations for IPF Borrowers, dated July 2016, revised November 2017 and August 2018, and provisions stipulated in the Financing Agreement. With regard to preparing and updating of Procurement Plans and processing, clearing, communicating, and tracking of procurement activities, the World Bank’s Systematic Tracking of Exchanges in Procurement (STEP) will be used for all procurement transactions under the project. Out of the project total financing of US$27 million, over 50 percent, amounting to US$14 million, will finance the CCT program grants for pregnant women and children in poor rural areas. Seven million dollars is allocated for procurement contracts to strengthen the CCT program, the delivery systems, and project management and evaluation and they will be governed under the Procurement Regulations. According to the institutional arrangements, the DRDC will be responsible for the overall supervision, execution, and management of the project while the DoPF will oversee procurement management implemented by the Project Management Unit under the DRDC. Procurement risk is rated Moderate based on the capacity and risk assessment carried out in June 2018. The key risks and the corresponding mitigation measures are discussed in annex 1. To inform fit-for-purpose procurement arrangements to feed into the project’s Procurement Plan covering at least the first 18 months of implementation, the DRDC, in close collaboration with the DoPF, prepared a Project Procurement Strategy for Development (PPSD). C. Safeguards (i) Environmental Safeguards OP 4.01 is triggered due to its potential socioeconomic impact on vulnerable groups, and the project is categorized B (Partial Assessment). Page 39 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) (ii) Social Safeguards Because the project will be operating in communities where there are ethnic groups that could be considered indigenous people, the World Bank’s Operational Policy on Indigenous Peoples (OP/BP 4.10) is triggered. The Non-Lao Lum ethnic groups constitute the majority (73 percent) of the population in the selected areas of intervention for the project. It is also the case that ethnic groups are expected to be one of the main beneficiaries of the project, as the children of ethnic households are more likely to be stunted and underweight. In addition to limited access to health and nutrition services due to their remote location, sociocultural beliefs and practices contribute to limited demand for health and nutrition services among ethnic households. Because the Non-Lao Lum ethnic groups will constitute the overwhelming majority of project beneficiaries, the elements of an ethnic group development plan have been integrated into the design of the project itself. In addition, the project benefitted from a social assessment52 in the form of a KAP survey which provided information on nutrition-related KAP in the districts where project activities will be rolled out. With regard to child nutritional status, the social assessment conducted found that there were major differences between households belonging to different ethnic groups, with the Akha and Phong households showing high prevalence of stunting and being underweight. Phong have highest prevalence of stunting among ethnic groups (59 percent of children under the age of 5 years). Also, both the Akha and Phong have the highest rates of underweight children (27 percent of children under the age of 5 years) among ethnic groups. Furthermore, community consultation meetings have taken place in selected beneficiary communities before appraisal. The purpose of these consultations was to pilot the approach and ascertain broad community support for project activities based on a process of free, prior, and informed consultation, as required by the indigenous peoples’ policy. The social assessment was disclosed on the World Bank website and the MAF website on October 8, 2018, and October 22, 2018, respectively. The consultation methodology will be continued during project implementation and has been included in the project’s Operations Manual. Other citizen engagement modalities such as process evaluations, satisfaction surveys, and a GRM will also be used. The results of the social assessment and consultation process have been integrated into the project design and reflected in the project Operations Manual. The project is proposed to be gender tagged and will address gender gaps that should contribute toward improvements in nutrition-related behaviors. As described earlier, there are notable gender gaps, including high maternal mortality rates and limited access to maternal care, as evidenced by the low percentage of women delivering with the help of a skilled birth attendant, particularly in rural areas. The project will address these gaps by using cash transfers to incentivize women’s attendance to SBCC sessions to improve their knowledge of adequate health and nutrition behaviors and improve their ability to access these services through additional income. As increases in the ANC are often associated with reduced maternal mortality, such increased attendance will improve maternal health and also nutrition behaviors for pregnant women and infants and will be monitored through indicator 9 in the Results Framework as a proxy for maternal and child mortality. To enable further points of contact between targeted households and the health sector and thus improve health and nutrition behaviors of pregnant women, the project will seek to time cash transfer payment delivery to the extent possible to health outreach sessions, 52 In the webpage of the MAF at the following link: http://www.maf.gov.la/wp-content/uploads/2018/10/Social-Assessment.pdf. Page 40 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) particularly in the most remote areas, thus increasing participation in services such as the ANC. Increasing ANC will be particularly critical for women in the target areas. The project will also address other gender-specific determinants of undernutrition and decision making within households. For example, by incentivizing women to gain knowledge about nutrition, these behaviors are likely to improve over time. By providing cash directly to women and combining it with the SBCC on the use of cash, financial inclusion, and nutrition, the project will increase women’s agency on matters of household spending, which have been shown to be positively correlated with better nutrition outcomes in Lao PDR and overall empowerment of women (indicator 8). The project will also ensure that SBCC addresses issues related to age of pregnancy and includes male heads of household to ensure greater buy-in of messages beyond pregnant women and mothers who are often beholden to other influences. Intermediate results indicator 3, indicator 5, and indicator 9 will track progress on attendance to SBCC, growth monitoring, and ANC, respectively. (iii) Other Safeguards None. (iv) Grievance Redress Mechanisms Communities and individuals who believe that they are adversely affected by a World Bank (WB) supported project may submit complaints to existing project-level grievance redress mechanisms or the WB’s Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed in order to address project-related concerns. Project affected communities and individuals may submit their complaint to the WB’s independent Inspection Panel which determines whether harm occurred, or could occur, as a result of WB 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 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/en/projects-operations/products-and-services/grievance-redress-service. For information on how to submit complaints to the World Bank Inspection Panel, please visit www.inspectionpanel.org. V. KEY RISKS A. Overall Risk Rating and Explanation of Key Risks The overall risk of the project is Substantial as it faces several risks, including the following: (a) the project design will require delivery of a new set of activities including the new notion of utilizing social assistance or demand-side interventions to address poverty and malnutrition; macro risks related to elevated fiscal deficits and public debt levels which could negatively affect PDO achievements; (c) the challenge of childhood undernutrition requires a multisectoral approach which can be complex in terms of coordination and M&E; (d) there is variability in the institutional and implementation capacity among the MAF and other key implementation partners such as the MOH and at the different levels of government, that is, central versus village level; and (e) the SBCC delivery mechanism will rely primarily Page 41 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) on implementing partners and village volunteers53 and thus likely to affect timely and effective implementation, commitment, and financial sustainability of the approach. Macroeconomic: Substantial. Elevated fiscal deficits and public debt levels could negatively affect PDO achievements. The GoL has recently adopted a fiscal consolidation plan to reduce the budget deficit substantially by 2020 and contain rising public debt. However, implementation will be challenging, particularly with the impact of the recent floods and the uncertain external environment. The uncertainty in the global economy, especially ongoing trade tensions, the possible tightening of global the global financing conditions and the pace of interest rate normalization in the US could lead to a slowdown of capital inflows and disorderly financial market movements. These risks are likely to adversely impact global demand, commodity prices and the Lao economy by reducing foreign direct investment and its exports. This would put further pressure on the fiscal space and the country’s foreign exchange reserves54. Overall, risks from domestic economic management policies, including public debt management and financial sector risks, are substantial. The GoL is undertaking a number of measures to ensure that fiscal sustainability is maintained. The revenue improvement is expected to come from strengthening both tax administration through the use of ICT, and the legal tax framework through the recently approved value- added tax law and upcoming laws on tax administration, and excise and income taxes under preparation for submission to the National Assembly in 2019. Public expenditure will be contained by limiting both the number of new recruits and wages. The new civil service quota will be further cut to 1,500 in 2019, and the public wage index increase will be postponed further. These measures, together with implementation of the Public Debt Management Law (passed in mid-2018), are supported by the WB’s under the Lao PDR Green Resilient Growth Development Policy Operation 2 (P166839). As such, we expect that the fiscal framework will be on more sustainable path in the medium term and thereby mitigate the impact of any macro-fiscal shocks on the project. Sector strategies and policies: Substantial. The project aims to address poverty and undernutrition, which crucially depend on political commitment, multisectoral collaboration, and community engagement. Sector strategies and policies on social assistance and poverty and undernutrition reduction, including institutional mandates for implementing these agendas, are nascent in Lao PDR. Though nutrition has been adopted as a key Government priority with the NNSPA, public sector ownership of this issue is still building momentum as evidenced by limited Government investments in this sector. The notion of utilizing social assistance or demand-side interventions to address poverty and malnutrition is also a relatively new concept in Lao PDR as is the general move to coordinate interventions with other sectors. Furthermore, Lao PDR’s new poverty criteria under Decree No. 348 has a broad list of poverty criteria. Though these broad categories have been informed by PMT analysis, the detailed list of indicators from the PMT is not included, and the explicit method of assessment is not explicitly stated in Decree No. 348 but was left to the final determination of the MAF. Final adoption of the PMT methodology is therefore not guaranteed, particularly beyond the area of intervention of the cash transfer, though there has been a strong interest in using a statistically driven approach to the identification of poor households under Decree No. 348. To mitigate this risk, the project and other parallel TA will continue to support the development and implementation of the poverty, social 53 The volunteers, so-called ‘facilitators’, only receive compensation for the day they support the delivery of SBCC. 54 Country Partnership Framework for Lao People’s Democratic Republic for the period FY2017–FY2021 World Bank, March 2, 2017; and Lao Economic Monitor, June 2018. Page 42 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) protection, and nutrition strategies and policies and high-level policy dialogue. Financing of the national rollout of data collection for identification of poor households in the four provinces and the development of the social registry information systems will be based on use of a sound, statistically driven methodology and instruments that are finalized under the project, in a manner satisfactory to the World Bank. Technical design: High. The technical design of the project is considered complex given the capacity level and state of social protection system development in Lao PDR. The project aims to support the development of key social protection building blocks and a nutrition-sensitive CCT program in a setting with limited previous experience with such complex programs. The project promotes the use of evidence- based and cost-effective interventions that are essential to deal with the immediate as well as underlying determinants of stunting, including adoption of a multisectoral approach; a mix of supply- and demand- side interventions; and broad-based involvement of communities and national stakeholders. As such, cash transfers alone are unlikely to achieve a reduction in stunting, unless accompanied by strong SBCC and effective access to and utilization of essential, quality health and nutrition services. Creating and maintaining synergies between these three interventions is critical, and the complexities it entails could pose a serious risk to the project’s success. Interactive project monitoring and adaptation will be needed to mitigate design risks and respond rapidly to lessons learned throughout implementation and adapt the program as needed. The MAF will sign MOUs and partnership agreements with the MOH, AFN, and LWU for the timely delivery of the SBCC and will coordinate on the continued improvement of the SBCC. The World Bank supervision team will conduct regular joint missions to provide implementation support to the project and the effectiveness of the geographic convergence approach. Moreover, the steady provision of parallel TA during project preparation and implementation will help shape the Government’s response. The multisectoral convergence approach will also require a coordinated approach. Providing multisectoral leadership and coordinated action for nutrition programs is a challenge. There are risks of fragmentation of the response among different ministries and other stakeholders, establishment of parallel systems, and duplication of efforts. In response, the support to provincial and district multisectoral nutrition coordination committees and their regular meetings financed under the project are expected to mitigate this potential risk. Institutional capacity for implementation and sustainability: Substantial. While the institutional capacity of the MAF at the national level is relatively strong, the capacities at district and community levels are generally more constrained, especially for effective multisectoral coordination. Moreover, the ministry does not have direct experience in CCTs and has recently undergone a restructuring. The DRDC has no experience with the implementation of World Bank projects. These risks will be mitigated with extensive training for DRDC staff at the central and local levels in targeted areas and hiring of consultants to support the existing teams, TA for systems development, and M&E. These risks will also be mitigated by incorporating lessons from the CNP—for example, separating the function of cash payment from the provision of SBCC—and establishing agreements/partnership/MOUs with the MOH and the LWU which has membership throughout the country and has experience delivering the nutrition SBCC curriculum at the community level. Fiduciary: Substantial. The DRDC will be responsible for the project management, including FM and procurement. The DoPF under the MAF will provide overall guidance and supervision to the DRDC fiduciary role. The DoPF has implemented one IDA-financed project (Lao PDR Uplands Food Security Improvements Project, LUFSIP [P120909]) which was closed in December 2014 and has prepared another IDA-finance project (Lao PDR Agriculture Competitiveness Project [P161473] which is currently under Page 43 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) implementation). The project hired consultants to support the fiduciary tasks and it was rated Satisfactory and Moderately Satisfactory in FM and procurement, respectively, at closure of the LUFSIP. Based on recent procurement assessment, the DRDC lacks qualified and experienced staff in both FM and procurement and internal review and approval by many levels. This could lead to increased risk of delays in procurement processing, noncompliance with internal controls, delays in disbursement and financial reporting, and funds not being effectively used. Further, lack of experience in managing CCT coupled with lack of efficient and streamlined transfer systems could lead to increased risk of funds not being received by intended beneficiaries. Monitoring capacity or third-party verification capacity in the country is also limited, which may affect the timeliness of verification of achievement of conditions and thus timeliness of payments. Based on the above, the fiduciary risk is considered substantial. To mitigate the risk, extensive capacity-building training in FM and procurement will be provided, and the project will hire external consultants to fill some key fiduciary roles and responsibilities. For the CCT, an FM for the CCT will need to be developed with clear guidelines and procedures. This together with having in place an MIS for the CCT, both satisfactory to the World Bank, will be conditions for disbursement of the cash transfers grants. Stakeholders: Substantial. The project involves several stakeholders, including Government ministries, beneficiary populations, various sector teams within the World Bank, and other DPs. While stakeholders agree on the common objective of stunting reduction, they may have different priorities and agendas for achieving that objective on a day-to-day basis. Stakeholder-related risks will be mitigated by having a multisectoral approach that will focus on synchronizing supply and demand interventions in the same proposed geographical convergence areas with a demonstration effect. Coordination with other line ministries (mainly the MOH, but also the MOES, Ministry of Public Works and Transportation, and with different departments within the MAF and DPs) will be critical to the project’s implementation. Internal World Bank coordination on overlapping nutrition-related agendas will be the key first step, and involvement of relevant line ministries during project preparation and implementation will be important in mitigating this risk. The project design will also invest in improving collaboration between ministries to the extent possible and pertaining specifically to the Government’s NNSPA to encourage greater communication and performance. The MPI will also play a key role in ensuring effective coordination at all levels. The World Bank will conduct regular joint supervision missions with the project teams involved in the geographic convergence approach. For ministries involved in the proposed multisectoral approach and key donors, MOUs at the central and provincial levels will clarify roles and responsibilities; these will be prepared, negotiated, and signed at the early stages of implementation. . Page 44 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) VI. RESULTS FRAMEWORK AND MONITORING Results Framework COUNTRY: Lao People's Democratic Republic Reducing Rural Poverty and Malnutrition Project Project Development Objectives(s) The Project Development Objective is to support the design and implementation of a nutrition-sensitive social assistance program to improve nutrition behaviors, and enhance the convergence of nutrition-focused interventions. Project Development Objective Indicators RESULT_FRAME_T BL_ PD O Indicator Name DLI Baseline End Target Objective 1: Develop a targeting, information, and monitoring system for social protection programs Indicator 1: Percentage of households with periodically updated socio-economic survey information reported in the social 0.00 80.00 registry. (Percentage) Objective 2: Improve nutrition behaviors Beneficiaries of social safety net programs (CRI, Number) 0.00 42,743.00 Beneficiaries of social safety net programs - Female (CRI, 0.00 38,460.00 Number) Indicator 3: Percentage of children 6–23 months from cash transfer beneficary households consuming foods from four or 0.00 40.00 more recommended food groups. (Percentage) Objective 3: Enhance convergence of the multisectoral nutrition approach in targeted provinces Indicator 4: Number of villages in project districts where at least 0.00 528.00 three nutrition convergence projects have been implemented. Page 45 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) RESULT_FRAME_T BL_ PD O Indicator Name DLI Baseline End Target (Number) PDO Table SPACE Intermediate Results Indicators by Components RESULT_FRAME_T BL_ IO Indicator Name DLI Baseline End Target Component 1: Developing the building blocks of a social protection system Indicator 1: Development of a social registry. (Yes/No) No Yes Indicator 2: Percentage of households surveyed with the PMT questionnaire in target areas. (Percentage) 0.00 90.00 Component 2: Conditional cash transfer program Indicator 3: Percentage of project beneficiary households who participate in community nutrition sessions at least once per 0.00 90.00 month. (Percentage) Indicator 4: Percentage of cash transfers reaching target areas within 5 days of scheduled payment date. (Percentage) 0.00 80.00 Indicator 5: Percentage of children under 2 years from cash transfer beneficary housholds receiving growth monitoring and promotion services according to the standard monitoring 0.00 40.00 schedule. (Percentage) Indicator 6: Number of female village facilitators trained to use 0.00 1,600.00 new SBCC tools. (Number) Indicator 7: Percentage of grievances addressed and/or resolved within the stipulated service standards for response times. 0.00 90.00 (Percentage) Indicator 8: Percentage of female direct cash transfer recipients who report increased decision-making power on spending 0.00 90.00 decisions for the household. (Percentage) Page 46 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) RESULT_FRAME_T BL_ IO Indicator Name DLI Baseline End Target Indicator 9: Percentage of pregnant women from cash transfer beneficary housholds with at least 4 ANC contacts during their 0.00 60.00 pregnancy. (Percentage) Component 3: Coordination, management, monitoring and evaluation Indicator 10: Number of spot checks implemented. (Number) 0.00 3.00 Indicator 11: Percentage of project districts convening a multisectoral nutrition coordination meeting at least once every 0.00 90.00 three (3) months. (Percentage) Indicator 12: Percentage of cash transfer monthly reports generated in a timely manner. (Percentage) 0.00 90.00 Indicator 13: Number of cross-sectoral surveys carried out to evaluate different convergence interventions. (Number) 0.00 3.00 IO Table SPACE UL Table SPACE Monitoring & Evaluation Plan: PDO Indicators Methodology for Data Responsibility for Data Indicator Name Definition/Description Frequency Datasource Collection Collection Numerator: Number of Social Information on the Biannual households in the target Registry and total number of (Every two area for whom the socio- progress household surveyed Indicator 1: Percentage of households years) or as economic PMT reports on will be recorded into with periodically updated socio-economic defined in DRDC questionnaire has been socio- the program developed survey information reported in the social the project administered at the economic for data collection (i.e. registry. operations household level and data survey every survey completed manual migrated to the social implementati will leave an electronic registry. The PMT will be on and record) in the Social Page 47 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) applied every two years and population Registry. This total will information will be available estimates. be compared to the in the social registry no later most recent population than 2 months after estimates for the target implementation of the area. survey. Denominator: Total number of estimated households living in the target area. The estimated number of overall households living in the target area would come from population estimates. Management Conditional information system Cash Transfer (MIS) based on the Program Quarterly conditional cash DRDC Beneficiaries of social safety net programs Management transfer beneficiaries Information registered into the System (MIS) program Project MIS based on the Management Beneficiaries of social safety net Quarterly beneficiaries registered DRDC Information programs - Female into the program System Numerator: Children, 6-23 Household survey on Indicator 3: Percentage of children 6–23 months old from cash Biannual nutrition knowledge, Household A survey firm months from cash transfer beneficary transfer beneficary (every two attitude, and practices. survey contracted by DRDC households consuming foods from four or housholds who are years) The survey will be more recommended food groups. reported to have consumed implemented every at least four out of the other year. Page 48 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) seven reccomended food groups (using a classification of food groups based on international recommendations) during the 24 hours preceding the time of interview. Denominator: Total number of children 6-23 months from cash transfer beneficary housholds in the area of intervention. Project Number of villages in the Progress target districts in which report. When three or more projects the (from health, WASH, PRF, MPI, and DRDC in beneficiary Project progress report Indicator 4: Number of villages in project IFAD financed project, and collaboration with the registry will and when beneficiary districts where at least three nutrition this project) are Monthly nutrition convergence be registry in place via the convergence projects have been implementing their approach project operational registry. implemented. respective project activities. teams. information will also be IFAD and PRF will be available via implemented in separate the registry. villages. ME PDO Table SPACE Page 49 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Monitoring & Evaluation Plan: Intermediate Results Indicators Methodology for Data Responsibility for Data Indicator Name Definition/Description Frequency Datasource Collection Collection This indicator is met if the social and beneficiary registry information systems are developed and operational where developed means that the information systems software are developed and operational means that they are working on line. The Project Indicator 1: Development of a social information collected as Once progress Project progress report. DRDC registry. part of the socio-economic report. survey will be regularly migrated into the social registry, and for the beneficiary registry in the area of interventions information on CCT program beneficiaries and on beneficiaries of WB financed nutrition convergence programs will be reported. Numerator: Number of households surveyed with Project Indicator 2: Percentage of households the PMT questionnaire in Annual progress Project progress report. DRDC surveyed with the PMT questionnaire in the target areas report. target areas. Denominator: Number of households living in the Page 50 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) target area. The estimated number of overall households living in the target areas would come from population estimates and from the household level survey collected for the overall nutrition convergence approach impact evaluation every other year. Numerator: Number of project beneficiaries attending monthly community/village nutrition sessions at least once per month. Where "project beneficiaries " are pregnant Cash Transfer women, mothers of children Cash Transfer Indicator 3: Percentage of project Management 0-2 years, and/or caregivers Management beneficiary households who participate in Quarter Information DRDC of children 0-2 years who Information System community nutrition sessions at least System are enrolled in CCT program. (MIS). once per month. (MIS). Denominator: Total number of project beneficiaries who are enrolled as CCT beneficiaries and who will be monitored for compliance with attendance to community nutrition sessions. Indicator 4: Percentage of cash transfers This indicator is meant to Quarter Project The data will be DRDC reaching target areas within 5 days of capture the efficacy of progress collected after each Page 51 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) scheduled payment date. project delivery systems, report, payment cycle. specifically payment process Contracted payment systems. A schedule for cash evaluation, agent(s) will report to transfer payments will be MIS, spot DRDC when the cash is developed once all systems checks made available to are in place, taking into beneficiaries during consideration the time it each cycle. The process takes for each step to be evaluation will also completed, to the point evaluate this process. where the cash is made Spot checks will also be available for collection by its used to corroborate intended beneficiary. This information from indicator will only measure payment agents. the timeliness of the cash transfer in terms of when it is made available to the beneficiaries (in cash or as electronic payment). Cash collection by beneficiaries will not be measured by this indicator. Numerator: Total number of children under 2 years of age from cash transfer Project MIS Indicator 5: Percentage of children under beneficary housholds whose and District Semiannua Project MIS and District 2 years from cash transfer beneficary growth has been measured Health l and Health Information DRDC housholds receiving growth monitoring (that is, weight and height) Information annual System (DHIS2) and promotion services according to the and results plotted in their System standard monitoring schedule. growth chart/pink book as (DHIS2) per MOH growth monitoring and promotion procedures and schedule. Page 52 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Denominator: Total number of children under 2 years of age from cash transfer beneficary housholds. This refers to the total number of female village facilitators who will receive training to use new SBCC Consolidated tools created under the training Semiannua Consolidated training project in target areas. report and Indicator 6: Number of female village l and report and project DRDC Wherever possible, these project facilitators trained to use new SBCC tools. annual progress report. will be female village progress facilitators who are already report. delivering SBCC through other projects such as the WASH, health, PRF, or AFN projects in the target areas. This indicator is meant to capture the efficacy of project delivery systems, specifically the grievance Project redress mechanism which progress Project progress report will capture grievances or report Indicator 7: Percentage of grievances and project perceived irregularities. and project addressed and/or resolved within the Quarter Management DRDC Stipulated service standards Management stipulated service standards for response Information System for response times will be Information times. (MIS) outlined in the Cash System Transfer Manual (MIS) Numerator: Total number of grievance cases from the CCT Program addressed in accordance to established Page 53 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) protocol. Denominator: Total number of grievance cases received from the CCT Program. Numerator: Number of pregnant women and/or women with children under two years that are beneficiaries of the cash transfer program who have Household survey on received CCT payments nutrition knowledge, directly and report Indicator 8: Percentage of female direct Biannual (E attitude, and practice increased decision-making Household su A survey firm contracted cash transfer recipients who report very two survey report. The power on spending rvey by DRDC. increased decision-making power on years) survey will be decisions for the household. spending decisions for the household. implemented every Denominator: Number of other year. pregnant women and/or women with children under two years that are beneficiaries of the cash transfer program who have received CCT payment directly. Numerator: The number of Household survey on Project MIS pregnant women from cash nutrition knowledge, and, District transfer beneficary attitude, and practice Indicator 9: Percentage of pregnant Health housholds in target districts survey report. The A survey firm contracted women from cash transfer beneficary Annually Information who had at least 4 ANC survey will be by DRDC, and DRDC. housholds with at least 4 ANC contacts System 2, visits (at health facilities or implemented every during their pregnancy. and househol during health outreach other year. d survey. sessions conducted by The MIS will also track health staff). this indicator, and Page 54 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Denominator: Total number compare information of mothers of children 0-2 with the district health years from cash transfer information system. beneficary housholds in the target districts. Periodic spot checks will assess beneficiary perceptions and participation in SBCC sessions, community awareness meetings, payment systems and Project Semiannua Indicator 10: Number of spot checks timeliness, and other Progress Project Progress Report MPI and DRDC. l implemented. elements of the cash Report transfer program. The spot checks are expected to be implemented at least twice a year, and will be done so on a random basis without prior notice to locations to be visited. Numerator: Number of project districts convening multi-sectoral nutrition coordination meeting with Indicator 11: Percentage of project Project actors working on nutrition districts convening a multisectoral Quarter progress Project progress report MPI and DRDC. (PRF, health, AFN, WASH, nutrition coordination meeting at least report and the CCT program) from once every three (3) months. government, as well as other development partners, at least once every three months Page 55 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Denominator: Total number of nutrition convergence project districts The cash transfer management information system would be developed with the functionality to generate regular reports. Project Mana This indicator will assess the gement Project Management Indicator 12: Percentage of cash transfer capacity of efficacy of DRDC Monthly Information Information System DRDC monthly reports generated in a timely to fully utilize the functions System (MIS) manner. of the cash transfer MIS (MIS) through the production of timely reports. Timely will refer to no later than 5 days after the end of the month or as described in the project operations manual. The objective of this indicator is to report on the evaluation of the overall nutrition convergence Indicator 13: Number of cross-sectoral approach. Every 18 Progress Household Surveys MPI and DRDC surveys carried out to evaluate different The number of cross- months Report convergence interventions. sectoral surveys refers to independent surveys carried out for the purpose of evaluating the impact of the convergence approach. ME IO Table SPACE Page 56 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Page 57 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) ANNEX 1: Implementation Arrangements and Support Plan COUNTRY: Lao People's Democratic Republic Laos Reducing Rural Poverty and Malnutrition Project (i) Project Institutional and Implementation Arrangements 1. MAF will be responsible for overall implementation of the project (see Figure 1.1). The recent expansion of MAF’s mandate, through the addition of the DRDC, now comprises rural development and poverty reduction, which were previously under the purview of the National Committee for Poverty Eradication and Rural Development in the Prime Minister’s Office. Some of the key functions that were remapped to MAF include the coordination and implementation of rural poverty reduction programs as well as the annual poverty assessment. In addition to poverty reduction-oriented initiatives, MAF, along with other ministries, is working on a joint platform to improve nutrition, including efforts to improve service provision in health, education, water and sanitation, and agriculture. MAF is responsible for 4 out of 22 agreed actions under the NNS 2. Day-to-day project implementation will be managed by the newly formed DRDC within MAF, whose mandate is closely aligned with the project objectives. MAF’s DoPF will be responsible for overseeing fiduciary aspects of the project, in which it has experience through the implementation of other World Bank projects, and overall coordination within the ministry. Because the DRDC is a new department with limited experience managing projects, investments in capacity building are necessary and will be part of Component 3. Building technical capacity within the DRDC, at the central and local levels, will be a key element of the project in the preparation stage and also through TA from the World Bank on the development of social protection programs. The overall implementation of the program would be led by the Project Management Office at the national level and at the district level by a dedicated team at the DAFO. At the provincial level, the Provincial Agriculture and Forestry Office (PAFO) will provide overall support to the district project teams. 3. The PRF and AFN projects, which are also under MAF, would be key internal partners as they provide an effective service delivery platform at the local level. While the PRF and AFN projects do not have the capacity to assume technical programmatic work beyond their core competencies (for example, delivering technical interventions on nutrition and health), they provide an on-the-ground presence that is needed for the successful delivery of the proposed program, particularly given their demonstrated ability to provide outreach and organize communities. At the district level they are being integrated into the DAFO. The proposed project will also rely on them and on the MOH (see next paragraph) for the delivery of nutrition-focused SBCC. A joint plan will be prepared for the activities at the local level. 4. MAF will work in close collaboration with the MPI for the overall planning, coordination, and M&E of the nutrition activities and with other key implementing partners such as the MOH and LWU for the implementation of complementary nutrition interventions. Implementing partners will include the LWU for SBCC delivery, and the MOH will be crucial in ensuring quality provision of essential health and nutrition services to maximize the impact of the demand-side interventions supported by this project. Under the CNP, the LWU was instrumental in delivering behavior change communication to local communities. Their existing knowledge of communities and widespread presence, as well as their ability Page 58 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) to communicate with women, give them a strategic advantage. The CNP pilot proved that this was a replicable model for delivering messages, organizing women in the communities for workshops, and being constantly present for community-based support. The LWU is also the model used by UNICEF to deliver SBCC. The MOH has been implementing a pilot SBCC approach in the proposed area and will continue to implement and strengthen it. MOUs and partnership agreements will be signed with the implementing partners to ensure effective synergetic implementation of the program. Figure 1.1. Overall Proposed Implementation Arrangements for the Project 5. Dedicated teams will be set in place at the national, provincial, and district levels (in the selected districts), with a larger presence at the district level. At the central level, the project will have a national project director, a project coordinator, an MIS specialist, a cash transfer program manager, an M&E specialist, an IT specialist, a communication and outreach specialist, procurement specialist, and a FM specialist. At the provincial level, the project will have a project coordinator, and at the district level in the DAFO, it will have the following personnel: a project coordinator responsible for the overall coordination and M&E and facilitators responsible for the implementation of the program at the village level with expertise in community development.55 Depending on the size of the target population and access to villages, up to three facilitators will be hired at the district level with clear geographic division of labor. 6. The payment of the cash transfer to beneficiaries will be contracted out by MAF to a financial institution(s), wherever feasible, taking into account factors such as distance to the payment provider for the majority of beneficiaries in any particular location and cost. If it is found that certain villages are too distant from a payment provider, the payment providers would need to arrange for delivery of cash. A payment assessment was conducted to inform the development of the TOR for the payment contract. The World Bank team with international experts on cash payment will support the GoL in the relevant bidding process. 55 In larger districts, more facilitators will be covering this role. Page 59 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) 7. MAF will be responsible for providing on time a list of beneficiaries in each payment cycle. The cash transfers will be conditioned on attendance at the village-level SBCC sessions as well as beneficiary utilization of key health and nutrition services, namely, ANC for pregnant women, growth monitoring and promotion sessions for children 0-2 years, and age appropriate vaccination for children 0-2 years old. MAF will work closely with the MOH to ensure complementarity and availability of services; given that the project will have a strong M&E component, of which access to services will be a key element, the project will help establish a model of mutual accountability between service supply and demand. Given the multiple actors supporting SBCC, it will be crucial to strengthen the planning and coordination mechanism at the provincial and district levels through joint planning exercises. At the provincial and district levels, project coordinators will be appointed in MAF to provide support and ensure appropriate implementation of activities in the field. At the district level, the DRDC will also appoint a team to support the coordinator, specifically with the function to coordinate with the MOH and LWU for the provision of SBCC and to provide support, mentorship, and supervision to village facilitators, appointed to be the focal people in the field for the project. At the village level, mothers’ groups will be set up to ensure beneficiaries’ cohesion and continue learning from each other. Mothers will also appoint mother leaders who will be responsible at the village level for liaison with the village facilitator and to voice any concern from mothers. 8. In the four nutrition convergence projects, MPI will assume the leadership role for coordination, M&E of nutrition convergence for the provinces, building on existing systems under the supervision of the NNC and the NNC Secretariat. MAF will work in close collaboration with the MPI for the overall planning, coordination, and M&E of nutrition-specific and nutrition-sensitive activities across the different ministries. At the provincial and district levels, the project will finance a devoted convergence team, and the convening of multisectoral steering committees which, through their regular meetings and activities, would oversee and provide guidance for the overall implementation of the proposed nutrition convergence approach as well as conduct periodic reviews of the approach. These committees will report on progress made directly to the Vice Governors as Chair of the Nutrition Committees, while convergence team will work on a day to day assignments. 9. The project’s strategic direction and progress would be reported annually to the NNC and semiannually to the Provincial Vice Governor as chair of the NNC at the provincial level. Those meetings would also be the venue to discuss and agree on the work program, coordination, and M&E mechanisms with other key actors in the selected geographic area of intervention. (ii) Financial Management 10. The overall FM risk is considered high. The FM assessment was carried out in accordance with the ‘Financial Management Practices in World Bank-Financed Investment Operations’. Based on an initial FM assessment of the FM capacity in MAF, in particular the DRDC and the PMD of the DoPF, MAF FM capacity and systems are considered relatively weak. There is limited capacity in terms of number of FM personnel and work experience on CCT. In addition, the project has a high level of complexity since grant distribution will be done on a wide geographic reach that includes hard-to-reach areas. The assessment identified the following potential risks: Page 60 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) (a) Failure to deliver grants to beneficiaries due to the complex payment delivery system for cash grants to beneficiaries and lack of familiarity with the CCT approach including the necessary capacity to monitor the work progress; (b) Failure to maintain accurate and timely accounting information due to the varying FM capacity in the MAF offices, lack of experienced FM staff, and significant increase in workload without the corresponding work force and reassessment of the organizational structure; and (c) Noncompliance with FM and reporting requirements and misuse of funds. 11. Actions to mitigate these risks have been identified as follows: (a) Develop an Operations Manual and update the existing FM Manuals to be tailored for CCT payouts; (b) On FM staffing, MAF should assign a designated FM personnel for the project whose roles and responsibilities are specified in the TOR. Additional FM consultants will also be hired, including any additional manpower that may be necessary for ensuring that cash grants are delivered and monitored; (c) ACCPAC software with some configuration will be used to record transactions and produce project IFRs; (d) Provide training to staff concerned once the project is effective; (e) An annual budget and work plan will be prepared and approved by the Bank; (f) Annual audit carried out by a qualified independent audit firm acceptable to the World Bank. In addition, MAF will submit status of actions taken to address the findings and recommendations of auditors on the project financial statements; and (g) IFRs will be prepared quarterly and submitted to IDA no later than 45 days after the quarter- end. 12. In relation to overall project implementation, the Compliance Verification System and Grievance Redress System are to be established and fully documented in the project’s Operations Manual. This is to ensure that cash is only paid out when conditions are met and to mitigate misuse of funds. Organization and Staffing 13. MAF is the lead implementing agency of the project. The PMD under the DoPF was established in 2013 to oversee project management, including FM for all projects implemented by MAF. FM responsibilities are limited to review of documents before seeking approval from the Project Director, who is usually Director General of the DoPF. The PMD has 11 government staff, of which there are 4 FM staff—2 staff and 2 interns/assistants. The PMD has experience in overseeing World Bank-financed projects (that is, the LUFSIP which was closed in 2014 and Scaling Up Participatory Sustainable Forest Management [SUPSFM; P130222]- project which is ongoing). However, all FM work was carried out by a team of consultants. The PMD would like to step up its involvement and is willing to assign staff to assist in FM work of this project. However, due to lack of experience and the possible overload from the additional work, the PMD will still require support of consultants who will work alongside the designated staff. To ensure that FM systems are adequately addressed, MAF will hire for the project a national FM Page 61 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) consultant who will facilitate FM requirements, build FM capacity, and monitor financial reporting requirements from field offices and partner agencies. Hiring and TOR will be subject to the approval of the World Bank. Additional FM consultants will also be hired, including any additional manpower in the field offices that may be necessary for ensuring that cash grants are delivered and monitored. Budgeting and Planning 14. A budget shall be prepared for each component annually and cover the period of the GoL fiscal year (January to December) and in accordance with the approved annual work plan. The quality of budgeting and forecasting will be strengthened as part of the support provided by the FM consultants. The PMD will elaborate the process and timing for the preparation and approval of the annual budget following a similar process stated in the State Budget Law. The project annual budget will be reviewed and approved by the Bank. The annual work plan and budgets will be prepared not later than June of each year. Accounting Policies and Procedures 15. Cash basis of accounting will be used by the project to prepare financial statements. ACCPAC accounting software currently used in other World Bank-financed projects will be used to record transactions and produce project financial reports. Field offices will also use the same software to record transactions and to enable automatic download of financial data. Separate books of account will be maintained for the project. 16. The existing FM Manual at MAF is acceptable for use in World Bank-financed projects. Hence, this manual will continue to be used but will need to be updated for CCT payouts under Component 2. The submission of an FM Manual specific to the CCT will be submitted to the World Bank for approval and will be required as a disbursement condition for the subsidies expenses category. This will formalize policies, processes, and procedures specific to the project. Key items that should be included in the FM Manual are the following:  Organizational structure for the project, manpower requirements, and TOR;  Roles and responsibilities of FM personnel in the central and field offices;  Procedures and accounting instruction for processing transactions;  Funds flow;  Eligible expenses and disbursement procedures; and  Reporting requirements. Financial Reporting 17. The project will follow the GoL fiscal year (January to December). IFRs will be prepared by MAF and will cover the period of three months (quarter) and will be due for submission within 45 days of the end of each quarter. The IFRs will follow a format agreed with the World Bank and report the sources and uses of funds by project components/activities including fund balances. Variance analysis between actual Page 62 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) and budgeted expenditure will be performed and reported as part of the IFR. MAF will also prepare the project annual financial report for audit. Audit Arrangements 18. The project will be subject to an annual audit by qualified auditors to be recruited on behalf of the project by MAF, with TOR acceptable to the World Bank. The audit will cover expenditure incurred at all levels including transfer of grants to beneficiaries. The audit report, together with management letters, will be submitted to the World Bank no later than six months of each fiscal year-end. Audited financial statements and audit opinion will also be subject to disclosure in accordance with the World Bank Policy on Access to Information. Funds Flow and Disbursement Arrangements 19. A Designated Account (DA) will be opened at the Bank of Lao (BOL), managed by the National Treasury, Ministry of Finance (MOF) (see Figure 1.2). IDA funds will flow to the DA. The DoPF-MAF will be responsible for arranging for payments from and replenishment of funds into the DA. The DA will have variable ceilings based on the approved six-month forecast. Applicable disbursement methods will include: (a) advance; (b) reimbursement; (c) direct payment; and (d) special commitment. Minimum application value for direct payment and reimbursement will be US$100,000. Reporting of expenditure paid from the DA will be based on submission of the statement of expenditure (SOE). Disbursements will be made against the following expenditure categories. Table 1.1. Disbursement Amounts by Category Amount of the Financing Percentage of Expenditures to Be Disbursement Categories allocated (in SDR) Financed Goods, works, non-consulting services, 9,480,000 100% consultants’ services, training and operating costs under the project (except for Component 2.2) Cash Transfers under Component 2.2 of 10,120,000 100% the project Total 19,600,000 20. The following funds flow arrangement is proposed: (a) For cash transfer to beneficiaries under Component 2.2., the Treasury will transfer funds directly to a bank account opened for CCT at the financial institutions to carry out the grant distribution process after submission by MAF of the grant payments instruction to the Treasury. Financial institutions will then have to provide liquidation reports that the funds were transferred to the rightful beneficiary56. 56Prior to the distribution of cash transfers to beneficiaries, the financial institutions (payment agents), will enter into an agreement with MAF The TORs for the payments agents’ contracts so as the modalities for contracting the payment agents would be discussed and agreed with the World Bank. Page 63 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) (b) For operating costs under category 1 of expenses, the PMD will also open a project operating account to facilitate smoother day-to-day operations and for emergency situations. This will be opened at a commercial bank with a ceiling of US$250,000. Replenishment from DA to operating account shall be made monthly or when the balance reaches 20 percent of the ceiling. The funds will be downloaded to PAFOs and DAFOs based on the quarterly budget and expenditure reported on a monthly basis. The amount transferred to the provincial and district operating account will be considered as advance payment. The service fee to financial institutions is expected to be divided into two parts: (i) a flat payment, and (ii) a performance-based payment which will be based on evaluating the rate of beneficiaries’ satisfaction with the service provided by the financial institutions. The service fees will be paid from MAF operating account. Figure 1.2. Funds Flow from World Bank to MAF (iii) Procurement 21. The project procurement will be carried out in accordance with the World Bank Procurement Regulations for IPF Borrowers, dated July 1, 2016, revised November 2017 and August 2018, and provisions stipulated in the Financing Agreement. Under the project, the World Bank’s planning and tracking system, STEP, will be used to prepare, clear, and update Procurement Plans and conduct all procurement transactions for the project. 22. The procurement risk is considered moderate. About 75 percent of the project funds will finance developing the building blocks of a social protection system and the implementation of a maternal and child cash transfer program. Seven million (26 percent of the total project budget) will finance ICT for strengthening the delivery system and consulting services as firm to manage cash transfer, TA and capacity Page 64 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) building at the central level to support the program. The DRDC will be responsible for the overall supervision, execution, and management of the project. The DoPF will be responsible for overseeing the procurements implemented by the project management unit (PMU) under the DRDC. 23. In June 2018, the World Bank carried out a procurement assessment of the implementing agencies. Based on the assessment, the DRDC is a new department within MAF and has no experience with World Bank procurement procedures. Therefore, the capacity of the DRDC to manage procurement activities was found inadequate and further strengthening was needed. The DoPF has increased capacity and experience in implementing World Bank-financed projects but would also require additional support to implement the task. The key procurement risks to project implementation are as follows: (a) setting up ICT and skills to design and maintain such system is limited in Lao PDR, and (b) difficulty in finding qualified individual consultant may also cause delays. The procurement risk under the project is therefore rated moderate. The key mitigation measures in Table 1.2 were agreed with the project implementing agencies and will be implemented during project implementation to mitigate the identified risks and strengthen the procurement capacity of the DRDC. Table 1.2. Identified Procurement-related Risks and Mitigation Measures No. Risk/Challenge Proposed Risk Mitigation Measure Responsibility Deadline 1. Setting up ICT and (a) An international expert will be hired if local DRDC During project skills to design and individual consultant is not available. preparation and maintain such (b) The World Bank supervision team will implementation system is limited comprise an expert in information systems in Lao PDR. who will support the project team and review all the relevant documents. 2. Difficulty finding (a) An international consultant shall be hired if DRDC, MAF During project qualified individual local individual consultant is not available. implementation consultant (b) Procurement training shall be provided by World Bank the World Bank staff. (c) Full-time staff shall be assigned by the DRDC DRDC to work closely with the procurement consultant, with the aim to build capacity. 24. PPSD and Procurement Plan. The DRDC, in close collaboration with the DoPF, prepared the PPSD to inform fit-for-purpose procurement arrangements in the Procurement Plan for the first 18 months of implementation. International competitive market approach and selection of consultants involving international competition will be carried out in accordance with the Procurement Regulations. National market approaches (Requests for Bids and Quotations) will be carried out in accordance with the national regulations, including Procurement Decree No. 03, dated January 9, 2004, and Implementation Rule and Regulations No. 0063 issued by the MOF on March 12, 2004, and No.0861/MOF, dated May 5, 2009 (amended version) and the Procurement Manual, dated May 2009, and conditions for use of such procedures will be stipulated in the Procurement Plan. Standard document for such procurement will be based on Requests for Quotations and harmonized National Competitive Bidding documents agreed with the World Bank. Page 65 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) 25. Based on the findings and recommendations of the PPSD, the initial Procurement Plan for the first 18 months of the project was prepared and agreed by the World Bank. The Procurement Plan will be entered in STEP and updated annually (or as needed) by the DRDC to: (a) reflect project implementation; (b) accommodate changes that should be made; and (c) add new packages as needed for the project. All Procurement Plans, their updates, and modifications shall be subject to the World Bank’s prior review and no-objection. The World Bank will carry out procurement post reviews on an annual basis with an initial sampling rate of 20 percent, which will be adjusted periodically during project implementation based on the performance of the project. The detailed Procurement Plan is available in a separate project document. (iv) Strategy and Approach for Implementation Support 26. The innovative approach of the operation, the engagement with different actors, will require intensive implementation support, particularly in the initial stages of the project. The team composition and the expected time allocation are described in Table 1.3. The implementation support proposed focuses on implementing the risk mitigation measures:  Implementation capacity. The core team will work in close collaboration with the project implementation team to ensure effective design and setup of the CCT program. Being the first time for MAF to implement a cash transfer program, significant effort would need to be placed in strengthening the implementation capacity of the project implementation unit.  Coordination. The core team will closely monitor project implementation to promote coordination and detect possible lack of communication, duplication of efforts, and delays in implementation.  M&E. The function of M&E will be significant for the project and for the overall nutrition convergence approach and therefore requires specialized support. The M&E specialist will be a core team member and work across the other World Bank nutrition convergence operations.  FM. During implementation support, the World Bank’s FM specialist will support the implementing agency (including with ad hoc training) and routinely review the project’s FM capacity, including, but not limited to, accounting, reporting, and internal controls to ensure that they are satisfactory to the World Bank.  Procurement. The World Bank’s procurement specialist will work closely with the implementing agencies to build capacity and support them in the periodic procurement activities. (v) Implementation Support Plan 27. Key World Bank team members involved in implementation support will be based in Bangkok, Washington, DC, the Philippines, and in the Lao PDR Country Office to ensure timely, efficient, and effective implementation support. The core team is expected to conduct four formal implementation support missions during the first year of implementation, including field visits. After the first year, the periodicity of the implementation support missions is expected to be reduced to two missions a year and maintained throughout the project. Detailed inputs from the World Bank team are outlined as follows: Page 66 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) (a) Technical inputs. (i) technical experts and professionals to support the elaboration of TOR (consultant and non-consultant services), (ii) field visits to follow implementation of the planned operational enhancements, (iii) TA to the systems’ components, and (iv) the organization of technical workshops to share best practices and support the evaluation agenda. (b) Fiduciary requirements. During preparation, the World Bank team identified capacity- building needs to strengthen the FM capacity and improve procurement management in the context of World Bank operations. Support will be provided from the World Bank office in Lao PDR. Formal implementation support of FM reports and procurement will be carried out semiannually, while prior review will be carried out for contracts specified in the Procurement Plan as required. (c) Social safeguards. During implementation the social specialist will closely monitor the implementation of the project to ensure full inclusiveness of indigenous groups and women. 28. The project will require the following implementation support in the first year. The Implementation Support Plan will be revised after the first year of implementation. 29. FM implementation review shall be undertaken twice a year during project implementation to ensure that the credit proceeds are used for the purpose they were granted, which may take at the most two weeks. The scope of the supervision is left to the professional judgment of the FM specialist. It may cover any of the following: (a) review of the continuous maintenance of adequate FM system by MAF; (b) review of IFRs; (c) follow-up of timeliness of FM reporting and actions taken on issues raised by external auditors; (d) review of the project’s financial reports; (e) follow-up of the status of any agreed action, and (f) review of compliance with the financial covenants. In addition, the FM implementation review should include desk review of the quarterly IFRs and audited financial statements and management letter submitted to the World Bank. Page 67 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Table 1.3. Required Project Supervision and overall nutrition convergence monitoring and evaluation a Number of Staff Number Travel Cost Skills Needed Staff Cost Comments of Trips 57 Estimates Weeks Est. Senior 10 8 62,316 7,244 (from Senior Economist and Senior Nutrition Specialists will Economist/Senior Thailand) oversee entire operation, supervise technical and Nutrition Specialists 22,992 fiduciary aspects, and ensure effective coordination of (Task Team Leaders) (from US 58) the overall nutrition convergence approach. Senior Economist 5 4 31,160 7,244 (from Senior Economist will provide implementation Vietnam) guidance for the setup of the targeting system and the evaluation agenda of the project. Senior M&E Expert 7 4 43,624 7,244 (from Senior M&E Expert will provide overall guidance to the Vietnam) M&E of the convergence approach and of the project. Senior Social 5 2 31,160 6,496 (from Senior Social Protection Specialist will provide overall Protection Specialist US for 2 implementation support to the social protection trips59) system agenda. Systems Specialist 6 2-3 2,238 6,496 (from Specialist will be responsible for the TA to the design (Consultant) US for 2 and implementation for the information systems in trips) Components 2 and 3. Social Protection 32 0 18,352 0 Social Protection Specialist will provide overall Specialist (Extended implementation support for the project and Term Consultant- coordinate with the projects involved in the Local) convergence approach. Senior Procurement 4 0 9,631 0 Senior Procurement Specialist will support the Specialist implementing agencies on related issues. Senior FM Specialist 4-5 2 12,829 3,622 Senior FM Specialist will support the implementing agencies on related issues. Safeguards 2 2 2,691 3,622 Safeguards Specialist will ensure effective inclusion of Specialist indigenous peoples and women into project design and implementation. Communication 4 2 5,356 3,622 Communication Specialist will support the team in the Specialist development and implementation of a communication strategy at central and provincial/district/village levels. The Communication Specialist will work in close collaboration with other teams involved in the nutrition convergence approach, providing SBCC. Note: a. Given the significant cost to effectively supervise the implementation of the project and overall convergence approach, additional budget would be provided to finance the supervision and overall nutrition convergence approach. A significant percentage of the budget for financing the Senior Nutritionist and the Senior M&E expert 57 The total estimated staff time is expected to be of 219k and the travel costs at a maximum of 53k. Training and Workshop costs would be approximately 7k for an overall total of 279k for the first year of implementation of the project and overall nutrition convergence approach. A similar budget would be needed to support and supervise the implementation of the following years of the project. 58 The trips costs would be shared with other projects in Lao PDR- HANSA and with other projects in the region to maximize use of resources. 59 Costs for trips from Washington DC will be shared with other missions in the region for the SP and System Specialist. Page 68 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) staff time and their travel costs will come from the CMU-Nutrition ASA (P165482). The team will also proactively seek TF to complement allocated BB funds. Page 69 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) ANNEX 2: World Bank Country Portfolio Results Chain for an Integrated Approach to Tacking Childhood Stunting 60 1. The proposed convergence approach will support the Government’s NNSPA to accelerate the reduction of under-5 stunting from 44 percent to an ambitious target of 25 percent by 2025, by enabling the implementation of nutrition-specific and nutrition-sensitive interventions known to reduce stunting in select high-stunting burden provinces. The key elements in the causal results chain to the achievement of the stunting target will be to address the immediate, underlying, and some of the basic causes of child undernutrition in Lao PDR (Figure 2.1). At the immediate level, nutritional status will ultimately be determined by the availability of nutrients to the body to meet its requirements and the status of health, while the underlying and basic causes are related to access, availability, and utilization of food; maternal and child caring practices; water and sanitation; and personal hygiene. These determinants are heavily influenced by the social and economic status of women. Achievements in these areas of interventions supported by necessary systems and capacity improvements should result in improved nutrition and reduced illness and disease of pregnant women and children, which, in turn, should result in reduced prevalence of stunting and better physical and cognitive development of children. 2. The overall goal for the World Bank-financed multisectoral nutrition convergence approach is to showcase that with an integrated approach, in four years, stunting rates could be reduced significantly, by as much as 1.75 percent annually. The proposed four sectoral operations (Table 2.1) will all contribute to tackling the immediate and underlying causes of malnutrition in provinces with the highest share and absolute numbers of stunted children.61 The selected evidence-based interventions proposed under the convergence approach are expected to reduce stunting rates in the target areas by over 20 percent by 2024, which will correspond to close to 2 percent reduction nationally. 60 In the agriculture sector, synergies will be applied with a donor-financed project (IFAD) on food and nutrition security implemented by MAF in the same geographic areas of intervention. 61 Phongsaly 54 percent, Oudomxay 42.7 percent, Huaphanh 40.7 percent, and Xiengkhuang 46.3 percent (LSIS 2017). Page 70 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Figure 2.1. Causal Framework to Reducing Stunting in Lao PDR Impact Improved Child Growth; Reduced Stunting Medium- Improved diets of mothers and Reduced illness of children term results children  Increased utilization of quality maternal and child health and nutrition services  Improved nutrition/health behaviors: maternal and child care and feeding and hygiene practices Short-term results  Improved access to diverse foods  Increased convergence and coverage of nutrition-specific and nutrition- sensitive services (Health, Nutrition, and Population, Social Protection, WASH, PRF, and Education) Improving Enabling Increasing supply and environment utilization quality of and demand services Inputs and Strengthening and Focus on results Strategic communication integrating delivery of and context-specific outputs services social behavior change Capacity and communication enhancement, Supplying essential coordination, and equipment, commodities, Removing demand-side M&E and human resources barriers Increasing community Developing competency Improving ownership and and skills of providers stewardship (women’s) participation Guiding Principles  Focus on high-stunting districts and on vulnerable and poor households  Use of a common social behavioral and change strategy, action plan, and tools  Leveraging of each project’s delivery platforms, for example, established community-based structures  Use of a common M&E framework Page 71 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Table 2.1. Country Portfolio Results Chain for an Integrated Approach to Tackling Childhood Stunting in Lao PDR Overall Country Country Expected Sector-specific Portfolio Key Indicators Relevant Project Activities Program Goal Results Objective Reduce stunting To enable the Health and Nutrition  Percentage of children under two  SBCC for optimal infant and child feeding, prevalence in GoL to Increased supply and years of age whose growth is maternal nutrition, and hygiene children under implement utilization of essential adequately monitored (as per  Improve availability and access to ANC and PNC 2 years of age in nutrition-specific maternal and child national guidelines) services targeted and nutrition- health and nutrition  Percentage of women who attended  Provision of essential micronutrients to women regions by 20 sensitive services at least 4 ANC session during their and children percent. interventions by most recent pregnancy  Treatment of infections (for example, diarrhea key sectors to  Percentage of infants 0–5 months and malaria) address the who are exclusively breastfed  Deworming of children and pregnant women immediate and  Percentage of children 6–59 months underlying receiving vitamin A supplementation determinants of within the past 12 months childhood Social Protection  Percentage of households with  Deliver cash transfers and improve SBCC undernutrition Reduced (nutritional) periodically updated socio-economic delivery to generate/increase demand for and in an integrated vulnerability of poor survey information reported in the improve access to essential health and nutrition and coordinated households and increase social registry services manner the demand for and  Number of beneficiaries of social  Target social protection services/interventions utilization of health and safety net programs to the poorest and most nutritionally nutrition services and  Percentage of children 6–23 months vulnerable population in rural areas access to diverse diets from cash transfer beneficiary  SBCC improved in its delivery for optimal infant households consuming foods from and child feeding, maternal nutrition, and four or more recommended food hygiene and use of cash for nutrition inputs groups  Advocacy and provision of technical support to  Number of villages in project other ministries on nutrition issues districts where at least three  Finance mechanisms to coordinate and monitor convergence projects have been nutrition convergence implemented Page 72 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Overall Country Country Expected Sector-specific Portfolio Key Indicators Relevant Project Activities Program Goal Results Objective WASH  Number of people provided with  Construct/rehabilitate water supply systems Interrupted routes of access to improved water sources  Support and promote the use of improved fecal-oral contamination  Number of people with access to sanitation facilities and handwashing stations among infants and improved sanitation services  Construct toilets and handwashing facilities in young children 0–24  Percentage of the target population health centers and schools months practicing handwashing with soap  SBCC to promote handwashing with soap for all after using the latrine household members at critical times, that is,  Percentage of water supply systems before preparation of food, before feeding of that meet project service levels infant/young child, after cleaning of floors, and  Number of villages where at least after use of latrine three nutrition convergence projects have been implemented Agriculture/PRF  Percentage of children 6–23 months  Seed grant finance and financial management Improve access to basic from SHG and Farmer Nutrition capacity building for investment in agriculture services, increased Group households consuming foods and livestock production for consumption and production and from four or more recommended sale consumption of diverse food groups  Material (i.e. seeds and basic garden tools), and nutritious foods for  Income from the sale of SHG and training, monitoring and support on home poor households Producer Group-financed production nutrition gardens  Agriculture, livestock and handicraft  Establishment and support to Farmer Nutrition production by SHG member Groups comprised mainly of pregnant women households and women with children less than 24 months  Percentage of SHG members with of age focusing on SBCC and peer year-round production from home support/learning on the growing, processing, nutrition gardens cooking and feeding of diverse and nutritious  Percentage of women in leadership foods to themselves (especially when pregnant) positions with SHGs and Village SHG and their children Management Committees (VSMCs)  Investment in infrastructure that will facilitate access to markets for the sale of production and access to services (i.e. roads and bridges) as well as enhanced production (i.e. irrigation, animal shelter and fencing, storage facilities) Page 73 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Table 1.2. Basic Descriptive Statistics of the nutrition convergence geographic area Number Provinces Number Number of Number of Total of and of children Households Population (1) villages Districts Female under 5 (1) (1) (1) (1) Phongsaly 1 Mai 26,145 13,600 4,083 88 4,678 2 Khoua 25,557 13,800 3,443 94 5,293 3 Samphanh 22,981 12,400 3,857 68 4,375 4 Boun Tai 23,402 11,500 3,648 63 4,723 Oudomxay 5 La 16,506 7,400 2,150 44 3,502 6 Namor 37,322 20,600 5,634 62 6,870 Huaphanh 7 Houamuong 32,234 15,700 4,759 76 5,292 8 Xam Tai 36,696 18,000 5,210 90 6,022 9 Kouane 24,525 13,600 4,055 66 3,809 10 Xone 15,755 8,000 2,421 34 2,474 Xiengkhuang 11 Kham 47,256 22,800 6,274 90 8,470 12 Nonghed 37,406 20,800 6,107 106 6,033 Total 345,785 178,200 51,641 881 61,541 Sources of data: (1) Population and Housing Census 2015 Page 74 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Table 2.3. Basic Descriptive Nutrition Statistics for Both National and Convergence Target Populations Lao World Bank Project Convergence Districts*** (2017) PDR**(2017) Huaphanh Oudomxay Phongsaly Xiengkhuang All**** Number of districts 148 4 2 4 2 12 Number of villages 8,499 266 106 313 196 881 Number of households* 1,189,233 17,597 10,372 19,069 14,503 61,541 Total Population* 6,277,592 109,210 53,828 98,085 84,662 345,785 Population: 0 – 5 years old* 823,910 16,445 7,784 15,031 12,381 51,641 Population: 0 – 2 years old* 394,058 7,842 3,694 6,886 5,939 24,361 Poverty Rate**** 23% 49% 23% 23% 26% 32% Share of ethnic minority (non-Lao Tai) 32% 66% 86% 74% 63% 74% population* Stunting 33% 46% 36% 46% 41% 43% Wasting 9% 6% 6% 6% 4% 21% Minimum acceptable diet (Breastfed 45% 22% 24% 16% 25% 22% children, 9-23 months) Not enough food 0 14% Institutional delivery 65% 41% 55% 26% 52% 42% Full immunization coverage 48% 38% 32% 27% 39% 35% Up-to-date Growth monitoring - 7% 8% 1% 10% 07% At least 4 ANC Visits 62% 59% 64% 29% 59% 52% Received PNC after 48 hours 47% 31% 19% 16% 35% 28% Mothers who can identify at least 1 reason why fruits and vegetables are 64% 67% 50% 75% 64% important for the body Household sanitation coverage 73% 66% 60% 37% 68% 58% Households practicing open defecation or using unimproved 29% 30% 37% 63% 31% 40% sanitation Households with handwashing 51% 71% 66% 72% 36% station/facility Access to improved water coverage 84% 92 88 82 91 88% Notes: *Based on Population and Housing Census, 2015, ** Lao Social Indicators Survey (LSIS), 2017; *** KAP Baseline Survey, 2017, **** Poverty Estimates based on small areas estimation technique applied to Population and Housing Census, 2015, **** refers to the 12 districts together as areas of overall nutrition convergence approach. Page 75 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Table 2.4. World Bank Nutrition-related portfolio in Lao PDR and expected synergies with the proposed operation62 Projects and Sector Activities (Status; Nutrition-related Elements Synergies with This Operation Total Project Cost) Health Lao PDR HGNDP Strengthening primary health care, The HGNDP will continue focusing (P151425) improving both the coverage and the on provision of quality essential (US$26.4 million) quality of maternal, neonatal, and child health care services especially health services mostly at the facility level; clinical services at the facility level Additional includes support for nutrition-related and during outreach, while this Financing of the indicators in the disbursement-linked operation will focus on (a) HGNDP (US$25 indicators (DLIs) and support development increasing demand for those million) of an integrated national strategy and services known to improve implementation plan for SBCC to improve nutritional outcomes and (b) nutrition as well as implementation of the further strengthening mainly strategy at the national level and at the community-based preventive and village level in selected priority districts. promotive services. Health and This proposed operation’s PDO will be to The availability of nutrition- Nutrition Services ‘improve access to quality health and specific interventions will be Access Project nutrition services while ensuring financial crucial to maximize impact of (P166165) protection, in targeted areas of Lao PDR’. A financial incentives for poor major component of this operation will be households. As quality health and Pipeline, US$30 to strengthen and improve quality of nutrition service become available million service delivery for universal health in the selected geographic coverage, with a focus on maternal and convergence areas, co- child health services, including nutrition. responsibilities on utilization of those same services will be added as a condition for beneficiaries to receive cash transfers. WASH Scaling-Up Water Improving access to sanitation and clean The project will be implemented Supply, Sanitation water and improving hygiene practices, in in the geographic areas targeted and Hygiene targeted convergence villages. for nutrition convergence. Using Project (P164901) the Nutrition Social Behavioral Change and Communication Pipeline, US$25 Strategy and Action Plan and tools million as a base, the project will deliver an integrated water supply, sanitation and hygiene intervention at the village level. 62In the agriculture sector, synergies will be applied with a donor-financed project (IFAD) on food and nutrition security implemented by MAF in the same geographic areas of intervention. Page 76 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Projects and Sector Activities (Status; Nutrition-related Elements Synergies with This Operation Total Project Cost) Social PRF III The overall development objective of the The PRF will be a service delivery Develop (P157963) project is to improve access to basic partner for this proposed project ment services for the project’s targeted poor as it provides a well-established, Ongoing, US$30 communities, through including effective service delivery platform million community and local development at the local level in all four target processes. provinces as well as direct engagement with target One component finances provision of beneficiaries on livelihood and capacity-building assistance to SHGs in nutrition activities in Huaphanh targeted districts in Savanakett and Province. The proposed operation Huaphanh Provinces to increase incomes of also has the same implementing poor families through increased agriculture agency, the Ministry of Agriculture and livestock production. Well-performing and Forestry, PRF’s home SHGs offer sustainable access to finance for Ministry, so there will be investing in income generating activities alignment and synergy around the and accumulating group savings for social Ministry’s operations (including welfare needs. Household production is central and field-based staff) and used for consumption, particularly protein- strategy. rich, small livestock such as poultry, fish and pigs, as well as for market sales for income. Light support is also provided to Village Nutrition Centers (VNCs) which were established under the PRF II operation. PRF III AF At the concept stage, the proposed revised The proposed PRF III AF would (P168620) PDO was “to improve access to basic enable a full geographic overlap services, increase production and with the proposed project in all Pipeline, US$10 consumption of diverse and nutritious target districts and a large number million foods for poor households in the Project’s of villages. Income from SHG targeted poor communities.” This revision activities would combine with is intended to capture the expansion of PRFcash transfer income to enhance activities in the area of livelihoods and the purchasing power of target nutrition. beneficiaries while strengthening their financial management AF activities will expand livelihood and capacity and sustainable access to nutrition activity coverage into the three finance through revolving funds. other nutrition convergence provinces Farmer Nutrition Groups would (Phongsaly, Xiengkhuang and Oudomxay), also be a key channel for SBCC strengthening SHG support, adding support delivery, particularly on messages for the establishment of Producer Groups, relating to nutritious food expanding support for home nutrition production, food processing and gardens, building on VNC experience to preparation and child feeding. establish Farmer Nutrition Groups comprised primarily of pregnant women and mothers of children up to 24 months of age which would receive support to grow, cook and serve nutritious meals to their children. Page 77 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Projects and Sector Activities (Status; Nutrition-related Elements Synergies with This Operation Total Project Cost) Education ECE Project The overall development objective of the The project overlaps with some of (P145544) project is to increase coverage and the geographic areas of the improve the quality of ECE services for 3- HGNDP and therefore where this Ongoing, US$28 to 5-year-olds in target districts. The proposed project will be million project is also piloting two ECE modalities implemented. The projects will that are new in the Lao context—a non- coordinate on the SBCC at the Early Childhood formal Community Child Development community level. Development Playgroup for children of ages 2 to 4 years and a formal delivery of multiage teaching to groups of children of ages varying from 3 to 5 years and community awareness campaign to promote good child care and health practices and emphasize the importance of early cognitive stimulation. All the piloting activities (implemented in the selected villages in the proposed four northern provinces) are being rigorously evaluated. Page 78 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) ANNEX 3: Monitoring and Evaluation Framework for the Nutrition convergence approach 1. The World Bank will closely monitor the implementation of this multispectral nutrition convergence approach. A comprehensive M&E framework will be established specifically to: (a) track the convergence of the World Bank’s portfolio of nutrition interventions at the village level; (b) report on nutrition indicators; and (c) quantify the impact of the convergence approach, its cost-effectiveness, and effectiveness of individual interventions that are associated with individual projects. This will be achieved by tracking the delivery of interventions at the village level, process monitoring, measuring household- and individual-level outcomes, and imbedding impact evaluations in the projects to measure attributable impacts of the portfolio interventions. An overall summary of the M&E Framework is provided in Figure 3.11. Figure 3.1. Overview of the M&E Framework Page 79 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) 2. Monitoring activities shall focus on monitoring the delivery of interventions to assess the achievement of convergence and tracking progress on the utilization of nutrition-specific and nutrition- sensitive services and nutrition outcomes. Thus, the monitoring system shall track input and output delivery and nutrition outcomes committed in the list of convergence result indicators and related intervention activities. The evaluation framework is set up to measure the impact at the portfolio level and the project level. The portfolio-level evaluation assesses the effectiveness of the convergence approach on nutrition outcomes while the project-level evaluation assesses the impact of specific interventions on the achievement of intermediate outcomes, as well as process or delivery mechanism evaluation. Monitoring of Outcomes 3. The monitoring framework will be designed to regularly report on the progress in improving nutrition behaviors and outcomes at the individual and household levels in program areas. Some of the outcome indicators will be obtained from administrative data sources, especially the projects’ MIS, but the majority shall be monitored using harmonized household surveys (see Table 3.1). The harmonized household surveys will include a standardized set of questions in separate modules, to measure the key indicators for the convergence result indicators and project-specific indicators, depending on the final implementation arrangements. The definitions and measurement methodology for each of those indicators will be based on the project-specific guidelines for such measures, with teams from each of the four projects taking leadership in the design of the modules of their respective projects. The convergence M&E team will take overall responsibility on the survey design and field implementation plans. Table 3.1. Monitoring Plan for Convergence Result Indicators Indicator Name (Disaggregated by Gender, Ethnicity, Data Source Frequency Start Year End Year and Welfare Status) Under 2 years old stunting rate Harmonized 3 times 2019 2024 household survey Percentage of children under two years of age whose Harmonized 3 times 2019 2024 growth is adequately monitored household survey Percentage of infants 0–5 months who are exclusively Harmonized 3 times 2019 2024 breastfed household survey Percentage of children 6–59 months receiving vitamin A Harmonized 3 times 2019 2024 supplementation within the past 12 months household survey Percentage of pregnant women with at least 4 ANC Harmonized 3 times 2019 2024 during pregnancy household survey Number of households with pregnant women and/or Social protection Annually 2020 2024 children 0–2 years in target provinces receiving cash project MIS transfers Page 80 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Indicator Name (Disaggregated by Gender, Ethnicity, Data Source Frequency Start Year End Year and Welfare Status) Percentage of project beneficiaries who participate in Social protection Annually 2020 2024 community nutrition sessions at least once per month project MIS Percentage of children 6–23 months of age consuming Harmonized 3 times 2019 2024 foods from four or more recommended food groups household survey Percentage of households with access to improved Harmonized 3 times 2019 2024 sanitation household survey Percentage of households with access to clean water Harmonized 3 times 2019 2024 household survey Proportion of households with soap at handwashing Harmonized 3 times 2019 2024 stations household survey Proportion of households that use proper disposal Harmonized 3 times 2019 2024 techniques for child and animal feces household survey Percentage of households with a mean household Harmonized 3 times 2019 2024 dietary diversity score > 4 household survey Percentage of pregnant women and mothers of children PRF MIS Annually 2019 2024 under two years of age in targeted communities participating in Mother and Children Nutrition Groups and SHGs Percentage increase of income (or overall consumption) Harmonized 3 times 2019 2024 of SHG members household survey Percentage of SHG member food production which is PRF Project MIS Annually 2021 2024 consumed by members (agriculture, livestock, fisheries data and aquaculture) Percentage increase in the availability of nutritious foods Harmonized 3 times 2019 2024 household survey Percentage increase in the consumption of nutritious Harmonized 3 times 2019 2024 foods household survey Percentage of time saved and reduced workload for Harmonized 3 times 2019 2024 women (including pregnant and breastfeeding) household survey 4. At least three surveys would be needed, corresponding to the baseline, midline, and end line of the program implementation. The exact timing of these surveys will factor the rollout process of the four projects to maximize synergies. The surveys ought to be representative of all the 12 nutrition convergence districts and include both household- and village-level questionnaires. Thus, the surveys would ideally have a sample size of around 2,500–3,000 households. Page 81 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Monitoring Delivery of Interventions 5. Monitoring delivery of interventions will focus on tracking the achievement of convergence activities at the village level. This establishes a system for tracking the provision of inputs and outputs produced at the village level, assessing the adequacy of delivery mechanisms and the program take up, and utilization of delivered services. The main goal would be to assess and provide regular feedback on the achievement of convergence activities in terms of totality of delivery of key interventions at the village level, the number of villages, and to the extent possible the number of households where convergence has been achieved and the duration of that coverage between 2019 and 2014, during which period the four projects will be implemented. Four main tools will be used for this purpose:  Village score cards;  IBM;  Administrative data - sector and program MIS; and  Spot checks and key informant interviews. 6. Village score cards shall be employed as a tool for regularly reporting on interventions being delivered in each of the villages in the 12 districts covered by at least one of the four planned projects, providing a village-level mapping of ongoing interventions. A bottom-up approach will be employed to collect data using village score cards, taking advantage of implementation arrangements of current and planned projects by the World Bank and other agencies that already use village facilitators to coordinate and deliver some interventions at the village level. Among the World Bank’s own portfolio, both the HGNDP and the ECE project have village facilitators, which provides a pool of potential data collectors for the village score card. The PRF also has Kumban Facilitators and Village Self-Help Group Management Committees to potentially draw upon. The score card will focus on a few input indicators (see Table 3.2.) selected from a list of overlapping indicators in the convergence result indicators framework and the national nutrition surveillance system that the MOH is currently developing with TA from UNICEF and the World Food Programme (WFP). The World Bank plans to collaborate with other DPs to develop a simple mobile-based tool, acquire the appropriate mobile devices, and train and assign one of the village facilitators in each village to periodically report on ongoing nutrition-sensitive programs at the village level, so that data could be captured locally and uploaded into a centralized database. 7. This concept offers some significant advantages. Beyond the initial development, equipment, and training expenses, the running costs are very low, requiring only token expenses for data airtime credit and top-up incentives. The village facilitators are already sensitized on nutrition interventions, given their various roles in SBCC and other functions they perform in their communities, for which they may receive payment under the current projects. The M&E budget could be used to provide incremental allowances for performing the data collection at a lesser cost than hiring professional enumerators. Reporting can be more frequent, since the village facilitators reside in villages where they work, unlike when a survey firm is hired to undertake initial data collection. The downside is that village facilitators are not trained enumerators. However, the simplicity of the tool, combined with some training, validation, and incentives for good performance, can mitigate this. Setting up the system and collecting the data are envisaged to Page 82 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) take about six months, after which data can be collected on a semiannual basis. This involves the following processes:  Design of tools in consultation with the Government, especially the NNC;  Software application development (both the field mobile-based application that village facilitators will use for recording data in the field and the end user web-based interface, for receiving, processing, and reporting the data) and repository set;  Training of selected staff at the province and district levels on collecting data using the mobile application and on how to supervise and validate this data so they can later be field trainers and supervisors;  Pretesting to validate the quality of data collected, assess the limits and scope for expansion of the application, and review the application’s performance under different conditions, including the mobile network variability and digital illiteracy; and  Training of village facilitators on using the data collection tool and implementation of data quality control mechanisms. 8. IBM shall be employed to obtain continuous feedback from program beneficiaries about the challenges and adequacy of delivery mechanisms for the interventions. IBM is done using quick, small, and targeted surveys that track a narrow set of indicators and can be implemented in a three-week period at a cost of US$3,000–5,000. A different set of indicators could be tracked in each survey. This allows for continuous monitoring of delivery of interventions at the household level and for improved utilization of services. It will also be used for process monitoring by including targeted questions on either satisfaction with implementation arrangements or whether processes are being followed. It will be used to quickly assess challenges in program take-up too. Two such surveys are envisaged every fiscal year, from the time of effectiveness of the first of the four projects under preparation, which mostly could be run with a local team of Lao consultants or partner institutions. 9. Administrative data shall also be used for monitoring program outputs, supply of some inputs, and program take-up. This includes both the sector-wide and project-specific administrative data and MIS. PRF already has an MIS for tracking various inputs and outputs (that is, SHG and Mother and Children Nutrition Group members and their activities), and this will be enhanced through the additional financing to cover a wider geographic area and new interventions. Both the Scaling-up Water Supply, Sanitation and Hygiene project and the Reducing Rural Poverty and Malnutrition project will build MISs that could be used to monitor key outcomes such as number of households receiving benefits and number of handwashing stations/facilities constructed. Meanwhile, delivery of most interventions in the health sector will be captured from the HANSA Project results framework, DLIs, and DHIS2 data. This could be complemented with information obtained from key informant interviews at the district and village levels. 10. Table 3.2 provides a summary of the interventions from the portfolio results chain that will be monitored, their data sources, time frame, and frequency of monitoring. Delivery of most interventions can be monitored on a semiannual basis according to this monitoring plan. Thus, a semiannual convergence monitoring report will be produced to report and update management and the government Page 83 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) principals on progress toward achieving convergence outcomes. This will report on the number of villages where convergence outcomes resulting from portfolio interventions have been achieved and highlight any implementation challenges discovered. Table 3.2. Monitoring Plan for Delivery of Interventions at the Portfolio Level Data Sources Period Intervention Village Key Frequency Administrative Start End Score IBM Informant Data Year Year Card Interviews SBCC for optimal infant and   2018 2024 Semiannually child feeding, maternal nutrition, and use of cash for nutrition inputs SBCC to promote   2019 2024 Semiannually handwashing with soap for all household members at critical times SBCC to increase production   2019 2024 Semiannually and consumption of diverse foods Improvement of availability  DHIS2 2018 2024 Semiannually and access to ANC and PNC services Provision of essential  DHIS2 2018 2024 Semiannually micronutrients to women and children Treatment of infections (for DHIS2 2018 2024 Semiannually example, diarrhea and malaria) Deworming of children and  2018 2024 Semiannually pregnant women Delivery of cash transfers to  2020 2024 Semiannually generate/increase demand for and improve access to essential health and nutrition services Target social protection  Social 2020 2024 Semiannually services/interventions to the protection poorest and most project MIS nutritionally vulnerable population in rural areas Advocacy and provision of  2019 2024 Annually technical support to other ministries on nutrition issues Page 84 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Data Sources Period Intervention Village Key Frequency Administrative Start End Score IBM Informant Data Year Year Card Interviews Support and promote villages  WASH project 2019 2024 Semiannually to achieve 100% use of CLT data improved sanitation facilities Provision/construction of  2019 2024 Semiannually handwashing stations/facilities Promotion of use of  2019 2024 Semiannually household-level treatment of water before use, for example, chlorination and boiling Dissemination of nutrition  2020 2024 Semiannually information to communities/households through the agricultural extension and other outreach systems Provision of financing,   2020 2024 Semiannually facilitation support, and TA for IGAs including the production and sale of small livestock (for example, poultry and fish) and vegetables Incentive for regular group  2020 2024 Semiannually food processing, cooking, and eating among pregnant women, mothers, and infants Provision of seeds, TA, and   2020 2024 Semiannually SBCC to increase production and consumption of nutritious and diverse foods Finance for construction and  2020 2024 Semiannually rehabilitation of livelihood- oriented infrastructure to improve access to markets and services Evaluation of Convergence Approach 11. Project design practicalities will necessarily result in variations in the number and type of interventions received at the village level as the four new projects roll out. This provides opportunities to embed an experimental evaluation design of the convergence approach to assess the impact of World Page 85 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Bank interventions collectively and the cost-effectiveness of the convergence approach and identify the combination of interventions with the greatest impact on nutrition outcomes given their cost. 12. Two main features of the program implementation result in this varying intensity of convergence. The first is the varying geographical coverage of the four projects. The HANSA Project and Reducing Rural Poverty and Malnutrition Project will cover all villages in the 12 districts. On the other hand, the PRF III Additional Financing and AFN will cover up to 601 of the overlapping villages depending upon resource availability, while the Scaling-Up Water Supply, Sanitation and Hygiene Project will likely cover 450 villages, depending upon community demand. Thus, only 450 of the 881 villages will receive all interventions at full implementation of all the four projects. Additionally, the rollout pace differs across programs either because some interventions can be prepared and implemented much quicker than others or due to phased rollout of interventions within projects. For example, setting up the payment system might take up to 12 months, while SBCC is anticipated to be implemented much earlier. When the cash transfer is rolled out, it is anticipated to cover only half of the eligible beneficiaries at the beginning. Careful planning and coordination of this rollout process (for example, randomizing phase-in) permits embedding an evaluation of the impact and cost-effectiveness of the convergence approach. Project-level Evaluations 13. Such evaluation will focus on evaluating the impact of specific interventions on the achievement of intermediate outcome indicators and the effectiveness of different delivery mechanisms. This will be done using three approaches depending on the context.  Experimental designs can be built in by exploiting any phased approach to implementation within projects. In this case, phased implementation can be carefully planned to accommodate an impact evaluation, randomizing selection of villages in each phase for example.  Quasi-experimental designs that exploit arbitrary discontinuities introduced by program eligibility criteria. For example, age-based cutoff points for eligibility of cash transfer in the first phase of the Reducing Rural Poverty and Malnutrition project make it possible to use regression discontinuity analysis to evaluate the impact of the interventions for people around the cutoff point. Similarly, using PMT thresholds for eligibility for subsidies for the construction of sanitary facilities under the Scaling-Up Water Supply, Sanitation and Hygiene Project also makes use of regression discontinuity applicable for impact evaluation of interventions.  Nimble experiments. Small experiments can also be run without significantly changing the nature of program implementation and still answer questions on how best to implement key interventions. For example, by taking advantage of changes to existing interventions such as SBCC, which is already being done, the impact of a new module can be assessed compared to current practice by making small changes to the operation procedures across locations, for example, how and who delivers an intervention. Page 86 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Implementation arrangement 14. The Reducing Rural Poverty and Malnutrition Project will finance the data collection and overall M&E of the convergence approach. Subcomponent 3.2 of the project therefore includes financing of three rounds of harmonized surveys covering data needs of all four projects, the costs of regular implementation of the village score cards (twice a year) to monitor the achievement of convergence, and IBM (twice a year) to obtain regular beneficiary feedback. The surveys will be organized and designed to also serve the data needs of impact evaluations of the convergence approach given the rollout plans of the four projects. 15. MPI will lead these overall convergence M&E activities as part of the overall coordination of the convergence portfolio of projects in the four target provinces, working with multi-sectoral convergence coordinating committee. The project will hire a M&E expert to provide technical support to MPI in consultation with other sectors, on developing the survey instruments, methodology, supervision and reporting plans, as well as aggregation of relevant statistics produced from administrative data sources. Primary data collection activities like the harmonized surveys and IBM will be implemented by a survey firm based on the established methodology and instruments, while administrative and project MIS data, shall be generated by the responsible sector ministries. The World Bank technical teams from the four projects, and the poverty team shall work closely with MPI in this process also, to ensure timely and high- quality implementation of the M&E activities. 16. Strong coordination across projects and implementing agencies is crucial for successful implementation of the M&E Framework. Experimental approaches require coordinated rollout of project implementation across projects. The four project teams will therefore develop a geographic, intervention, and time-specific rollout plan, keeping in mind that total convergence should be achieved within a given time frame of the project. Regular convergence workshops with the Government would also be crucial for instilling a shared vision for the M&E of convergence of nutrition interventions. 17. The early stages of implementation will focus on developing a concrete roll-out plan across sectors as the projects await effectiveness and developing monitoring instruments such as the harmonized surveys and village score cards. Project MIS systems will also be established that will later provide information used to compute some key convergence indicators. Baseline data collection for the harmonize surveys and first village score cards will then be implemented. These activities should be completed within the first 12 months of the project’s approval by the Board. Routine data collection, monitoring and reporting activities such as the semiannual implementation of the village score card, IBM, spot checks and reporting from administrative data will then follow. Information they will generate shall be summarized into a semiannual monitoring bulletin, providing crucial information for the convergence coordinating committee discussions. In the final stages, M&E activities will mostly focus on analytics for impact evaluations for the portfolio level outcomes, assess the impact of the convergence approach and draw lessons for future implementation. 18. Since the portfolio of interventions will be implemented Phased Multi-Sectoral Approach spanning three phases, the M&E activities in this first phase are naturally centered on developing and establishing instruments for M&E, and generating knowledge and lessons learnt to improve Page 87 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) implementation of nutrition interventions in the future. The village score card, harmonized surveys and IBM are both instruments that will be developed and used for the first time. This phase of the program will help establish them for monitoring of interventions in future. Impact evaluations activities, will help to assess the cost effectiveness of the convergence approach, identify which interventions work and how delivery of interventions could be improved for greater impact. Thus, great emphasis shall be placed on rigorously measuring the impact of the convergence approach, impacts of different ways of delivering interventions, documenting and sharing the supporting evidence and lessons learnt. Page 88 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) ANNEX 4: Framework for the Design of a Common Nutrition Social Behavioral Change and Communication Strategy for the Overall World Bank-Financed Nutrition Convergence Approach 1. Creating a common vision of planning and implementing a strong and coordinated evidence- based Nutrition SBCC Strategy and Action Plan would be critical for the success of the overall convergence approach. The proposed SBCC approach is behavior centered to facilitate individuals, households, groups, and communities in adopting and sustaining nutrition-related practices. It complements the National Social and Behavior Change Multisectoral Communication Strategy for Nutrition by designing an approach for four World Bank-supported operations: HGNDP (P151425)/HANSA Project (P166165), Reducing Rural Poverty and Malnutrition Project (P162565), Scaling-Up Water Supply, Sanitation, and Hygiene Project (P164901), and the PRF III Additional Financing (P157963). Box 4.1. Social and Behavior Change and Communication SBCC activities can be categorized into two primary types—mass media and community-based approaches—and successful campaigns are best delivered in a complementary manner. In addition, SBCC also includes advocacy activities for nutrition, targeted at different levels of leaders and decision makers. Mass media approaches can be in the form of ‘edutainment’ or social marketing campaigns. Edutainment is characterized by radio and television messages, dramas aired on radio or television, and songs containing relevant messages and may also include social media. In contrast, community-based approaches leverage social networks, outreach activities, and peer influence to promote discussion among communities, within households, and among peers. They aim to influence the utilization of services and behaviors through norms, information, emotional drivers, and social and peer support. These approaches can be delivered in the form of community edutainment events, community discussion groups, peer groups, or one-on-one exchanges and are often targeted at specific subpopulations (such as pregnant women, women with children under a certain age, men, and adolescents). In the 12 districts of the four priority provinces, the HGNDP supports community-based SBCC activities aimed at contributing to improvements in infant and young child feeding and caring practices, maternal nutrition and related caring practices, appropriate sanitation and personal as well as environment-related hygiene behaviors, household air pollution through use of near smokeless cookstoves, dietary diversification, and other determinants of nutrition at the village level. VFs, who comprise mostly female village health volunteers and/or members of LWU, support the SBCC implementation at the village level, under the guidance of district health staff. The VFs are responsible for organizing communications sessions at least monthly, conducting home visits for follow-up on pregnant women and children under two years of age, supporting the organization of edutainment community events, and coordinating with relevant district line ministries. 2. Convergence for an effective delivery of SBCC will be achieved in the following manner:  Thematic convergence. The thematic convergence builds on UNICEF’s framework to address the underlying, basic, and immediate causes of malnutrition, all of which are behavior related (see Figure 4.1). All projects are designed to include nutrition-specific and nutrition- sensitive interventions to improve (a) care and feeding practices, (b) household food security, and (c) household environment and health services. The related SBCC interventions will be carried out in a coordinated and phased manner. Page 89 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Figure 4.1. Framework for the SBCC Delivery Pathways to Improved Behaviors and Nutritional Status Note: MCH = maternal and child health; SP = social protection; WB = World Bank; WRA = women in reproductive age 3. Communications convergence through coordinated SBCC planning and implementation: (a) Identification of messages based on sector (and which is therefore nutrition-specific or nutrition-sensitive) but linked to overarching behaviors that contribute to the nutrition agenda in Lao PDR. Figure 4.1 provides key practices per sector, which can be grouped into seven clusters. These clusters are: (i) maternal nutrition; (ii) health care seeking behavior; (iii) breastfeeding and complementary feeding practices; (iv) WASH and environmental health; (v) nutrition-sensitive agriculture practices (including food processing); (vi) income/household expenditures/savings; and (vii) women empowerment. The evidence supporting the positive relationship between each practice and nutritional status has been documented in other documents of the World Bank convergence approach. It is important to note that the practices presented in Figure 4.1 are not exhaustive; there are many sub- practices that can be added at a later stage. (b) Complementary messaging by the various projects using primary messaging from one’s own sector to meet specific project and sector goals, supplemented by secondary/support messaging from other projects/sectors. These complementary messages feed into the same Page 90 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) behavior change. Using this method serves to provide the beneficiary with many more reasons to change their behavior/adopt the new behavior and also reiterates the message from a new angle (avoids communication fatigue, which is a result of straightforward repetition). (c) Communication will be coordinated to focus on the behaviors of those who need to practice the desired behaviors, for example, mothers and other caregivers but also those who can influence decisions. The SBCC framework identified four types of audiences (see Figure 4.1): The primary audience includes women in reproductive age (women ages 15–49 years, in particular those who are pregnant and with children under two years of age) and other caregivers. The secondary audience includes other family members and peers/group members—this will include those producing food (farmers). As the tertiary audience, the focus is on community leaders (for example, Village Development Committee, VDC) who can mobilize or allocate resources as well as local GoL service providers (including primarily maternal and child health, WASH, and agricultural service provision). As the final target group, central GoL, private sector, and other DPs will be targeted. (d) Same or similar delivery platforms from national to community level (see Figure 4.2). Develop and improve communication for better coordination between the PMUs of different projects and the line ministries at the national, provincial, and, in particular, the district and village levels. This can be done by using an existing committee and inviting convergence project personnel to its meetings, by using a common planner at the village level to earmark main meetings, by coordinating high-level visits, and so on. At the village level, a concerted effort should be made to coordinate village groups, in particular, with a view on sustainability.63 63 Example: PRF’s proposed wireless communication and networking groups (WCNGs) can be a good forum for WASH to promote safe water practices or the building of household-level handwashing stations. The ongoing HGNDP already supports the implementation at the community level of the national nutrition SBCC plan in the form of community edutainment events, community discussion groups, peer groups, or one-on-one exchanges that are often targeted at specific subpopulations (such as pregnant women, women with children under a certain age, men, and adolescents) and CLTS in the 12 selected districts (10 of these districts overlap with the PRF districts). Starting in 2019, the WASH Project expand these efforts in the 12 districts. In the villages that do not have a WASH project, CLTS can be carried out by the other projects such as the HGNDP, HANSA, or PRF. Page 91 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) Figure 4.2. Framework for Common Nutrition SBCC Strategy Note: IEC = Information, Education and Communication; WB = World Bank; N=National; P=Provincial; D=District Under this multisectoral nutrition convergence approach, the convergence projects will endeavor to coordinate their planning to dovetail efforts at the community level, thereby enhancing synergy and reducing redundancy and message fatigue. Some of the areas wherein this can be achieved include: (a) By coordinating village-level SBCC action plans and, to the extent possible, having all projects working within an agreed time frame to deliver the various SBCC interventions to the same households in any particular village.64 (b) By jointly carrying out certain activities with other projects or combining project activities in one event at the village level, thereby increasing visibility for all projects, and helping reinforce the impact of SBCC. Example: Health, social protection, WASH, and PRF could jointly do village cleaning or PRF village planning meeting. (c) In continuation, trying to achieve a common branding (including logo and legend) for the multisector nutrition agenda (see Figure 4.2) and using it both at the national level (for example, for the National Sanitation Campaign planned under the Water Supply and Sanitation-WSS- project) as well as for the village level (to increase interest and recall). 64 The cycle should be no longer than 2 years to deliver all the messages. Page 92 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) (d) In continuation of points (a) and (b), using similar and standardized communication tools and channels at the village level, which are simple to use. Different projects could be using a similar communication style across projects. For example, pictorial and similar in their look and usage. Short audio-visuals could be used to deliver complementary messaging, which can be shown at meetings of any project and would still be relevant. (e) Joint training and orientation of project staff at various levels, to increase synergy and strengthen the institutional links between PMUs/line ministries. Overall Communication Strategy for the World Bank-financed Nutrition Convergence Approach 4. All projects would have to be aligned in the overall communication on the multisectoral nutrition convergence approach. National-level advocacy for the World Bank multisector approach on nutrition and increasing communication within the Government and within the stakeholder community through workshops, publications, sharing of key learnings through common social media platforms, discussion groups with DPs, and so on will need to be fully coordinated. Page 93 of 95 The World Bank Laos Reducing Rural Poverty and Malnutrition Project (P162565) ANNEX 5. MAP Page 94 of 95