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Document of
The World Bank
Report No: ICR00002916
IMPLEMENTATION COMPLETION AND RESULTS REPORT
(IDA-43670)
ON A
CREDIT
IN THE AMOUNT OF SDR 22.0 MILLION
(US$ 33.6 MILLION EQUIVALENT)
TO
THE REPUBLIC OF UGANDA
FOR
A KAMPALA INSTITUTIONAL AND INFRASTRUCTURE DEVELOPMENT
ADAPTABLE PROGRAM LOAN (APL) PROJECT
June 27, 2014
Urban Development & Services Practice 1 (AFTU1)
Country Department AFCE1
Africa Region
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ii
CURRENCY EQUIVALENTS
(Exchange Rate Effective July 31, 2007)
Currency Unit = Uganda Shillings (Ushs)
Ushs 1.00 = US$ 0.0005
US$ 1.53 = SDR 1
FISCAL YEAR
July 1 – June 30
ABBREVIATIONS AND ACRONYMS
APL Adaptable Program Loan
CAS Country Assistance Strategy
CRCS Citizens Report Card Surveys
CSOs Civil Society Organizations
EA Environmental Analysis
EIRR Economic Internal Rate of Return
EMP Environment Management Plan
FA Financing Agreement
FRAP Financial recovery action plan
GAAP Governance Assessment and Action Plan
GAC Governance and Anti-corruption
GoU Government of Uganda
HDM-4 Highway Development and Management Model
HR Human Resource
ICR Implementation Completion Report
IDA International Development Association
IPF Investment Project Financing
IPPS Integrated Personnel and Payroll System
ISM Implementation Support Missions
ISR Implementation Supervision Report
KCC Kampala City Council
KCCA Kampala Capital City Authority
KDMP Kampala Drainage Master Plan
KIIDP Kampala Institutional and Infrastructure Development Project
LGDP Local Government Development Program
M&E Monitoring and evaluation
MDGs Millennium Development Goals
MoLG Ministry of Local Government
MTR Mid-term review
NCRP Nakivubo Channel Rehabilitation Project
NEMA National Environmental Management Agency
iii
NPV Net Present Value
OAG Office of the Auditor General
PAP Project Affected Persons
PCU Project Coordination Unit
PDO Project Development Objectives
PDU Procurement and Disposable Unit
PEAP Poverty Eradication Action Plan
PIP Project Implementation Plan
QAG Quality Assurance Group
QMS Quality Management System
RAP Resettlement Action Plan
SFR Strategic Framework for Reform
TA Technical Assistance
UFUP Uganda First Urban Project
UJAS Uganda Joint Assistance Strategy
Ushs Uganda Shillings
VOC Vehicle Operating Costs
Vice President: Makhtar Diop
Country Director: Philippe Dongier
Sector Director: Jamal Saghir
Sector Manager: R. Mukami Kariuki
Project Team Leader: Martin Onyach-Olaa
ICR Team Leader: Chyi-Yun Huang
iv
UGANDA
Kampala Institutional and Infrastructure Development Project
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 Project Performance in ISRs
H. Restructuring
I. Disbursement Graph
1. Project Context, Development Objectives and Design ............................................... 1
2. Key Factors Affecting Implementation and Outcomes .............................................. 9
3. Assessment of Outcomes .......................................................................................... 16
4. Assessment of Risk to Development Outcome ......................................................... 25
5. Assessment of Bank and Borrower Performance ..................................................... 25
6. Lessons Learned ....................................................................................................... 27
7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners .......... 28
Annex 1. Project Costs and Financing .......................................................................... 29
Annex 2. Outputs by Component ................................................................................. 30
Annex 3. Economic and Financial Analysis ................................................................. 35
Annex 4. Bank Lending and Implementation Support/Supervision Processes ............ 62
Annex 5. Beneficiary Survey Results ........................................................................... 64
Annex 6. Stakeholder Workshop Report and Results ................................................... 66
Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR ..................... 67
Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ....................... 75
Annex 9. APL Triggers, Benchmarks and Status ......................................................... 76
Annex 10. List of Supporting Documents .................................................................... 78
v
A. Basic Information
Country: Uganda Project Name:
Kampala Institutional
and Infrastructure
Development Project
Project ID: P078382 L/C/TF Number(s): IDA-43670
ICR Date: 04/12/2014 ICR Type: Core ICR
Lending Instrument: APL Borrower: GOVERNMENT OF
UGANDA
Original Total
Commitment: XDR 22.00M Disbursed Amount: XDR 21.74M
Revised Amount: XDR 22.00M
Environmental Category: B
Implementing Agencies:
Kampala Capital City Authority
Cofinanciers and Other External Partners: NA
B. Key Dates
Process Date Process Original Date Revised / Actual
Date(s)
Concept Review: 05/11/2004 Effectiveness: 11/19/2008 11/19/2008
Appraisal: 05/07/2007 Restructuring(s): 12/03/2010
12/27/2012
Approval: 11/06/2007 Mid-term Review: 04/30/2009 11/24/2010
Closing: 12/31/2010 12/31/2013
C. Ratings Summary
C.1 Performance Rating by ICR
Outcomes: Moderately Satisfactory
Risk to Development Outcome: Moderate
Bank Performance: Moderately Satisfactory
Borrower Performance: Moderately Satisfactory
C.2 Detailed Ratings of Bank and Borrower Performance (by ICR)
Bank Ratings Borrower Ratings
Quality at Entry: Moderately Satisfactory Government: Moderately Satisfactory
Quality of Supervision: Satisfactory Implementing
Agency/Agencies: Moderately Satisfactory
Overall Bank
Performance: Moderately Satisfactory
Overall Borrower
Performance: Moderately Satisfactory
vi
C.3 Quality at Entry and Implementation Performance Indicators
Implementation
Performance Indicators
QAG Assessments
(if any) Rating
Potential Problem Project
at any time (Yes/No): Yes
Quality at Entry
(QEA): None
Problem Project at any
time (Yes/No): Yes
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)
Flood protection 23 23
Rural and Inter-Urban Roads and Highways 23 23
Solid waste management 23 23
Sub-national government administration 31 31
Theme Code (as % of total Bank financing)
City-wide Infrastructure and Service Delivery 50 50
Municipal finance 25 25
Municipal governance and institution building 25 25
E. Bank Staff
Positions At ICR At Approval
Vice President: Makhtar Diop Obiageli Katryn Ezekwesili
Country Director: Philippe Dongier John McIntire
Sector Manager: Rosemary Mukami Kariuki Jaime M. Biderman
Project Team Leader: Martin Onyach-Olaa Solomon Alemu
ICR Team Leader: Chyi-Yun Huang
ICR Primary Author: Chyi-Yun Huang
F. Results Framework Analysis
Project Development Objectives (from Project Appraisal Document) The project development objective (PDO) is to support the Recipient’s efforts to improve the
institutional efficiency of KCC, through the implementation of the Strategic Framework for
Reform of the KCC.
Revised Project Development Objectives (as approved by original approving authority) The PDO was not revised.
vii
(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 : Reduction of KCC's overdue liabilities
Value
quantitative or
Qualitative)
UGX 8 billion UGX 3 billion UGX0.5
billion UGX 0 billion
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
103%. Target achieved and surpassed. While an amount of UGX 2.6 billion was
still recorded as KCCA liabilities, there are no supporting documents for the
claims. KCCA is in the process of clearing off the liabilities officially through
the Accountant General. So far, public notices have been published in the print
media requesting for potential claimants to come forward but no response was
received. Thus the liabilities would be written off by mid-year after further
verification by the Accountant General.
Indicator 2 : Increase the percentage share of KCC own source revenue spent on service
delivery.
Value
quantitative or
Qualitative)
10% 30% 34% 32.7%
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
96%. Target mostly achieved. Original target was achieved but slightly below
revised target which was higher than original target.
Indicator 3 : Increase KCC's own source revenue.
Value
quantitative or
Qualitative)
UGX 22 billion UGX30 billion UGX33.5
billion UGX55.71 billion
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
166%. Target achieved and well surpassed. KCCA performed well in increasing
its own source revenue collections from property rates, ground rent, licenses,
hotel tax, advertisements and other sources mainly due to improvement in
efficiency of the Revenue Directorate.
Indicator 4 : Increase in public satisfaction in service delivery in (a) Roads, (b) Drainage and
(c) Solid waste
Value
quantitative or
Qualitative)
(a) Roads 18%; (b)
Drainage 22%; and (c)
Solid waste 44%
(a) Roads 50%; (b)
Drainage 31%;
and (c) Solid waste
60%
(a) Roads
50%; (b)
Drainage 31%;
and (c) Solid
waste 60%
(a) Roads 29%; (b)
Drainage 22%; and
(c) Solid waste 46%
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
(a) Roads 58%; (b) Drainage 71%; (c) Solid Waste 77%. Target not met. Level
of satisfaction is measured by the citizen report card surveys which pertain to
overall Kampala services, and not just KIIDP (which only marginally contributed
to results).
viii
Indicator 5 : Average traffic growth on KIIDP upgraded roads.
Value
quantitative or
Qualitative)
2% NA 20% 31%
Date achieved 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
155%. Target achieved and well surpassed. New indicator after restructuring. As
not all road works were fully completed by project closing (but were eventually
completed by end May 2014), a calculation was made using Average Annual
Daily Traffic estimates which gives the average annual traffic growth from 2011-
2014 on KIIDP upgraded roads. (Note: The value 31% is an calculation taking an
average on the five roads completed under the project; the corresponding value
for each of the road ranged from 15% to 40%).
Indicator 6 : Number of people directly affected by floods along Lubigi Channel.
Value
quantitative or
Qualitative)
8800 people NA 0 0
Date achieved 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
100%. Target achieved. New indicator after restructuring. No flooding has been
reported in the Lubigi channel catchment area in 2013.
(b) Intermediate Outcome 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 : Reduction in building plan permit approval processing.
Value
(quantitative
or Qualitative)
1 year 2 months 2 months 2 months
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
100%. Target achieved.
Indicator 2 : Percentage of property rate demand notes issued to property owners.
Value
(quantitative
or Qualitative)
30% 90% 100% 100%
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
100%. Target achieved.
Indicator 3 : Gravel roads upgraded (km)
Value
(quantitative
or Qualitative)
0km 9km 12.89km 8.73km
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
ix
Comments
(incl. %
achievement)
68%. Below target. The actual total road length supported by KIIDP was
11.81km (below restructured target) of which 8.73km of road (or 74%) was fully
completed and operational by project closing. The remaining portion was
substantially completed by project closing and largely accessible by pedestrians;
they were fully completed by KCC by end May 2014.
Indicator 4 : Poor quality bitumen roads and associated drains improved and strengthened
(km)
Value
(quantitative
or Qualitative)
348.08 kms 374.07km NA 0km
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
This activity was dropped during restructuring of the project since all roads
maintenance in the country is now being funded under the Uganda National Road
Funds.
Indicator 5 : Primary drainage channel expanded and lined (km)
Value
(quantitative
or Qualitative)
0km 3.6km 3.6km 3.6km
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
100%. Target achieved.
Indicator 6 : Secondary drainage channels expanded and lined
Value
(quantitative
or Qualitative)
0km 4km NA 0km
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
Activity dropped following project restructuring due to decrease in balance of
funding for sub-components.
Indicator 7 : Tertiary drainage “black spots” improved
Value
(quantitative
or Qualitative)
0 4 NA 0
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
Activity dropped following project restructuring due to decrease in balance of
funding for sub-components.
Indicator 8 : KCC utilizing results of annual Citizens Score Card to measure service delivery
satisfaction
Value
(quantitative
or Qualitative)
Citizen Report Card
completed for baseline 2 2 2
Date achieved 06/01/2006 12/31/2010 12/31/2012 12/31/2013
Comments
(incl. %
achievement)
100%. Target achieved. Results of Citizens Score Card were used as feedback to
inform KCCA operations and services.
x
G. Ratings of Project Performance in ISRs
No. Date ISR
Archived DO IP
Actual
Disbursements
(USD millions)
1 11/30/2007 Satisfactory Satisfactory 0.00
2 05/20/2008 Satisfactory Satisfactory 0.00
3 06/25/2008 Satisfactory Moderately
Unsatisfactory 0.00
4 11/20/2008 Satisfactory Moderately Satisfactory 0.00
5 05/28/2009 Satisfactory Satisfactory 1.61
6 12/01/2009 Satisfactory Moderately Satisfactory 1.79
7 06/10/2010 Satisfactory Moderately Satisfactory 3.34
8 01/29/2011 Satisfactory Moderately Satisfactory 4.47
9 07/12/2011 Moderately Satisfactory Satisfactory 5.97
10 01/30/2012 Moderately Satisfactory Moderately Satisfactory 9.62
11 07/29/2012 Satisfactory Satisfactory 14.61
12 03/30/2013 Satisfactory Moderately Satisfactory 22.55
13 08/04/2013 Satisfactory Moderately Satisfactory 26.15
14 01/17/2014 Moderately Satisfactory Moderately Satisfactory 30.11
H. Restructuring (if any)
Restructuring
Date(s)
Board
Approved
PDO Change
ISR Ratings at
Restructuring
Amount
Disbursed at
Restructuring
in USD
millions
Reason for Restructuring &
Key Changes Made DO IP
12/03/2010 Y S MS 3.54
(i) Extension of closing date by
twenty four months from
December 31, 2010 to
December 31, 2012; (ii)
Reduction in total project
funding (decrease in counterpart
funding); (iii) Reallocation of
the credit between components
and; (iv) Additional category of
eligible expenditure (grants to
community for involuntary
resettlement).
12/27/2012 NA S S 18.72
A further extension of closing
date from December 31, 2012 to
December 31, 2013.
xi
If PDO and/or Key Outcome Targets were formally revised (approved by the original approving
body) enter ratings below:
Outcome Ratings
Against Original PDO/Targets Moderately Satisfactory
Against Formally Revised PDO/Targets Moderately Satisfactory
Overall (weighted) rating Moderately Satisfactory
I. Disbursement Profile
1
1. Project Context, Development Objectives and Design
1.1 Context at Appraisal
Country Context
1. Kampala is the capital city of Uganda and its center of economic, political and
administrative activities. Kampala has a population of about 1.8 million and a high annual
population growth rate of about 3.9%, compared to the national rate at about 3.3%. With about
50% of Uganda’s urban population1, Kampala is the primate city of Uganda and the next largest
urban center has less than 10% of its population. Kampala is also the political hub and economic
engine of the country – accounting for around 50% of GDP. The economic future of Uganda is
thus intrinsically related to the performance of Kampala as a locus of productive activity and
investment.
2. Kampala is divided into five urban divisions namely Central, Kawempe, Makindye,
Lubaga, Nakawa, totaling 189 square kilometers. Approximately 23% of its area is fully
urbanized; a significant portion - around 60% - semi-urbanized; and the remaining 7% is rural
settlements. Kampala is also part of a rapidly growing metropolitan area, linked to several
adjacent towns, and therefore experiences a high transient population of about 1 million that
commute daily into the city from the outskirts of the city or more distant locations.
Sector and Institutional Background
3. The infrastructure provision and service delivery levels in key sectors (such as
roads, drainage, solid waste, markets etc.) in Kampala have not kept pace with its economic
and demographic growth and have deteriorated over time. Most of Kampala's roads were
constructed in the 1940s and 1950s and the majority has never undergone any major rehabilitation
or reconstruction since. The city's roads outside the central business district are heavily potholed
and in a high state of disrepair; and drainage systems are overloaded, clogged and poorly
maintained. Only 10% of the city's population is connected to the sewer lines of the National
Water and Sewerage Corporation; and the amount of solid waste generated overwhelms the
capacity of the city authority to collect and dispose - only 30% of the total waste generated is
removed by the authority.
4. Kampala’s local authorities have faced multiple challenges in delivering
infrastructure and services effectively for the city. The Kampala City Council (KCC) and its
five Divisions are primarily responsibility for infrastructure and service delivery for Kampala.
Over the years, KCC developed serious deficiencies in organizational, management, financial and
human resource capacities making it difficult to meet the needs of the city. The City has also had
a fundamental lack of vision and weak public service orientation. In addition, while progress has
been made in the areas of enhancing transparency and accountability, the service delivery process
faced political interference, with weak internal control systems and a weak governance regime.
These issues directly impacted on the areas of procurement, financial management and public
disclosure, and subsequently affected KCC’s public image.
5. Over the past decade, various attempts had been made to deal with these problems,
notably the formulation of the “Strategic Framework for Reform” (SFR) by KCC launched
in January 1997 to push for fundamental reforms. The SFR focused on three broad areas of
reform for achieving real changes in performance: (i) restructuring KCC aimed at changing the
1 2002 Uganda population and Housing census.
2
administrative structure to improve efficiency and rationalizing (down-sizing) staff; (ii) service
delivery liberalization by enhancing private sector participation in service delivery; and (iii)
financial and fiscal reform.
6. While a number of positive results had been achieved under SFR2, the progress of
organizational reforms was not as fast as envisaged at the time of its formulation. This was
compounded by the extremely weak financial position of the city at the time. As such the
intermediate results of SFR needed to be carried forward and brought to maturity through
institutionalization and application of the strategies, systems and procedures to KCC’s day-to-day
operations. As these successes were unlikely to be sustained or integrated into KCC’s operations
without additional support and deep commitment to mainstreaming the approaches and capacities,
in 2004, KCC carried out a review of the SFR implementation achievements and developed a
revised SFR-II.
7. The SFR-II aimed at consolidating the achievements KCC made during
implementation of the first SFR; and enabling achievement of its vision under two pillars3 –
good governance and good urban management. Priority activities to be implemented were
identified, especially in the areas of institutional development (institutional restructuring, revenue
enhancement, information and communication technology, urban planning), and infrastructure
development (drainage system, traffic and road maintenance management, solid waste
management and urban markets infrastructure). These activities were considered critical in
realizing the SFR-II.
8. In March 2010, the Kampala Capital City Authority (KCCA) took over the
operations of KCC. The Parliament of Uganda passed a new bill - the Kampala Capital City Act
2010 - which replaced the Local Government Act, 1997 as the legal basis for managing Kampala
City. Kampala City was elevated from a Local Government to a Capital City with the main
objective of improving its administration and improving the quality of services to the public under
an effective, efficient and accountable framework placed under the direct supervision of the
Central Government. This effectively led to the new KCCA, being converted to a central
government agency, with an Executive Director (rather than a Town Clerk) at the rank of a
Permanent Secretary. As a successor to the SFR-II and previous reform efforts, KCCA launched a
new KCCA Corporate Strategy (2013 – 2018) which was formulated based on the SFR and
retained similar focus and priority activities.
Rationale for Bank Assistance
9. The Bank has been supporting Kampala City since the late 1980s through three
main operations – Uganda First Urban Project (UFUP), Nakivubo Channel Rehabilitation
Project (NCRP), and Local Government Development Program (LGDP I). While each project
brought about a number of positive results and supported the KCC to implement some aspects of
its reform, KCC was still lacking in certain areas of institutional reform and financial
sustainability. In response to the government request for a follow on operation to support SFR-II,
2 For example, in the areas of development of strategies, and systems and procedures in all facets of KCC
operations including development of accurate information and data on revenues, manpower, financial
situation, contracting out revenue assessment and collection, reliable and accurate budgeting, expenditure
control, institutional restructuring, and ICT development and applications. 3 In addition to the pillars, particular strategies identified to be implemented are: (i) institutional policy
formulation and enhanced performance; (ii) organizational reform through implementation of a new
organizational structure that focuses on core functions; (iii) implementation of a financial recovery action
plan with transparent budgeting; (iv) expenditure control and increasing revenue; (v) improved service
delivery through enhanced private sector participation; (vi) adequate resource allocation for O & M; and
(vii) effective contracts management.
3
the Bank prepared the KIIDP. This project aimed to support KCC to consolidate the gains made
thus far, prevent an unraveling of the progress achieved and place Kampala on a solid foundation
for sustained service delivery. KIIDP therefore, was to function as a more concentrated and
comprehensive effort to promote the institutional and fiscal strengthening of city government than
previously attempted.
10. The project was conceived as the first of a three phase Adaptable Program Loan
(APL) to provide support for the implementation of KCC’s long-term development program
which would require step-by-step policy reform and institutional development over a sustained
period. The APL was designed to support the SFR and therefore phased its activities in a manner
that was intended to focus on institutional strengthening in the first phase, to build a solid
foundation for expanding the focus on infrastructure investments in later phases. The APL was
also expected to enable an early adjustment in course in the event that institutional changes
occurred or commitment to reforms dissipated. Project preparation activities leading to pre-
appraisal were therefore made conditional on KCC taking key measures to demonstrate
commitment to the reforms outlined in the SFR. (The original indicative financing plan and
implementation period for the three phases are shown in table below.)
APL Indicative Financing Plan Estimated
Implementation Period
IDA
(US$ Mil)
% of Total
IDA
Program
GoU
(US$ Mil)
Total
(US$ Mil)
Start Date Closing
Date
APL1 33.6 37 3.5 37.1 01/01/2008 12/31/2010
APL2 40.0 44 4.0 44.0 01/01/2011 12/31/2014
APL3 17.4 19 1.5 18.9 01/01/2015 12/31/2017
Total 91.0 100 9.0 100.0
11. The project was also aligned to the higher-level objectives of the country and the
World Bank. In 2005, seven major Uganda’s development partners developed a Uganda Joint
Assistance Strategy (UJAS) centered on three principles: supporting implementation of the
country owned and led revised Poverty Eradication Action Plan (PEAP) to achieve the
Millennium Development Goals (MDGs); collaborating more effectively among the development
partners and with the government; and focusing on results and outcomes. The project (planned to
be effective in FY 2008) was therefore identified as one of the instruments to support the UJAS;a
key pillar of IDA’s Country Assistance Strategy (CAS) for Uganda (Report no. 16540-UG April
30 1997) and in the National Development Strategy (1998/99) as a tool for reducing poverty
through increased economic activity, flowing directly from the positive effects of the institutional
and infrastructure improvements under the project.
1.2 Original Project Development Objectives (PDO) and Key Indicators (as approved)
12. The original project development objective is to support the Recipient’s efforts to
improve the institutional efficiency of Kampala City Council (KCC) through the
implementation of the Strategic Framework for Reform of the KCC. As KIIDP was designed as
phase 1 of a three phase APL, an overall Program objective was also defined in the PAD, that is,
to “develop a strong governance and management capacity in KCC to enhance service delivery
and economic development”.
13. In line with the initial focus on institutional outputs intended by KIIDP, the original PDO
level indicators were:
(i) reduce overdue liabilities from Ushs 8 billion to Ushs 3 billion;
(ii) increase the share of KCC own source revenue spent on service delivery from 10% to 30%;
4
(iii) increase in KCC own source revenue from Ushs 22 billion to Ushs 30 billion; and
(iv) increase in public satisfaction in service delivery in the following areas: roads from 18% to
50%, drainage from 22% to 31%, and solid waste from 44% to 60%.
14. The focus on institutional outcomes was also supported by the KIIDP APL triggers,
which focused on five institutional outputs: (i) new organizational system operational; (ii)
establish and implement a formal public consultation process; (iii) implementation of financial
recovery action plan (FRAP); (iv) comprehensive O&M plan for infrastructure; and (v) effective
implementation of the infrastructure rehabilitation and maintenance.
1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and
reasons/justification
15. The project objective was not revised.
16. Changes were made to project-level indicators and targets during the mid-term
review (MTR) and first restructuring completed on December 3, 20104. Two new project-
level indicators were added and some of the original project-level indicator targets were revised.
No further changes were made to the PDO or indicators in the second restructuring (which was
only for an extension of closing date). A summary of the project-level revised indicators, targets
and cited reasons for changes is included in the table below:
Changes to PDO-level Indicators and Targets Original (Project Approval) Revised
(at MTR and 1st Restructuring)
Rationale for Changes5
1 Reduce overdue liabilities from
Ushs 8 billion to Ushs 3 billion.
No change in indicator.
Target revised to Ushs 0.5 billion.
Target of Ushs 3 billion
achieved at MTR.
2 The share of KCC own source
revenue spent on service delivery
increase from 10% to 30%.
No change in indicator.
Target revised to 34%.
Target of 30% achieved at
MTR.
3 Increase in public satisfaction
with service delivery in:
- Roads from 18% to 50%
- Drainage from 22% to 31%
- Solid waste from 44% to 60%
No change in indicator and targets. NA
4 Increase in KCC own source
revenue from Ushs 22 billion to
Ushs 30 billion.
No change in indicator.
Target revised to Ushs 33.5 billion.
Target of Ushs 30 billion
achieved at MTR.
5 NA New indicator:
Average traffic growth on KIIDP
upgraded roads (increase from 2%
to 20%).
New indicator added as
best proxy for measuring
impact of city-wide
upgraded roads.
6 NA New indicator:
Number of people directly affected
by floods along Lubigi Channel
(decrease from 8800 to 0).
New indicator added for
measuring impact of main
drainage works under the
project.
1.4 Main Beneficiaries
17. The primary project beneficiaries are the residents, visitors and businesses of Kampala
city, including the flow of both daily and long term migrants who will benefit from KCC/KCCA
4 Date of countersigning by client indicating agreement to the amended Financing Agreement.
5 Rationale for changes as quoted from restructuring paper.
5
institutional enhancement and better infrastructure/service delivery. Kampala City has an
estimated population of 1.5 million people in 2013. In addition, about 1 million people from
outside the city commute to Kampala daily. Other beneficiaries include contractors and workers
hired to implement the various civil works financed under the project. KCC/KCCA staff also
benefitted directly from capacity building and training activities.
1.5 Original Components (as approved)
18. Project Funding. The KIIDP IDA Credit was SDR 22 million (equivalent to US$33.6
million). The total value of the Project was equivalent to US$37.1 million, including co-financing
of US$3.5 million (9.4%) from GoU.
Original Financing Plan
Component
Funding / Percentage Contribution
Total
(US$ Mil)
% of
Project
IDA
(US$ Mil) IDA %
GoU
(US$ Mil) GoU %
1. Institutional
Development 5.80 15.6% 5.22 90.0% 0.58 10.0%
2. Kampala city
Infrastructure and
Services Improvement 28.49 76.8% 25.87 90.8% 2.62 9.2%
3. Project Implementation,
Monitoring and
Evaluation 2.79 7.5% 2.51 90.0% 0.28 10.0%
Total 37.08 100.0% 33.60 90.6% 3.48 9.4%
19. The project consisted of the following three components and various sub-components:
20. Component 1 - Institutional Development. The component focused on institutional
development activities that support organizational development and governance, the
implementation of the Financial Recovery Action Plan (FRAP), and actions to enhance
effectiveness of service delivery. The sub-components were:
i. Support to Organizational Development and Governance: to develop a comprehensive
approach to municipal development. Sub-components include: (i) human resource
management and training; (ii) general administration; (iii) education information system;
(iv) gender, welfare and community services; (v) planning and M&E; (vi) communication
strategy; and (vii) environmental management.
ii. Support to Financial Recovery: to implement a detailed financial recovery plan designed
to place KCC on a sound financial position by the end of the program. The sub-
components are: (i) enhancing revenue management capacity; (ii) enhancing expenditure
management capacity; and (iii) establishing a framework for the reduction, and control of
expenditures.
iii. Strengthening Service Delivery, providing support to strengthen KCC’s capacity in
service delivery. Activities in the following areas were to be supported: (i) public health
and environment; (ii) quality assurances for infrastructure; (iii) urban planning and land
management; (iv) information and communication technology; and (v) environmental
monitoring and preparation of environmental studies.
21. Component 2 – Kampala City Infrastructure and Services Improvement. This
component supported activities aimed at improving the provision of critical services to the city.
The investment in infrastructure and service improvements sought to address the following five
6
priority areas which were critical for public confidence and contributed to the economic and
commercial development of the city:
i. Drainage system improvement - to increase the capacity of the Lubigi primary channel
(total length 3.6km); expand the capacities and lining of secondary channels (total length
4km); and undertake remedial measures on 4 tertiary drainage “black spots” in various
parts of the city;
ii. Traffic management –to improve (i) area traffic management including measures for
improved traffic flow through provision of traffic management infrastructure such as
guard rails, signs etc.; and (ii) improvements in five junctions by providing localized
widening and signalizing;
iii. Road maintenance and upgrading – to undertake (i) maintenance of about 26km of
selected tarmac roads and (ii) upgrading of about 14.42km of high priority gravel roads to
bitumen standard;
iv. Solid waste management – to support (i) expansion of a landfill by 6 acres, (ii) testing
and installation of a landfill gas collection and flaring system at the existing landfill, and
(iii) design of a new landfill site to be identified and acquired by KCC; and
v. Urban markets infrastructure - provide infrastructure to two markets (Kibuli and
Kawempe) through improved access roads, lighting, and sanitation.
vi. Resettlement Action Plan implementation.
22. Component 3 - Project Implementation, Monitoring and Evaluation. This component
encompassed the management activities associated with the implementation of the project, the
establishment and implementation of a monitoring and evaluation (M&E) system and the
preparation of the next phase of the project. Activities included: (i) project implementation
support; (ii) monitoring and evaluation, (iii) the annual citizen’s report card; and (iv) staff and
councilor survey.
1.6 Revised Components
23. The original components were not revised. However, changes were made to sub-
components in response to practical constraints that emerged - mainly implementation delays and
escalating project costs. The changes are detailed in the next section.
1.7 Other significant changes
First Restructuring.
24. A level-2 restructuring was completed on December 3, 2010 and allowed for: (i)
extension of the closing date by twenty four months from December 31, 2010 to December 31,
2012; (ii) reduction in total project funding (to reflect a decrease in counterpart funding); (iii)
reallocation of the credit between components and; (iv) additional category of eligible expenditure
(grants to community for involuntary resettlement).
25. The restructuring was both corrective and adaptive in nature. The main reason for
the extension in project closing was to accommodate a 9 month delay incurred when obtaining
Parliamentary approval for the project (also experienced by various other Bank projects). More
time was also required to complete the Component 2 civil works. Delay in the implementation of
Component 2 activities was mainly due to the long procurement turnaround time when the
7
responsibility rested with the Ministry of Local Government (MoLG) 6
(discussed later in the
Fiduciary section).
26. The reduction in total project funding occurred as GoU was unable to fully meet the
agreed funding contribution7 due to budget deficits. The original total project funding was
reduced from US$37.1 million to US$35.15 million - GoU contribution decreased from US$3.5
million to US$1.55 million (IDA funding remained at US$33.6 million). The majority of the GoU
funding was dedicated to resettlement compensation.
27. The reallocation in funding between components was necessary mainly to: (i)
accommodate increased consultancy and operating costs (from SDR 4.4 million to SDR 6.7
million; and from SDR 530,000 to SDR 622,000 respectively) over the additional two years of
project implementation period; and (ii) supplement funds required to pay involuntary resettlement
costs8 under the Resettlement Action Plan (RAP) – with IDA credit financing. The resettlement
cost was originally to be fully funded by GoU but as the full contribution was still not availed by
MTR, in order to avoid further delays in the implementation of civil works (which could not start
before the payment of the associated involuntary resettlement cost), the Bank agreed with GoU to
fund the shortfall from the IDA credit through reallocation of funding between components9.
28. Adjustments were made to project sub-components in response to the reallocation in
funding and delay in project effectiveness. Several sub-component activities were dropped due to
the decrease in funding available to support them (as IDA funds were directed to RAP costs,
extended consultancies and additional operating costs, as explained above.) The sub-components
which remained were those identified as having the highest priority, largest potential impact10
,
and no funding from other sources. Some of the sub-components which were dropped were
planned to be taken up in future phases of the APL. The changes in project sub-components are
summarized in the table below.
Original and Revised Project Sub-Components
Original Components
(Project Approval)
Revised
(After 1st Restructuring)
Reasons for
Sub-Component Changes
Component 1: Institutional Development
• Human Resource Management
and Development
– training, general
administration, education
information system, welfare &
• Human Resource Management and
Development
– training, general administration,
education information system,
welfare & community service,
Ministry of Public Service
implemented an Integrated
Personnel and Payroll System
(IPPS)
6 Contract execution/implementation delays across the board due to failure by Solicitor-General’s office to
expeditiously approve/clear contracts. 7 The exact reason for GoU not being able to fully meet the co-funding contribution was unknown, but
generally attributed to budget constraints or inavailability of alternative funding. While IDA funding was
reallocated to cover the outstanding GOU contribution (mainly RAP costs) at MTR, an additional valuation
conducted for the RAP (after the MTR) led to even higher RAP cost being assessed. After KCCA was
formed it took over GoU’s responsibility for the Project’s RAP cost. The revised RAP cost - not covered
through the IDA reallocation - was therefore financed by KCCA. 8 During the restructuring, the estimated full amount of outstanding RAP costs that need to be paid was
US$1.684 million or SDR 1.155 million. 9 As approved by the IDA Land Committee in September 2010.
10 Priority and impact were determined mainly from the result of two strategic studies – the Kampala
Drainage Master Plan and the Kampala Urban Traffic Improvement and Road Maintenance Plan - carried
out under the NCRP.
8
community service,
communication strategy,
environmental management.
communication strategy,
environmental management.
(HR management system
dropped.)
• Support to Financial Recovery
- Enhance revenue and
management capacity, enhance
expenditure management,
expenditure control
No Change
NA
• Strengthening Service Delivery
- Public health and
environment services, quality
assurance for infra, urban
planning (Kampala structure
plan), InfoComm technology
No Change NA
Component 2: City Wide Infrastructure and Services Improvement
• Drainage system improvement
- Lubigi primary channel (total
length 3.6km)
- secondary channels (total
length 4km)
- remedial measures to 4
tertiary drainage “black spots”
in various parts of the city.
Lubigi primary channel
(total length 3.6km)
(Secondary and tertiary drainage
channel works dropped)
Lack of funding (escalated
construction costs)
• Traffic management
– area traffic management
- junctions improvement
• (Traffic management dropped) Lack of funding (escalated
construction costs)
• Road maintenance and
upgrading
- maintenance of about 26km
of selected tarmac roads
- upgrading of about 14.42km
of high priority gravel roads to
bitumen standard
Upgrading of about 12.00km11
of
high priority gravel roads to
bitumen standard
(Maintenance of roads dropped)
-
• New funding source from
central government through the
Road Fund was made available
to finance road maintenance.
• Solid waste management
- developing land adjacent to
existing site,
- landfill gas collection and
flaring system,
- design for new landfill
Solid waste management
- Develop land adjacent to existing
site
- Design for new landfill
(Landfill gas collection and flaring
system dropped12)
• Lack of funding (escalated
construction costs)
• Urban markets infrastructure
- Provision of infrastructure for
two markets (Kibuli and
Kawempe) eg access, lighting
etc., detailed design for high
priority markets
• (Urban markets infrastructure
dropped.)
• -Lack of funding (escalated
construction costs);
• -Land availability issues
• - ADB plan to finance the
development of seven markets
in Kampala.
11 Namely Bukoto-Kisasi Road, Kalerwe Road, Kawempe-Mpererwe Road, Kimera Road, Soweto Road
and Salaama Road. 12
An assessment on the potential yield of the landfill gas was carried out under the project.
9
• Implementation of the
Resettlement Action Plan
• No change • NA
Component 3: Project Implementation Support, Monitoring and Evaluation
• Project Implementation
Support
No Change NA
• Monitoring and Evaluation No Change NA
• Annual Citizen’s Report Card No Change. NA
• Staff and Councilor Survey No Change NA
Second Restructuring
29. The second restructuring (level 2) was completed on December 27, 201213
. and
allowed for a further extension of closing date from December 31, 2012 to December 31, 2013.
Delays in civil works, mainly due to compensation for resettlement issues and contractual issues,
required a further extension of project closing in order for Component 2 works to be completed
(challenges in implementation are further discussed below). No change in scope of work was
required.
2. Key Factors Affecting Implementation and Outcomes
2.1 Project Preparation, Design and Quality at Entry
Analytical
30. The analytical foundation and project design of KIIDP was in full alignment with the
SFR-II, and thus enabled high ownership by the client. The project components and sub-
components mirrored the two main categories of activities in the SFR-II (see table below) -
Component 1 therefore directly supported the improvements in institutional efficiency while both
Components 1 and 2 contributed to the implementation of priority activities identified in the SFR-
II. In particular, the civil works in Component 2 were a selection of those identified as priority
activities in the SFR-II.
31. In addition, many results indicators and APL triggers were borrowed from the SFR-II
monitoring and evaluation framework. The project design was and remains highly relevant to the
needs of the city, in response to the mainstream government strategy and framework. As the
project design was intertwined with the drafting of the SFR-II (both occurred around the same
time, and KIIDP was intended to support SFR-II), the wider public and stakeholder consultation
undertaken for the SFR-II was also directly relevant to KIIDP. The consultations included an
independent consultant review of the SFR, a high level workshop with major stakeholders, and
creation of Kampala’s first-ever Citizens Report Card. The project scoping and preparations were
also carried out with full participation of the key KCC staff across all directorates.
13 Date of countersigning by client indicating agreement to the Financing Agreement.
10
SFR-II Strategies & Priorities and KIIDP Project Design
SFR-II KIIDP Components
SFR-II Strategies Priority Activities identified to
implement SFR-II strategies
1. Institution policy
formulation and
performance
2. Political support,
management and
teamwork
3. Communication and
corporate image
building
4. Organizational reform
5. Financial recovery
6. Works and physical
planning
7. Public Health
8. Management systems
1. Institutional development
• Institutional restructuring
• Revenue enhancement
• ICT
• Urban planning
2. City-wide infrastructure and
service improvement
• Drainage system
• Traffic and road maintenance
management
• Solid waste management
• Urban markets infrastructure
3. Civil society participation and
management
• Support CSOs for effective
participation
• Increase transparency (SFR)
4. Monitoring & Evaluation of
SFR-II
Component 1: Institutional
Development (US$5.8 million)
• Human Resource Management
• Support to Financial Recovery
• Strengthening Service Delivery
Component 2: Kampala City
Infrastructure and Services
Improvement (US$28.5 million)
• Drainage system improvement
• Traffic management
• Road maintenance and upgrading
• Solid waste management
• Urban markets infrastructure
• Implementation of the
Resettlement Action Plan
Component 3: Project
Implementation, Monitoring and
Evaluation (US$2.8 million)
• Project Implementation Support
• Monitoring and Evaluation
• Annual Citizen’s Report Card
• Staff and Councilor Survey
32. Besides a strong alignment with the SFR-II, the analytical basis of KIIDP was also built
upon previous projects and informed by studies conducted under them. Its focus on institutional
improvements filled in the gaps and reinforced the efforts of past operations (UFUP, LGDP 1 and
NCRP). In particular, the scoping and selection of the Component 2 infrastructure sub-projects
were mainly based on two strategic studies carried out under the NCRP – the Kampala Drainage
Master Plan and the Kampala Urban Traffic Improvement and Road Maintenance Plan. Under
these two studies, qualified international consultants prioritized sub-projects which would address
immediate needs of the city, and prepared the detailed design including draft bidding documents
for these priority interventions. Unfortunately, as significant time elapsed from the preparation of
these studies and sub-projects to the time that the implementation of KIIDP could begin, most of
the detailed designs required updates. This took additional time and caused delays in
implementation.
Assessment of project design
33. KIIDP was designed as the first of a three phase APL with the intention to strengthen and
build institutions in order to create a foundation for sustainable infrastructure investments. The
first phase primarily targeted institutional outcomes, while the infrastructure component was
intended to be smaller and more targeted to enable the implementation agency to “learn-by-doing”.
This is reflected consistently in its PDO, and throughout the design of the results framework and
the APL pre-conditions and triggers for phase 2. The APL was designed to leave more substantial
infrastructure works to its second and third phases, and although the APL instrument was
discontinued, the follow-on operation, KIIDP2, has continued its alignment with the original
thinking and included large scale infrastructure works with more substantial funding.
11
34. The project implementation arrangement was appropriate and relatively straight-forward,
with one main counterpart (KCC, and later KCCA). The project also intended to mainstream the
Project Coordination Unit (PCU) functions within the agency. This took varying forms under
KCC and subsequently under KCCA. In KCC, the key consultants were hired by the PCU and
attached under the various KCC directorates; they tended to act rather independently from the
directorates. When KCCA was established, in-house staff was appointed to implement KIIDP and
implementation was integrated into the agency. However, the staff had to work both on KIIDP
and other KCCA work and was at times overstretched.
35. The project design made provisions for institutional reforms in anticipation of the
impending constitutional changes – resulting in the KCC to KCCA transition. A specific clause
was included in the Financing Agreement (FA) to first notify the Bank of the change and to
ensure that, in consultation with the Bank, the new entity will be designated and assume all the
responsibilities of KCC for the project. This put in place a vital transitional arrangement that
ensured continuity of activities, and enabled a seamless transfer of KCC’s responsibilities and
obligations for KIIDP to KCCA.
36. The original scope of works (with activities spanning 11 institutional improvements and 5
types of infrastructure works) was rather ambitious. However these investments were derived
from the SFR-II and were intended to ensure alignment of objectives outlined in both documents.
In addition, it was expected that a suite of complementary activities undertaken together would
yield greater synergies and achieve better results especially in support of institutional
improvements; and that rapid service delivery improvements were expected to address the urgent
needs.
Assessment of risks
37. The project rightly recognized several risks affecting achievement of the PDO and the
components. During project design, three risks were rated as high: (i) failure to develop and
implement an effective fiscal discipline in KCC; (ii) change in current policies/Acts by central
government that would affect Kampala’s ability to implement the SFR; and (iii) lack of capacity
in Directorates to carry out project implementation activities effectively. The project was largely
successful in mitigating these high risks, especially through provisions in the financing agreement
(as discussed earlier), and building in the various Component 1 activities focused on supporting
organizational development and governance, financial recovery and service delivery capacity. In
addition, again by closely aligning the project design with the SFR II, this helped to increase the
sense of ownership and strengthen client commitment, thus reducing potential implementation
risks. (Despite these, implementation delays were still encountered – these are discussed in the
subsequent sections.)
38. No quality at entry review for the project was carried out by the Quality Assurance Group
(QAG).
2.2 Implementation
39. The project went through two project restructurings and was extended by 3 years in total,
largely due to an initial delay in securing parliamentary approval14
and several implementation
challenges, especially on contractual issues encountered for infrastructure works. The major
factors that affected implementation are summarized here:
14 KIIDP was approved by the Board of Directors on November 6, 2007, signed on 20 February 2008 and
became effective on 19 November 2008.
12
Factors outside the control of government or implementing agency -
a. Contractual issues and delays due to external factors;
b. Technical challenges of relocating utility services15
in order to clear the right of way
for civil works;
c. Inadequate staffing and capacity of KCC/KCCA, due to a general country-wide skills
and human resource issue;
Factors generally subject to government control –
a. Delay in Parliament approval of project;
b. Delay and failure in fulfilling the total committed amount of counterpart funding to
support RAP costs;
c. Delay when procurement was being approved by the MoLG before being taken over
by the dedicated PDU under KCC;
d. Transition from KCC to KCCA and complete staff change (which is inherently
disruptive and resulted in, to certain extents, the loss of institutional capacity and
knowledge );
e. Unresolved structural issues in KCCA – friction between political and technical
wing16
.
Factors generally subject to implementing agency control -
a. Inadequate staffing and capacity of KCC/KCCA;
b. Ineffective enforcement and implementation of RAP, resulting in escalated RAP costs
and delays;
c. Contract management and supervision issues17
: a general lack of capacity to
effectively handle contract management and supervision, poor packaging of the civil
works contract packages, ineffective due diligence conducted to verify contractors
capacity and qualification, and delayed and ineffective procurement;
d. Inadequate capacity to follow up with safeguards requirements.
40. A MTR was conducted in end 201018
and appropriately recommended that the project
should be extended by 24 months to allow completion of project activities. The MTR also
provided valuable inputs for managing the implementation delays. For example, as the GoU was
still unable to fully supply the committed funding to cover the RAP cost then, the team proposed
the alternative of reallocating the IDA funds to cover this cost in order to prevent further
implementation delays.
41. Although the various sub-component activities that were dropped or deferred inherently
compromised or delayed the potential project impacts which could have been achieved – mainly
15 There is a common challenge associated with the identification and relocation of underground utility lines
(water and telephone). These utility lines were laid many years back and there are no proper records or
maps showing where they are located. 16
There are two wings within KCCA - a political wing headed by the Lord Mayor and an administrative
wing headed by the Executive Director. The tension between the technical and political leadership of
KCCA, and the governance environment is largely due to the interplay between the interests of central
Government, KCCA locally elected leaders, and staff. 17
Various contractual and contractor issues were experienced in KIIDP which led to much delay of the
infrastructure works. For example, several contracts were awarded to the lowest cost bidders, whom under
quoted and also have insufficient capacity and capital fund flow to complete the assignment within the
specific time and budget. This leads to delays and sometimes further complications from renegotiations and
re-bidding of contracts for incomplete works packages. In other cases, inadequate supervision, court
injunctions and other administrative reviews also delayed the infrastructure works and caused additional
costs. 18
The MTR was conducted later than the April 30, 2009 date per the legal covenant due to delay in project
effectiveness.
13
from the greater improvements to roads and drainage network, traffic management and new or
enhanced markets and landfill gas collection and flaring system – it should be noted that the
institutional objectives were largely achieved, including all triggers to move to APL 2.
2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization
42. M&E Design: The M&E framework design had a good coverage of indicators to measure
the two main project components. At the PDO-level, three out of the four original indicators were
directly relevant to the PDO of institutional improvement, giving it the necessary emphasis. In
addition, it was commendable that the targets of these three indicators were further increased
during restructuring to set a higher bar of performance. It was also laudable to have aligned the
indicators with the borrower’s own system – the SFR-II monitoring and evaluation framework,
which allowed easier tracking and measurement, and laid the foundation for systematic
assessment of progress at city level. However, one indirect result of this, was that some of the
indicators cannot be solely attributed to actions taken/investments made under KIIDP. They relate
to city wide impacts, influenced by a broader context and external actions (for example, in
addition to specific measures supported by the project KCCA took additional measures (e.g.
passed policies) which also boosted their financial performance).
43. A specific example is the indicator on “public satisfaction in service delivery”. This
indicator did not provide an accurate and objective reflection of KIIDP impacts because it was
measured using the Citizens Report Card Surveys (CRCS) which pertains to city wide
improvements rather than KIIDP-specific infrastructure and services. It is thus not a good proxy
of the public satisfaction with infrastructure and services provided by KIIDP. (This is further
discussed in Section 3.2.) In addition, given the lower level of investment in infrastructure that
was expected under the first phase of the APL, this indicator is likely to improve after completion
of KIIDP II and as other donor and government funded investments are scaled up.Lastly, the two
new PDO-level indicators which were added during the first project restructuring, while having
useful intent, were not convincing PDO-level indicators, and perhaps could have been
intermediate result indicators instead.
44. M&E Implementation and Utilization: KCCA was primarily responsible for all M&E
data collection. The majority was made available through mainstream data collection performed
by KCC/KCCA such as through their quarterly/annual financial reports and the mid-term and
annual review reports. Several of the indicators, especially those on KCCA’s financial
performance, have been mainstreamed into the overall KCCA corporate M&E framework, and
would be monitored beyond the project period. Generally, reporting of the results was done
regularly and consistently during implementation. For the two PDO-level indicators added during
project restructuring, a baseline was established when they were first introduced. However, for the
indicator measuring “average traffic growth on KIIDP upgraded roads”, as some road works were
delayed and not fully completed by project closing (but were completed by end May 2014), the
actual traffic count could not be carried out and has therefore only been estimated.
2.4 Safeguard and Fiduciary Compliance
Safeguards
45. Environment. KIIDP was an Environmental Category B project, triggering OP4.01
Environmental Assessment and OP 4.04 Natural Habitats. During project preparation, an
Environmental Analysis (EA) of the planned infrastructure investments was carried out. The EA
included an Environmental Management Plan (EMP) which outlined institutional arrangements
for the implementation of appropriate mitigation and monitoring measures, as well as capacity
building measures and cost estimates.
14
46. During project implementation, there were deficiencies in complying with environmental
mitigation or safeguard measures. (The last five Implementation Supervision Report (ISR) until
project closing rated overall safeguards as moderately unsatisfactory.) This was mainly due to
KCC/KCCA lacking sufficient capacity in environment and social safeguards and had no relevant
specialists in the Procurement and Disposable Unit (PDU) – which was responsible for carrying
out this function. Therefore, KCC/KCCA was generally slow in following up with the necessary
actions such as conducting the environmental audit which had been recommended since 2010 (but
this was eventually completed by project closure).
47. Deficiencies in safeguards implementation were observed especially for the landfill
operations, starting with initial land acquisition and including: (i) poor handling of the landfill
acquisition with no proper due diligence undertaken prior to the purchase of the 6-acre extension
landfill (existing encumbrances delayed KCC from taking possession until fully resolved); (ii)
KCC/KCCA relied on temporary licenses19
to operate the landfill for a longer period of time than
expected (while awaiting resolution of environmental issues), (iii) incomplete fencing around
landfill site (which was eventually completed by project closure); and (iv) inadequate leachate
monitoring and treatment system, not commensurate with the national wastewater treatment and
discharge standard, posing health and safety risks to the public (landfill extension work including
satisfactory leachate monitoring and treatment system was eventually completed by 31st January,
2014).
48. Social. OP 4.12 Involuntary Resettlement was triggered for the project. While a detailed
RAP was completed during project preparation, there was a general lack of capacity in
KCC/KCCA to manage the RAP process effectively. This, compounded by a difficult external
environment, resulted in multiple challenges to the implementation of the RAP, including: (i)
inadequate GoU funding for compensation; (ii) increased RAP costs from the original valuation,
(iii) discrepancies and inadequacies in documentation; and (iv) weak enforcement by KCCA in
fully securing the areas acquired. Three valuation reports20
were carried out throughout the project
period, each with different compensation costs identified. As a result some RAP compensation
remained outstanding at project closing - as of 31st December 2013, a total of 494 Project
Affected Persons (PAPs) had been compensated with UGX 7,562,420,039 (approximately
US$2.95 million), leaving a balance of 239 PAPs to be compensated and a total outstanding
compensation of UGX 1,404,337,726 (approximately US$550,000). However, these outstanding
payments were largely due to unsubstantiated claims. With a further round of public advertising
and verification, all eligible claims were paid off at the time of concluding this ICR.
19 The landfill operation licenses are issued by the National Environmental Management Authority (NEMA).
NEMA required the environmental audit to be completed before issuing the permanent license. 20
In the 1st and 2nd valuation reports, UGX 5,764,909,478 was approved as payment to the 689 PAPs on
the Lubigi channel, phase I and II roads and Kiteezi landfill site. A total of UGX 4,850,017,492 was paid to
480 PAPs, leaving a balance of UGX 914,891,986 to be paid to 209 PAPs. During construction, additional
properties and land were affected following a change in the design of the Lubigi channel, roads and
junctions. Additional complaints were also registered by the people who had been assessed and/or
compensated under the 1st and 2nd valuations. This resulted in the third and final supplementary valuation
report comprising a total of 46 beneficiaries with a total compensation of UGX 801,848,287. In March
2013, out of the 46 beneficiaries, a total payment of UGX 312,402,547 was made to 16 of them, leaving a
balance of UGX 489,445,740. The total outstanding RAP compensation resulting from the 1st, 2nd and 3rd
valuation is therefore UGX 1,404,337,726. Out of these, UGX 1,187,067,720 did not have the necessary
supporting documentation. In an attempt to conclude the exercise, KCCA publicly advertised the call for
claimants and the deadline for submission of claims expired on February 19, 2014. 21 submissions were
received, of which, only 10 had complete documentation and were eligible for further verification; the other
11 were requested to provide additional information by 7 June 2014, and if not, will be deemed as
ineligible. Out of the 10 with complete documentation, 6 were found to be valid claims (totaling
UGX21,376,675) and these have been paid for; while the other 4 were found to be ineligible as they had
been previously paid off. Since the deadline for submission has passed, no further claims will be eligible.
15
Fiduciary
49. Financial Management. In general, the project complied with project financial
management requirements and GoU financial regulations. The financial management system of
the project was generally adequate to manage project resources and a Financial Management
Manual was prepared as part of the Project Implementation Plan (PIP). Over the course of the
project implementation, quarterly financial and progress reports were prepared and reviewed
timely. Formal audits including review of financial statements were carried out annually in
accordance with the International Standards on Auditing. The last available audit confirmed that
“adequate records have been maintained concerning the project progress and financial statements
were adequately supported and presented a true and fair view of the financial position of the
project and of its operating expenditures” (as of 30 June 2013).
50. Procurement. The procurement processes, including procurement initiation, planning,
publications, bidding, evaluation and award were generally compliant with the GoU law and IDA
Procurement and Consultant guidelines. The PIP and the Procurement Plan as approved at project
design was generally adhered to and complied with, and updates were made and approved by IDA
as and when it has been required.
51. The project rightly assessed the procurement risk as High during project preparation and
built in measures to mitigate this risk. These measures included the establishment of a
Procurement and Disposable Unit (PDU) in KCC, preparation of overall project procurement plan
satisfactory to IDA, providing training to staff, sensitizing councilors on the procurement system
and law, amongst others. As KCC initially lacked procurement capacity, the procurement function
was held by the MoLG until May 2010. This introduced another layer of approval and both
contributed to, and resulted in, further unnecessary delays. A fully staffed PDU was established in
KCC only at the first project restructuring, after which, the PDU took over the responsibility for
all project procurement. The PDU greatly reduced the procurement turnaround time (time
required for Contracts Committee clearances reduced from two months to two weeks) and
improved progress on the implementation of project activities. However, the general lack of
procurement capacity in KCC/KCCA21
was a factor throughout the project. Delays were
frequently experienced in the procurement process (the final two Implementation Status and
Results Report both rated procurement as moderately unsatisfactory).
52. In general, KCCA had developed controls for Internal Audit, Financial Management and
Procurement and made efforts to integrate financial management into the KCCA framework. The
draft KCCA financial management manuals, internal audit manuals and procurement management
manual are underway to be approved. Arrangements were also made to bring on board the Quality
Assurance Unit within the Internal Audit Directorate to address weaknesses in covering project
procurement activities.
2.5 Post-completion Operation/Next Phase
53. Preparation of a follow on project, KIIDP II has just been completed and Board Approval
obtained on March 20, 2014. KIIDP II adopts the Investment Project Financing (IPF) instrument
as the APL instrument is no longer available. The objective of KIIDP II builds upon the
foundation of KIIDP and, along the same lines, seeks to “enhance infrastructure and institutional
21 The procurement audit conducted in October 2013 for FY2011/2012 found that “the PDU team lacked
appreciation or proficiency in procurement management under IDA financed projects with limited
experience especially in procurement processing for works contracts. This is based on the findings carried
out on all assessed civil works files where there is little or no participation of the PDU with contract
management issues.”
16
capacity of KCCA to improve urban mobility in Kampala.” KIIDP II continued the alignment
with the original thinking of KIIDP as an APL, and focused its support on scaling up service
deliver through large scale infrastructure works with more substantial funding. Its design has also
incorporated various lessons learnt from KIIDP and built in appropriate measures to enhance
results. This includes: (i) supporting the client to develop capacity for rigorous due diligence
before award of contracts; (ii) preparing larger contract packages so as to attract bigger and more
competent firms, with option of joint ventures or sub-contracting of critical elements such as
drainage structures; (iii) improving capacity to manage safeguards, including technical and
financial arrangements for timely compensation; and (iv) further strengthening of KCCA
technical capacity through technical assistance and recruitment of critical staff in the relevant
technical departments.
3. Assessment of Outcomes
54. As the PDO level indicators changed during the first restructuring, a split evaluation has
been carried out.
3.1 Relevance of Objectives, Design and Implementation
55. The overall relevance of objectives, design and implementation is Satisfactory.
56. The overall project objectives was and remains highly relevant and consistent with the
country’s current development priorities, as well as the Bank’s current country and sectoral
assistance strategies and corporate goals (cross reference to section 2.1). At the country level, the
project objectives were in line with the IDA’s long-term CAS for Uganda. The project objectives
were highly in line with, and referred directly to supporting the implementation and priority
activities of the SFR-II.
57. The project design addressed the objectives of the KCC/KCCA institutional reforms
which were critical for delivering the much-needed services and infrastructure for Kampala. The
project components mirrored the priority activities identified in the SFR-II, which the project
sought to support (as discussed earlier under the project design section). The project design is
commendable for striving to be fully integrated within the mainstream government strategy and
framework. It is notable that KCCA maintained their focus on the reform agenda outlined in APL
1 and as a result by project closing all triggers for proceeding with the second phase of the APL
(APL 2) were met.
58. The Bank’s implementation assistance was responsive to changing needs and context.
When the new KCCA was formed to replace KCC, the PDO and project design were re-examined
during the MTR and found to continue to be relevant to the new institution and needs of Kampala.
In addition, as some sub-component activities were dropped due to a decrease in the funding
balance for such activities, the team worked with KCCA to select those sub-projects of the highest
priority and potential impact, based on previous studies conducted (for example, the Lubigi
primary channel works was retained while secondary and tertiary drainage channel works were
dropped) .
3.2 Achievement of Project Development Objectives
59. The project development objective was to “support the Recipient’s efforts to improve the
institutional efficiency of Kampala City Council (KCC), through the implementation of the
Strategic Framework for Reform of the KCC”. The PDO consisted of two inter-related parts, the
achievements against each are further assessed below. (The complete results framework and
details are included in the datasheet on page vii.)
17
(i) Improve institutional efficiency of KCC
60. The overall focus and objective of the project was to support the institutional
improvements of KCC and later KCCA. Indeed, during the lifetime of the project, KCC/KCCA’s
institutional efficiency improved dramatically despite the challenging broader environment.
Impressive achievements have been made especially in two areas: KCC/KCCA’s (i) financial
health and (ii) governance.
61. The financial health improvements were clearly demonstrated through three of the four
original PDO-level indicators (ie. reduce overdue liabilities, increase in KCC own source revenue
(OSR) and increase share of KCC own source revenue spent on service delivery). These
indicators were more closely related to the PDO and therefore should receive a higher weightage
in determining how well the PDO is achieved. These three PDO-level indicators were all met by
the first restructuring and in fact, performed exceptionally well (although the indicator on
“increase share of KCC own source revenue spent on service delivery” was slightly short of
eventual target). KCCA greatly reduced its stock of overdue liability, from UGX 8 billion to 0
billion; and increased its OSR from UGX 22 billion at project start in FY2005/2006 to UGX
55.71 billion by FY2012/13 at the end of the project - a 166 percent achievement above the set
target. This is largely a result of the successful implementation of KCCA’s Financial Recovery
Action Plan (FRAP) and the notable improvements made in the collection of current property
rates, local service tax and hotel tax.
62. In addition, substantial improvements in governance have been achieved, especially after
the transition to KCCA. The last assessment of implementation of the KIIDP governance
assessment and action plan (GAAP) showed a significant paradigm shift towards better
governance and anti-corruption (GAC). The leadership team introduced a new results-driven
working culture that included a dynamic and aggressive approach to addressing GAC issues.
KCCA management has been taking action on a range of transparency and accountability issues,
key of which is the enforcement of a zero tolerance policy for corruption, taking appropriate
disciplinary actions22 on errant staff and immediate sanctioning of staff involved in corrupt
activities. In addition, KCCA management introduced a performance based compensation system
for key staff and staff is being appraised bi-annually using the balance score system. There is also
enhanced engagement of citizen and civil society organizations (CSOs), as reflected by: (i)
holding a series of grassroots neighborhood dialogues modelled along the traditional “baraza”
meetings, (ii) establishing a formal public consultation process with annual budget meetings held
for all stakeholders; and (iii) increasing public engagement through websites and social media.
Many of these were a result of KIIDP inputs including, amongst others, the staff performance-
based compensation system, enforcing the code of conduct, improvements in records management
system of the general administration, various communication strategy implementation and
trainings for staff.
63. KIIDP’s contribution to institutional improvements are mainly achieved through the
following: (i) revenue enhancement activities supported under the project which led to increase in
own-source revenue; (ii) technical assistance (TA) and policy dialogues conducted as part of the
project which influenced changes in behavior and mindset of KCC/KCCA leadership and staff;
(iii) effective systems put in place and supported under KIIDP to improve governance; (iv)
capacity building activities such as training for staff, equipping them with necessary skills
relevant to their functional roles; and (v) enhanced communication, consultation and rebranding
activities supported under KIIDP which improved KCCA’s image and relation with the public. It
is noted that the KIIDP served a demonstrative role and supplemented the overall institutional
improvement efforts being concurrently undertaken through non-KIIDP initiatives and resources.
22 In FY2012/13 disciplinary actions were taken on a total of 31 KCCA staff (16 termination, 8 interdictions,
3 warnings, and 4 interdictions being lifted).
18
64. In addition, the institutional focus of KIIDP as a phase 1 APL is also illustrated by: (i) the
key actions/conditions to be met as agreed during KIIDP project preparation23
(these included
formal adoption of the SFR-II; approval of codes of conduct for KCC Councilors and Officers;
preparation of the Kampala Financial Recovery Action Plan (FRAP) including completion of the
valuation rolls of all properties in Kampala and setting up a revenue task team; completion of the
process for organizational restructuring of KCC on the basis of the approved structure; and
incorporation of the Kampala Citizens’ Score Card in the SFR); and (ii) APL triggers (such as
performance based compensation system implemented for key staff, enforcement of the
leadership code, media strategy implemented, reduce the stock of overdue liability, increase own
source revenue, provision and release of adequate O&M budget, infrastructure investments
selected based on sound appraisal and public consultation etc.) under the project. As the
institution was required to meet these conditions and targets before embarking on the project and
before moving to the second phase of the APL respectively, this provided large incentives to
achieve the required institutional improvements
65. By the first restructuring in November 2010, great progress had already been made with
regards to institutional reform of the then KCC - three of the four PDO-level outcomes more
closely related to the PDO had all been achieved24
. Due to the impressive achievement, the final
targets for these three indicators were further raised during the restructuring, setting the bar even
higher.
(ii) Implementation of the SFR-II.
66. Implementation of the SFR-II was the key vehicle chosen to support realization of the
PDO, and it is an appropriate one. As discussed in Section 2.1, the SFR-II strategies largely
addressed institutional improvements and it further identified priority activities in four key areas:
(i) institutional development; (ii) city-wide infrastructure and service improvement; (iii) civil
society participation and management; and (iv) monitoring and evaluation. As the overall
achievement of the PDO on improving institutional efficiency has already been discussed above,
the following discussion focuses on the achievements of the infrastructure and services.
67. One of the original four PDO-level indicators was directly related to the implementation
of infrastructure ie. the “Increase in public satisfaction in service delivery in (a) Roads, (b)
Drainage and (c) Solid waste”. This indicator has not been met by project closure. This indicator
is measured by results from the CRCS25
. It is noted that the CRCS does not pertain solely to
KIIDP-specific infrastructure and services but measures performance in the whole of Kampala,
which KIIDP infrastructure only contributed marginally to26
. As such, the results from the CRCS
could not be taken as a direct reflection of the beneficiaries’ satisfaction with infrastructure and
services provided under KIIDP. While the indicator is not a good proxy of project impact, it is a
key indicator of the SFR-II and a useful measure reflecting overall improvements of infrastructure
and service delivery in the city. The CRCS showed that overall, there was vast improvement in
23 The project preparation was pre-conditioned to KCC taking certain initial measures towards
implementation of the SFR to enable KCC to demonstrate its commitment to the reform agenda. 24
The PDO indicators achieved were: (i) Reduce overdue liabilities from Ushs 8 billion to Ushs 3 billion;
(ii) The share of KCC own source revenue spent on service delivery increase from 10% to 30%; and (iii)
increase in KCC own source revenue from Ushs 22 billion to Ushs 30 billion. 25
The methodology for the Citizens Report Card survey combined both quantitative and qualitative
methods that included face-to-face interviews, focus group discussions, personal interviews and literature
review. 26
For example, in terms of roads improvement, approximately 12km of road upgrading was targeted to be
completed under KIIDP, compared to approximately 100km of roads reconstructed by KCC/KCCA during
the same period, and in a city with about 1,200 km of road network in total.
19
the satisfaction level with KCCA services from 2005 to 2011 and 2012. Satisfaction levels have
risen in the areas of solid waste, roads and drainage, which in fact coincide with the areas of
infrastructure improvements undertaken in KIIDP. (Refer to Annex 5 for more detail.) In addition,
two new PDO-level indicators added during the first restructuring were associated with measuring
infrastructure implementation: (i) average traffic growth on KIIDP upgraded roads; and (ii)
number of people directly affected by floods along Lubigi Channel. Both indicators were met by
project closing.
68. However, some of the infrastructure works were not completed27
by project closure: (i)
the Lubigi Channel works was 98% complete; (ii) three out of six roads were 100% upgraded
(while Kimera Road was at 90% completion, Soweto Road at 75% completion and the funding of
Salaama Road was taken over by KCCA during project implementation; all road works were
completed by end May 2014); and (iii) solid waste management works were around 90%
completed.
69. As implementation of the infrastructure works faced multiple challenges throughout the
project, little progress had been made in the infrastructure works by the first project restructuring
(mainly due to the delays in credit effectiveness and delays in RAP implementation, as explained
earlier). The infrastructure work scope was then reduced during the restructuring as the balance in
funding for such works was reduced (four out of eight intermediate level indicators were dropped
as a result). This inherently reduced the potential impact that could have been achieved if the
original scope of work was kept (however, several priority works have been moved to KIIDP II).
After project restructuring, the implementation challenges were largely attributed to poor
contractual management and supervision (as the then KCC had inadequate capacity) and
insufficient contractors capacities (inadequate financial and equipment). Rigorous contract
management measures came too late in the project implementation by the time of the new KCCA
administration. (Factors affecting project implementation were discussed in Section 2.2.)
70. The infrastructure built under the project achieved visible, positive impacts. On the
upgraded roads, the immediate impact included improved accessibility and better traffic flow. In
addition, observations made during site visits and discussion with residents and road users post
project completion revealed additional benefits such as: (i) general improvement in the
environment (due to better road conditions and roadside drains provided), (ii) improved safety and
security (due to the provision of sidewalks and street lights), and (iii) longer business hours
enabled for the business and shops along the improved roads. For the Lubigi channel
improvement, it allowed for better drainage, reduction in flooding in the Bwaise, Kawala and
Kalerwe areas and other environmental benefits (such as reduced incidences of diseases and
enhanced public health and environmental cleanliness). From focus group 28 conducted with
communities in the area, respondents indicated that the construction has resulted in an immediate
reduction in flooding. Lastly for the landfill improvements, it allowed for extended life and
increased capacity of solid waste disposal.
3.3 Efficiency
71. The overall efficiency of the project is Satisfactory.
Economic and Financial Analysis of Components
72. For Component 1, the relevant PDO-level indicators performed exceptionally well –
especially the stock of overdue liability was reduced from UGX 8 billion to 0 billion; and its OSR
27 KCCA has set aside budget within its own resources and will fund the necessary completion of remaining
works. 28
Conducted as part of the CRCS 2012.
20
was increased from UGX 22 billion to UGX 55.71 billion. A potential economic analysis on this
component will examine the performance of in a with-and-without project scenario. However,
data to support such a counterfactual analysis is unavailable. As a proxy and taking the indicator
on increase in OSR for KCC/KCCA, a comparison is made between the period before the project
commenced and that during the project implementation. The results showed that the average
annual growth rate of the OSR for the seven years (FY00-06) leading up to the start of the project
was 6.4%. In contrast, that for the project period (FY0629
-FY14) was at 12.2% - almost double
that of the previous period. (See figure below.)
Comparison of OSR Annual Growth Rate Before and During KIIDP
73. In addition, there are two main sub-components in KIIDP which directly supported the
outcome of institutional achievement: Organizational Development & Governance (project cost of
US$1.46mil) and Support to Financial Recovery (project cost of US$0.16 mil), at total project
cost of US$1.62mil. This is, comparatively a much smaller sum with respect to the leveraged gain
– such as the OSR increase of approximately UGX33.71 billion (or approximately US$17 mil) (in
addition to many other benefits as discussed earlier), demonstrating potentially very high
efficiency (as noted earlier not all the institutional gains could be attributed solely to KIIDP.)
74. For Component 2, the economic analysis was conducted for the infrastructure works
mainly for roads and drainage system (details of the analysis are included in Annex 3). Results of
the project efficiency and economic analysis showed that the main infrastructure investments
yielded largely positive NPVs with an overall EIRR of 29.8% for the roads improvements and
approximately 17.5% for the Lubigi Channel.
Roads Improvement
75. The approach used for the economic analysis is the cost-benefit analysis of a “with” or
“without project” case. The economic analysis is based on homogenous road sections, in terms of
physical characteristics, traffic and road condition. The Highway Development and Management
Model (HDM-4) was used as the analytical tool. The roads analyzed are those completed under
KIIDP, including Bukoto-Kisaasi Road, Kalerwe-Tula Road, Kawempe-Mpererwe Road, Kimera
Road and Soweto Road. The discount rate used for the analysis is 12 percent, and the analysis
period is 20 years with the base year for the analysis as 2012.
29 Baseline was set using FY06 figures although project was approved in 2007.
0
10000
20000
30000
40000
50000
60000
UG
X (
Bill
ion
)
Year
21
76. The main benefits of the roads improvement are savings in vehicle operating costs (VOC)
and savings in passenger travel time. Net benefits were estimated using HDM-4 which simulates
road life cycle and vehicle operation conditions and costs for multiple road design and
maintenance alternatives. Vehicle operating costs were for nine vehicle classes. Periodic
maintenance and upgrading costs estimated in financial terms were converted into economic
terms (net of taxes). The benefits are calculated in terms of savings in road user costs. It was
found that the savings in VOC is US$17.37 million and the savings in travel time cost is US$3.00
million, both discounted over the analysis period. (It is assumed there are no savings in accident
costs for the KIIDP road improvements as much anecdotal evidence in Africa suggest that the
frequency of accidents may actually increase after unpaved roads are improved to tarmac surface
as vehicle speed increases.) In addition, when compared with estimated benefits during appraisal,
those at project closing were higher for both the savings in VOC and travel time cost.
77. The economic analysis of KIIDP road improvements at project closing found that the
overall Net Present Value (NPV) is US$13.098 million with an EIRR 0f 29.8%, NPV/RAC ratio
1.31 and overall Benefit-Cost Ratio of 2.31. Three road projects yielded positive NPVs and
EIRRs greater than the discount rate of 12% and two roads gave negative NPVs and EIRRs less
than 12%. (As compared with analysis done during appraisal, phase 1 roads – Bukoto-Kisaasi,
Kalerwe-Tula and Kawempe-Mpererwe all yielded much higher NPVs and EIRRs at project
closing than the appraisal estimates. However, phase 2 roads – Kimera and Soweto roads had
much higher actual construction cost per km and both yielded negative NPV. Overall, the EIRR at
project closing is slightly less but close to that determined at appraisal. The net benefit at project
closing is greater than that at project appraisal by US$4.45 million.) The approximate timing
when the discounted cumulative net benefit of investments will become positive (i.e. the break-
even point) was determined to be Year 7 (i.e. 2018 since the base year for this analysis is 2012).
Comparison of Economic Indicators for Roads at Appraisal and Project Closing
Road
Name
Economic
Indicators
At Appraisal
(from PAD)
At Project
Closing
Comments
Bukoto -
Kisaasi
EIRR % 38 67.8 The net benefit at project closing is
almost 5 times higher than that at
appraisal. The difference is US$ 8.259
million, notwithstanding the relatively
higher actual cost per km.
NPV (US$ mil) 2.113 10.372
B/C Not available 5.36
Unit Cost
US$ per km
403,333 779,636
Kalerwe -
Tula
EIRR % 17 25.5 The net benefit at project closing is
almost 6.5 times higher than that at
appraisal. The difference is US$ 2.202
million, notwithstanding the relatively
higher actual cost per km.
NPV (US$ mil) 0.399 2.601
B/C Not available 1.94
Unit Cost
US$ per km
368,421 869,261.32
Kawempe-
Mpererwe
EIRR % 15 17.7 The net benefit at project closing is
almost 4 times higher than that at
appraisal. The difference is US$ 0.547
million, notwithstanding the relatively
higher actual cost per km.
NPV (US$ mil) 0.191 0.738
B/C Not available 1.37
Unit Cost
US$ per km
333,333 873,736.55
Kimera2 EIRR % 32 7.9 The net benefit at appraisal is positive
but the net benefit at project closing is
negative US$ 0.378 million. This can be
attributed to the very high actual
construction cost per km (more than
twice the estimated unit cost).
NPV (US$ mil) 0.225 -0.378
B/C Not available 0.73
Unit Cost
US$ per km
805,714.11 1 1,753,480.89
Soweto2 EIRR % Not analysed 9.6 This road was not included in the
economic appraisal (not stated in PAD). NPV (US$ mil) Not analysed -0.256
B/C Not analysed 0.84
Unit Cost
US$ per km
Not analysed 303,921.31
22
Overall3 EIRR % 32 29.8 The EIRR at project closing is slightly
less but close to that determined at
Appraisal. The net benefit at project
closing is greater than that at project
appraisal by US$ 4.45 million.
However, it is important to consider the
notes below the table.
NPV (US$ mil) 8.648 13.098
B/C Not available 2.31
Unit Cost
US$ per km
Not available 1,027,621.21
Notes Used conversion of UGX1 = US$0.0005 according to PAD conversion 1 Based on estimated cost in 2007
2 Values assume fully completed roads.
3 For PAD the list includes other roads that were dropped (e.g. St Barnabas Road)
78. After being subjected to sensitivity analysis using 15% increase in construction and
maintenance cost and 15% decrease in total benefits in both cases, the NPVs of the three roads
remained positive and of the other two roads remained negative. A simultaneous increase of 15%
in total construction and maintenance costs on one hand and a decrease of 15% in total benefits on
the other resulted in an overall NPV of US$8.951 million at a discount rate of 12% and an overall
EIRR of 23.1%, indicating that the selected projects represent a positive return on investment
even in a worst case scenario.
Drainage system improvement
79. The Lubigi primary drainage system is 14km long with 17 secondary channels totaling
45km located within and outside the Kampala District boundary. Under KIIDP, the improvement
of 3.6km of the Lubigi channel was implemented. The basis of the economic analysis of the
drainage sub-component is the cost-benefit analysis of a “With Project” and a “Without Project”.
The cost-benefit analysis evaluates the project capital and maintenance costs for the channel
improvement, compared with the associated benefits of better drainage. The design of the channel
is for a 10-year return storm period with an economic life of 40 years and the base year of analysis
is 2011, at the start of project implementation, with actual construction period of 2.5 years. In
addition, it is assumed: GDP growth rate at 5.5% per annum, population growth rate of 3.9% and
inflation rate at 7.8% per annum. The cost-benefit evaluations of the drainage subcomponent are
based on detailed data collected and presented in Kampala Drainage Master Plan (KDMP) in
March 2003 with updated costs to December 2013.
80. The estimated cost for Lubigi channel under KIIDP is US$ 8,755,463 and the actual cost
of implementation is US$ 11,633,655 (including consultancy services and resettlement
compensation). A conservative value of 1% of capital investment costs has been assumed to cover
the annual operating and maintenance costs for the Lubigi channel. The operational and
maintenance costs are therefore US$ 116,337 per annum.
81. The main inferred benefits are both quantifiable and non-quantifiable. Among the
quantifiable are: savings from prevention of road damage and damage to property and structures,
prevention of disruption to commercial and industrial activities and traffic, additional income
from rentals. In addition, notional amounts are assigned to savings in agricultural produce and
reduced health and environmental impacts.
82. Investment in Lubigi channel yielded positive NPVs at US$6.5 million for the base
scenario and EIRRs greater than 12%. The sensitivity analysis indicates that the implemented
project has a positive return on investment even for the worst case scenario of 15% increase in
cost and 15% decrease in benefits. In addition, the net benefit determined at project closing is
much greater than the amount estimated at appraisal, at a difference of US$ 5.793 million. The
approximate timing when the discounted cumulative net benefit of investments will become
positive (i.e. the break-even point) was determined to be Year 15 (i.e. 2025 since the base year for
this analysis is 2011).
23
Comparison of Economic Indicators for Lubigi Channel at Appraisal and Project Closing Economic
Indicators
At Appraisal
(from PAD)
At Project
Closing
Comments
EIRR % 14.0 17.5 The net benefit determined from evaluation at
project closing is much greater than the
amount estimated at appraisal. The difference
is US$ 5.793 million.
NPV (US$ mil) 0.708 6.501
3.4 Justification of Overall Outcome Rating
83. Based on all the assessment discussed earlier, the overall project outcome is rated
Moderately Satisfactory, with a rating of Moderately Satisfactory as measured against the original
PDO/targets and Moderately Satisfactory against revised PDO/targets (refer to split evaluation
calculations in table below).
Overall Outcome Rating
Ratings
Against Original
PDO/Targets
Against Revised
PDO/Targets Overall
1. Relevance Satisfactory Satisfactory Satisfactory
2. Achievements Moderately
Satisfactory
Moderately
Satisfactory
Moderately
Satisfactory
3. Efficiency Moderately
Satisfactory Satisfactory Satisfactory
Overall Rating Moderately
Satisfactory
Moderately
Satisfactory -
Rating Value 4 4 -
Weighted
(% disbursed before/after
revision)
10.54%30
89.40% 99.94%31
Weighted Value 0.42 3.58 4.00
Final rating (rounded) - - Moderately
Satisfactory
Note: Ratings and values- Highly Satisfactory=6; Satisfactory=5; Moderately Satisfactory=4; Moderately
Unsatisfactory=3; Unsatisfactory=2; and Highly Unsatisfactory=1
3.5 Overarching Themes, Other Outcomes and Impacts
(a) Poverty Impacts, Gender Aspects, and Social Development
84. The project contributed to poverty reduction, gender and social development. While no
detailed analysis or data were conducted to demonstrate the poverty dimensions of the project,
KIIDP benefitted all the residents, visitors and businesses of Kampala. As described earlier,
improvements supported under KIIDP contributed to the more efficient functioning of Kampala,
and therefore supports firm growth and job creation which in turn reduces poverty. In addition,
attention to gender and community issues were reflected on various levels under KIIDP, including
the project design (as a sub-component under Component 1 and as capacity building activities)
30 Project disbursement is US$3.54 million as on October 5, 2010, before the first project restructuring.
31 Total project disbursement is US$33.58 million i.e. 99.94% of the total US$33.6 million IDA credit.
24
and approach (adopting the Harmonized Participatory Planning Guidelines (HPPG)32
). The
investments identified, prioritized and funded have been done in a participatory, transparent and
accountable manner. Similarly, the same participatory processes were observed during
implementation and for monitoring and evaluation. Related to this were the efforts in public
consultations (“barazas” and CRCS) and the piloting of a gender community welfare policy under
the KIIDP (this is awaiting the final approval for implementation).
(b) Institutional Change/Strengthening
85. KIIDP significantly contributed to strengthening the institutional efficiency and capacity
of KCC/KCCA, as well as overall governance. The development objective of the project is
directly linked to institutional change and improvements. In particular, Component 1 was
designed to enhance the efficiency and effectiveness of KCC/KCCA and capacity/productivity of
its staff while Component 2 supports this objective as well. (Refer to earlier sections.)
(c) Other Unintended Outcomes and Impacts (positive or negative)
86. NA
3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops
87. No specific beneficiary survey or stakeholder workshop was conducted for KIIDP.
However, throughout the project period, various stakeholder meetings (citizens’ forum and
“barazas”) were held and two CRCS (in 2011 and 2012) on service level and quality for Kampala
as a whole, were conducted. Various consultative and feedback meetings were also held with
different stakeholders at ward and divisional levels.
88. In general, there was vast improvement in the satisfaction level with KCCA services from
2005 (which set the baseline for KIIDP) to 2011 and 201233
. Even just focusing on 2011 to 2012,
respondents who were either very satisfied or satisfied with KCCA services rose significantly
from only 5% in the 2011 CRCS to 30% in 2012; the level of dissatisfaction has also fallen
dramatically from 70% in 2011 to 25% in 2012. For specific areas including solid waste, roads
and drainage, satisfaction levels have also risen. These coincides with the infrastructure
improvements areas under KIIDP. (Refer to Annex 5 for more details.)
4. Assessment of Risk to Development Outcome
89. The likelihood of risks occurring which will be detrimental to maintaining the
development outcome is Moderate.
90. All new and rehabilitated assets of KIIDP are expected to be managed and maintained by
KCCA and the relevant division urban councils. Under the directorate of Engineering and
Technical Services of the KCCA, budgetary provisions have been made to regularly repair and
maintain the infrastructure built under the project, including the roads, Lubigi channel and the
extension of landfill. Also, Kampala receives funding for road maintenance under the Road
Fund34
which will ensure the sustainability of KIIDP roads.
32 The HPPG is a framework formulated and promoted by both local authorities and civil society in Uganda
and has the aim of promoting citizen empowerment and social inclusion. 33
The Citizens Report Card Survey was conducted twice during the project period, in 2011 and 2012.
While designed as an annual exercise, the lapse in the early years of KIIDP was mainly due to the transition
from KCC to KCCA. 34
The Road Fund allocation to KCCA is assumed to increase by 5 percent per annum, taking FY2012/13 as
the base year which will adequately cover the future maintenance of KIIDP roads.
25
91. Other relevant reasons which reduces the risk to development outcomes are:
a. Strong commitment demonstrated by GoU and KCCA to the new Corporate Strategy,
the successor to the SFR;
b. Adequate capacity and resources of KCCA and the relevant division urban councils
in managing and maintaining the infrastructure built under the Project especially
given its relatively small scale; and Continuity of support. KIIDP was conceived as
part of a larger program. Indeed, the Bank will continue to support institutional and
infrastructure investments in Kampala through the follow-on KIIDP II. This will
enable continued efforts in improving capacity development and ensure the
sustainability of KIIDP outcomes.
92. However, the sustainability of the outcome is at risk from the relative instability of KCCA
as a new organization. KCCA is yet to be fully staffed (currently at about 30% of the approved
establishment) and faces friction between political and technical wing (as mentioned earlier under
factors affecting implementation). This poses risks to the overall effective institutional
functioning of KCCA and its delivery of infrastructure and services.
5. Assessment of Bank and Borrower Performance
5.1 Bank Performance
(a) Bank Performance in Ensuring Quality at Entry
Rating: Moderately Satisfactory
93. KIIDP was a continuation of the Bank’s engagement with GoU in support of the
development of Kampala City since the 1990s. The Bank appropriately identified the key issues
and designed a highly relevant operation, adopting the country’s own strategy, and responded to
the critical needs of the city. The project design was based on analytical work from previous
projects and the process was carried out with full participation and buy-in from the GoU and KCC.
However, the project could have been more conservative and designed to have fewer
infrastructure activities and a longer implementation period. The indicator targets on “increase in
public satisfaction in service delivery” could have been tailored to KIIDP work scope
(documented as a subset of the CRCS) to allow better attribution of impacts.
(b) Quality of Supervision
Rating: Satisfactory
94. Supervision was adequate and intensive, averaging two full missions per year with
continual support by staff in the Bank's Kampala office (averaging one meeting every fortnight).
The team worked effectively with both KCC/KCCA teams during the transition period to ensure
proper handing over and continued commitment towards achieving the PDO. Missions responded
to implementation issues in a timely manner as they were emerging and repeatedly urged for
necessary actions to be taken by the implementing agency. For example, restructuring and
extension of project closing dates were initiated when the project was not on track to meet its
development objective. The team also focused on contractual, procurement and supervision issues
which prevented further such problems from arising. However, the revision of indicators and
targets of the monitoring and evaluation framework during project restructuring could have been
more rigorous (e.g. revise the public satisfaction indicator and targets).
(c) Justification of Rating for Overall Bank Performance
95. Based on the assessment of performance at project entry and during supervision, the
overall Bank performance is rated Moderately Satisfactory.
26
5.2 Borrower Performance
(a) Government Performance
Rating: Moderately Satisfactory
96. The government remained committed to the project and its objectives throughout the
project period. There was close cooperation between GoU, KCC/KCCA and the World Bank and
responses from GoU were generally prompt. GoU continuously showed concern and followed up
on the project progress with the implementation agency. However, project effectiveness was
delayed for almost a year while waiting for parliament approval. Government commitment of
project counterpart funding was not fully realized, and not paid on schedule, causing major delays
in implementing the RAP, and thus negatively impacting the overall project implementation
timetable and costs. (However, after KCCA took over the counterpart funding responsibility from
GoU from 2012, it has adequately provided for the counterpart funding to the project since.)
(b) Implementing Agency or Agencies Performance
Rating: Moderately Satisfactory
97. There were inherent challenges during the transition from KCC to KCCA, mainly due to
changes in leadership and direction, funding constraints, entire staff turnover, time required for
staff recruitment, general uncertainty during the change, tension between outgoing and incoming
KIIDP project team etc. Despite the statutory, administrative and structural changes during the
transition, the implementing agency remained committed to the project and its objectives,
devoting a core team of staff to oversee the implementation. The new KCCA KIIDP project team
also demonstrated an improvement in attitude and performance. The KCCA team maintained
close engagement with Bank staff, and its Executive Director showed keen interest regarding
project implementation issues. A number of innovative solutions (such as use of escrow accounts
to address working capital constraints for contractors) were employed leading to improvements in
the implementation progress of civil works.
98. However, KCC/KCCA faced multiple challenges during implementation, largely due to
inadequate staffing and capacity constraints. Lapses were encountered in the enforcement and
implementation of RAP, resulting in escalated overall costs. Capacities in procurement, safeguard
measures, contractual management and supervision were lacking during implementation and
therefore, the environmental mitigation or safeguard measures recommended could not be taken
up speedily sometimes.
(c) Justification of Rating for Overall Borrower Performance
99. Based on the assessment of government and implementing agency performance, the
overall borrower performance is rated Moderately Satisfactory.
6. Lessons Learned
100. Strengthening country systems and strategy. The KCCA made impressive progress in
governance and institutional efficiency. One key factor was that instead of re-inventing the wheel,
KIIDP adopted, complemented and strengthened the organization’s strategy – the SFR and filled
in the resource gap where needed. This was essential to the sustainability of the institutional
objectives as it ensured ownership, was not disruptive, avoided duplication and increased
efficiency in resource usage and implementation. It also allowed transferability and flexibility -
where possible, when conditions matured and capacity was sufficiently built up, project activities
were mainstreamed within the directorates of the KCCA. For example, activities to enhance
revenue management capacity and expenditure management, and to establish a framework for
reduction and control of expenditure originally planned under KIIDP were mainstreamed and
27
taken over by the relevant KCCA directorates during the course of the project. The process was
largely seamless and ensured high sustainability and ownership.
101. Managing external influences and risks. KIIDP made a commendable effort in
proactively addressing such external risks through its project design. These proved to be largely
effective. This was demonstrated through two main examples: (i) provision of conditions in the
FA to ensure continued commitment and uninterrupted implementation of KIIDP in view of the
transition of KCC to KCCA; and (ii) building in a KIIDP specific GAC action plan (as part of a
larger KCCA wide GAC action plan) to strengthen GAC around KIIDP and reduce corruptive
practices which may affect the project impacts.
102. Sustaining Institutional and governance improvements. Broader lessons could be drawn
from the improvements made by KCC/KCCA in its institutional efficiency and governance.
- Firstly, there is a strong continuity in the reform direction despite the transit of KCC
to KCCA. The new entity did not abandon the original SFR, rather built upon it. The
successor to the SFR- the Corporate Strategy (2013 – 2018) – has largely similar
focus: (i) KCCA institutional development, (ii) infrastructure and civil works; (iii)
social services development, and (iv) economic growth, sustainability and
development.
- Secondly, the SFR was comprehensive and adopted a multi-pronged approach,
covering a range of areas from institution policy formulation and performance;
political support, management and teamwork; organizational reform; management
systems; communication and corporate image building; to financial recovery; works
and physical planning and public health.
- Thirdly, the implementation of the SFR, through translating the strategies into actual
actions, was effective overall. A detailed analysis will be needed to properly study the
multitude of reasons for effective implementation. However, a few of the observable
factors were strong leadership and commitment and increased capacity of staff.
KIIDP also played a key role contributing to the implementation.
103. Strengthening contract management and implementation.. One of the key challenges of
the project was effective and timely implementation of the infrastructure works. Several lessons
can be drawn from the experience:
- Rigorous client due diligence – Implementing agencies should enforce more stringent
standards when conducting due diligence before contract award so as to avoid
awarding contracts to firms which do not have the requisite technical staff, equipment
and financial resources to deliver the task.
- Contract packaging – Civil works contracts should be packaged in such a way that
they provide sufficient incentives to attract competent firms with the necessary
capacity and resources to deliver on the assignment.
- Supervision – It is crucial for the implementing agency to check on the performance
of both the contractor and supervising consultants directly and frequently. The team
should also be vigilant in detecting any indication of any potential issues so as to take
the necessary mitigation measures as soon as possible.
104. Ensuring timely RAP implementation. Ensuring that there is sufficient human and
financial capacity for timely and complete implementation of RAPs requires upfront planning and
preparation. Weak capacity in safeguard handling can significantly delay infrastructure
investments, inflate project costs and may lead to adjustments to project design. Making adequate
arrangements to prepare quality RAPs, setting aside funding for each RAP, and completing
compensation in a timely manner are critical factors. While these were not sufficiently provided
for in KIIDP, the design of KIIDP II RAP has taken the lessons learned into account. In particular,
the following factors were considered: (i) streamlining the RAP preparation and implementation
28
process; (ii) specifying/clarifying cut-off dates early on; (iii) setting aside funding for
compensation and resettlement; (iv) establishing clear grievance management mechanism; and (v)
strengthening grievances resolution processes.
105. Application of lessons learned. The follow-on operation, KIIDP II, has taken into
consideration the above lessons from KIIDP and put in place appropriate mitigation measures.
These include: (i) supporting the client to develop capacity for rigorous due diligence before
award of contracts, (ii) preparing larger contract packages so as to attract bigger and more
competent firms, with option of joint ventures or sub-contracting of critical elements such as
drainage structures, (iii) improving capacity to manage safeguards, including technical and
financial arrangements for timely compensation, and (iv) strengthening of KCCA technical
capacity through technical assistance and recruitment of critical staff in the relevant technical
departments.
7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners
(a) Borrower/implementing agencies
106. No specific issues raised (refer to Annex 7 for a Summary of Borrower's ICR).
(b) Co-financiers NA
(c) Other partners and stakeholders NA
29
Annex 1. Project Costs and Financing
(a) Project Cost by Component (in USD Million equivalent)
Components Appraisal Estimate
(USD millions)
Actual
(USD millions)
Percentage of
Appraisal
1-Institutional Development 5.80 6.93 119.48%
2-Kampala City Infrastructure
and Services Improvement 28.50 25.64 89.96%
3-Project Implementation,
Monitoring and Evaluation 2.80 3.07 109.64%
Total Project Costs 37.10 35.64 96.06%
Front-end fee PPF NA NA NA
Front-end fee IBRD NA NA NA
Total Financing Required 37.10 35.64
Total Undisbursed 0.023
Percentage Disbursed 99.94%
(b) Financing
Source of Funds Type of
Cofinancing
Appraisal
Estimate
(USD millions)
Actual
Expenditure
(including
committed)
(USD millions)
Percentage
of Appraisal
Borrower Parallel
Co-financing 3.50 2.06 58.85%
International
Development
Association (IDA)
33.60 33.58 99.94%
Total 37.10 35.64 96.06%
30
Annex 2. Outputs by Component
Components/
Tasks Final Outputs
Comments
(including outputs designed at
appraisal but not delivered)
Actual
Expenditure
(USD)
Component 1: Institutional Development
Focus on institutional development activities that support organizational development and governance, the
implementation of the Financial Recovery Action Plan, and actions to enhance effectiveness of service delivery.
Component 1.1 Organizational Development & Governance
Human Resource
Management
Training (refer to detailed table
below.)
-Total number of staff trained:
76
-Technical Cooperation with
Hyderabad Municipal
Corporation. (Exchanges
through visiting delegations)
Visit to Hyderabad took place
between 19th and 25th July
2010 in Israel and Cape Town.
Performance-based
compensation system
(Performance based
compensation system for key
staff being fully implemented.)
Code of Conduct
The staff code of conduct is
being enforced. In FY2012/13
disciplinary actions were taken
on a total of 31 KCCA staff (16
termination, 8 interdictions, 3
warnings, and 4 interdictions
being lifted.)
HR Management System was
dropped during project
restructuring as the Ministry of
Public Service rolled out the
Integrated Personnel and Payroll
System (IPPS).
$582,000
General
Administration
Records management system
(in legal department),
Records management
equipment
SFR performance workshops
Completing strategic plan
development process
Printers, 25 vehicles were
procured.
$155,722
Implementation of
Communication
Strategy
PR Strategy
Public consultations &
Stakeholders engagements – 5
barazas & workshops
Publicity of new Mission,
Vision & Core Values;
Rebranding; Unveiling new
corporate identity;
communication equipment
The following items were not
implemented/deferred:
"Knowledge, attitudes and
perception survey" in end 2010
Complaints management system
Customer care desks
Client Charter
$365,719
31
Education PC, Vehicles Education Information System for
KCC was dropped. $39,999
Gender Welfare &
Community
Development
Piloting gender community
welfare policy
Implementation support of
RAP (incl. training, legal
services)
$321,296
Component 1.1 Sub-Total $1,464,736
Component 1.2 Support to Financial Recovery
- Enhance revenue and management capacity, enhance expenditure management, expenditure control
Support to
Financial
Recovery
PCs, Vehicles
A study on documenting owner
occupied costs
Various activities on enhancing
revenue and management
capacity, enhancing expenditure
management and expenditure
control were mainstreamed and
taken up directly by KCCA as
they acquired sufficient capacity. $160,707
Component 1.2 Sub-Total $160,707
Component 1.3 Strengthening Service Delivery
Strategic Plan for
Health &
Environment
Services
HIV/AIDS workplace strategy
Capacity Building for EMP
Environment audit
Vehicles, PC
$414,806
Works
(Engineering
Services)
Quality assurance system for
infra;
Vehicles, PC
Engineering software
$298,328
Urban Planning &
Land Management
Update Kampala Physical
Development Plan;
Hardware/software - GIS
Vehicles
$3,789,022
ICT
Extension of network;
IT equipment (Network servers,
radios, UPS, Routers and
switches
75 computers, 5 multipurpose
photo copiers, 75 IP phones, 2
smart board screens and a 65”
LED smart screen
Software
$672,992
Component 1.3 Sub-Total $5,175,148
COMPONENT 1 SUB-TOTAL $6,800,591
Component 2: Kampala City Wide Infrastructure and Services Improvement
Component 2 will finance infrastructure mainly focusing on rehabilitation of high priority infrastructure which
were identified as critical to maintaining the productivity and welfare of the City and that the proposed activities
are ready for implementation. The objectives of the physical investments are the preservation of the current assets
and arrest the deterioration of the assets. It will enable KCC to be a functioning capital city and position itself to
attract investors.
Drainage Works Lubigi primary channel
(total length 3.6km)
Lack of funding (escalated
construction costs) led to dropping
(i) secondary channels (total
length 4km); and (ii) remedial
measures to 4 tertiary drainage
“black spots” in various parts of
$11,755,148
32
the city.
Urban Traffic
Improvements Nil
Lack of funding (escalated
construction costs) led to dropping
of: (i) area traffic management;
and (ii) junctions improvement.
$0
Road Maintenance
& Upgrading
Upgrading of 11.81 km of roads.
(Namely Bukoto-Kisasi Road
(3.0km) from Kira Road to Kisasi
Road, Kalerwe Road (3.27 km)
from Gayaza Road to Tula Road,
Kawempe-Mpererwe Road
(2.46km) from Bombo Road to
Gayaza Road, Kimera Road
(0.90km) from Apollo Road to
Kawala Road, Soweto Road
(1.22km) from Gaba Road to
Lukuli Road and Salaama Road
(0.96km) from Wavamuno Road
to Kabaka’s landing site.)
Lack of funding (escalated
construction costs) led to dropping
of: i) maintenance of roads; and ii)
and dropping of incomplete
Salaama road from KIIDP (cost to
complete taken over by KCCA)
$11,905,563
Solid Waste
Management
Developed land adjacent to
existing site (Kietz Landfill);
Landfill gas collection and flaring
system dropped.
Design for new landfill was
dropped due to unavailability of
land. KCCA is in the process of
acquiring land.
$1,977,481
Markets Nil
Originally targeted for provision
of infrastructure for two markets
(Kibuli and Kawempe) eg. access,
lighting etc. and detailed design
for high priority markets.
This was dropped due to: • Lack
of funding (escalated construction
costs); • Land availability issues;
and • ADB had a plan to finance
the development of seven markets
in Kampala.
$0
COMPONENT 2 SUB-TOTAL $25,638,192
Component 3: Project Implementation Support, Monitoring and Evaluation (US$2.8 million)
Component 3 will support project management and M & E activities.
Project Support
Operating costs, personnel,
equipment, Project Audit, MTR,
Study, ICR Preparation,
Procurement Audit $2,104,030
Economic Planning
Unit
KCC M&E framework
produced.
2 Citizen Score Cards
Staff & Council Surveys
conducted
$124,825
Project Preparation
Facility $973,900
COMPONENT 3 SUB-TOTAL $3,202,755
PROJECT TOTAL $35,641,538
33
Summary of Training under KIIDP (KCC) Course Dates and Location Number of
Participants
Cost in
US$
Monitoring and Evaluation February 15-March 15, 2010,
Durban, South Africa
2 18,616
Design and Implementation of a Performance
Management System
April 19-30, 2010, Mombasa,
Kenya
3 19,254
Performance Auditing May 3-14, 2010, Mbabane,
Swaziland
2 13,948
Goods and Equipment Procurement
Programme
June 7-25, 2010, Mombasa, Kenya 3 34,515
Environmental Management July 5-30, 2010, Lilongwe, Malawi 2 26,675
Strategic Environmental Assessment (SEA) August 9-20, 2010, Arusha,
Tanzania
5 31,840
Computer assisted Financial Management 18th
April – 13th
May 2011 2 20,090
Procurement procedures for World Bank
aided projects
November 1-12, 2010, India 5 48,801
Total Number of Staff Benefiting and Cost 24 213,739
Summary of Training under KIIDP (KCCA)
Names Course/Program Institution Cost in US$
1 Harriat Mudondo Exposure visit Municipal of Cape Town 2,971
2 Jennifer Kaggwa Exposure visit Municipal of Cape Town 2,971
3 Kaujju Peter Exposure visit Municipal of Cape Town 2,971
4 Bolingo Robert Exposure visit Municipal of Cape Town 2,971
5 Mpaata Elizabeth Exposure visit Municipal of Cape Town 2,971
6 Mutyaba Robert Exposure visit Municipal of Cape Town 2,971
7 Ndagimana Richard Exposure visit Municipal of Cape Town 2,971
8 Musoke Patrick Strategy Management (Boot camp) Kapan Norton Balanced
S.Card 15,306
9 Tumwebaze Charles Strategy Management (Boot camp) Kapan Norton Balanced
S.Card 15,306
10 Nantamu Simon Strategy Management (Boot camp) Kapan Norton Balanced
S.Card 15,306
11 Jill Aijuka Property & Asset Management ESAMI 10,094
12 Naggayi Vanessa PR and customer care ESAMI 6,085
13 Mbatudde Shiela Modernising HRM &
Development ESAMI 8,529
14 J.S Musisi Exposure visit - Israel Benchmark 3,381
15 Charles Ouma Exposure visit - Israel Benchmark 3,381
16 Jacqueline Asiimwe Exposure visit - Israel Benchmark 3,381
17 Bidong Bosco Bernard Exposure visit - Israel Benchmark 3,381
18 Bwambale Eddger Exposure visit - Israel Benchmark 3,381
19 Prisca Asiimwe Exposure visit - Israel Benchmark 3,381
20 Isaac Sempebwa Exposure visit - Israel Benchmark 3,381
21 Thomas Ssentongo South Africa - Compensation &
Benefits ESAMI 6,238
34
22 Richard Lule South Africa - Org. Dev. IMTC 7,937
23 Nuwe Saison Swaziland - PCA Africa Institute for
Capacity Development 4,946
24 Bukirwa Juliet Walakira South Africa - Protocol and Events
Management IMTC 8,219
25 Josephine Mukasa South Africa - Gender IMTC 5,385
26 Kabatabire Donny Swaziland - PCA Africa Institute 7,066
27 Jennifer B. Kaggwa London - Modernizing Public
Institutions Ripa 12,884
28 Phoebe Lutaaya London - Modernizing Public
Institutions Ripa 12,884
29 Mudondo Harriet Uganda/ISRAEL UMI 9,080
30 KITONSA Edward Uganda/ISRAEL UMI 8,864
31 Edison Maseruka Uganda/ISRAEL UMI 8,864
32 Elizabeth Kamanyire Uganda/ISRAEL UMI 8,864
33 Robert Nowere Uganda/ISRAEL UMI 8,936
34 Moses Wasswa Uganda/ISRAEL UMI 8,864
35 Prosper Lwamasaka Uganda/ISRAEL UMI 8,864
36 Nambi Diana Uganda - Land Acquisition World Bank 919
37 Faridah Kiggwe Uganda World Bank 919
38 Ndiwalana Robert Uganda - Land Acquisition World Bank 919
39 Grace Abenitwe Uganda - Land Acquisition World Bank 919
40 Asiimwe Christine Uganda - Land Acquisition World Bank 919
41 Hospitality Corporate
Governance Politicians 45,632
42 Consultants Corporate
Governance Politicians 8,654
43 Disaster Preparedness Uganda 6,000
44 Luzinda Janet M & E of projects in Private and
Public Sector South Africa 8,340
45 Ishaq Mawanda Project and program management,
monitoring and control Setym 10,971
46 Charles Tumwebaze Effective Leadership and project
team management Setym 10,506
47 Innocent Silver Project management master class USA 9,437
48 Henry Kikonyongo ISO 26000 Project management Kenya 600
49 Patrick Musoke Strategy management and business
development Dubai 10,499
50 Fred Andema Cost analysis to support strategic
decisions Dubai 7,110
51 Francis Waligwa Budgeting and cost control Dubai 7,110
52 Kizza Micheal Building leaders in Urban
Transport Planning Seoul 9,650
53 Jacob Betubiza
Byamukama
Building leaders in Urban
Transport Planning Seoul 9,650
TOTAL 391,739
35
Annex 3. Economic and Financial Analysis
A. METHODOLOGY AND ASSUMPTIONS FOR ECONOMIC ANALYSIS
1. For Component 1, the two most relevant PDO-level indicators both performed exceptionally
well - the stock of overdue liability was reduced from UGX 8 billion to 0 billion; and its OSR
was increased from UGX 22 billion to UGX 55.71 billion. A potential economic analysis on
this component will examine the performance of these two indicators in a with-and-without
KIIDP scenario. However, data to support such a counterfactual analysis is unavailable. As a
proxy and taking the indicator on increase in OSR for KCC/KCCA, a comparison is made
between the period before the project commenced and that during the project implementation.
The results showed that the average annual growth rate of the OSR for the seven years (FY00-
06) leading up to the start of the project was 6.4%. In contrast, that for the project period
(FY0635
-FY14) was at 12.2% - almost double that of the previous period. (See table and
figure below).
Comparison of OSR annual growth rate before and during KIIDP
Year 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 13/14
Total Local
Revenue (UGX
Billion) 14433 18276 15816 21342 20409 24274 22251 24301 27804 30230 38296 44596 41690 55710
Average Annual
Growth Rate (%) 6.4 12.2
2. In addition, there are two main sub-components in KIIDP which directly supported the
outcome of institutional achievement: Organizational Development & Governance
(US$1.46mil) and Support to Financial Recovery (US$0.16 mil), totaling US$1.62mil. This is,
comparatively a much smaller sum compared to the leveraged gain – such as the OSR
increase of approximately US$17 mil (in addition to many other benefits as discussed earlier),
demonstrating potentially very high efficiency. (It is noted that not all the institutional gains
could be attributed solely to KIIDP.)
3. For Component 2, the economic analysis was conducted for the infrastructure works under the
three categories of intervention:
35 Baseline was set using FY06 figures although project was approved in 2007.
0
10000
20000
30000
40000
50000
60000
UG
X (
Bill
ion
)
Year
36
Roads improvement, and
Drainage system improvement
Solid Waste improvement
1. Roads Improvement
1.1 Analytical Framework and Tool
4. The approach used for the economic analysis is the cost-benefit analysis of “with” or “without
project” case. The economic analysis is based on homogenous road sections, in terms of
physical characteristics, traffic and road condition. The list of roads considered for economic
analysis is given in Table 3.
5. HDM-4 was used as the analytical tool for this project. The HDM-4 analytical framework is
based on the concept of pavement life cycle analysis, which is typically 15 to 40 years. This is
applied to predict road deterioration, road works effects, road user effects and socio-economic
and environmental effects (Odoki and Kerali, 2000).
6. After its construction, a road pavement deteriorates as a consequence of several factors, most
notably: traffic volume and loading, pavement design, material types, construction quality,
environmental weathering and the effect of inadequate drainage systems. The rate of
pavement deterioration is directly affected by the standards of maintenance applied to repair
defects on the pavement surface or to preserve the structural integrity of the pavement thereby
permitting the road to carry traffic in accordance with its design function. Consequently, in
addition to the capital costs of road construction, the total costs that are incurred by road
agencies will depend on the standards of maintenance and improvement applied.
7. The impacts of the road condition (as well as the road design standards) on road users are
measured in terms of road user costs (RUC), and other social and environmental effects. RUC
comprise: vehicle operation costs (i.e., fuel, lubricating oil, parts consumption, maintenance
labour, tyres, depreciation, crew and overhead), costs of travel time for both passengers and
cargo due to road condition and traffic congestion, and costs to the economy of road accidents
(i.e., loss of life, injury to road users, damage to vehicles and roadside objects). The social and
environmental effects comprise: vehicle emissions, energy consumption, traffic noise and
other welfare benefits to the population served by the roads.
8. The interacting sets of costs, related to those incurred by the road authority and those incurred
by the road users, are added together over time in discounted present values. Economic
benefits are then determined by comparing the total cost streams for various maintenance and
construction alternatives with a base case, typically a ‘do nothing’ or minimum maintenance
scenario. For this research, economic benefits were calculated as the difference between the
do nothing option and the various scenarios for both options. The HDM-4 model was used to
simulate future changes to the KIIDP roads from current conditions. The reliability of the
results is dependent upon two primary considerations.
How well the data provided to the model represent the reality of current conditions
and influencing factors, in the terms understood by the model; and,
How well the predictions of the model fit the real behaviour and the interactions
between various factors for the variety of conditions to which it is applied.
Application of the HDM-4 model thus involves two important initial steps:
37
Data input: a correct interpretation of the data input requirements, and achieving a
quality of input data that is appropriate to the desired reliability of the results.
Calibration of output: adjusting the model parameters to enhance the convergence of
the computed road behaviour with that observed in the field for the various
interventions. Calibration of the HDM model focuses on the components that
determine the physical quantities, costs and benefits predicted by the analyses.
9. Since HDM-4 is designed to be used in a wide range of environments, it needed to be
configured to reflect the situation in Kampala Capital City Area. The data for this relates to
traffic flows, climate zones and road types. Calibration is intended to improve the accuracy of
predicted pavement performance and vehicle resource consumption. A fundamental
assumption made prior to using HDM-4 is that the pavement performance models will be
calibrated to reflect the observed rates of pavement deterioration on the roads where the
models are applied.
10. The calibration data used were obtained from Uganda National Road Authority (UNRA). For
this level of analysis, this together with HDM-4 default data was considered adequate.
1.2 Data Requirements
The main data sets required as inputs for HDM-4 analyses are categorised as follows:
(i) Road network data: include inventory, geometry, pavement type, pavement strength, road
condition
(ii) Vehicle fleet data: include vehicle physical characteristics, tyres, utilisation, loading and
performance.
(iii) Traffic data: include details of traffic composition, volumes and growth rates, speed-flow
types and traffic flow pattern.
(iv) Road works data: include a range of construction and maintenance work items together
with their unit costs.
(v) Economic analysis components and parameters
11. The sources of data used in this study included the following: Kampala Capital City Authority,
Uganda National Road Authority, previous studies conducted in Kampala, Internet literature
review and HDM-4 parameter default values.
Road Network Data
12. The KIIDP roads were defined as a series of homogeneous road sections with unique
characteristics. The list of sections studied and the key data requirements are given in Table 2.
A major assumption made in this study was that the data used was reasonably accurate for this
level of analysis. The overall confidence level in the project data used have been qualitatively
assessed and categorised by the Consultant as “Medium”.
13. The KIIDP roads analysed are: (i) Bukoto-Kisasi Road (3km) from Kira Road to Kisasi Road,
(ii) Kalerwe-Tula Road (3.27 km) from Gayaza Road to Tula Road, (iii) Kawempe-Mpererwe
Road (2.46km) from Bombo Road to Gayaza Road, (iv) Kimera Road (0.90km) from Apollo
Road to Kawala Road, and (v) Soweto Road (1.22km) from Gaba Road to Lukuli Road.
Salaama Road (0.96km) has not been completed with KIIDP funds.
Vehicle Fleet Data
14. A representation of the vehicle fleet that use the North-South Corridor was based on grouping
vehicles of similar characteristics and the types of goods they carry. This resulted in the
38
following 10 vehicle types: (i) Cars (ii) Matatu Mini Bus (iii) Medium Bus (iv) Four-wheel
Drives and Pick-up (v) Light Trucks (vi) Medium Bus (vii) Medium Truck (viii) Heavy Truck
(ix) Articulated Truck & Trailers, and (x) Motorcycles. The key vehicle fleet data used in this
study were obtained from UNRA and these are presented in Table 3. HDM-4 default data
were used where local data were not available.
Traffic Data
15. The traffic data used in this study includes annual average daily traffic (AADT) and
composition by vehicle types for each road section, and average traffic growth rate. The
AADT data was estimated on the basis of road functional class and data obtained from KCCA.
16. Details of two-way AADT including traffic composition for each of the roads studied are
given in Table 4. Traffic growth rate is assumed to be 5% per annum.
Road Works and Unit Costs
17. The primary sources of the unit cost data were KCCA and UNRA. Table 5 shows the road
work costs and a summary of the unit costs used for future periodic and routine maintenance.
39
Table 2: KIIDP Roads ID Road
Name
Length
(Km)
Road Class and
Surface Class
AADT Road Condition Type of
Intervention
Implementation
Period
Costs (US$)
Before
(2011)
Current
(2014)
Before
(2011)
Current
(2014)
Start End Estimated in
2007
Actual
1 Bukoto -
Kisaasi
3.00 Collector road
(C)
2-lane single
carriageway
Unsealed
C B Poor Good Full upgrade
from gravel to
paved
bituminous
standard
Feb
2012
Feb 2013 2,130,522.6 2,338,908.5
2 Kalerwe -
Tula
3.27 Local road (D)
2-lane single
carriageway
Unsealed
D B Poor Good Full upgrade
from gravel to
paved
bituminous
standard
Feb
2012
Feb 2013 2,730,042.6 2,842,484.5
3 Kawempe -
Mpererwe
2.46 Local road (D)
2-lane single
carriageway
Unsealed
D B Poor Good Full upgrade
from gravel to
paved
bituminous
standard
Feb
2012
Feb 2013 2,245,335.8 2,149,391.9
4 Kimera 0.90 Local road (D)
2-lane single
carriageway
Unsealed
D C Poor Good Full upgrade
from gravel to
paved
bituminous
standard
Feb
2012
Dec 2013 725,142.7 1,578,132.8
5 Soweto 1.22 Local road (D)
2-lane single
carriageway
Unsealed
D C Poor Good Full upgrade
from gravel to
paved
bituminous
standard
Feb
2012
Dec 2013 950,269.4 1,869,988.4
6 Salaama 0.96 Local road (D)
2-lane single
carriageway
Unsealed
D D Poor Fair Full upgrade
from gravel to
paved
bituminous
standard
Feb
2012
Has not
been
completed
674,152.8 Not
available
40
Table 3: Vehicle Fleet Unit Costs (in US$) Vehicle Type New
Vehicle
Price
Replace-
ment
Tyre
Fuel
(per
litre)
Lubricant
(per litre)
Maintenance
Labour (per
hr)
Crew
Wages
(per
hour)
Annual
Overhead
Annual
Interest
(%)
Passenger
Work Time
(per hr)
Passenger
Non-Work
Time (per
hr)
Cargo
Holdin
g (per
hr)
06-Light truck 25,000 75 1.30 3.00 0.65 0.65 1,200 12.00 0.65 0.26 0.01
02-Four Wheel Drive 40,000 75 1.30 3.00 0.65 0.65 1,200 12.00 4.00 1.60 0.00
09-Articulated Truck &
Trailer 130,000 400 1.30 3.00 2.24 1.62 3,050 12.00 0.65 0.26 0.03
04-Medium bus 70,000 100 1.30 3.00 0.65 0.82 2,020 12.00 0.65 0.26 0.00
10-Motorcycle 900 35 1.30 3.00 0.17 0.17 110 12.00 0.65 0.26 0.00
05-Large bus 80,000 300 1.30 3.00 2.24 1.62 2,870 12.00 1.42 0.57 0.00
03-Matatu 33,000 60 1.30 3.00 0.65 0.82 1,380 12.00 0.65 0.26 0.00
01-Car 20,000 50 1.30 3.00 0.65 0.65 650 12.00 4.00 1.60 0.00
07-Medium truck 50,000 150 1.30 3.00 0.65 0.82 960 12.00 0.65 0.26 0.02
08-Heavy truck 95,000 270 1.30 3.00 0.65 0.82 1,330 12.00 0.65 0.26 0.03
41
Table 4: Roads Hierarchy and Traffic Levels
Road class name Code
KCCA Traffic Functionality Attributes
Urban expressway U
Over 20000
Representative
AADT 30,000
Traffic movement is a primary function
No property access;
Speed limits 80 to 100 km/hr;
No local transit service;
Pedestrians and cyclists prohibited;
Grade-separated intersections (no traffic
signals)
Major arterial road A
Over 20000
Representative
AADT 25,000
for Bituminous
roads
Traffic movement is a primary function
Subject to access controls;
Greater than 20,000 vehicles per day;
Public transport route
Speed limits 50 to 60 km/hr;
Sidewalks on both sides; may have bicycle
lanes
Minor arterial road B
8000-20000
Representative
AADT 14,000
for Bituminous
roads and 1000
for Unsealed
roads
Traffic movement is a primary function
8,000 to 20,000 vehicles per day
Public transit route
Speed limits 40 to 60 km/hr
No “Stop” signs; main intersections
controlled by traffic signals;
Sidewalks on both sides; may have bicycle
lanes
Collector road C
2500-8000
Representative
AADT 5,000 for
Bituminous roads
and 750 for
Unsealed roads
Provide access to property and traffic
movement
2,500 to 8,000 vehicles per day
Public transit route
Signalized intersections at arterial roads;
Sidewalks on both sides of the road
Local road D
0 – 2500
Representative
AADT 1,000 for
Bituminous roads
and 400 for
Unsealed roads
Provide access to properties
Less than 2,500 vehicles per day
Low traffic speed;
No public transit routes
Sidewalks on at least one side of road
43
Table 5: Road Works and Unit Costs
Work Type Description Economic
Costs (US$)
Financial
Costs
(US$)
Units
Patching Potholes
Repair of surface distresses such as
potholing, wide structural cracking
and ravelling
30.50
35.00 m2
Edge Break Repair Patching edge failures on paved roads 30.50 35.00 m2
Surface Dressing
Single sealing of the carriageway with
shape correction in order to delay
major intervention and to renew the
skid resistance.
3.91 4.6 m2
40mm Overlay 40mm overlay to existing asphalt
concrete road. 40.48 47.62 m
2
Reconstruction (STGB)1
Reconstruction of existing surface
treatment road comprising double
surface dressing on granular base
683,333.00 803,922.00 Per Km
Reconstruction (AMGB)2
Pavement reconstruction of existing
asphalt concrete road comprising
50mm asphalt concrete surfacing on
granular base.
800,000.00 941176.00 Per Km
Miscellaneous Works for
Paved Roads
Includes shoulder repairs, vegetation
control, road sign repairs and
replacement, line marking, guardrail
repair and replacement, etc.
4,250.00 5,000.00 Per km per
Year
Miscellaneous Works for
Unsealed Roads
Includes shoulder repairs, vegetation
control, road sign repairs and
replacement, line marking, guardrail
repair and replacement, etc.
1,750.00 2,000 Per km per
Year
Regravelling Regravelling existing unpaved road to
a final grave thickness of 150mm 72 85 m
3
Grading
Heavy motorised grading of unpaved
roads with water and light roller
compaction
10,417.00 12,255.00 Per Km
Spot Regravelling Spot regravelling to unpaved roads to
replace 80% of annual material loss 71 84 m
3
1. STGB refers to road pavement type comprising Surface Treatment on Granular Base 2. AMGB refers to road pavement type comprising Asphalt Mix on Granular Base
44
1.3 Economic Analysis Components and Parameters
18. The study considered one improvement alternatives for each road section which was defined
and compared against the Base Case. Thus for each section, two alternatives were defined as
follows:
“Base Case” alternative: aimed at preserving the existing asset using the present
practice without KIIDP investment.
Improvement alternative: aimed at improving the road standard and maintaining it by
applying periodic maintenance and routine maintenance such that average long-term
road condition will not exceed a certain threshold roughness value.
19. For each alternative, road work standards were defined in such a way that the objective of the
alternative can be achieved. A work standard comprises one or more works item (e.g. overlay,
reseal, patching), defined intervention criteria to determine the timing, design characteristics,
the unit costs, and the after works effects.
Discount Rate and Analysis Period
20. The discount rate used for the analysis is 12 percent, and analysis period of 20 years starting
from 2012. The base year for the analysis is 2012.
Salvage Value
21. By the end of the design life of the road most of the components would have low residual
value. Earthwork (e.g. fills and cuts), culverts, bridges, etc. would have significant
percentages of their values remaining. Salvage values estimated for the different road sections
depending on the type of road investment works.
Standard Conversion Factor
22. To convert financial costs into economic costs a standard conversion factor (SCF) of 0.85
was used in this Study. The SCF was derived from the following expression:
SCF = [border price value of all imports plus border price value of all exports] divided by
[(value of all imports plus all taxes on imports) plus (value of all exports minus all taxes on
exports)]
23. The SCF value of 0.85 was estimated using data on Uganda exports and imports from 2003 to
2008 obtained from Uganda Revenue Authority (URA).
Economic Indicators
24. The Net Present Value (NPV) of investment option m relative to base option n is the sum of
the discounted annual net benefits or costs, calculated from the relationship:
Y
1=y
1)-(y
n)-y(mn)(m
r]*0.01 + [1
NB = NPV
where: NBy(m-n) is the net economic benefit of investment option m relative to base option n in
year y
45
r discount rate (%)
y analysis year (y = 1, 2, ... ., Y)
25. The IRR of a project is defined as the discount rate at which the present value of costs equals
the present value of benefits, i.e. when NPV is zero. It is calculated by solving the implicit
relationship for r:
0 = ]r*0.01 + 1[
NBY
1=y1)-(y
n)y(m
26. This equation is solved for r by evaluating the NPV at 5 percent intervals of discount rates
between -95 and +900 percent, and determining the zero(es) of the equation by linear
interpolation of adjacent discount rates with NPV of opposite signs. Depending on the nature
of the net benefit stream, NBy(m-n), it is possible to find one solution, multiple solutions, or
none at all. The IRR gives no indication of the size of the costs or benefits of an investment;
it acts as a guide to the profitability of the investment - the higher the better. If the computed
IRR is larger than the planning discount rate, then the investment is economically justified.
27. The Benefit Cost Ratio (BCR) of investment option m, relative to base option n, is the ratio is
calculated as follows:
1C
NPVBCR
m
-n)(m-n)(m =
.
where:
BCR(m-n) benefit cost ratio of investment option m relative to base option n
NPV(m-n) discounted total net benefit of investment option m relative to base
option n. This is the Net Present Value at discount rate r
Cm discounted total road agency costs (RAC) of implementing investment
option m
28. If the NPV(m-n) is zero, then (NPV/C)(m-n) is zero. These ratios give an indication of the
profitability of investment option m relative to base option n at a given discount rate. These
measures eliminate the bias of NPV towards larger project options but, like the IRR, they
give no indication of the size of the costs or benefits involved.
Project Benefits
29. The main benefits of the roads improvement are savings in vehicle operating costs and
savings in passenger travel time. Net benefits estimates were based on Highway Development
and Management Model (HDM-4), which simulates road life cycle and vehicle operation
conditions and costs for multiple road design and maintenance alternatives. Vehicle operating
costs were for nine vehicle classes. Periodic maintenance and upgrading costs estimated in
financial terms were converted into economic terms (net of taxes).
30. The benefits are calculated in terms of savings in road user costs. The annual economic
benefits are calculated separately by components (savings in VOC, savings in travel time
costs and reduction in accident cost) and traffic categories as described below.
46
a) Savings in vehicle operating costs
31. Vehicle operating costs increase as a function of roughness (or riding quality) and the speed
travelled. Vehicle operating benefits due to normal and diverted traffic is calculated as
follows:
s s
msnsn)(m VCN - VCN = VCN
k
nsknskns UC*TN = VCN
k
mskmskms UC*TN = VCN
Vehicle operating benefits due to generated traffic is calculated as follows:
s k
msknsknskmskn)(m UCUC*TGTG*0.5 = VCG
The summations are over all the vehicle types (k = 1, 2, ..., K) specified by the user, and all road
sections (s = 1, 2, ... ., S) being analysed, see Table 3 above.
The annual saving in vehicle operating costs is given by the following expression:
nmnmnm VCGVCN VOC
where:
VCN(m-n) vehicle operating benefits due to normal and diverted traffic of investment
option m relative to base option n
VCNjs annual vehicle operating cost due to normal and diverted traffic over the
road section s with investment option j
TNjsk normal and diverted traffic, in number of vehicles per year in both
directions on road s, investment option j, for vehicle type k
UCjsk annual average operating cost per vehicle-trip over road section s, for
vehicle type k under investment option j (where j = n or m)
VCGjs annual vehicle operating cost due to generated traffic over road section s
with investment option j
VCG(m-n) vehicle operating benefits due to generated traffic of investment option m
relative to base option n
TGjsk generated traffic, in number of vehicles per year in both directions on road
s, for vehicle type k, due to investment option j
VOC(m-n) savings in vehicle operating costs due to the total traffic of investment
option m relative to base option n
b) Savings in travel time costs
32. Travel time is calculated from vehicle speeds. Vehicle travel time benefits due to normal and
diverted traffic are calculated as follows:
47
s s
msnsn)(m TCN - TCN = TCN
k
nsknskns UT*TN = TCN
k
mskmskms UT*TN = TCN
Vehicle travel time benefits due to generated traffic are calculated as follows:
s k
msknsknskmskn)(m UTUT*TGTG*0.5 = TCG
The annual savings in travel time costs are given by the expression:
nmnmnm TCGTCN TTC
where:
TCN(m-n) travel time benefits due to normal and diverted traffic of investment
option m relative to base option n
TCNjs annual vehicle travel time cost due to normal and diverted traffic over
road section s with investment option j
UTjsk annual average travel time cost per vehicle-trip over the road section s, for
vehicle type k, under investment option j (where j = n or m)
TCGjs annual vehicle travel time cost due to generated traffic over road section s
with investment option j
TCG(m-n) travel time benefits due to generated traffic of investment option m
relative to base option n on the given road section in the given year
TTC(m-n) savings in travel time costs due to total traffic of investment option m
relative to base option n
c) Reduction in accident costs
33. The benefits from reduction in total accident costs are given by the expression:
mnn)(m- AC- ACACC
where:
ACC(m-n) the accident reduction benefits due to implementing investment option
m relative to base option n
ACj the total accident costs under investment option j (where j = n or m)
34. However, for unpaved road upgrading - to paved road surface - projects, no changes in
accident rates are attributed. There is much anecdotal evidence in Africa to suggest that the
frequency of accidents may actually increase after unpaved roads are improved to tarmac
surface. Additionally, research evidence (from TRL in UK and VTI in Sweden) shows that
accident rates, and the severity of injuries, increase geometrically with increases in vehicle
speed. All roads implemented under KIIDP1 fall under this category of intervention.
48
Total road user benefits
35. The annual savings in road user costs are given by the expression:
n)-(mn)-(mn)-(mnm ACC TTC VOC RUC
where:
RUC(m-n) the total road user benefits of investment option m relative to base
option n
2 Drainage System Improvement
2.1 The Basis of Economic Analysis
36. Lubigi Primary drainage system is 14km long. It has 17 secondary channels, with a length of
45km located within and outside Kampala District boundary. Under KIIDP the improvement
of 3.6km of the Primary Drainage System was implemented. The main features of the
improved system are presented in Table 7.
Table 7: Lubigi Primary Drainage System
Length
(Km)
Drainage channel Condition Type of
maintenance
Intervention
Implementation Period
Before (in 2010) Current (in 2014) Start End
3.6 Poor. Channels
too small for the
peak flows.
Frequent flooding
and damages.
Good.
Frequency of
flooding greatly
reduced.
Works Contract in
Defects Liability
Period. De-silting
and solid waste
removal.
29/6/2011 30/12/2013
37. The drainage systems in Kampala form integrated networks. The construction and
rehabilitation works for Lubigi impacted on the performance of the channels both
downstream and upstream. Improvement in the selected drainage is considered in terms of
both local impacts and within the broader context of better operation of drainage channels as
a whole. The scale of the impact of flooding in Kampala is reflected in the extent of present
and anticipated socio-economic development in the City. This is considered within a broad
context of the rapid urbanisation currently underway in Uganda.
38. The basis of the economic analysis of the drainage sub-component is the cost-benefit analysis
a “With Project” and a “Without Project”. Thus, the cost-benefit analysis evaluates the
project capital and maintenance costs for the channel improvement, compared with the
associated benefits of better drainage. The design of the channel is for a 10-year return storm
period with an economic life of 40 years. The cost-benefit evaluations of the drainage
subcomponent are based on detailed data collected and presented in Kampala Drainage
Master Plan (KDMP) in March 2003 with updated costs to December 2013 as part of the
Appraisal of KIIDP.
39. As stated in the Terms of Reference (ToR), it is required to use the model, methodology and
assumptions used during the project appraisal. The analysis period is 40 years and the base
49
year of analysis is 2011, that is the start of project implementation, with actual construction
period of 2.5 years. In this analysis, future development within Kampala was considered as
follows:
GDP growth rate of 5.5% per annum
Population growth rate of 3.9% (National average is 3.2% from 1999 to 2011)
Inflation rate of 7.8% per annum
2.2 Project Costs
40. The estimated cost for Lubigi Primary Channel project under KIIDP is US$ 8,755,463
(source KCCA, 2007) and the actual cost of implementation is US$ 11,633,655 (including
consultancy services and resettlement compensation).
41. Operational and maintenance costs for the Nakivubo Channel were estimated at 0.5% per
annum of the cost of Channel Rehabilitation. Costs will, however, be a function of the type of
channel (concrete or earth) as well as its size. A conservative value equal to 1% of capital
investment costs has been used to cover annual operating and maintenance costs for the
purpose of economic analysis of Lubigi Primary Drainage system. The operational and
maintenance costs are therefore US$ 116,337 per annum.
2.3 Project Benefits
42. The main inferred benefits are both quantifiable and non-quantifiable. Among the
quantifiable are: savings from prevention of road damage, property and structures, prevention
of disruption to commercial and industrial activities, additional income from rentals and
savings in agricultural produce.
43. The basis for impacts quantification by category is defined as presented in Table 8. Flooding
from the channels has impact on residential, commercial and industrial buildings, road
network, environment, health; mitigation measures to be used and even on peri-urban
agriculture produces. Some of the costs to individuals and society attributed to flooding are
quantifiable and others are non-quantifiable.
Table 8: Basis for Impacts Quantification by Category
No Category Impacts
1 Residential Damage to buildings and structures
Impact on property values
Additional costs in flood prevention and reduction
2 Road Networks Physical damage
Maintenance costs
Traffic delays
Additional vehicle operating costs
3 Commercial and Industrial Physical damage to property and goods
4 Environment Deterioration
5 Health Disease
Loss of work-days
6 Mitigation Measures Applicable during construction
7 Agricultural Loss of crop areas
Source: Kampala Drainage Master Plan (KDMP, 2003)
50
44. Where possible all the impacts and benefits attributed to improved drainage have been
quantified as described below.
Damages to Residential and Commercial Properties
45. The flooding of residential property damages buildings and structures, adversely impacts the
value of property, and causes additional expenses in cleaning-up and flood prevention and
reduction measures. Flooding impacts significantly affect rental value. Residential houses in
flooded areas have rents below the rents of similar houses in non-flooded areas of the city.
For example, a residential room has rental value of UGX 550 per square metre per month in
flooded areas. A comparable room in non-flooded areas rents for UGX 916 per square metre;
represents an increase of 67% indicating the importance of drainage in residential
investments. The savings in cleaning-up, maintenance and flood prevention measures
attributable to improved drainage is estimated to be about 5% of the construction cost per m2
and is assumed to have grown at a similar rate to GDP growth at about 5.5% starting 2007.
The updated values assigned by house categories are given in Table 9.
Table 9: Updated Values assigned by house categories
Building Type Rental Values (UGX
per room per month)
Construction costs per
m2 (UGX)
Attributed flood repair
costs (5%)
Residential:
Low level
7,330 to 14,660 85,400 4,270
Medium 14,660 to 21,990 170,810 8,540
High 21,990 to 36,650 256,220 12,810
Commercial:
shacks/boutiques
36,650 85,400 4,270
Solid construction
(medium)
87,960 170,810 8,540
Table 10: Estimated flood damages in residential areas for a 10-year flood
Building Type Areas affected
(m2)
Construction
costs per m2
(UGX)
Flood repair costs
(5%) (UGX)
Estimated Annual
costs (in 1000
UGX)
Low level 50,000 85,400 4,270 213,500
Permanent
(medium)
45,000 170,810 8,540 384,300
Permanent
(medium – high)
45,000 256,220 12,810 576,450
TOTAL 140,000 1,174,250
46. According to valuation officers consulted in the various Divisions, KDMP concluded that
there is consensus that rental values of similar buildings in flooded and non-flooded areas
have a differential of 100%. Table 11 gives the estimated annual rental value benefits of
improved drainage.
51
Table 11: Estimated annual rental value benefits to improved drainage in Lubigi Channel
Building Type Areas affected (m2) Increased Rental
Values ((UGX/m2 per
month)
Annual Benefits (in
1000 UGX )
Low level 50,000 550 330,000
Medium 45,000 916 494,640
High 45,000 1,466 791,640
TOTAL 140,000 1,616,280
47. Table 12 gives the estimated damages to the commercial sector in terms of annual rental
losses and flood repair costs. These will become annual benefits due to improvement in the
drainage system.
Table 12: Estimated damages to the commercial sector
Building Type Boutiques Medium (solid
construction)
Annual Benefits (in
1000 UGX)
Areas affected by floods
(m2)
2,500 5,000
Assumed Rental Values
(UGX/m2 per month)
855 1,710
Annual rental losses
(in 1000 UGX)
25,650 102,600 128,250
Construction cost per m2
(UGX)
85,400 170,810
Flood repair costs
(5%) (in 1000 UGX)
10,675 42,703 533,778
Disruption of commercial and industrial activities
48. The impact of flooding on commercial and industrial activities is reflected both in delays to
transport of goods, raw materials and personnel, as well as damages to goods in transit and
storage. However, it is not easy to assess the full impact of the disruption to commerce and
industry. An income survey of retail traders was carried out based on a sample of 251 traders
in a Social Impact Assessment Study for the Nakivubo Channel (KDMP, 2003). The study
estimated that the trader’s average income was around UGX 250,000 per month or UGX 3
million per annum. On this basis the estimated loss of benefit per trader per year due to lack
of improved drainage was around UGX 150,000 or 5% of the average annual income. These
figures have been updated to values in 2013 by applying GDP growth rate factor. The result
gives an estimate of the trader’s average income to be UGX 427,000 per month or UGX
5,124,000 per annum. The loss of benefit per trader per year due to lack of improved drainage
is estimated to be UGX 256,200, that is 5% of the average annual income. Assuming that
around 150 traders would be severely affected, annual losses would be around UGX 38.43
million.
49. It is therefore proposed to use a total figure of UGX 100 million per annum to cover losses
for the commercial sector, taking into consideration the impact categories of flooding
mentioned above.
52
Road damages
50. A good drainage system reduces the rate of road network deterioration and results in savings
in road user costs. With improved drainage systems, less frequent repairs and periodic
maintenance and rehabilitation will be required. The expected economic life of the road
network will be enhanced and the effect of reduced roughness results in savings of vehicle
operating costs to the road users.
51. The JICA Study (1997) indicated approximately one kilometre of major roads and two
kilometres of secondary roads in the Lubigi System will be seriously affected by floods, and
will require to be rehabilitated more frequently than in a non-flood situation.
52. In the “With” project case, rehabilitation of primary roads will only be required twice over
the project life of 40 years, compared with four times in the “Without” project case. In the 10-
year flood case, some repair will be involved on the roadbase and total replacement will be
needed of the overlay at a cost of UGX 800 million per km. This gives an estimated savings
in road agency costs of two overlays.
53. Usually secondary (unpaved) roads are regravelled every second year, but it is assumed that
flooded sections of secondary roads would require an annual treatment. Over the project life,
there would, therefore be a saving of the costs of twenty treatments over 40 years. The cost of
regravelling is estimated UGX 77 million per km.
Disruption to Traffic
54. Under the Uganda rainfall condition, the frequency of flooding in Kampala is between 10 to
15 times in a year lasing 3 to 4 hours per flooding. Private and commercial vehicles are
blocked from passing or significantly delayed. The cost of this is measured in terms of
additional vehicle operating cost (VOC) and the value of passenger time.
55. Table 13 shows the estimated coefficients for VOC savings and passenger value of time by
vehicle type. The VOC coefficients were derived using HDM-4 for vehicles travelling at 30
km/h. The VOC figures shown are updated to 2013 values from those figures given in KDMP
(2003) by applying annual inflation rate of 7.8% per annum. The time value figures were
obtained from the latest HDM-4 customisation data by UNRA, see also Table 3 given above
in Sub-section 2.1.2.
Table 13: Estimated Coefficients for VOC savings and passengers value of time
Vehicle Type Potential savings in VOC when
the road roughness is reduced
from 7 IRI to 3 IRI (in UGX
per km)
Passenger time value per
vehicle (in UGX per hour)
Car 155 8,050
Pick-up 131 9,450
Bus 138 8,076
Medium Truck 394 1,300
Heavy Truck 1,129 1,300
56. These coefficient values are applied to the 2013 traffic and future traffic forecast as growing
at 5% per annum and used to calculate the annual savings in VOC as presented in Table 14
and the annual savings in travel time as presented in Table 15.
53
Table 14: Estimated VOC savings on a “with” and “without” project case
Vehicle Category Average hourly
traffic in 2013
Traffic delayed
over 30 hours per
year (vehicles)
Savings in VOC
per kilometre
(UGX)
Annual Savings
in VOC (in UGX)
Private Vehicles
(Car and Pick-up)
2,019 60,570 155 9,388,350
Heavy Vehicles (Medium
and Heavy Trucks)
228 6,840 1,129 7,722,360
Public Buses 1,307 39,210 138 5,410,980
TOTAL 3,554 22,521,690
Table 15: Estimated Travel Time savings on a “with” and “without” project case
Vehicle Category Average hourly
traffic in 2013
Traffic delayed
over 30 hours per
year (vehicles)
Travel time cost
per vehicle (UGX
per hour)
Annual Savings
in Travel Time
Cost (in UGX)
Private Vehicles
(Car and Pick-up)
2,019 60,570 8,050 487,588,500
Heavy Vehicles (Medium
and Heavy Trucks)
228 6,840 1,300 8,892,000
Public Buses 1,307 39,210 8,076 316,659,960
TOTAL 3,554 813,140,460
Other damages
57. There is a small amount of agriculture within Lubigi Drainage System. However, this is not
estimated to be significant in terms of flood damage. Agricultural crops on the sides of the
drainage channels are often damaged by flooding. The saving estimates in losses are valued
on the basis of the compensation schedule agreed by KCC and the Ministry of Lands and
Environment.
58. It is difficult to quantify the health impacts of bad drainage of the Lubigi System in terms of
statistics, since many of these diseases might have been contracted in other areas of Kampala.
In the city as a whole, water-borne diseases are one of the major causes of illness.
59. Improvements to the environment, health benefits from water borne disease due to improved
drainage, better functioning of markets and reduction in the loss of goods, etc., are significant.
The impact of such benefits is not fully reflected in the cost-benefit assessments indicating
that the cost-benefit estimates are conservatives.
60. A notional amount of UGX 150 million per annum is attributed to these factors.
Summary of Project Benefits
61. Table 16 summarizes the benefits of the improvement to the whole Lubigi System,
comprising both primary and secondary channels, for a 10-year flood.
62. According to KDMP (2003), it is assumed that 80% of the benefits are attributable to
improvements of the primary channel. The adjustment factor of 0.8 was applied to calculate
the benefits attributable to the KIIDP project of improving Lubigi Primary Channel. The
result is presented in Table 17.
54
Table 16: Benefits of improving the whole of Lubigi Drainage System
Category Annual Benefits in Year
2014 (in 1000 UGX)
Specific Benefits
(in 1000 UGX)
Observations
Housing Repairs 1,174,250 Increasing in line with
population growth
Loss in residential rental
values
1,616,280 Increasing in line with
population growth
Commercial and
Industrial Sector damage
533,778 Increasing in line with
GDP growth
Loss in commercial and
industrial rental values
128,250 Increasing in line with
GDP growth
Loss of commercial
earnings
100,000 Increasing in line with
GDP growth
Savings in Vehicle
Operating Costs
22,522 Increasing in line with
GDP growth
Travel Time Savings 813,140 Increasing in line with
GDP growth
Road damage (Primary
paved roads)
800,000 per
rehabilitation
x 2 = 1,600,000
In year 10 and year 30
increasing in line with
traffic growth
Road damage
(Secondary unpaved
roads)
77,000 per operation
x 20 = 1,540,000
x 2 km = 3,080,000
Re-gravelling required
every other year
instead of every year.
Increasing in line with
traffic growth
Others 150,000 Notional
Table 17: Benefits of the improvement to the 3.6km of Lubigi Primary Drainage System
Category Annual Benefits in Year
2014 (in US$)
Specific Benefits
(in US$)
Observations
Housing Repairs 469,698 Increasing in line with
population growth
Loss in residential rental
values
646,5132 Increasing in line with
population growth
Commercial and
Industrial Sector damage
213,512 Increasing in line with
GDP growth
Loss in commercial and
industrial rental values
51,299 Increasing in line with
GDP growth
Loss of commercial
earnings
40,000 Increasing in line with
GDP growth
Savings in Vehicle
Operating Costs
9,008 Increasing in line with
GDP growth
Travel Time Savings 325,258 Increasing in line with
GDP growth
Road damage (Primary
paved roads)
320,000 per
rehabilitation
x 2 = 640,000
In year 10 and year 30
increasing in line with
traffic growth
Road damage
(Secondary unpaved
roads)
30,800 per operation
x 20 x 2 = 1,232,000
Re-gravelling required
every other year instead
of every year. Increasing
in line with traffic
growth.
Others 60,000 Notional
Note: 1 US$ = UGX 2,500
55
3 Solid Waste Improvement
63. This sub component supported two activities namely: (i) Expansion works of the existing
Mpererwe landfill by 6 acres, including consulting services for design update, preparation of
bidding documents; and construction supervision of the works; (ii) consulting services for
testing, feasibility study and design for installation of landfill gas extraction and flaring
system. The status of each is as follows:
(a) Expansion of the Mpererwe Landfill: A new landfill was constructed as an extension to
the KCCA Mpererwe Landfill in the interim while KCCA procures land and constructs a new
solid waste treatment facility. The new landfill extension covers 6 acres and it is adjacent to
the old landfill. According to recent projections, it will be used for disposal of garbage for
approximately 2 years (2014-2016). In addition to the 3 landfill cells constructed, this
extension was constructed with a natural impervious liner to prevent groundwater
contamination, a porous drainage layer which drains leachate to a collection pond for onward
treatment, a new chain-link fence to prevent access to the landfill, a new groundwater
monitoring well and internal circulation roads.
(b) Landfill gas extraction and flaring: A consultant investigated the potential for recovery of
landfill gas from the existing Mpererwe Landfill through pumping trials, assessed the
feasibility of utilization of land fill gas for power generation, and prepared detailed design for
feasible landfill gas utilization. The results from this study are being used to inform the
landfill management component of forthcoming Integrated Solid Waste Management Project
which will be done using a Public Private Partnership (PPP) arrangement.
64. It is KCCA’s policy and budgetary allocation are made on a yearly basis to maintain the
landfill. KCCA will extend the maintenance services to the new landfill after its completion.
The maintenance of the land fill falls in the docket of the directorate of Public Health and
Environment.
65. The actual expenditure on the implementation of the solid waste component is US$ 1,882,833.
The information available was not sufficient to conduct a meaningful economic analysis of
solid waste project. The function of the compositing facility is to optimize the operation of
the existing facility and is considered the most cost-effective alternative available for KCCA
in the short run.
B. ECONOMIC ANALYSIS RESULTS
66. The economic analysis results are presented below under the following headings:
Roads improvement
Drainage system improvement
1 Roads Improvement
67. The result of economic analysis of KIIDP road improvement sub-component is summarized
in Tables 18, 19 and 20. The following are the key points:
a) The overall NPV for KIIDP roads improvement project is US$ 13.098 million at a discount
rate of 12% with an EIRR 0f 29.8%, NPV/RAC ratio 1.31 and overall Benefit-Cost Ratio of
2.31
56
b) Three road projects yielded positive NPVs and EIRRs greater than the discount rate of 12%
and two roads gave negative NPVs and EIRRs less than 12%
c) After being subjected to sensitivity analysis using 15% increase in construction and
maintenance cost and 15% decrease in total benefits in both cases, the NPVs of the three
roads remained positive and of the other two roads remained negative.
d) A simultaneous increase of 15% in total construction and maintenance costs on one hand and
a decrease of 15% in total benefits on the other resulted in an overall NPV of US$ 8.951
million at a discount rate of 12% and an overall EIRR of 23.1%, indicating that the selected
projects represent a positive return on investment even in a bad case scenario.
Table 18: Economic Indicators of KIIDP Improved Roads Scenario
ID Road
Name
Length
in Km
Average
Financial
Cost US$ per
km
Actual
Financial
Cost in US$
Net Present
Value NPV
in
US$ million
NPV/Road
Agency
Cost Ratio
Economic
Internal
Rate of
Return
(EIRR %)
1 Bukoto –
Kisaasi 3.00 779,636.18 2,338,908.5 10.372 4.36 67.8
2 Kalerwe -
Tula 3.27 869,261.32 2,842,484.5 2.601 0.94 25.5
3 Kawempe
-
Mpererwe
2.46 873,736.55 2,149,391.9 0.738 0.37 17.7
4 Kimera 0.90 1,753,480.89 1,578,132.8 -0.358 -0.27 7.9
5 Soweto 1.22 303,921.31 370,784.0 -0.256 -0.16 9.6
All Roads 10.85 1,027,621.21 11,149,690.1 13.098 1.31 29.8
Note: Salaama Road has not been completed and is not included in the economic analysis.
Table 19: Sensitivity Analysis for KIIDP Roads – Net Present Values
ID Road
Name
Length
in Km
Improved Roads
Scenario Net
Present Value
NPV in
US$ million
Sensitivity NPVs (in US$ million)
15% Increase in
Construction and
Maintenance Cost
15%
Decrease in
total
benefits
15% Increase
in Cost and
15% Decrease
in total
Benefits
1 Bukoto –
Kisaasi 3.00 10.372 10.147 8.591 8.366
2 Kalerwe -
Tula 3.27 2.601 2.307 1.916 1.622
3 Kawempe -
Mpererwe 2.46 0.738 0.525 0.414 0.201
4 Kimera 0.90 -0.358 -0.524 -0.471 -0.637
5 Soweto
1.22 -0.256 -0.447 -0.409 -0.600
All Roads 10.85 13.098 12.007 10.042 8.951
57
Table 20: Sensitivity Analysis for KIIDP Roads – Economic Internal Rate of Return
ID Road
Name
Length
in Km
Improved
Roads
Scenario
EIRR (%)
Sensitivity EIRRs (%)
15% Increase in
Construction and
Maintenance Cost
15%
Decrease in
total
benefits
15% Increase in
Cost and 15%
Decrease in total
benefits
1 Bukoto –
Kisaasi 3.00 67.8 60.0 58.8 52.1
2 Kalerwe -
Tula 3.27 25.5 22.7 22.2 19.7
3 Kawempe -
Mpererwe 2.46 17.7 15.6 15.3 13.5
4 Kimera
0.90 7.9 6.6 6.4 5.2
5 Soweto
1.22 9.6 8.2 7.9 6.7
All Roads 10.85 29.8 26.5 26.0 23.1
Present Values of Benefits
68. Savings in vehicle operating cost is US$ 17.37 million, discounted over the analysis period.
Savings in travel time cost is US$ 3.00 million, discounted over the analysis period. The
magnitude of benefits determined at Appraisal and Evaluation are given in Table 21.
Table 21: Comparison of Evaluation to Appraisal (PAD) Present Values of Benefits
Benefit component At Appraisal
(from PAD)
At Project
Closing
Comments
Decrease in Vehicle Operating
Costs (in US$ million)
14.27 17.37 The benefit determined at
Evaluation is US$ 3.1 million
more than that at Appraisal
Decrease in passenger time costs
(in US$ million)
2.54 3.00 The benefit determined at
Evaluation is US$ 0.46
million more than that at
Appraisal
Decrease in accident costs (in
US$ million)
0.40 0.00 There are no savings in
accident costs for paving the 5
roads. This is explained in
Sub-section 2.1.3 under
reduction in accidents
69. The proportions of the road user benefit determined at Evaluation are illustrated in Figure 1.
58
Figure 1: Road User Benefits Distribution
Cumulative Net Benefits Stream
70. Figure 2 shows the cumulative net benefits of investment over the analysis period. The
approximate timing when the discounted cumulative net benefit of investments will become
positive (i.e. the break-even point) was determined to be Year 7 (i.e. 2018 since the base year
for this analysis is 2012).
Figure 2: Cumulative Net Benefits over the Analysis Period
Appraisal Summary Results
71. The results of economic evaluation compared to the economic appraisal results (from PAD)
are summarized in Table 22.
85%
15%
Road user benefits distribution
Savings in VOC Savings in Travel Time Costs
-10
-5
0
5
10
15
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22
Cu
mu
lati
ve N
et
Ben
efi
ts U
S$
(Millio
ns)
Year
59
Table 22: Comparison of Evaluation to Appraisal (PAD) Economic Indicators
Road Name Economic
Indicators
At Appraisal
(from PAD)
At Project
Closing
Comments
Bukoto - Kisaasi EIRR % 38 67.8 The net benefit at project
closing is almost 5 times
higher than that at appraisal.
The difference is US$ 8.259
million, notwithstanding the
relatively higher actual cost
per km.
NPV (US$ mil) 2.113 10.372
B/C Not available 5.36
Unit Cost US$ per
km
403,333 779,636
Kalerwe - Tula EIRR % 17 25.5 The net benefit at project
closing is almost 6.5 times
higher than that at appraisal.
The difference is US$ 2.202
million, notwithstanding the
relatively higher actual cost
per km.
NPV (US$ mil) 0.399 2.601
B/C Not available 1.94
Unit Cost US$ per
km
368,421 869,261.32
Kawempe-
Mpererwe
EIRR % 15 17.7 The net benefit at project
closing is almost 4 times
higher than that at appraisal.
The difference is US$ 0.547
million, notwithstanding the
relatively higher actual cost
per km.
NPV (US$ mil) 0.191 0.738
B/C Not available 1.37
Unit Cost US$ per
km
333,333 873,736.55
Kimera EIRR % 32 7.9 The net benefit at appraisal is
positive but the net benefit at
project closing is negative
US$ 0.378 million. This can
be attributed to the very high
actual construction cost per
km (more than twice the
estimated unit cost).
NPV (US$ mil) 0.225 -0.378
B/C Not available 0.73
Unit Cost US$ per
km
805,714.11 1 1,753,480.89
Soweto EIRR % Not analysed 9.6 This road was not included in
the economic appraisal (not
stated in PAD). NPV (US$ mil) Not analysed -0.256
B/C Not analysed 0.84
Unit Cost US$ per
km
Not analysed 303,921.31
Overall 2 EIRR % 32 29.8 The EIRR at project closing is
slightly less but close to that
determined at Appraisal. The
net benefit at project closing is
greater than that at project
appraisal by US$ 4.45 million.
However, it is important to
consider the notes below the
table.
NPV (US$ mil) 8.648 13.098
B/C Not available 2.31
Unit Cost
US$ per km
Not available 1,027,621.21
Notes Used conversion of UGX1 = US$0.0005 according to PAD conversion 1 Based on estimated cost in 2007 (see also Table 2 in Section 2.1.2 above)
2 For PAD the list includes other roads that were dropped (e.g. St Barnabas Road)
60
2 Drainage Systems Improvement
72. The result of economic analysis for Lubigi drainage channel and the sensitivity analysis
results are summarised in Table 23. Investment in Lubigi Primary drainage systems projects
yielded positive NPVs with EIRRs greater than 12%. The sensitivity analysis indicates that
the implemented project has a positive return on investment.
Table 23: Economic Indicators and Sensitivity Analysis Results for Lubigi Drainage Channel
Drainage
System
Actual
Financial
Cost
Base Scenario 15% Increase in
Construction
and Maintenance
Cost
15% Decrease in
Benefits
15% Increase in
Cost and 15%
Decrease in
Benefits
NPV
(US$M)
EIRR
(%)
NPV
(US$ M)
EIRR
(%)
NPV
(US$ M)
EIRR
(%)
NPV
(US$ M)
EIRR
(%)
Lubigi
Primary
11,633,65
5 6.501 17.5 5.034 15.8 6.243 17.2 4.776 15.6
73. For the drainage system improvement the net benefits distribution over the Analysis Period
(in US$) is illustrated in Figure 3 and summarized in Table 24.
Table 24: Benefits Distribution by Category
Benefit Category Amount in US$
Reduction in building damage 72,761,972
Increase in rental values 67,013,778
Increased commercial and industrial earnings 5,464,225
Savings in road agency costs 44,235,079
Savings in road user costs 45,662,553
Others 60,006,096
74. Details of the methodology and methods used to determine the benefits by categories are
provided in Section 2.2.
Figure 3: Benefits distribution
25%
23%
2% 15%
15%
20%
Benefits distribution
Reduction in buildingdamage
Increase in rental values
Increased commercial andindustrial earnings
Savings in road agencycosts
Savings in road user costs
Others
61
75. Table 25 gives a comparison of the economic appraisal result (from PAD) to the economic
evaluation result at project closing.
Table 25: Comparison of Evaluation to Appraisal (PAD) Economic Indicators for Lubigi Channel
Economic Indicators At Appraisal (from PAD) At Project Closing Comments
EIRR % 14.0 17.5 The net benefit
determined from
evaluation at project
closing is much greater
than the amount estimated
at appraisal. The
difference is US$ 5.793
million.
NPV (US$ mil) 0.708 6.501
76. Figure 3 shows the cumulative net benefit of investment over the analysis period. The
approximate timing when the discounted cumulative net benefit of investments will become
positive (i.e. the break-even point) was determined to be Year 15 (i.e. 2025 since the base
year for this analysis is 2011).
Figure 4: Cumulative Net Benefits over the Analysis Period
-12
-10
-8
-6
-4
-2
0
2
4
6
8
10
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43
Cu
mu
lati
ve N
et
Ben
efi
ts
US
$ (
Millio
ns)
Year
62
Annex 4. Bank Lending and Implementation Support/Supervision Processes
(a) Task Team members
Names Title Unit Responsibility/
Specialty
Lending
Modupe A. Adebowale Consultant AFTME
Solomon Alemu Consultant AFTU1
Yvette Laure Djachechi Senior Social Development Spec AFTCS
Serigne Omar Fye Consultant CICAF
Edeltraut Gilgan-Hunt Consultant AFTTR
Matthew D. Glasser Adviser OPSKL
Katherine Kuper Sr Urban Spec. AFTU1
Rowena J. Martinez Consultant AFTU1
Barjor E. Mehta Lead Urban Specialist SASDU
Lance Morrell Consultant IEGPS
Edith Ruguru Mwenda Senior Counsel LEGAM
Richard Olowo Lead Procurement Specialist AFTPE
Perla San Juan Temporary AFTU1
Patrick Piker Umah Tete Sr Financial Management Specia AFTMW
Supervision/ICR
Solomon Alemu Consultant AFTU1
Tewodros Tigabu Alemu Consultant FEUCA
Mary C.K. Bitekerezo Senior Social Development Spec EASDE
Martin Fodor Senior Environmental Specialis AFTN3
Edeltraut Gilgan-Hunt Consultant AFTTR
Paul Kato Kamuchwezi Financial Management Specialis AFTME
Agnes Kaye Program Assistant AFMUG
Marie Claire M. Li Tin Yue Senior Program Assistant AFTU1
Barbara K. Magezi HRSSD-
HIS
Mbuba Mbungu Consultant AFTU1
Barjor E. Mehta Lead Urban Specialist SASDU
Grace Nakuya Musoke
Munanura Senior Procurement Specialist AFTPE
Edith Ruguru Mwenda Senior Counsel LEGAM
Naa Dei Nikoi Operations Adviser LCSDE
Martin Onyach-Olaa Sr Urban Spec. AFTU1
Zara Inga Sarzin Senior Urban Development Speci AFTU1
Kristine Schwebach Social Development Specialist AFTCS
Patrick Piker Umah Tete Sr Financial Management Specia AFTMW
63
(b) Staff Time and Cost
Stage of Project Cycle
Staff Time and Cost (Bank Budget Only)
No. of staff weeks USD Thousands (including
travel and consultant costs)
Lending
FY03 18.62
FY04 37.70
FY05 110.48
FY06 209.72
FY07 188.96
FY08 73.90
Total: 639.38
Supervision/ICR
FY03 0.00
FY04 0.00
FY05 0.00
FY06 0.00
FY07 0.00
FY08 38.90
Total: 38.90
64
Annex 5. Beneficiary Survey Results
1. No specific beneficiary survey or stakeholder workshop was conducted for KIIDP.
However, throughout the project period, various stakeholder meetings (or “barazas”) were held
and two Citizens Report Card Surveys36
(CRCS) (in 2011 and 2012) on the overall Kampala
service level and quality were conducted. Various consultative and feedback meetings were also
held with different stakeholders at ward and divisional levels. While multiple factors (such as
design of survey, sample size, manner in which survey was conducted etc.) affect the results of
such surveys and are generally subjective, they are useful engagement tools which shed light on
the overall service delivery, quality and capacity of KCC/KCCA. In spite of this, it is to be noted
that these engagements were not pertaining specifically to KIIDP but the whole of Kampala.
Therefore, the results from the CRCS could not be taken as a direct reflection of the beneficiaries’
satisfaction with infrastructure and services provided under KIIDP.
2. In general, there was vast improvement in the satisfaction level with KCCA services from
2005 (which set the baseline for KIIDP) to 2011 and 201237
. Even just focusing on 2011-2012,
30% of the respondents were either very satisfied or satisfied with KCCA services in the 2012
CRCS compared to only 5% in the 2011 CRCS; level of dissatisfaction has also fallen
dramatically from 70% in 2011 to 25% in 2012. Satisfaction levels have also risen in the areas of
solid waste, roads, drainage and public toilets. However, satisfaction fell in the areas of education
services, water services, medical services and public transport services during this period.
3. On the satisfaction with roads, respondents were asked to indicate their levels of
satisfaction with various aspects of the roads in Kampala such as condition of the roads, safety of
the roads, safety of passengers, maintenance of roads, road width and pedestrian walkways as
indicated in Table below. Respondents who overall rated roads to be outstanding or above
average rose from 14% in 2011 to 23% in 2012. There has been a remarkable decline in the
respondents who consider the condition of the roads as poor from 72% to 54%.
Table: Rating of roads (percent)
Service Outstanding/ Above
Average
Average Below Average/
Poor
2012
CRCS
2011
CRCS
2012
CRCS
2011
CRCS
2012
CRCS
2011
CRCS
Conditions of roads 23 14 23 14 54 72
Safety of the roads 22 10 30 23 48 67
Safety of a passenger 18 n/a 34 n/a 48 n/a
Maintenance of roads 13 8 35 16 52 76
Road width 16 17 31 19 43 64
Availability of
pedestrian walkways 17 12 30 21 43 67
36 The methodology for the Citizens Report Card survey combined both quantitative and qualitative
methods that included face-to-face interviews, focus group discussions, personal interviews and literature
review. 37
The Citizens Report Card Survey was conducted twice during the project period, in 2011 and 2012.
While designed as an annual exercise, the lapse in the early years of KIIDP was mainly due to the transition
from KCC to KCCA.
65
4. Levels of satisfaction with roads have more than doubled from 13% in the 2011 CRCS to
29% in the 2012 CRCS. There has also been a decline in the respondents who are dissatisfied
with roads overall form 67% in 2011 to 53% in 2012. (Refer to figure below). This indicates a
perceived improvement of the roads in Kampala as indicated in the efforts by in all urban council
in the financial year 2011/2012.
Figure: Satisfaction with Roads overall
5. On the satisfaction with drains, respondents were asked to rate three aspects of the
drainage system: condition, cleanliness and maintenance. The results are as indicated in the table
below. However, a majority of the respondents, 64%, 61% and 61%, rated the 3 aspects of the
drainage systems as poor and below average respectively. Only 12%-13% rated the various
aspects as outstanding and above average. There was no substantial difference in the results of the
2 years apart from ratings on cleanliness and maintenance of the drains where the proportion of
the respondents who thought these aspects were poor and below average declined from 78%and
73% in 2011 to 61% and 61% in 2012 respectively.
Table: Rating of drains (percent)
Outstanding/
Above Average
Average Below Average/
Poor
2012
CRCS
2011
CRCS
2012
CRCS
2011
CRCS
2012
CRCS
2011
CRCS
Condition of the drains 13 14 23 22 64 64
Cleanliness of the drains (litter,
rubbish, plastic bags “buveera” etc) 12 12 27 10 61 78
Maintenance of the drains 13 11 26 16 61 73
6. Overall in terms of satisfaction, there was an increase of 10% in the levels of satisfaction
by respondents from 12% in 2011 t0 22% in 2012. There was also a sharp decline in the
proportion of the dissatisfied respondents with the state of drainage systems from 71% in 2011 to
57% in 2012. (Refer to figure below.) These are the result of efforts by KCCA in resolving the
problems of flooding and other related issues.
66
Figure: Satisfaction with Drainage Overall
7. Challenges remain in various areas for effective service delivery, including limited
funding, inadequate staff and capacity and need to continuously sensitize and educate the public
and other stakeholders on proper usage and maintenance of public services and infrastructure, and
their roles and responsibilities, in addition to that of KCCA’s.
Annex 6. Stakeholder Workshop Report and Results
Refer to Annex 5.
67
Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR
Background
1. Kampala started as a municipality in 1947 and became Uganda’s capital city at
independence in 1962. Kampala has since grown to become the largest city in Uganda.
The 2002 Uganda population and housing census indicated that 50% of Uganda’s urban
population resides in Kampala. It’s the hub of the economic, political and administrative
activities. It was estimated that 80% of the country’s industrial and services sector are
located in Kampala and generates 65% of the national GDP. Therefore the economic
future of Uganda is intrinsically related to the performance of Kampala as a locus of
productive activities and investment and this in turn relies on the city’s ability to provide
the services and infrastructure for which businesses and residents rely on.
2. Kampala City is currently divided into five urban divisions namely Central, Kawempe,
Makindye, Lubaga, Nakawa, covering a total of 189 square km, with 169 squares km of
land and 19 square km of water. About 23% of Kampala’s area is fully urbanized, a
significant portion (60%) semi-urbanized and the rest considered rural settlements.
Kampala displays a clear radial structure with a denser center and clear concentric rings
around it. A further ring is developing in its peri-urban periphery. Kampala’s clear radial
structure and network concentrates almost all activities of significance, apart from
residence, in and around the city center. This has resulted in a very high transient
population of about 2.5 million that are economically engaged in the city center and live
in the neighboring districts.
3. The Kampala City Council (KCC) and five Divisions have the primary responsibility for
infrastructure and service delivery for Kampala. In 2010, the Government of Uganda
(GoU) created Kampala Capital City Authority (KCCA) following the enactment of the
KCC Act 2010 with the overall intention of streamlining operations and improving
service delivery. The Act elevated Kampala from a district status under the Ministry of
Local Government (MoLG) to a Central Government Agency under the Office of the
President. Together with the development of a Strategic Plan, a successor to the Strategic
Framework for Reform II (SFR II), these efforts seek to address the deteriorating quality
of service delivery, rebuild key institutional structures responsible for the delivery of
goods and services, and respond to the challenges of increasing urbanization influenced
by a younger population and rural urban migration.
Brief Project Description
4. Adding to the efforts to address the service delivery concerns of the citizens of Kampala,
one of the most significant was support by the World Bank through financing the
Kampala Institutional and Infrastructure Development Project (KIIDP). The KIIDP was a
three phase project funded by the World Bank through an Adaptable Program Loan
(APL) equivalent to US$ 100million. The first phase (KIIDP i.e. current Project) was
allocated US$ 33.6 million. The Project Development Objective (PDO) was to “improve
institutional efficiency of the Kampala City Council (KCC) by implementing the
Strategic Framework for Reform II (SFR II)”.
5. The scope of the project comprised three components namely: (i) institutional
development, (ii) city wide infrastructure and services improvement, and (iii) project
management, monitoring and evaluation. The first component aimed at assisting the then
68
KCC (and later KCCA) to improve its institutional efficiency by implementing strategies
and measures as identified in the SFRII. The objective of component two was to preserve
the current assets and arrest the deterioration of the assets which would enable Kampala
to be a functional capital city and position its self to attract investors. The third
component supported the implementation of the project as well as its monitoring and
evaluation.
Project Outputs and Outcomes
Component 1 - Institutional Development
6. The project had positive institutional development impacts. The capacity building
component in the project provided the new KCCA staff with skills relevant to their
functional roles and also to identify, implement, and supervise projects. KIIDP team
showed significant improvements in project management by the closure of the project in
December 2013. Significant improvements in procurement, financial and project
management were observed.
7. Some of the approved policies, strategies and plans are already in use. Communication
within and outside the institution has greatly improved following the purchase of
communication equipment as well as vehicles. The rebranding exercise re-oriented
people’s minds away from the KCC bad experiences to a new institution (KCCA) with a
difference. The financial standing of KCCA has also improved as shown in the results
indicator, particularly on the improvement of KCCA’s own source revenue collection.
Component 2 - City Wide Infrastructure & Services Improvement
8. At project closure, not all infrastructure works were completed. The status of the
infrastructure sub-components were:
i. Drainage System Improvements - All the critical civil works on the Lubigi Channel
had progressed to 98% completion levels with minor works remaining on the
greening, silt dredging and other minor reinstatement works for road crossings.
Culvert crossings on Hoima road, Kawaala road, Bombo road & Kampala Northern
bypass have been completed and the reinstatement works finalized. (By 31 January
2014 lanes of the Kampala Northern Bypass were open to traffic. All drainage works
have been substantially completed however, cleaning of the main channel,
construction of secondary channel and unblocking of the box culverts in still
ongoing.)
ii. Upgrading of Gravel Roads to Bitumen Standard - Upgrading of Phase 1 roads
(Bukoto – Kisaasi; Mpererwe – Kawempe and Kalerwe – Ttula roads) to bitumen
standard had progressed to 100% level of completion by 31st March, 2013. Phase 2
roads, Kimera Road and Soweto Road, had progressed to approximately 90% and
75% completion levels respectively at project closure. (As of 31st January, 2014, the
progress on Kimera and Soweto roads stands at 95% and 85.7% respectively and the
pending works include: completion of the walkways particularly around the
manholes, installation of street light protection pillars, signage and guard rails.) In
addition, due to lack in KIIDP funding, the construction costs of Salaama Road was
taken over by KCCA during the later stage of project implementation.
69
iii. Solid Waste Management - Landfill extension works at Kiteezi had progressed to
90% completion levels by 31st
December, 2013 (and progressed to 100% completion
levels by 31st January, 2014).
9. Overall, there are large positive impacts from the infrastructure works. The new road
infrastructure constructed has increased traffic flow in the area and helped to decongest
the nearby Bombo and Gayaza Roads. They helped to increase accessibility and
connectivity, and opened up new catchment areas to economic development and new
economic activities along the project road corridors have already emerged. This included
the emergence of new buildings and developments such as retail shops. This in turn has
enhanced the socioeconomic standards of the residents in Kampala city.
10. The project has improved the livelihoods of the people living close to the infrastructural
improvements and generated skilled and unskilled employment for the local people, For
example, in the area of Kawempe-Tula, Bukoto-Kisasi, Bwaise-Kawaala and Kawempe-
Mpererwe, both short term and long term off-farm employment opportunities for local
people were created, including maintaining existing roads, building new roads, driving
vehicles, and working in automobile workshops. The roads were constructed using highly
labor-intensive methods which generated greater employment. In addition, the people
living at Kisaasi roundabout informed the team during the May 2013 mission that the
hours of business have extended beyond mid-night, in contrast to before the project
interventions when shops would close by 8.00pm.
11. The continuous flooding phenomenon in the area of Bwaise, Karelwe and Kawaala
whenever it rains (which was a result of the previous small drainage channel) has not
reoccurred after the construction of Lubigi channel. This has reduced sanitation related
issues and in turn, less time spent in health centers as evidenced in the OPD utilization
rate in the KCCA health centers. This implies more time devoted to work which
translates into better living standards.
Other Impacts
12. Social and Economic Impact: The project was envisaged to enhance improvement in
service delivery for Kampala city resident with an aim of bettering their lives. There was
overwhelming stakeholder support for the KIIDP project as a whole, as it would lead to
improved social and economic opportunities. As mentioned, the project generated local
employment and benefitted the local economy through wages earned during construction
and payment to service providers. The constructed roads established useful road linkages
and increased accessibility amongst residents and market/employment centers and
facilitated the flow of goods & services. This, in turn, enhanced the socioeconomic
standards of the residents in Kampala city.
13. Environmental Impact: There was no major negative environment impact as the roads
did not pass through any environmentally sensitive areas (wetland) and the infrastructure
improvements generally led to better environment and improved public health (e.g.
Lubigi Channel). However, some environmental challenges were experienced during
project implementation. For the Lubigi Channel, the main challenge was the recurring
water hyacinth growth on the completed section of the channel caused by stagnant water
in the channel and inappropriate disposal of excavated materials (provision for waste-
tipping areas in the design was inadequate, as was site supervision during excavation;
disposal of waste improved during the later phases of the project implementation). Steps
70
have been taken to resolve this issue and the hyacinth was removed by project
completion.
Implementation Issues and Challenges Encountered
14. Contracts management and construction supervision: The ISM for November 18 – 25,
2011 noted some delays in the procurement processes which were attributed to the delays
in the review by the Contract’s Committee. Some contracts were awarded based on the
lowest bidder principle. In most cases, these contractors under quoted the assignments
which heavily constrained their capacity to deliver the expected outputs on time. This
was exacerbated by diversion of advance payments by the contractors to other jobs rather
than deploying the resources to the execution of the project. As a result, such contractors
were always cash stricken and did not have sufficient cash flow to advance the works at
the desired pace. Hence, delayed completion of the projects.
15. The special account threshold (US$ 2 million) was in some cases inadequate to support
the project in meeting the payment requirements. Therefore, the team was compelled to
issue direct payments in some cases. The direct payment process is quite lengthy and it
increases the payment period by another two weeks. This has been mitigated by changes
being implemented where the replenishment is guided by the Financial Management
Reports (FMRs) that will be based on 6 months cash flow forecasts submitted by the
project team.
16. Inadequate contract supervision resulting from incompetence on the side of the consultant
but also due to dual role played by KCCA staff (supervising the project while carrying
out other functional roles). Injunctions and other administrative reviews also delayed the
commencement of some projects, for example, Kimera Road and Soweto Road. This did
not only affect the completion dates but exposed the institution to additional costs.
17. Challenges in implementing RAP. Implementation of the RAP became a challenge.
Originally it was the role of the Government of Uganda to implement the RAP. However,
because of deficits in the budget, the Government was unable to honor its obligations.
This resulted in delay in the implementation of the project since settlement of RAP has to
be completed before infrastructure works could begin. During the midterm review, the
Bank together with KCCA provided USD 1,860,000 (approximately UGX 5 Billion) for
compensation. This was however insufficient to settle the affected people on all the
KIIDP projects, as deemed by further valuations. By project closing on 31st December,
2013, UGX 1.4 Billion had not been resolved, causing damage to institutional image.
However all outstanding eligible RAP has since been paid for.
18. Inadequate staffing. This posed a challenge when it came to implementation of project
activities. This perhaps explains the delays in procurements, effective supervision and
execution of project activities and fund replenishments. Previously in KCC, the project
team was solely responsible for implementation of the whole project yet later in KCCA,
the project was fully mainstreamed. However since KCCA was operating at 30% of the
overall structure, this meant multi-tasking for the few staff. This probably explains the
slow pace at which the project activities were executed.
19. Transition from KCC to KCCA. The transition process partially affected the performance
of the project given that the new staff did not participate in the project development
process and therefore required significant time to understand and thereafter implement
71
the project. The team was also not very conversant with the World Bank project
implementation guidelines and this resulted in longer transaction time.
Sustainability
20. The sustainability of the Project is rated likely. The measures being put in place are
summarized as below:
a. Institutional Improvements. KCCA has made a provision in its annual budget
for the repair and maintenance of the IT equipment’s that were procured under
KIIDP. KCCA is planning for a framework contract for the maintenance of the
vehicles. To ensure sustainability of the capacity built, the Directorate of
Administration and Human resource came up with the Staff Training and
Development Bond agreement that bonds the beneficiary for a period not less
than 3 years. Following approval of the Kampala Physical Development Plan,
KCCA through the directorate of Physical planning is planning to develop the
detailed master plans for the 5 Divisions and KCCA needs Parliament support
and funds to execute this as a priority. The functionality of the installed GIS
software in the Physical Planning Directorate will be instrumental in enhancing
revenue collection although it needs to be enhanced. To ensure quality control,
KCCA put in place a Quality Management System (QMS) for the Engineering &
Technical Services directorate together with Physical Planning. Processes for the
two directorates were re-engineered and standards of service developed. The
QMS will be rolled to other directorates and once completed will form a critical
input into the development of the Institutional service charter.
b. Infrastructure. It is the mandate of Technical Services directorate to keep all city
roads and infrastructure in good condition and the maintenance of the land fill
falls under the responsibility of the directorate of Public Health and Environment.
KCCA is planning to budget and provide adequately for the repair and
maintenance of the road infrastructure, drainage channel and landfill. KCCA is
already maintaining the newly constructed roads by regularly sweeping them.
Regular de-silting will be carried out in order to keep the Lubigi Channel in good
shape. On a yearly basis, budgetary allocations are made to maintain the landfill
and KCCA will extend the maintenance services to the new landfill.
Key Lessons Learnt and Recommendations
21. The project gives rise to a number of lessons learnt and recommendations as summarized
below.
a) Construction works of both roads and drainage channels require a high level of site
supervision to ensure timely delivery of the required output, quality standards and to
support contractor in executing their works. Therefore in phase 2 of the project,
provisions for resident clerk of works, planning advisor, site agent and quality
assurance specialist should be made to ensure quality of works and timely delivery
of works.
b) Advance recruitment of consultants, where possible, sufficient due diligence on
contractors and establishing necessary project management systems should be
undertaken in development projects to facilitate infrastructure works. This is to
72
avoid unnecessary delays in implementation. Staff should also be adequately trained
and equipped with the appropriate project implementation skills to ensure better
project management and supervision.
c) A simplified procedure for approval and payment to contractors should be
established and put into operation before any construction starts. This will help
address the delays that were experienced while implementing the project. Measures
should be put in place to ensure that contractors pay service providers and laborers
on time to avoid delay in provision of required inputs and strikes by the laborers.
(KCCA had addressed this by opening up an Escrow account to pay for the required
inputs from the service providers and the laborers.)
d) Road maintenance needs to be considered from the planning phase to the post -
construction phase. Commitments need to be monitored against indicators during
the implementation stage, so that a reliable mechanism to carry out operation and
maintenance after construction can be put in place
e) An increase in the traffic flow was observed especially on Karerwe – Tula road
which has resulted in traffic jam on peak hours and accidents during normal times
because of speeding. KCCA needs to upgrade the nearby Mambule road and
signalize junction so as to decongest the newly constructed Kalerwe –Tula road.
Future road improvements should be informed by broader, more comprehensive
city-wide transport planning so as to reduce traffic congestion as much as possible.
f) The project has been instrumental in building capacity of the KCCA staff in various
fields. The acquired skills will be of great importance in operation and maintenance
of KIIDP infrastructure as well as in implementation of KIIDP II. So the institution
should devise ways of retaining the trained staff to ensure sustainability of the
project outcomes.
g) The project did not generate any quantified data on the impact that the project has
had on land use and the development of social, economic and commercial activities.
The Bank and KCCA should include monitoring of socio-economic indicators in
KIIDP II.
h) Community participation/involvement is very important especially when the Project
is seen to be addressing urgent needs of the community. Community engagement
activities under KIIDP, such as through the barazas and citizen scorecards could be
further enhanced, in terms of the frequency, types of activities and how they are
conducted. The engagement of local NGOs can also ensure that local people are
better informed and mobilized.
Bank Performance
22. Project design and implementation support: Bank performance overall was considered
efficient and effective. Bank provided adequate staff time for missions and field
supervision. Eight (8) Implementation Support Missions (ISM) and one (1) midterm
review missions were conducted regularly during project design, implementation and at
closure of the project. The Bank also allowed flexibility and in the ISM of November 18
– 25, 2011 agreed to a number of adjustments to overcome problems that had arisen
during the transformation process from KCC to KCCA. In that regard, the Bank agreed to
73
a one year extension of the loan closing date from 31st December, 2012 to 31
st December,
2013 (which had already been extended by a year before). Bank supervision made it
possible to resolve some issues encountered during the implementation phase and
enhanced the progress of project implementation, in particular on technical and financial
problems related to works on the Lubigi channel, phase 2 roads and extension and
fencing of Kiteezi landfill. For example, in the November 26-30, 2012 mission, the Bank
advised KCCA to negotiate with Lubigi Contractor to sub-contract the box culvert for the
Northern bypass crossing and Bwaise culvert crossing to reduce time needed and finish
the project within the extended contract date.
23. Environmental and Social management: The Bank environmental specialist provided
guidance to mitigate the impacts as set out in the Environmental Analysis (EA) report and
Environment Management Plan (EMP). The Governance and Anti-corruption team
(GAC) also successfully monitored the transparency measures related to the institution.
24. Fiduciary: The Bank continuously carried out procurement capacity assessment for KCC
as indicated in the successive implementation missions. For example in the November
2012 mission, the Bank agreed with KCCA to organize post procurement review mission
and share findings with the borrower. Bank missions regularly reviewed Procurement
Plan, audit reports and provided comments where necessary and the required clearances
timely.
Borrower’s Performance
25. Project design and Implementation: The performance of the KCCA in carrying out the
responsibilities assigned to them was satisfactory. KCCA prioritized the implementation
of the KIIDP and ensured availability of the counterpart funding, after taking over from
KCC. The assessment of KCC’s capacity at appraisal was reasonably accurate however
staffing levels after the transition process into KCCA were not satisfactory (398
permanent staff or 30% of overall structure). However, KCCA provided as many as
possible, suitable qualified and experienced staff, resources and support facilities for the
project implementation. A KIIDP team led by the Project Coordinator, supervised by the
Deputy Director Strategy Management and under the Deputy Executive Director was
behind the project implementation. This team coordinated all the project activities well
and provided support to component owners under the relevant Directorates so that they
could implement their components successfully. However, delivery was adversely
affected by (i) transition process from KCC to KCCA and (ii) lack of closer supervision
of the contractor.
26. General Execution and Implementation: The project team strove to implement all the
recommendations of the supervision missions in a timely manner, although there were
lapses due to various factors and capacity issues. For the most part, the Borrower/Donor
used the works progress reports, project account audit reports and the recommendations
of supervision missions in their decision-making.
27. Fiduciary: The arrangements for implementation of the project, contracting and
disbursements were kept the same throughout the project as was set out in the PAD, the
loan agreement and the Protocol of Agreement. However, delays in procurement and
sometimes ineffectiveness were encountered. (It is to be noted though, that the KIIDP
project team does have other responsibilities within KCCA and thus a general lack in
74
sufficient capacity to support project implementation.) There were notable improvements
in payment processing with minimum delays, although lapses exist (such as the
automated accounting system was not functioning properly as expected). The project
team has been active in submitting applications for both replenishments and direct
payments through e-disbursements. External audit reports for the subsequent financial
years were regularly prepared, approved and submitted to the Bank.
Comments on Draft ICR (if any)
28. No additional comments.
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Annex 8. Comments of Co-financiers and Other Partners/Stakeholders
NA
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Annex 9. APL Triggers, Benchmarks and Status
Triggers Benchmarks Status (at Project Closure – 31 December 2013)
New organizational
system operational
Staffing level 80%38
filled.
Partially Achieved. As at December 31, 2013 a total of 399
permanent staff and 529 temporary staff have been appointed
out of the 1332 staff required. Hence current staff level is
69.6% filled, higher than the 68% midterm review target for
the financial year 2012/2013. Staffing level started at zero
when KCCA was formed, in place of KCC and thus a longer
time was required to increase the staff level. The filling of
vacancies is also being halted by limited funds for staff
salaries.
Performance based
compensation system
implemented for Key
staff (Heads of
Department, Deputy
Heads and Senior
Principal Assistant
Town Clerks).
Achieved. Performance based compensation system for key
staff including Directors, Deputy Directors and other Senior
Staff has been fully implemented.
• Out of the 359 staff who had been appointed by June
2013, 230 had made six months and thus qualified for
performance evaluation.
• Out of the 230, 95.1% met and exceeded their
performance expectations, while 4.8% required
improvement. There were neither outstanding nor
unsatisfactory performances registered
• Level 1 – Unsatisfactory performance –
Termination on performance grounds
• Level 2 – Needs improvement – Put on
Performance improvement plan (PIP)
• Level 3 – Meets expectations – Paid a normal
monthly salary and encouraged to improve further
• Level 4 – Exceeds expectations – Promoted if a
vacancy exists
• Level 5 – Outstanding performance – Promoted
immediately and paid a performance bonus.
Enforcement of the
Leadership Code.
Achieved. The staff code of conduct is being enforced.
KCCA management is committed to implementing GAC
activities particularly those aimed at enhancing the culture of
transparency, accountability and due process. Management is
also enforcing a policy of “zero” tolerance to corruption. In
FY2012/13 disciplinary actions were taken on a total of 31
KCCA staff (16 termination, 8 interdictions, 3 warnings, and
4 interdictions being lifted).
Establish and
implement a formal
public consultation
process
Framework for
measuring KCCA
performance by
stakeholders in place.
Achieved. The Citizens Scorecard has been conducted
annually except with lapses during the transition period from
KCC to KCCA. Under KIIDP, two Citizen Scorecard Card
reports were completed - in 2011 and 2012 and a copy has
been shared with the Bank. KCCA management has
continued to take on board the findings so as to address
citizens’ views and concerns.
38 This is the percentage level recommended by Public Service.
77
Media strategy
implemented
Achieved. Following the preparation of the new KCCA
Corporate Strategy, the media strategy has been discussed by
KCCA management and a rebranding process completed.
The new KCCA corporate identity and status, including a
new logo was launched on November 29, 2012. The
implementation of the media strategy is on-going.
Budget and
development planning
consultation carried out
Achieved. KCCA has continued to hold conference for all
stakeholders. Since April KCCA has held five “barazas”39
and shared three of the reports with IDA team during the
November 2013 mission.
Implementation of
financial recovery
action plan (FRAP)
Reduce the stock of
overdue liability from
UGX 8 billion to UGX
0.5 billion
Achieved. Overdue liabilities had been reduced from
UGX8bn to 040
.
Increase own source
revenue from UGX 22
billion to UGX 33.5
billion
Achieved. OSR collection for FY2012/13 was UGX55.71
billion.
Comprehensive
O&M plan for
infrastructure
Provision and release of
adequate O&M budget
Achieved. In the FY2012/13, out of a total OSR budget of
UGX75.69 billion, UGX24.75billion (32.7%) was allocated
to O&M.
Quality control system
in place and
operationalized for both
O&M and new
construction.
Achieved. The Quality Management System (QMS) were
introduced in Engineering and Works and Physical Planning
Directorate. Plans are underway to roll out the system to the
other Directorates/Departments under the proposed KIIDP
II.
Effective
implementation of
the infrastructure
rehabilitation and
maintenance
Infrastructure
investments selected
based on sound
appraisal and public
consultation.
Achieved. Infrastructure investments were selected based on
sound appraisal and public consultation.
Quality Assurance
system is operational.
Achieved. QAS has been started in the engineering and
technical services with plans to roll out the system to all the
KCCA departments.
39 Public stakeholders’ meetings.
40 While an amount of UGX 2.6 billion was still recorded as KCCA liabilities, there are no supporting
documents for the claims. KCCA is in the process of clearing off the liabilities officially through the
Accountant General. So far, public notices have been published in the print media requesting for potential
claimants to come forward but no response was received. Thus the liabilities would most likely be written
off by mid-year after further verification by the Accountant General.
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Annex 10. List of Supporting Documents
1. Strategic Framework for Reform II (2005-2010), August 2006
2. KIIDP Project Appraisal Document, September 2007
3. KIIDP Financing Agreement, February 2008
4. KIIDP Project Agreement, February 2008
5. KIIDP Resettlement Action Plan, October 2006
6. KIIDP Environmental Analysis, November 2006
7. KIIDP Aide Memoires and Implementation Status and Results Reports, Various Dates
8. KIIDP Restructuring Papers and Amendments to Financing Agreement, October 2010
and December 2012
9. KIIDP Mid-Term Review Report (Technical Assessment Report), December 2010
10. KIIDP Audit Reports, Various Dates
11. The Kampala Capital City Act, 2010
12. KCCA Strategic Plan 2013/14-2017/18, Draft, November 2013
13. Community Baraza reports, Various Dates
14. Citizens Report Card Final Reports, November 2011 and February 2013
15. KIIDP Implementation Completion Report by KCCA, April 2014
