Document of The World Bank Report No: ICR2282 ... · PGDI Governance and Institutional Development Project PARP EU's Budget Support Program PFM Public Finance Management PRSC Poverty

Document of

The World Bank

Report No: ICR2282

IMPLEMENTATION COMPLETION AND RESULTS REPORT

(IDA-43410, IDA-44860 and TF-92655)

ON TWO CREDITS

IN THE AMOUNT OF SDR 26.3 MILLION

(US$ 40 MILLION EQUIVALENT)

AND

IN THE AMOUNT OF SDR 30.7 MILLION

(US$ 50 MILLION EQUIVALENT)

AND A SUPPLEMENTAL FINANCING GRANT

(US$ 10 MILLION)

TO THE

THE REPUBLIC OF MADAGASCAR

FOR A

POVERTY REDUCTION SUPPORT CREDIT SERIES

June 22, 2012

Poverty Reduction and Economic Management 1

Africa Region

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CURRENCY EQUIVALENTS

(Exchange Rate Effective as of May 31, 2012)

Currency Unit = Malagasy Ariary (MGA)

1.00 MGA = US$ 0.000477

US$ 1.00 = 2,096 MGA

FISCAL YEAR

January1-December 31

ABBREVIATIONS AND ACRONYMS

ACT Artemisinin-based Combined Therapies

ADB African Development Bank

ARMP Regulatory Agency for Public Procurement

CBM Central Bank of Madagascar

CAS Country Assistance Strategy

CDE Expenditures Control (Contrôle des dépenses engages)

CHD Hospital at district level

CSB Basic Health Center

DGWS Directorate General of Water and Sanitation

DHS Demographic Household Survey

EC European Commission

EFA National Education for All

EITI Extractive Industry Transparency Initiative

EU European Union

FAF Fer Acid Folic

FDI Foreign Direct Investment

FDL Local Development Fund

GDP Gross Domestic Product

GNI Gross National Product

GoM Government of Madagascar

ICRR Implementation Completion and Results Report

INSTAT National Statistics Institute

MAP Madagascar Action Plan

MDGs Millennium Development Goals

MDRI Multilateral Debt Relief Initiative

MEFB Ministry of Finance and Budget

ONN National Office for Nutrition

PAP Priority Action Plan

PDSS Health Sector Development Program

PRSP Poverty Reduction Support Credit

SIGFP Integrated Financial Management System

CNN National Nutrition Council

DGWS Directorate General of Water and Sanitation

INSTAT National Institute for Statistics

OMNIS National Office of Mines and Strategic Industries

PGDI Governance and Institutional Development Project

PARP EU's Budget Support Program

PFM Public Finance Management

PRSC Poverty Reduction Support Credit

CPIA Country Policy and Institutional Assessment

PEFA Public Expenditure and Financial Accountability

M&E Monitoring and Evaluation

Vice President: Makhtar Diop

Country Director: Haleh Z. Bridi

Sector Manager: John Panzer

Task Team Leader: Maria Teresa Benito-Spinetto

ICR Team Leader: Maria Teresa Benito-Spinetto

MADAGASCAR

IMPLEMENTATION COMPLETION AND RESULTS REPORT

POVERTY REDUCTION SUPPORT CREDITS 4-5

CONTENTS

Data Sheet

A. Basic Information

B. Key Dates

C. Ratings Summary

D. Sector and Theme Codes

E. Bank Staff

F. Results Framework Analysis

G. Ratings of Program Performance in ISRs

H. Restructuring

1. Program Context, Development Objectives and Design ............................................ 1

2. Key Factors Affecting Implementation and Outcomes .............................................. 6

3. Assessment of Outcomes .......................................................................................... 14

4. Assessment of Risk to Development Outcome ......................................................... 19

5. Assessment of Bank and Borrower Performance ..................................................... 20

6. Lessons Learned........................................................................................................ 20

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners........... 22

Annex 1 Bank Lending and Implementation Support/Supervision Processes.............. 23

Annex 2. Beneficiary Survey Results ........................................................................... 25

Annex 3. Stakeholder Workshop Report and Results ................................................... 26

Annex 4. Summary of Borrower's ICR and/or Comments on Draft ICR ..................... 27

Annex 5. Comments of Cofinanciers and Other Partners/Stakeholders ....................... 28

Annex 6. List of Supporting Documents ...................................................................... 29

Annex 7. Program Development Objectives Results Matrix……………………….... 30

Annex 8. Summary PEFA Indicators………………………………………………… 36

MAP

A. Basic Information

Program 1

Country Madagascar Program Name

Fourth Poverty

Reduction Support

Credit

Program ID P099420 L/C/TF Number(s) IDA-43410,TF-56900

ICR Date 05/25/2012 ICR Type Core ICR

Lending Instrument DPL Borrower REPUBLIC OF

MADAGASCAR

Original Total

Commitment XDR 26.30M Disbursed Amount XDR 26.30M

Implementing Agencies

Ministry of Economy Finance and Budget

Cofinanciers and Other External Partners

Program 2

Country Madagascar Program Name Fifth Poverty Reduction

Support Credit

Program ID1 P105135 L/C/TF Number(s) IDA-44860

ICR Date 05/25/2012 ICR Type Core ICR

Lending Instrument DPL Borrower REPUBLIC OF

MADAGASCAR

Original Total

Commitment XDR 30.70M Disbursed Amount XDR 30.70M

Implementing Agencies

Ministry of Finance Economy and Budget

Cofinanciers and Other External Partners

1 A Supplemental Financing Grant was approved by the Board in August 13, 2008 in the

amount of US$10 million.

B. Key Dates

Fourth Poverty Reduction Support Credit - P099420

Process Date Process Original Date Revised / Actual

Date(s)

Concept Review: 03/28/2007 Effectiveness: 08/30/2007 08/30/2007

Appraisal: 05/08/2007 Restructuring(s):

Approval: 07/31/2007 Mid-term Review:

Closing: 07/31/2008 07/31/2008

Fifth Poverty Reduction Support Credit - P105135

Process Date Process Original Date Revised / Actual

Date(s)

Concept Review: 02/06/2008 Effectiveness: 07/30/2008

Appraisal: 05/09/2008 Restructuring(s):

Approval: 06/26/2008 Mid-term Review:

Closing: 07/31/2009 07/31/2009

C. Ratings Summary

C.1 Performance Rating by ICR

Overall Program Rating

Outcomes Unsatisfactory

Risk to Development Outcome High

Bank Performance Moderately Unsatisfactory

Borrower Performance Unsatisfactory

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR)

Overall Program Rating

Bank Ratings Borrower Ratings

Quality at Entry Moderately

Satisfactory Government: Not applicable

Quality of Supervision: Moderately

Unsatisfactory

Implementing

Agency/Agencies: Not applicable

Overall Bank

Performance

Moderately

Unsatisfactory

Overall Borrower

Performance Unsatisfactory

C.3 Quality at Entry and Implementation Performance Indicators


Implementation

Performance Indicators

QAG Assessments

(if any) Rating:

Potential Problem

Program at any time

(Yes/No):

No Quality at Entry

(QEA) None

Problem Program at any

time (Yes/No): No

Quality of

Supervision (QSA) None

DO rating before

Closing/Inactive status Satisfactory


Implementation

Performance Indicators

QAG Assessments

(if any) Rating:

Potential Problem

Program at any time

(Yes/No):

No Quality at Entry

(QEA) None

Problem Program at any

time (Yes/No): No

Quality of

Supervision (QSA) None

DO rating before

Closing/Inactive status Satisfactory

D. Sector and Theme Codes


Original Actual

Sector Code (as % of total Bank financing)

Central government administration 50 Ibid.

General education sector 10 Ibid.

General water, sanitation and flood protection sector 10 Ibid.

Health 20 Ibid.

Sub-national government administration 10 Ibid.

Theme Code (as % of total Bank financing)

Education for all 17 Ibid.

Health system performance 17 Ibid.

Other accountability/anti-corruption 16 Ibid.

Public expenditure, financial management and

procurement 33

Ibid.

Rural services and infrastructure 17 Ibid.


Original Actual

Sector Code (as % of total Bank financing)

Central government administration 56 Ibid.

General education sector 11 Ibid.

General water, sanitation and flood protection sector 11 Ibid.

Health 22 Ibid.

Theme Code (as % of total Bank financing)

Education for all 17 Ibid.

Health system performance 17 Ibid.

Other accountability/anti-corruption 17 Ibid.

Public expenditure, financial management and

procurement 33

Ibid.

Rural services and infrastructure 16 Ibid.

E. Bank Staff


Positions At ICR At Approval

Vice President: Makhtar Diop Obiageli Katryn Ezekwesili

Country Director: Haleh Z. Bridi Ritva S. Reinikka

Sector Manager: John Panzer Laura Frigenti

Task Team Leader: Alain W. D'Hoore Stefano Paternostro


ICR Primary Author: Maria Teresa Benito-Spinetto

Fifth Poverty Reduction Suport Credit - P105135

Positions At ICR At Approval

Vice President: Makhtar Diop Obiageli Katryn Ezekwesili

Country Director: Haleh Z. Bridi Dirk Reinermann (Acting)

Sector Manager: John Panzer John Panzer and Lynne D.

Sherburne-Benz

Task Team Leader: Alain W. D'Hoore Jacques Morisset and Stefano

Paternostro


ICR Primary Author: Maria Teresa Benito-Spinetto

F. Results Framework Analysis

Program Development Objectives (from Program Document)

In line with the Country Assistance Strategy for Madagascar, a series of single tranche

Poverty Reduction Support Credits (PRSCs), provided in the form of budget support, was

envisaged to support implementation of key components of the second-generation

Madagascar PRSP called the Madagascar Action Plan (MAP). The focus of the series

was centered on: (i) governance and budget management reform and (ii) improved

systems for service delivery in education, health, nutrition, water and sanitation.

Revised Program Development Objectives (as approved by original approving

authority)

Program Development Objectives were not revised.

(a) PDO Indicator(s)

Indicator Baseline

Value

Original Target

Values (from

approval

documents)

Formally

Revised

Target

Values

Actual Value

Achieved at

Completion or

Target Years

Indicator 1 : Number of PEFA budget preparation and execution indicators (indicators 1

through 17) rated "B" and above.

Value

(quantitative or

Qualitative)

9 13 NA

Date achieved 03/31/2006 12/31/2010 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met. The 2011 PEFA that would have allowed assessment for this

indicator did not take place. (The last available PEFA dates from 2009). A

2011 review of PFM issues suggests limited progress on the Public Finance

Management reform agenda since March 2009.

Indicator 2 :

Number of public institutions (ministries at central government level)

executing their annual budgets through the integrated financial management

system (SIGFP).

Value

(quantitative or

Qualitative)

5 All All

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target met.

Indicator Baseline

Value

Original Target

Values (from

approval

documents)

Formally

Revised

Target

Values

Actual Value

Achieved at

Completion or

Target Years

Indicator 3 : Number of PEFA budget reporting (indicators 22 through 25) rated "B" and

above.

Value

(quantitative or

Qualitative)

0 3 NA

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met. See comment for Indicator 1.

Indicator 4 : Number of PEFA indicators measuring the internal/external control

mechanisms (indicators 20, 21, 26 through 28) rated “B” and above.

Value

(quantitative or

Qualitative)

0 4 NA

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)


Indicator 5 :

Percentage of reviewed procurement processes in selected public institutions

that conform to the new procurement regulations (Ministries of Education,

Health, Transport, and Agriculture used as reference points).

Value

(quantitative or

Qualitative)

5% 80% 50%

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met, but some improvement occurred.

Indicator 6 : National Anti-Corruption Perception Index of (i) households and (ii) civil

service employees.

Value

(quantitative or

Qualitative)

(i) 2.2

(ii) 3.0 10% increase 2.6

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met. (Available data for 2010 does not distinguish by target).

Indicator 7 : Share of annual central budget transferred to local governments.

Value

(quantitative or

Qualitative)

1.4 2.7 1.9

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met.

Indicator Baseline

Value

Original Target

Values (from

approval

documents)

Formally

Revised

Target

Values

Actual Value

Achieved at

Completion or

Target Years

Indicator 8 : Primary net enrollment rate.

Value

(quantitative or

Qualitative)

80%

90% 87.7%

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met, despite some improvement. (The baseline and target indicators

were revised in PRSC-5 for the series as a whole based on the availability of

better data.)

Indicator 9 : Primary school completion.

Value

(quantitative or

Qualitative)

50% 74% 63%

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met. (The baseline and target indicators were revised in PRSC-5 for

the series based on the availability of better data. )

Indicator 10 : Repetition rate.

Value

(quantitative or

Qualitative)

19% 14% 19%

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met. (The baseline and target indicators were revised in PRSC-5 for

the series based on the availability of better data.)

Indicator 11 : Skilled birth attendance in (i) CSB, (ii) CHD1 and (iii) in all public CHD2.

Value

(quantitative or

Qualitative)

(i) 18.8

(ii) 1.4

(iii) 2.1

(i) 20.8

(ii) 3.4

(iii) 4.0

(i) 24.9

(ii) 3.4

(iii) 3.4

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target met. Although skill birth attendance at all public CHD2 was not met,

overall birth attendance surpassed the target.

Indicator 12 : Consultation rate for treatment in CSB (number of curative outpatient

visits/total population).

Value

(quantitative or

Qualitative)

44.4 Not specified 31.2

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met. (The baseline was revised from 32.4 to 44.4 due to the

availability of better data)

Indicator Baseline

Value

Original Target

Values (from

approval

documents)

Formally

Revised

Target

Values

Actual Value

Achieved at

Completion or

Target Years

Indicator 13 : Availability of medicines in CSB for each of the following: (i) Chloroquine,

(ii) FAF, (iii) Cotrimoxazole, (iv) Paracetamol and Vitamin A.

Value

(quantitative or

Qualitative)

(i) 96.6%

(ii) 89.3%

(iii) 95.7%

(iv) 92.2%

(v) 93.4%

(i) >95%

(ii) >95%

(iii) >95%

(iv) >95%

(v) >95%

(i) ACT:99.0%

(ii) 88.3%

(iii) 96.7%

(iv) 96.6%

(v) 95.3%

Date achieved 03/31/2006 12/31/2010 2011

Comments

(incl. % of

achievement)

Target met for all sub-indicators except FAF (Fer Acid Folic). Note that

Chloroquine no longer exists due to policy change in malaria treatment.

Equivalent treatment was replaced by ACT (Artemisinin-based Combined

Therapies).

Indicator 14 : Child underweight rate.

Value

(quantitative or

Qualitative)

42% Decreased by 10%

of baseline 30%

Date achieved 06/30/2004 12/31/2010 12/31/2011

Comments

(incl. % of

achievement)

Target met. Baseline data is based on the 2003/04 Demographic Household

Survey (DHS) and 2011 is based on the Anthropometric and Child

Development Survey.

Indicator 15 : Percentage of the rural population with access to safe drinking water.

Value

(quantitative or

Qualitative)

31% 37% 38.5%

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target met. Data for 2010 based on the 2010 DHS.

Indicator 16 : Percentage of the rural population with access to sanitation.

Value

(quantitative or

Qualitative)

46% 51% 41.5%

Date achieved 03/31/2006 12/31/2010 12/31/2010

Comments

(incl. % of

achievement)

Target not met. Data for 2010, based in the 2010 HS, refers to access to

latrines/toilets. (The baseline indicator was revised slightly in PRSC-5 to 46%

due to better data availability).

G. Ratings of Program Performance in ISRs


No. Date ISR

Archived DO IP

Actual

Disbursements

(USD millions)

1 06/28/2008 Satisfactory Satisfactory 40.87


No. Date ISR

Archived DO IP

Actual

Disbursements

(USD millions)

1 08/25/2008 Satisfactory Satisfactory 48.55

H. Restructuring (if any) Not applicable.

1

Context of the Preparation of the Implementation Completion and Results Report

The PRSCs were originally designed as a three single-tranche credit series. The first two

operations, PRSC-4 and PRSC-5, were approved by the World Bank Board, respectively

on July 31, 2007 and June 26, 2008. However, due to the emergence of a political crisis

in Madagascar in early 2009, and OP 7.30 coming into effect2, the preparation of PRSC-6,

planned for mid-2009 was suspended, and the series was discontinued. Section 2.2

expands on the political situation in 2009 and following years.

The ICR for this PRSC series was delayed on account of expectations that PRSC-6 would

take place once the political situation was resolved. However, the political crisis

continued to be in effect for longer than expected and finally PRSC-6 was discontinued

and an ICR prepared.

1. Program Context, Development Objectives, and Design

1.1 Context at Appraisal

a. Macroeconomic situation at appraisal

Madagascar is one of the poorest countries in Sub-Sahara Africa, with a GNI per capita

of US$340 in 2007. Following the 2002 political crisis—a crisis that had lasted almost a

year and seen a 12.5 percent drop in real GDP, GDP had rebounded to its pre-crisis level

by 2004, and overall growth was set on a pace of close to 5 percent a year over 2005-06

with an estimated growth of 6.5 percent for 2007. Inflation continued to decline in 2006

aided by tight monetary policy, low prices, and a decline in world oil prices during the

second half of the year. Fiscal policy was been consolidated with the overall

macroeconomic situation remaining stable.

Growth in 2006 was led by the tertiary sector. Tourist arrivals increased 14 percent and

growth was strong in public sector, transport, and telecommunications. The primary

sector, on the other hand, grew only 2.3 percent due to rain shortfalls and low world

prices for key agricultural exports, such as vanilla. The secondary sector grew at a

moderate 4 percent, paced by solid gains in construction and mining, the latter related to

a large ilmenite mining investment in the Fort Dauphin area. Early estimates at the time

projected a healthy 6.5 percent growth in GDP for 2007 due to the launch of another

large mining investment project of around US$2.5 billion (or 45 percent of GDP) to be

undertaken over three years (2007-2009). This optimistic outlook was in spite of the six

tropical storms/cyclones that hit Madagascar in early 2007 when more than 300,000

people were affected by deteriorating food security, increasing health risks, and

substantial damage to public infrastructure and crops.

2 Refer to OP/BP 7.30 for more information on Bank‟s policy on “Dealing with the facto

governments”.

2

In 2006, inflation slowed down from its previous high levels over 2004-05, owing to

tighter monetary policy, lower rice prices, and a decline in oil prices later in the year.

However, the declining trend started to reverse in the early months of 2007 due to the

floods and increasing import prices, especially rice and petroleum. The exchange rate of

the ariary was broadly stable in 2005, but it began to rise against the U.S. dollar in the

last quarter of 2006 and the first months of 2007, with a nominal appreciation of 10

percent in the beginning of the year, reflecting an improved export performance and

greater foreign direct investment (FDI) linked to the mining project. FDI increased from

1.7 percent of GDP in 2005 to 4 percent in 2006. Stronger exports, greater FDI inflows,

and temporarily declining world petroleum prices contributed to an improvement in the

balance of payments, with the overall current account deficit improving from -

10.9 percent of GDP in 2005 to -8.8 percent in 2006. Foreign reserves were maintained at

three months of imports at year end 2006. The Central Bank of Madagascar (BCM)

guidelines for intervention in the foreign exchange market, aimed at achieving its foreign

assets objectives and dampening sharp swings that would create uncertainty, were

broadly followed.

Fiscal policy had two key objectives: reducing macroeconomic imbalances and avoiding

crowding out the private sector. Total spending was kept in line with domestic revenue

and concessional external financing, allowing domestic financing of the budget to be held

at a minimum. In 2006, the tax revenue to GDP ratio was still a low 10.7 percent.

Persistent problems in revenue collection hindered the Government's ability to implement

its ambitious poverty reduction strategy, with mid-year expenditure cuts implemented in

2006 to maintain overall fiscal discipline. The domestic fiscal balance improved from

-2.2 percent to -2.0 percent of GDP, and the overall fiscal balance (excluding grants)

from -10.1 percent to -10.5 percent of GDP.3 As a result, bank credit to the government

declined in the context of a modest pace of overall credit and monetary expansion. A

tight statutory limit on central bank financing of the budget deficit was strictly observed

and steps were taken to develop the Treasury bill market. Consolidated Government debt

owed to the BCM was converted into marketable securities. The Government was also

implementing a customs reform program and, with support from the IMF and World

Bank, was designing a comprehensive reform of tax and customs administration.

b. Alignment of PRSC program with Government, Bank and donor strategies

This PRSC series was approved shortly after the re-election of President Ravalomanana,

in December 2006, and the launch of the Madagascar Action Plan (MAP), the

government‟s Poverty Reduction Strategy. The series was designed to support

implementation of this strategy, and was consistent with the Bank's Country Assistance

Strategy (CAS) discussed at the Board of Executive Directors meeting on April 3, 2007.

The MAP‟s objective was to promote rapid and sustainable development over the next

five years in line with the Government's national vision document (Madagascar

3 The overall deficit, including grants, increased drastically from -4.3 percent to 37.5

percent of GDP due to a onetime MDRI.

3

Naturally) and the UN Millennium Development Goals (MDGs). To attain this objective,

the MAP presented eight key commitments: (i) responsible governance; (ii) connected

infrastructure; (iii) educational transformation; (iv) rural development and a green

revolution; (v) health, family planning, and the fight against HIV/AIDS; (vi) high-growth

economy; (vii) cherish the environment; and (viii) national solidarity.

The PRSC program for this series focused explicitly on improving governance, budget

management, and service delivery, and it included specific policy actions in these areas.

In parallel, Bank support aimed at directly enhancing Madagascar's growth potential

through its significant portfolio of ongoing IDA investment projects in infrastructure,

environment, mining, rural development, the Integrated Growth Poles project, the

Irrigation and Watershed Management project, and the Regional Telecommunications

project. Overall, the 2007 CAS devoted significant IDA resources to operations designed

to continue investment and policy dialogue on the growth agenda.

In line with the Government‟s request and consistent with the Paris Declaration on

harmonization, Bank assistance to Madagascar was aligned with financial and technical

support from other donors to provide a package of coordinated support around the MAP.

A partnership agreement (“Cadre de Partenariat”) was signed between the Government

and key donors providing part of their assistance through budget support (the European

Commission (EC), France (Agence Française de Développement and the French Co-

operation), the African Development Bank, and the World Bank) to provide a framework

and lay out procedures and modalities for a multi-donor approach to budgetary support.

This Budget Group initiated joint-donor missions already since October 2004 to review

implementation of the PRSP/MAP and supervise their respective budget support

operations.

In addition, the Bank collaborated and coordinated activities with the IMF. The staff of

the two institutions conducted regular joint assessments of the PRSP/MAP

implementation and worked closely together on such areas as: (i) analysis and reforms in

public financial management; (ii) other governance reforms, including customs and tax

reform; (iii) trade; and (iv) financial sector reforms. Joint policy advice was given on

budgetary procedures, including expenditure execution and the functioning of internal

and external controls.

1.2 Original Program Development Objectives (PDO) and Key Indicators (as

approved)

The original PDOs were stated as follows:

In line with the Country Assistance Strategy for Madagascar, a series of single-tranche

Poverty Reduction Support Credits (PRSCs), provided in the form of budget support, is

envisaged to support implementation of key components of the second-generation

Madagascar PRSP called the Madagascar Action Plan (MAP). The focus of the series is

centered on: (i) governance and budget management reform and (ii) improved systems

for service delivery in education, health, nutrition, water, and sanitation.

The original Key Outcome Indicators are shown in Table 1 below.

4

Table 1: Expected Key Outcome Indicators

Area Key Monitoring Indicator

A. PUBLIC FINANCE MANAGEMENT

Budget preparation and execution 1. Number of PEFA budget preparation and

execution indicators (indicators 1 through

17) rated “B” and above increased from 9

to 13.

2. Execution of annual budgets through the

integrated financial management system

(SIGFP) by all public institutions

(ministries at central government level).

Budgetary reporting 3. Number of PEFA budget reporting

indicators (indicators 22 through 25) rated

“B” and above increased from 0 to 3.

Internal and external controls 4. Number of PEFA indicators measuring

internal and external control mechanisms

(indicators 20, 21, 26 through 28) rated “B”

and above increased from 0 to 4.

Public procurement 5. Reviewed procurement processes in

selected public institutions assessed as

conforming to the new procurement

regulations increased to at least 80%

(Ministries of Education, Health,

Transport, and Agriculture are used as

reference points).

B. GOVERNANCE

Reduction of corruption 6. National Anti-Corruption Perception

Index of (i) households and (ii) civil

service employees increased by 10 percent

over its 2005 value.

Decentralization 7. Share of annual central budget

transferred to local governments increased

to 2.7 percent.

BASIC SERVICE DELIVERY

Education 8. Primary school net enrollment rate

increased from baseline.

9. Primary school completion rate

increased from baseline.

10. Reduced repetition rate over baseline.

Health 11. Skilled birth attendance increased to

20.8% in CSB, 3.4% in CHD1and 4.0% in

all the public CHD2.

12. Consultation rate for treatment

increased in CSB (number of curative

outpatient visits/total population).

5

13. Availability of medicines in CSB

increased to more than 95% for each of the

following: Chloroquine, FAF,

Cotrimoxazole, Paracetamol and Vitamin

A.

Nutrition 14. Child underweight rate (MDG

indicator) by reduced 10% from baseline.

Water and sanitation 15. Rural population with access to safe

drinking water increased to 37%.

16. Rural population with access to

sanitation increased to 51%.

1.3 Revised PDO, Key Indicators, and Reasons/Justification

The PDO and key indicators were not revised.

1.4 Original Policy Areas Supported by the Program (as approved)

The PRSC series supported three policy areas:

(i) Public Finance Reform:

Public finance reform was aimed at establishing an efficient and effective

government budget process by: (i) advancing on the public finance reform

started in 2005 and already in process of implementation, along with specific

steps identified in the rolling working plan for 2007-09; (ii) enhancing budget

formulation; (iii) improving budget execution and quality of public

procurement; (iv) strengthening controls on public finance management; (v)

improving debt management; (vi) improving revenue generation and

management; and (vii) improving budget transparency.

(ii) Governance:

Governance reforms included actions to improve decentralization and reduce

corruption. In the area of decentralization, the Government‟s reform program

supported by this PRSC series was expected to lead to a higher share of

resources available to the local governments. In the area of fighting corruption,

the reform program was expected to improve the perception of corruption

among the population and civil servants, and reduce opportunities for

corruption in extractive and natural resource industries.

(iii) Basic Service Delivery:

Basic service delivery was concentrated on education, health, nutrition, and

water and sanitation. Support in these areas was aimed at strengthening the

institutional systems and improving access and quality of services.

6

The reforms supported under the above policy areas were expected to increase fiscal

discipline, streamline and consolidate government budget practices, improve

transparency, and sustain efforts to upgrade the overall institutional setting for service

delivery. These reforms were expected to produce higher growth rates and faster poverty

reduction.

1.5 Revised Policy Areas

Not applicable.

1.6 Other Significant Changes

Supplemental Financing Grant under OP 8.6.4 A supplemental financing grant in the

amount of US$10 million was approved by the Board on August 13, 2008 in response to

the evolving risks of food crisis facing Madagascar. Since the beginning of 2008, when

international rice prices rose sharply, domestic prices had risen only moderately due to

the availability of locally produced rice.5 However, rice needs during the post-harvest

October-to-December period needed to be met through imports. At the time of PRSC-5

preparation, it was difficult to anticipate import needs. After PRSC-5 approval, it was

estimated that import needs for the rest of the year would be large (100 to 150 thousand

tons) and domestic prices could rise by more than 50 percent if international prices

remained at high levels. In addition, Madagascar faced the impacts of cyclones and the

oil price shock. Under this scenario, the Government worked with development partners

in preparing a coordinated response, and the Bank responded with this grant.

2. Key Factors Affecting Implementation and Outcomes

2.1 Program Performance

*The prior actions for the first and second operations in this series were met before the

respective Board approvals. However, many of these actions were reversed or their

implementation discontinued.

PRSC-4

Prior actions from Legal

Agreement/Program Document

Status

Public Finance Reform

The Borrower has satisfactorily

implemented the Priority Action

Plan for FY 2006.

Met in 2006. Assessed satisfactory by the

joint donor review of November 2006 and

March 2007. The PAP was no longer

4 See World Bank Report No.44743-MG (P113224).

5 The welfare of a majority of the population is highly sensitive to the price of rice, which

both is the main agricultural crop (rice production contributes around 10 percent of GDP)

and accounts for a large share of the consumption basket for the population.

7

implemented after March 2009.

The Borrower has allocated

adequate resources to PRSP/MAP

priority sectors in its Budget for

2007.

Met in 2007. The budget for 2007

allocated 18.1 % to education, 16.3% to

infrastructure, and 9% to health, which was

consistent with the MAP priorities. (See

current allocations under PRSC-5 status.)

All sector ministries have

submitted budget execution reports

based on an economic

classification to the Ministry of

Finance and Budget (MEFB)

within four weeks after the end of

the reference period (every four

months).

Met in 2007 and still currently submitted

every 4 months.

Procurement Audits are carried out

by or under the oversight of the

Regulatory Agency for Public

Procurement (ARMP) in at least 3

key ministries (education, health,

transport) to assess compliance

with new rules and regulations

Met in 2007 for the ministries of education,

health and transport. Procurement audits

have not been conducted since 2009.

Governance

The Borrower has adopted new

regulations on fiscal

decentralization to be reflected by

the 2007 Budget Law.

Met in 2007. The 2007 Budget Law

increased the share of certain taxes (impôt

synthétique, impôt foncier) in favor of the

communes. Formally the prior action was

fulfilled, but the adopted regulations fell

well short of the originally envisaged scope

of the reform due in part to difficulties in

conceptualizing and operationalizing a

broader revision of the fiscal

decentralization framework. In 2008, the

Government instituted a local development

fund (FDL)6

. As the Bank and EU

decentralization project did not

materialized, the FDL has not been able to

channel block grants to communes to

finance basic social and economic

infrastructure. However, since the

beginning of the crisis in early 2009, the

FDL has remained operational and has been

able to make limited transfers to communes

financed from domestic resources. The

6 The FDL was created with two main objectives: (i) strengthen commune capacity, and

(ii) transfer funds to communes for small social services/economic infrastructure.

8

percent of the budget allocated to FDL was

less than 2% in 2011.

The Borrower has developed

conflict-of-interest regulations.

Met in 2007. Government initiated the

process to develop conflict of interest

regulations for the civil service. A decree

was drafted and implementation was to

start in July-August 2007 in 4 pilot

ministries. However, it was never

implemented.

Basic Service Delivery

Implementation of the National

Education for All Initiative Plan

(EFA) is on track.

Met by 2006. The EFA plan was

implemented and is broadly on track. The

program is in the third phase and a new

EFA strategy is under preparation.

The Borrower has prepared and

validated the Health Sector

Development Program (PDSS).

Met by 2007, when the Ministry of Health

completed the elaboration of the PDSS and

it was validated by the Cabinet. The PDSS

is still the reference document for the

health sector today.

The Borrower has elaborated,

validated, and implemented the

recommendations of a nutrition

sector institutional assessment.

Met in 2007. The institutional assessment

of the National Office of Nutrition (ONN)

was completed in early March 2007 and

validated with the Prime Ministry. A decree

formalizing the main institutional changes

was issued on May 2007 (decree No. 397).

Although the institutional arrangement is

still in place, it lacks financing.

The Borrower and its main partners

have implemented the

recommendations of 2006 joint

donor/Government sector review in

the program budget 2007-2009.

Met by 2007. However, the program

budget only worked adequately until 2009.

PRSC-5



implemented the Priority Action

Plan (PAP) for FY2007.

Met as of October 2007. The joint donor

mission in October 2007 and the 2007

implementation status report confirmed

satisfactory implementation of the PAP.

Same in October and December 2008 for

the implementation of the PAP of 2008.

The PAP was no longer implemented after

March 2009.

The Borrower has allocated

adequate resources to MAP priority

sectors in its budget for 2008.

Met. The budget for 2008 continued to

allocate significant resources to priority

sectors (8% for health, 18.5% for

education, 11.5% for public works and

2.5% for transport). Budget allocations to

9

health, education and transport as percent

of GDP were significantly lower in 2010

and despite increasing for education and

health in 2011, resources are still

substantially insufficient to meet the

nation‟s needs (see section 3.2.3). The table

below shows committed expenditures as

shares of GDP in three priority sectors.

2009 2010 2011

Health

9.3%

5.7%

8.8%

Education

22.6%

17.0%

19.2%

Transport

1.4 %

0.5 %

0.3%

Source: Ministry of Finance and Budget.

All sector ministries have reconciled

their budget execution status with

the Ministry of Finance and Budget

at least every 2 months.

Met as of May 2008. Since the beginning of

February 2008 to 2009, the budget

execution status between key sector

ministries (health, education, transport,

public works, environment and agriculture)

and the Ministry of Finance was reconciled

and discussed on a monthly basis by using

the SIGFP. The practice appears to have

been discontinued since 2009.

The Borrower has published on the

website of the ARMP the results of

all public tendering processes of the

central Government with a contract

value above US$50,000.

Met. From December 2007 to March 2009,

all major central Government tendering

processes were published on the website of

ARMP. Although the system is still in

existence, the information it reports does

not appear to be reliable.7

The Borrower has started

implementing the recommendations

of the independent audit of the

commitment control (CDE) in: (i)

fully integrating the CDE into the

integrated financial management

system (SIGFP) and (ii) reducing

the current transaction time

Met. The CDE began to systematically use

the SIGFP in the second half of 2007 and

results indicated a significant improvement

of service standards. The CDE is currently

integrated in the SIGFP, and the visa takes

24 hours instead of 3 to 5 days.

7 According to the website, for example, the Ministry of Sports tendered equipment for a total of

30 billion ariary in 2010, even as its overall annual budget was only 3.3 billion ariary. See World

Bank, PER, “Madagascar: La Politique Budgétaire après Deux Ans de Crise Politique et

Comment l‟Investissement Public peut Contribuer à la Croissance du Pays”, September 2011.

10

necessary for the CDE visa by at

least 20%.

Governance

The Borrower has started reviewing

the hydrocarbon law to include the

separation of National Office for

Mines and Strategic Industries

(OMNIS) regulatory and

commercial functions.

Met. A first draft was prepared and

discussed through a participatory process.

As a result, the new law was expected to be

submitted to Parliament in early 2009, but

never was.


The implementation by the

Borrower of the National Education

for All (EFA) plan is on track.

Met. The EFA plan was implemented and is

broadly on track. The program is in the

third phase and a new EFA strategy is

under preparation.

The Borrower has updated and

validated a health mapping at all

levels of the health system.

Met. The updating of the health map was

completed before May 2008 and

implemented.

The Borrower has caused: (i) the

national coordinator of the National

Office for Nutrition (ONN) to

submit to the permanent office of

the National Nutrition Council

(CNN) the ONN financial accounts

certified by an external independent

auditor recruited by competitive

bidding and (ii) the permanent

office of the CNN to validate the

ONN‟s accounting and financial

procedures manual.

Met. The independent audit and the

elaboration of manuals were completed and

validated by the CNN permanent office in

April 2008.

The Borrower has issued the decree

for the creation of the Directorate

General of Water and Sanitation

(DGWS) and, through its ministry

in charge of water, has started

recruitment of at least 30 of the 60

new DGWS staff members.

Met. The decree was issued in November

2007. The DGWS was created and its

director general was recruited. The

recruitment process for all 60 new staff

members was launched in January 2008 as

planned. The DGWS was changed to a

ministry in mid-2008 and recruitment was

carried out.

PRSC-6 indicative triggers for what was intended to be the third PRSC of this series, as

presented in PRSC-5 Prior Actions Table is shown below. Even though the operation

was not presented to the Board, several of these triggers were carried out as of February

2009 and a few remain in place today.



implemented the PAP for FY2006.

Carried out as of February 2009. The joint

donor missions in October and December

2008 confirmed the satisfactory

implementation of the PAP. However, the

11

PAP was not implemented after March

2009.

Develop standardized budget

execution reports and distribute

them internally to all sector

ministries and cabinet on a monthly

basis.

Carried out as of February 2009. A

standardized report on the Ministry of

Finance website has been available to the

public since August 2008. After March

2009, the website8

continues to show

standardized reports on quarterly budgetary

commitments, albeit with gaps in coverage.

Continue to strengthen the capacity

of ARMP and of the procurement

units in key sector ministries,

including (i) training of

procurement auditors and the

creation of a pool of auditors and

(ii) carrying out procurement audits

in the following three Government

institutions: FER, SAMVA, and

OMH.

Not carried out.

Develop standardized monthly

reports for financial controls based

on the SIGFP, including (i) the total

number of rejections of

approvals/visas and (ii) the main

reasons for rejections by the General

Directorate for Financial Controls

(Direction Générale du Contrôle

Financier).

Carried out as of February 2009. Currently,

internal controls can effectively contain

spending commitments within the limits of

budgetary authorizations. The devolution of

financial controls coupled with a high level

of computerization and clear and well-

known procedures strengthen the controls

in place. However, discretionary control

mechanisms remain concentrated at the

different steps of the administrative

process, which undermines the potential for

effective control.

Governance

Submit revised hydrocarbon law to

Parliament.

Not carried out.

Budget allocation in the 2009

Budget Law to the Local

Development Fund (EPA-FDL)

increased by 15 percent compared to

the level in the 2008 Budget Law.

Carried out as of February 2009. The

budgeted allocation to the FDL funded on

internal resources increased 38% between

2008 and 2009. However, for reasons

explained before, the percentage of the

budget allocated to it has sharply decreased

since the beginning of the crisis. The FDL

allocation in the 2011 finance law was 1.14

8 http://www.mefb.gov.mg/index.php?option=com_content&view=article&id=465&Itemid=186

12

billion ariary (including FDL current

expenditures and EPA transfers), compared

to 28.3 billion ariary in 2008 (including

27.9 billion ariary for EPA transfer).


Implementation of national EFA

Plan is on track.

Carried out. The EFA plan was

implemented and is on track. The program

is in the third phase and a new EFA

strategy is now under preparation.

Design and start implementing in

pilot areas incentive- and

performance-based mechanisms for

redeployment of medical personnel

in rural areas.

Partly carried out as of February 2009.

During 2008, a series of incentives aimed at

encouraging the redeployment of health

personnel were implemented. The piloting

of performance based mechanisms started

in January 2009 in the regions of Alaotra

Managoro and Anosy where 70% of the

needed personnel were deployed. This

activity was part of the Sustainable Health

System Development Project. However,

the evaluation of the pilot could not be

carried out due to the political crisis.

The new ONN HR policy is

operational in accordance with the

2007 implementation decree.

Carried out by February 2009. The ONN

HR policy is still operational.

All the 60 new DGWS staff

members are recruited and 50 of

them are deployed to the regions.

Carried out as of February 2009. All 60

new staff were recruited and most of them

deployed to the regions.

2.2 Major Factors Affecting Implementation

Over the early implementation of the program supported under PRSC-4 and PRSC-5,

major factors affecting implementation included donor coordination, the effects of shocks,

capacity issues, and complementarities between PFM reforms and social sector policy

implementation.

Bank coordination with other donors through the common framework of budget

support was a positive element in the implementation of PRSC-4 and PRSC-5. The

joint donor status reports on PAP implementation provided inputs to the status of various

reforms supported by the series. During the joint supervision missions, common areas of

support with the EU‟s program of budget support (Programme d‟Appui Budgétaire à la

Réduction de la Pauvreté, or PARP) included the public-sector reform agenda, education

and health. There were also synergies with other donors on areas supported by the series.

Madagascar’s vulnerability to external shocks affected implementation of this series,

in particular, cyclones and variations in global commodity prices, such as oil and

rice, and the global financial crisis. These risks were identified in PRSC-4 and PRSC-5,

and some measures were taken to mitigate their impact. To reduce vulnerabilities to

13

climate shocks, for example, the Bank supported the Government in finalizing a Risk and

Social Protection review that paved the way for risk prevention and mitigating strategies.

There were also steps taken to investigate the feasibility of specific options to mitigate

shocks, such as weather risk insurance. The Bank also supported Government efforts to

protect vulnerable groups affected by food price increases.

Capacity constraints were a negative element in the implementation of PRSC-4 and

PRSC-5. Although the Government undertook efforts to improve internal capacity,

significant weaknesses at the sectoral and local levels remained. To mitigate the impact,

the Government, in coordination with the donors, prepared a capacity building strategy as

a key element of the MAP. The donor community designed a range of technical

assistance grants and training initiatives designed to enhance capacity. These efforts were

enhanced through round tables for public expenditure management reforms and the

Budget Support Group.

Delays in implementing public finance and structural reforms in strategic sectors

were a challenge and an identified risk for improving service delivery. The

unpredictability of budget execution, capacity weaknesses in applying the program

budget structure, and poor monitoring and evaluation (M&E) negatively impacted service

delivery in priority sectors. The PAP implementation was identified as critical to ensuring

real impact on service delivery and poverty reduction. The political crisis in early 2009

was the main impediment to the full implementation of the series and progress on its

objectives. Given Madagascar‟s recent history, political risks to implementation of both

PRSC-4 and PRSC-5 had been identified in the program documents. At appraisal of

PRSC-4 and PRSC-5, however, the political situation in Madagascar appeared to be

stable, having been solidified by the transparent and peaceful national elections in

December 2006 and municipal elections in December 2007. The coup d'etat of March

2009 forced President Marc Ravalomanana into exile and put into power the elected

Mayor of Antananarivo, who took the title of President of the High Authority (HAT).

This unconstitutional access to power was rejected by the international community. The

causes of the 2009 crisis were multiple and complex, and include governance issues in

the policy process and conduct of officials at the highest level of the Government, with

significant issues coming to the forefront already by late 2008 and forming part of the

triggers for the subsequent crisis and entrenched and widespread poverty, and limited

progress in sustained, inclusive economic growth.

The onset of the crisis, the change in government and several donors’ decisions to

suspend their respective programs effectively led to the interruption of the reform

program supported by the PRSCs. For the planned PRSC-6, although many of its

triggers were met by February 2009, the onset of the crisis triggered the application of OP

7.30, and its processing was suspended. In this context also, the broader agenda

supported by the PRSCs, including in PFM reform and service delivery has been

interrupted. The political crisis translated into a sharp contraction in spending, with donor

aid falling sharply, a fall in domestic revenues related in part to a decline in GDP, and the

adjustment of overall expenditures to maintain macroeconomic balance, even as the

relative allocation of funds to current spending on priority social sectors was broadly

maintained. On the structural front, since 2009, in particular, the PAP was not

implemented in its form, and the political crisis undermined the vision created for the

social sectors. It also created greater uncertainty in the modes of governance. In particular,

14

at the “last segment” of the value chain in education and health care, service delivery is

currently underfunded, inefficient, and insufficient.

2.3 Monitoring and Evaluation (M&E) Design, Implementation, and Utilization

The design of the indicators to monitor PDO progress was partly adequate and

envisaged adaptation to the detailed results framework for the MAP that was finalized in

2008. Prior actions for PRSC-4 and PRSC-5 and indicative triggers for PRSC-6 were

selected with Government on the basis of (i) their importance in contributing a key

constraint to the implementation of the intended reform and (ii) their alignment with

MAP objectives. Indicators in the Policy Matrix were also consistent with the MAP.

Despite the ambitious set of indicators, the PRSC was more conservative than the MAP

in foreseeing outcomes because the MAP presented a very ambitious progression path,

predicated on a large increase of external financing that did not fully materialize. PDO

indicators were based on data expected to be available. Without the data, gaps were

created in the M&E process. For example, the last PEFA took place in 2009 and

indicators related to it became very difficult to monitor and evaluate after 2010.

M&E was implemented in an environment already known for weak monitoring

capacity and data that needed quality improvements. The Bank supported efforts to

improve these, such as through an Institutional Development Fund grant on statistical

capacity-building and through a PRSP Trust Fund for M&E of the MAP. The Bank also

provided support through the PGDI Madagascar Second Governance and Institutional

Development Project (P103950) that aimed at improving ministry level monitoring

systems, developing the National Statistics Institute (INSTAT), and contributing to the

funding of the 1993 Population and Housing Census.9 Despite these efforts, M&E

implementation was inadequate. Several activities, such as the roll-out of the MAP M&E

system and the Population and Housing Census, were never carried out after suspension

of development assistance in March 2009.

2.4 Expected Next Phase/Follow-up Operation (if any)

3. Assessment of Outcomes

3.1 Relevance of Objectives, Design and Implementation

The PRSC objectives and design were fully relevant, and remain so today. An

extensive program of analytical and advisory activities (AAA) informed the PRSC design.

Key monitoring indicators were mostly chosen from the Government‟s Action Plan

Matrix in coordination with the Government and donors. The monitoring and evaluation

of this series was adapted to the monitoring system of the MAP. The Government

developed in close collaboration with partners, including the Bank, the detailed results

framework for the MAP and designed the proper institutional setting to monitor its

implementation.

9 The latest Madagascar Population and Housing Census is dated 1993.

15

The PRSC objectives are still relevant to Madagascar despite the political crisis that

put a halt to its implementation. The three-year crisis has imposed a high cost on one of

the world‟s poorest populations. As a result, Madagascar is gradually sinking into a state

of increased fragility, including a rise in poverty and a continued deterioration in

governance. Health and education are close to an emergency situation because the

delivery system for public services risks paralysis despite humanitarian aid, which,

bypassing public institutions is showing its limits. The infrastructure is in an alarming

state of falling into disrepair. Furthermore, Madagascar remains prone to exogenous

shocks (financial crisis, food or oil prices) and extreme climate risks (hurricanes,

drought), which further aggravate the vulnerability of the poor in a country where the

Government has only limited capacity to respond. Therefore, improving governance and

public sector management, and service delivery in key areas are still at the core of

Madagascar needs.

3.2 Achievement of Program Development Objectives

Program Development Objectives Results Matrix in Annex 7 presents a summary of the

achievements under this PRSC series relative to baselines and targets. Detailed indicators

provide evidence of progress towards achieving the PDOs.

3.2.1. Public finance reform (unsatisfactory)

In the area of public finance management, substantial improvement of the whole budget

process was achieved by 2008, a trend captured by the PEFA indicators comparing the

situation in 2006 and 2008 (see Annex 8). Despite these improvements, however, most of

the target indicators were not met as of 2011 (see Annex 7). A rapid assessment of the

PFM was done in 2011. It concluded that the PFM did not worsen significantly during the

political crisis, but the need for improving the system is urgent.

In the area of budget execution, the overall process was streamlined through the

introduction of the modern computerized SIGFP. As a consequence, all central public

institutions (ministries and central government level) now execute their annual budgets

through SIGFP. However, budget execution rates, which improved significantly between

2006 and 2008, deteriorated in recent years. The closest available measure of execution

rates for 2011 is presented in the Analysis of the Finance Act of 2012, which shows a

comparison between the Finance Act of 2011 budgeted amounts and expected realization

for 2011. These data show that, in most cases, the expected realization rate is

significantly off the projected amounts, except for staff costs, interest payable, and other

net treasury operations. The differences are most notable in non-tax revenues, grants, and

capital expenditures where expected realization is only 60%, 63%, and 51% of the

budgeted amounts, respectively, reflecting in part low donor‟s disbursements relative to

budget forecasts. This said, the execution of domestically-financed capital expenditure

also fell short of budget plans.

In the area of revenue generation, improvements from 2006 to 2009 resulted from

substantial administrative and policy reforms, such as the consolidation of the tax and

16

custom reforms, which led to an unprecedented increase in tax collection in 2008.10

The

Government was able to maintain the tax share at 10.7 percent of GDP in 2009 and 2010

and even increased it slightly to 10.9 percent of GDP in 2011, with a continued effort in

tax collection compensating for the decline in economic activity. The Government has

continued to pursue macroeconomic stability and fiscal sustainability, with public

investment having born the burden of adjustment to lower revenues and donor resources

since the beginning of the political crisis.

Internal control systems operate with significant deficiencies, particularly for

commitment controls. Controls continue to appear inadequate for the execution of civil

service payroll, for ensuring compliance of non-salary expenditure execution with

procurement rules and regulations, and in the verification of the actual delivery of goods

and services. However, limited information is currently available for assessing recent

trends and practices.

In the area of improving budget transparency, efforts included the previously

mentioned introduction of a SIGFP, which allowed the production of regular reports as

well as reformed public procurement. However, the absence of an effective control

system on the use of public funds remains a concern. Reporting and control processes on

use of funds in Treasury accounts (“comptes des dépôts”) remain insufficient. A

significant fraction of non-tax revenues and public funds managed by autonomous public

agencies are not included in the budget. To improve transparency of the public

procurement process, the ARMP set up a website to provide information about open

tenders and about the results of the tendering process. However, the information now

often appears outdated and its quality varies. The application of the new procurement

code was becoming more common, but due to a lack of training, local entities (communes,

regions, independent public agencies) do not systematically use it. Cases of misuse of

public funds are rarely reported due to weak and insufficient controls. The same is true

for corruption cases in public procurement.

3.2.2. Governance (unsatisfactory)

In the area of reduction of corruption, the PRSC program assisted the Government in its

efforts to consolidate the regulatory framework, but the political crisis took a heavy toll

on governance indicators. Between 2002 and 2009, most governance indicators were

improving, and Madagascar was doing better than the African average on most accounts.

Transparency International‟s Corruption Index for 2007, which the Government used to

assess the effectiveness of anti-corruption efforts, gave Madagascar a rating of 3.2,

ranking 95th

out of 179 countries. This was an improvement over the rating of 2.8 in 2005.

10 The Government also included a number of reforms in the 2008 Budget law, including the

merging of personal and corporate income taxes and the reduction of the top rate from 30 percent

to 25 percent, removing taxes on dividends and excise taxes on sugar and flour, raising the VAT

threshold and increasing its rate by 2 percentage points, removing small taxes, and eliminating

some special treatments.

17

Furthermore, the index for 2009 improved to 3.4 before rapidly deteriorating during the

ongoing crisis. From 2008 to 2011, Madagascar fell from 85th

to 100th

in the world on

Transparency International‟s Corruption Perception Index, earning a rating of 3.0 in 2010

and 2.6 in 2011. Similarly, the Bank‟s Country Policy and Institutional Assessment index

(CPIA) declined from 3.7 in 2008 to 3.4 in 2010 with the indicator on Transparency,

Accountability and Corruption in the Public Sector falling from 3.5 to 2.5.

In the area of reducing opportunities of corruption in natural resource industries, the

forestry sector has seen a surge in illegal logging of precious timber. This has risked

destroying the progress made in two decades of efforts to preserve the island‟s unique

biodiversity.

In the mining sector, where sound governance institutions have been adopted since the

late 1990s, transparent governance is at risk of being undermined. A transparent permit

management system was designed to encourage prudent exploitation and valuation of

Madagascar‟s mining potential, but implementation has been weak, with limited gains in

transparency and indications of political interference, including in the redistribution of

mining revenues among affected communes. Madagascar was accepted as an Extractive

Industry Transparency Initiative (EITI) candidate in February 2008, but it was suspended

from the EITI process in October 2011 due to a non-conducive environment for effective

multi-stakeholder dialogue.

Regarding decentralization, this PRSC series was expected to lead to a higher share of

resources available to the local governments. Initially, the share of the total budget

transferred to local government rose from 1.8 percent in 2007 to 2.3 percent in 2008;

however, it fell to 1.7 percent in 2009 and reached 1.9 percent in 2010. However, the

decentralization process which had already started in the 1990s has made little progress

over the last 20 years. Although decentralization is one of the seven challenges under the

governance agenda of the MAP, government commitment has been uneven.

3.2.3 Improving Service Delivery (unsatisfactory)

The public health service delivery system is increasingly under threat, with increasing

fragmentation of scarce donor resources, decreasing utilization of public health services

and growth of parallel service delivery systems. Despite improvements in such indicators

as the child underweight rate and skill birth attendance (see PDO Results in Annex 7), the

impact of the crisis in the health/nutrition sector is noticeable. Between 2008 and 2010-11,

other indicators showed worsening trends; for example, the prenatal consultation rate in

basic health centers decreased from 74 to 62 percent and the acute malnutrition rate

increased from 4.7 percent to 7.4 percent. Moreover, the poorest segment of the

population is now most likely to need these parallel systems, which inherently cost more.

Public delivery in education has also suffered. None of the indicators in the Annex 7 were

met, although some showed improvements, such as the primary enrollment rate and the

primary completion rate. However, the impact of the crisis in this sector is high. Lower

public funding for education has led many communities to hire and pay for teachers. It is

estimated that as many as two-thirds of primary school teachers are hired by the

18

community. Given the economic context and the absence of regulation, these trends are

becoming increasingly unsustainable and leading to higher dropout rates.

Regarding service delivery in water and sanitation, indicators show mixed results.

Among the rural population, access to safe drinking water was reported to have improved

from 31.6 percent in 2006 to 38.5 percent in 2010; meanwhile, sanitation access fell from

47 percent in 2006 41.5 percent in 2010.

3.3 Justification of Overall Outcome Rating

Rating: Unsatisfactory

Based on the achievements of the PDOs, the overall outcome of the PRSC series is rated

unsatisfactory. Ten of the sixteen indicators were not met, one was partly met, and only

four were met. The implementation of the reform was halted by the political situation and

the likelihood that most of the results would be achieved is nil until the political crisis is

resolved.

3.4 Overarching Themes, Other Outcomes, and Impacts

a. Poverty impacts, gender aspects, and social development

The series was expected to have contributed to reduced poverty incidence from 68.7

percent in 2005 to 64 percent in 2010, with significant distributional impacts. However,

poverty incidence was estimated to have increased by more than 9 percentage points

between 2005 and 2010, reaching 77 percent of households, one of the highest rate in

Africa (World Development Indicators, 2011). The poverty challenge differs across

regions and other dimensions. There are wide gaps among regions (from 57 percent to 77

percent) and between rural areas (74 percent) and urban areas (52 percent)11

. In addition,

income differences between the rich and the poor are large, especially in urban centers,

where the ratio between the highest and the lowest income groups may top 10. Under the

current circumstances, there are little chances that Madagascar would achieve most of the

MDGs by the deadline date of 2015.

b. Institutional change/strengthening

This PRSC series had a strong complementarily with the Governance and Institutional

Development Project I and II. Both PRSC-4 and PRSC-5 were implemented in close

collaboration with these projects which supported specific activities in the area of focus

of the PRSC series. Some progress was made in the institutional front. For example, the

management of the Tax Directorate and the large taxpayer doctorate underwent

restructuring and modernization to allow for more transparency on tax declaration and tax

collection.

11 Madagascar ISN, December 2011. Report No. 63863-MG.

19

c. Other unintended outcomes and impacts (positive or negative)

None observed.

3.5 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops

Not applicable.

4. Assessment of Risk to Development Outcome

Rating: High

Political and economic developments since early 2009 have effectively pre-empted the

achievement of most of the PRSC program‟s development objectives for the medium

term.

5. Assessment of Bank and Borrower Performance

5.1 Bank Performance

a. Bank performance in ensuring quality at entry

Rating: Moderately satisfactory

The design of this PRSC series, the second PRSC series in Madagascar, focused on

critical issues facing the country and in line with the CAS and Madagascar‟s

development goals as stated in its MAP. It supported the Government in implementing a

comprehensive reform program in the areas of governance and service delivery. It was

built on an extensive program of analytical and advisory activities (AAA), which

underpinned the Bank‟s policy dialogue and programmatic lending. It also incorporated

lessons from PRSC1-3. These ensured quality at entry. However, the series‟ scope was

very broad, and it could have benefited from more focus. There also could have been

scope to improve some of the linkages between prior action, triggers and PDO indicators.

For example, the trigger „the borrower has satisfactorily implemented the Priority Action

Plan‟ was very broad and could have been further detailed. Conversely, other PFM

related triggers were very much focused: allocation of adequate resources to PRSP/MAP

priority sectors in the budget (although no clear link to PDO indicators), and timely

submission of budget execution reports on an economic classification (PEFA Indicators 5

and 24).

Furthermore, the ambitious set of indicators, although less ambitious than the PAP, could

have been more conservative. For example, the PDO indicators related to PFM, in

particular, indicators 1, 3 and 4, could have been less ambitious at least in terms of the

horizon to achieve outcomes. For example, some of the objectives set out for PFM

reforms expected to be achieved in 3-4 years exceeded, in some cases, the performance of

two Middle Income Countries (Brazil and Peru) with very strong public sector and PFM

capacities.

20

b. Quality of supervision

Rating: Moderately unsatisfactory

Supervision was carried out through consultations with the Government and other

development partners. During the appraisal of PRSC-5, the Bank assessed the

achievement of prior actions and indicators as of 2007. In the context of the preparation

of the concept note for PRSC-6, it also evaluated the achievements of triggers for PRSC-

6. The Bank prepared two Implementation Status and Results Reports (ISRs), the last one

on August 2008, which assessed progress with indicators as of the end of 2007. It also

conducted periodic reviews with the other partners in the context of joint missions on

budget support and relevant sector programs. After March 2009, however, there was no

formal supervision. Nevertheless, the Bank maintained a technical dialogue with the

Ministry of Finance and Budget and other relevant ministries.

c. Justification of rating for overall Bank performance

Ratings: Moderately unsatisfactory

Despite a moderately satisfactory quality at entry, the scope for bank supervision and

policy dialogue was sharply reduced since March 2009 as a result of the ongoing political

crisis.

5.2 Borrower Performance

Rating: Unsatisfactory

In the early years of design and implementation, the Madagascar Government led the

design of the PRSC series through a process of frequent Bank-Government dialogue.

This series was designed to conform to the budget cycle, which runs from January 1 to

December 31, and PRSC-5 was delivered by the second quarter of the calendar year, as

requested by the Ministry of Finance. The responsibility for implementing this PRSC

program rested with the Ministry of Finance and Budget. The Government took the lead

in monitoring progress, implementing and updating the program policy matrix, and

coordinating inputs from other relevant ministries. The Government initially showed

strong ownership of reforms and commitment to achieve development objectives. In the

context of the political crisis, donor disengagement, and ensuing economic and financial

developments, however, the specific reform agenda supported by the PRSCs is no longer

a core government priority. Despite initial strong commitment to the DPOs and efforts to

strengthen the institutional structure to implement the overall MAP, subsequent

developments in policy conduct and performance called for a rating of unsatisfactory.

6. Lessons Learned

Development Policy Lending can be effective instruments for the Bank and

other development partners to signal significant concerns about governance.

By late 2008 development partners‟ governance concerns escalated. As a result,

the IMF postponed its Board presentation that was scheduled for December, 2008.

21

Other partners (EU and Germany) who were on the verge to disburse their budget

support in December 2008 decided to discontinue their disbursements until the

Government would provide satisfactory explanations and remedies. The Bank also

signed the letter that started the discontinuation of the disbursements. This was a

strong and coordinated signal that development partners were able to use to convey

these concerns about worsening governance and issues of transparency in fiscal

policy and management.

Donor coordination for budget support remains essential. A partnership

agreement was signed in 2004 between the Government and the key budget

support donors, the European Union (EU), France (Agence Française de

Developpement and the French Co-operation), the African Development Bank

(ADB) and the World Bank, later joined by Germany. The goal was to provide a

better alignment with Government procedures and Paris declaration objectives.

This group based its support on a harmonized matrix that guided individual

interventions. This group also agreed, in close coordination with the IMF, to

suspend budget support in December 2008. However, several members have also

noted that discussions within such a coordination group could be strengthened to a

more technical substantive level than has been the case.

Broader monitoring of developments on the ground and more attention to

outcomes, as opposed to inputs, is needed. Although selected prior actions and

indicators were coordinated with the Government‟s Action Plan and MAP

objectives, their monitoring did not always provide a whole picture of real progress

on the ground, especially in regards to developments on the governance front.

While in social sectors, outcomes indicators were used to assess progress, in PFM,

too much emphasis was put on progress on inputs (such as PFM systems,

institutions, and legal texts) rather than outcomes. In particular, the indicators used

to evaluate progress on transparency and PFM focused too much on budget

preparation and not enough on execution and checks and balances.

Even when the range of systemic performance issues is broad, as it is in all

areas supported under the PRSC series, especially PFM, it remains important

to set as much as possible a few reasonable objectives aiming at gradual and

sustainable improvements. Related to this is the need for careful recurrent review

of existing analytical work when designing and implementing a reform program,

targeting more focused triggers and PDO indicators. For example, as noted above,

the PRSC series could have supported two or three selected and critical PFM

improvements rather than proposing such a broad coverage.

Supplemental financing may sent mixed signals to authorities when issues

emerge in the implementation of a PRSC-supported program. PRSC-5 was

approved as an instrument to support the Government's progress on the

implementation of its national strategy. Concurrently, another budget operation

was prepared in 2008 to help Madagascar deal with the international food crisis.

Although these two operations were distinct, they resulted in an increase in budget

support and may have been interpreted by the authorities as a seal of approval from

22

the Bank and the donor community even at a time when significant governance

concerns had emerged at the forefront.

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners

a. Borrower/implementing agencies

b. Co-financiers

c. Other partners and stakeholders

Comments were received from donors and have been reflected in lessons learned.

23

Annex 1 Bank Lending and Implementation Support/Supervision Processes

(a) Task Team members

P099420 - Poverty Reduction Strategy Credit

Names Title Unit Responsibility/

Specialty

Lending

Norosoa Andrianaivo Language Program Assistant AFTED

Myrina D. McCullough Consultant AFTSP

Stefano Paternostro Lead Economist MNSED Task Team Leader

Francois Marie Maurice

Rakotoarimanana Sr Financial Management Specia AFTFM

Sylvain Auguste Rambeloson Senior Procurement Specialist AFTPC

Supervision

Noro Aina Andriamihaja Economist AFTP1

Sajitha Bashir Sector Leader LCSHD

Sofia U. Bettencourt Lead Operations Officer AFTEN

Mukesh Chawla Head HDNVP

Pierre Graftieaux Lead Transport Specialist AFTTR

Guenter Heidenhof Sector Manager MNSPR

Montserrat Meiro-Lorenzo Sr Public Health Spec. HDNHE

Jacques Morisset Lead Economist AFTP2

Suzanne F. Morris Senior Finance Officer CTRFC-

His

Christophe Prevost Sr Water & Sanitation Spec. LCSUW

Francois Marie Maurice

Rakotoarimanana Sr Financial Management Specia AFTFM

Patrice Joachim Nirina

Rakotoniaina Municipal Engineer AFTUW

Patrick Philippe

Ramanantoanina Senior Operations Officer LCSHE

Sylvain Auguste Rambeloson Senior Procurement Specialist AFTPC

Dieudonne Randriamanampisoa Senior Economist AFTPR

Herinjara Maria Ranohatra Team Assistant AFMMG

Ganesh Rasagam Senior Private Sector Developm AFTFE

Renaud Seligmann Manager AFTFM

Maryanne Sharp Senior Operations Officer LCSHH

Gilles Marie Veuillot Consultant AFTEG

P105135 - Madagascar Fifth Poverty Reduction Strategy Credit

Names Title Unit Responsibility/

Specialty

Lending

Supervision

Jacques Morisset Lead Economist AFTP2

(b) Staff Time and Cost

P099420 - Poverty Reduction Strategy Credit

24

Stage

Staff Time and Cost (Bank Budget Only)

No. of staff weeks USD Thousands (including

travel and consultant costs)

Lending

FY07 38 248.20

FY08 0.00

Total: 38 248.20

Supervision

FY07 0.00

FY08 0.00

Total: 0.00

P105135 - Madagascar Fifth Poverty Reduction Strategy Credit

Stage

Staff Time and Cost (Bank Budget Only)

No. of staff weeks USD Thousands (including

travel and consultant costs)

Lending

FY08 113 405.26

FY09 0.00

Total: 113 405.26

Supervision

Total: 0.00

25

Annex 2. Beneficiary Survey Results

None undertaken.

26

Annex 3. Stakeholder Workshop Report and Results None undertaken.

27

Annex 4. Summary of Borrower's ICR and/or Comments on Draft ICR

Based on the country‟s political circumstances and limited dialogue with the Ministry of

Finance, the team decided not to seek comments from the Borrower.

28

Annex 5. Comments of Cofinanciers and Other Partners/Stakeholders

Comments were received from donors and have been reflected in lessons learned.

29

Annex 6. List of Supporting Documents

World Bank

IDA Program Document, PRSC-4, Report No.39028, May 25, 2007.

IDA Program Document, PRSC-5, Report No. 43274-MG, May 29, 2008.

Food Price Crisis Response Trust Fund Program Document for a Proposed Supplemental

Financing Grant, Report No. 44743-MG, July 31, 2008.

Concept Note for PRSC 6, February 12, 2009 (Draft).

IDA Interim Strategy Note for the Republic of Madagascar, Report No. 63863-MG,

December 28, 2011.

Madagascar CPIA 2010 (draft), March 2011.

Madagascar: Governance and Development Effectiveness Review. A Political Econmy

Analysis of Governance in Madagascar. Report No. 54277-MG, July 2010.

Madagascar : “La Politique Budgétaire après Deux Ans de Crise Politique et Comment

l‟Investissement Public peut Contribuer à la Croissance du Pays ”, , September 2011.

Implementation Completion and Results Report for the First Governance and Institutional

Development Project, Report No 00001514, July 2010.

IMF

Republic of Madagascar: 2007 Article IV Consultation, IMF Country Report No. 07/236,

July 2007.

Other sources

“Mission d‟évaluation de la gestion des finances publiques malgaches du 26 Octobre au

16 novembre 2011”, Interim Report by Ibarhim Mamane, Decmber 2011.

“Évaluation de la mise en œuvre du système intégré de gestion des finances publiques

(SIGFP) malgaches”, Interim report by Michael Bitz, November 30, 2011.

30

Annex 7: Program Development Objectives Results

Baseline Value Original

Target

Value

(from

approval

documents)

Formally

Revised

Target

Values

Actual Value Achieved at

Completion of Target

Years

2007 2008 2009 2010 2011

A. PUBLIC FINANCE MANAGEMENT

Indicator 1: Number of PEFA budget preparation and execution indicators (indicators 1 through 17) rated “B” and above.

Value

(quantitative or

qualitative)

9 13 N.A. NA 10 9 9 NA NA

Date achieved 2006 2010

Comment

(incl. %

achievement)

Target not met. The 2011 PEFA that would have allowed assessment for this indicator did not take place. (The last

available PEFA dates from 2009). A 2011 review of PFM issues suggests limited progress on the Public Finance

Management reform agenda since March 2009.

Indicator 2: Number of public institutions (ministries at central government level) executing their budgets through the SIGFP.

Value

(quantitative or

qualitative)

5 All All 9 All All All All

Date achieved 2006 2010 2011

Comment

(incl. %

achievement)

Target met.

Indicator 3: Number of PEFA budget reporting indicators (indicators 22 through 25) rated “B” and above.

Value

(quantitative or

qualitative)

0 3 NA 1 0 0 NA NA


Comment

(incl. %


31


Target

Value

(from

approval

documents)

Formally

Revised

Target

Values



Years

2007 2008 2009 2010 2011

achievement)

Indicator 4: Number of PEFA indicators measuring the internal/external control mechanisms (indicators 20, 21, 26 through

28) rated “B” and above.

Value

(quantitative or

qualitative)

0 4 NA 0 0 0 NA NA


Comment

(incl. %

achievement)


Indicator 5: Percentage of reviewed procurement processes in selected public institutions that conform to the new procurement

regulations (Ministries of Education, Health, Transport, and Agriculture used as reference points).

Value

(quantitative or

qualitative)

5% 80% 50% 28.1% 35% 40% 50% NA


Comment

(incl. %

achievement)

Target not met, but some improvement occurred.

B. GOVERNANCE

Indicator 6: National Anti-Corruption Perception Index of (i) households and (ii) civil service employees.

Value

(quantitative or

qualitative)

(i) 2.2

(ii) 3.0

(i) 10%

increase

2.6 3.2 3.4 3.0 2.6 NA


32


Target

Value

(from

approval

documents)

Formally

Revised

Target

Values



Years

2007 2008 2009 2010 2011

Comment

(incl. %

achievement)

Target not met. Data is global in the sense that it does not distinguish by target.

Indicator 7: Share of annual central budget transferred to local governments.

Value

(quantitative or

qualitative)

1.4% 2.7% 1.9% 2.6% 1.8% 2.3% 1.7% 1.9%


Comment

(incl. %

achievement)

Target not met. The share of the central budget going to local governments improved from the baseline, but it is still

short of the target value. (The baseline and target indicators in PRSC-4 had a typo in the target values. PRSC-5

corrected this to the targets shown above.)

C. BASIC SERVICE DELIVERY

Indicator 8: Primary net enrollment rate.

Value

(quantitative or

qualitative)

83% 90% 87.7% 86.0%

88.9% 88.4% 87.7% NA


Comment

(incl. %

achievement)

Target not met, but showed improvement. (The baseline and target indicators were revised in PRSC-5 for the series

based on the availability of better data. Initially, the baseline was 97% and the target was not specified.)

Indicator 9: Primary school completion.

Value

(quantitative or

qualitative)

50% 74% 63% 60% 66% 64% 63% NA


Comment

(incl. %

Target not met. (The baseline and target indicators were revised in PRSC-5 for the series based on the availability of

better data. Initially, the baseline was 60% and the target was not specified.)

33


Target

Value

(from

approval

documents)

Formally

Revised

Target

Values



Years

2007 2008 2009 2010 2011

achievement)

Indicator 10: Repetition rate.

Value

(quantitative or

qualitative)

19% 14% 19% 20% 20% 20% 19% NA


Comment

(incl. %

achievement)

Target not met. (The baseline and target indicators were revised in PRSC-5 for the series based on the availability of

better data. Initially, the baseline was 18% and the target was not specified.)

Indicator 11: Skilled birth attendance in (i) CSB, (ii) CHD1 and (iii) in all public CHD2.

Value

(quantitative or

qualitative)

(i) 18.8

(ii) 1.4

(iii) 2.1

(i) 20.8

(ii) 3.4

(iii) 4.0

(i) 24.9

(ii) 3.4

(iii) 3.4

23.2

3.4

1.9

24.6

4.3

4.2

25.7

3.7

4.6

24.9

3.4

3.4

NA


Comment

(incl. %

achievement)

Target met. Although skill birth attendance at all public CHD2 was not met, overall birth attendance surpassed the

target.

Indicator 12: Consultation rate for treatment in CSB (number of curative outpatient visits/total population).

Value

(quantitative or

qualitative)

44.4 Not

specified

31.2

38.2 37.6 34.5 31.2 NA


Comment

(incl. %

achievement)

Target not met. (The baseline was revised from 32.4 to 44.4 due to the availability of better data. The target value was

never specified, but one would expect the target to be above the baseline value).

34


Target

Value

(from

approval

documents)

Formally

Revised

Target

Values



Years

2007 2008 2009 2010 2011

Indicator 13: Availability of medicines in CSB for each of the following: (i)Chloroquine, (ii)FAF, (iii)Cotrimoxazole,

(iv)Paracetamol andVitaminA.

Value

(quantitative or

qualitative)

(i) 96.6%

(ii) 89.3%

(iii) 95.7%

(iv) 92.2%

(v) 93.4%

(i) >95%

(ii) >95%

(iii) >95%

(iv) >95%

(v) >95%

i)ACT:

98.5%

(ii)88.3%

(iii)96.7%

(iv)96.6%

(v)95.3%

(i) 92.%

(ii)92.%

(ii)95.7%

(iv)95.%

(v)94.5%

(i)91.6%

(ii)92.4%

(iii)97.1

(iv)97.2%

(v)96.2%

(i)94.5%

(ii)94.9%

(iii)97.7%

(iv)97.3%

(v)96.8%

(i)ACT:

98.5%

(ii)89.7%

(iii)95.9%

(iv)94.1%

(v)96%

(i)ACT:

99.0%

(ii)88.3%

(iii)96.7%

(iv)96.6%

(v)95.3%


Comment

(incl. %

achievement)

Target met for all sub-indicators except FAF (Fer Acid Folic). Note that Chloroquine no longer exists due to policy

change in malaria treatment. Equivalent treatment was replaced by ACT.

Indicator 14: Child underweight rate.

Value

(quantitative or

qualitative)

42% Decreased

by 10% of

baseline

30% 30%

Date achieved 2003/04 2010 2011

Comment

(incl. %

achievement)

Target met. Baseline data is based on the 2003/04 Household Survey, while data for 2011 is based on the

Anthropometric and Child Development Survey.

Indicator 15: Percentage of the rural population with access to safe drinking water.

Value

(quantitative or

qualitative)

31.6% 37% 38.5% 38.5%


Comment Target met. Data for 2010 is based on the 2010 Household Survey.

35


Target

Value

(from

approval

documents)

Formally

Revised

Target

Values



Years

2007 2008 2009 2010 2011

(incl. %

achievement)

Indicator 16: Percentage of the rural population with access to sanitation.

Value

(quantitative or

qualitative)

47% 51% 41.5% 41.5%


Comment

(incl. %

achievement)

Target not met. Data for 2010, based in the 2010 Household Survey, refers to access to latrines/toilets. (The baseline

indicator was slightly revised to 46% in PRSC-5 based on the availability of better data).

36

Annex 8: Summary of PEFA Indicators

Indicators 2006 2008 Variations

Credibility of the Budget

PI-1 Aggregate expenditures outturn compared to original approved

budget

D D =

PI-2 Composition of expenditure outturn compared to original

approved budget

A A =

PI-3 Aggregate revenue outturn compared to original approved

budget

D B +

PI-4 Stock and monitoring of expenditure payment arrears D+* C+ +

Comprehensiveness and transparency

PI-5 Classification of the budget A A =

PI-6 Comprehensiveness of information included in budget

documentation

C C =

PI-7 Extent of unreported government operations C+* C+ =

PI-8 Transparency of inter-governmental fiscal relations B B =

PI-9 Oversight of aggregate fiscal risk for other public sector entities D+* D+ =

PI-10 Public access to key fiscal information D C +

Budget cycle

Policy-Based Budgeting

PI-11 Orderliness and participation in the annual budget process B+ A +

PI-12 Multi-year perspective in fiscal planning, expenditure policy

and budgeting

C+ C+ =

Predictability and Control in Budget Execution

PI-13 Transparency of taxpayers obligations and liabilities D+* B +

PI-14 Effectiveness of measures for taxpayers registration and tax

assessment

C+ B +

PI-15 Effectiveness in collection of tax payments D+ D+ =

PI-16 Predictability in the availability of funds for commitment of

expenditures

B B+ +

PI-17 Recording and management of cash balances, debt and

guarantees

B B =

PI-18 Effectiveness of payroll controls D+ D+ =

PI-19 Competition, value for money and controls in procurement D+* C +

PI-20 Effectiveness of internal controls in procurement C+ C+ =

PI-21 Effectiveness of internal audit C+ C+ =

Accounting, Recording and Reporting

PI-22 Timeliness and regularity of accounts reconciliation D+ D+ =

PI-23 Availability of information on resources received by service

delivery units

D D =

PI-24 Quality and timeliness on in-year budget reports C+ C+ =

PI-25 Quality and timeliness of annual financial statements D+ D+ =

External Scrutiny and Audit

PI-26 Scope, nature and follow up of external audits D D =

PI-27 Legislative scrutiny of the annual budget law C+ C+

PI-28 Legislative scrutiny of external audits D D +

C+ C+

D-1 Predictability of direct budget support A A =

D-2 Financial information provided by donors for budgeting and

reporting on project and program aid

B+ B+ =

D-3 Proportion of aid that is managed by use of national procedures D D =

Source: PEFA, 2009.

VatomandryVatomandry

MahanoroMahanoro

VarikaVarika

MananjaryMananjary

TsivoryTsivory

BeraketeBerakete

BelohaBeloha

BetrokaBetroka

ManjaManja

MandabeMandabe

MorombeMorombe

AnkazoaboAnkazoabo

BerorohaBeroroha

SakarahaSakaraha

BetiokyBetioky

AndrokaAndroka

AmpanihyAmpanihy

Midongy-Midongy-AtsimoAtsimo

AmbohimahasoaAmbohimahasoa

AntalahaAntalaha

MaroantsetraMaroantsetra

MananaraMananara

MoramangaMoramanga

AntanifotsyAntanifotsy

Ambatofinan-Ambatofinan-drahanadrahana

MiandrivazoMiandrivazo

MalaimbandyMalaimbandy

Belo TsiribihinaBelo Tsiribihina

AndilanatobyAndilanatoby

AndilamenaAndilamena Soanierana-IvongoSoanierana-Ivongo

AndriamenaAndriamena

SoalalaSoalala

BesalampyBesalampy

AntsalovaAntsalova

KandrehoKandreho

AnkazobeAnkazobe

VohimarinaVohimarina

AmbilobeAmbilobe

MandritsaraMandritsaraMampikonyMampikony

BefandrianaBefandriana

BealananaBealanana

AmbanjaAmbanja

AmboasaryAmboasary

ToamasinaToamasina

AmbatondrazakaAmbatondrazaka

AntsirananaAntsiranana

MahajangaMahajanga

ToliaraToliara

FianarantsoaFianarantsoa

ManakaraManakara

FarafanganaFarafangana

AntsirabeAntsirabe

MorondavaMorondava

MiarinarivoMiarinarivoTsiroanomandidyTsiroanomandidy

SambavaSambava

AntsohihyAntsohihy

TolanaroTolanaroAmbovombeAmbovombe

IhosyIhosy

MaevatananaMaevatanana

AmbositraAmbositra

MaintiranoMaintirano

Fenoarivo-AtsinananaFenoarivo-Atsinanana

ANTANANARIVOANTANANARIVO

DIANADIANA

SAVASAVA

SOFIASOFIA

ANALANJIROFOANALANJIROFOBOÉNYBOÉNY

BETSIBOKABETSIBOKA

ANALAMANGAANALAMANGABONGOLAVABONGOLAVA

ITASYITASY

MELAKYMELAKYALAOTRAALAOTRA

MANGOROMANGORO

ATSINANANAATSINANANA

AMORON’I MANIAAMORON’I MANIA

HAUTE-MATSIATRAHAUTE-MATSIATRA

IHOROMBEIHOROMBEATSIMO-ATSIMO-

ANDREFANAANDREFANA

ANOSYANOSY

ANDROYANDROY

ATSIMO-ATSIMO-ATSINANANAATSINANANA

MENABEMENABE

VATOVAVY-VATOVAVY-FITOVINANYFITOVINANY

VAKINANKARATRAVAKINANKARATRA

MayotteMayotte(France)(France)

Ank

arat

a

Massi fMassi fTsaratananaTsaratanana

Androy Plateau

Cli

f f o

f A

ng

av

o

Cl i

f f o

f B o n g o l a

v a

MaromokotroMaromokotro(2,876 m)(2,876 m)

Pic BobyPic Boby(2,658 m)(2,658 m)

TsiafajovonaTsiafajovona(2,642 m)(2,642 m) Vatomandry

Mahanoro

Varika

Mananjary

Tsivory

Berakete

Beloha

Betroka

Manja

Mandabe

Morombe

Ankazoabo

Beroroha

Sakaraha

Betioky

Androka

Ampanihy

Midongy-Atsimo

Ambohimahasoa

Antalaha

Maroantsetra

Mananara

Moramanga

Antanifotsy

Ambatofinan-drahana

Miandrivazo

Malaimbandy

Belo Tsiribihina

Andilanatoby

Andilamena Soanierana-Ivongo

Andriamena

Soalala

Besalampy

Antsalova

Kandreho

Ankazobe

Vohimarina

Ambilobe

MandritsaraMampikony

Befandriana

Bealanana

Ambanja

Amboasary

Toamasina

Ambatondrazaka

Antsiranana

Mahajanga

Toliara

Fianarantsoa

Manakara

Farafangana

Antsirabe

Morondava

MiarinarivoTsiroanomandidy

Sambava

Antsohihy

TolanaroAmbovombe

Ihosy

Maevatanana

Ambositra

Maintirano

Fenoarivo-Atsinanana

ANTANANARIVO

DIANA

SAVA

SOFIA

ANALANJIROFOBOÉNY

BETSIBOKA

ANALAMANGABONGOLAVA

ITASY

MELAKYALAOTRA

MANGORO

ATSINANANA

AMORON’I MANIA

HAUTE-MATSIATRA

IHOROMBEATSIMO-

ANDREFANA

ANOSY

ANDROY

ATSIMO-ATSINANANA

MENABE

VATOVAVY-FITOVINANY

VAKINANKARATRA

Mayotte(France)

Mah

avav

y

Betsiboka

Bemarivo Sofia

LakeAlaotra

Mangoro Mania

Tsiribihina

Mananara

Onilahy

Man

drav

e

Mangoky

Fihere

chana

Menarand

ra

Manambaho

Mahajamba

I N D I A N

O C E A N

Mo z a m

b i q u e C

h a n n e l

Ank

arat

a

Massi fTsaratanana

Androy Plateau

Cli

f f o

f A

ng

av

o

Cl i

f f o

f B o n g o l a

v a

Maromokotro(2,876 m)

Pic Boby(2,658 m)

Tsiafajovona(2,642 m)

45°E 50°E

50°E

45°E

25°S

20°S

15°S

20°S

15°S

MADAGASCAR

0 40 80 120 160

0 120 Miles8040

200 Kilometers

IBRD 33439R

MAY 2011

MADAGASCAR

This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other information shown on this map do not imply, on the part of The World Bank Group, any judgment on the legal status of any territory, o r any endo r s emen t o r a c c e p t a n c e o f s u c h boundaries.

SELECTED CITIES AND TOWNS

REGION CAPITALS

NATIONAL CAPITAL

RIVERS

MAIN ROADS

RAILROADS

REGION BOUNDARIES